IN THE HIGH COURT OF MADHYA PRADESH AT JABALPUR
SURESH KUMAR KAIT, CJ. VIVEK JAIN, J.
R.K.Transport And Construction Ltd. Thr. Director Chandra Prakash Singh – Appellant
Versus
The State Of
PETITION No. 28431 of 2021 WITH WRIT PETITION No. 26824 of 2021, WRIT PETITION No. 1457 of 2022, WRIT PETITION No. 1508 of 2022
Decided On :
Key Points: - The Rules 10(3) and 12(5) of the Rules of 2019 are declared invalid and ultra vires Section 15(3) of the MMDR Act; show cause notices and termination based on these rules are set aside. (!) (!) - Royalty under MMDR Act is not a tax and arises from contractual conditions of mining leases; the annual contract amount under Rule 10(3) is not to override the royalty requirement, but disputes over its relation to royalty are addressed; fresh notices may be issued based on quantity actually consumed or removed. (!) (!) (!) - The writ petitions are allowed, and respondents may issue fresh notices assessing contract demand based on actual consumption/removal rather than the invalid rules. (!) (!)
| Table of Content |
|---|
| 1. common issues and reliefs sought in several petitions. (Para 1 , 2) |
| 2. factual background regarding contract and notices. (Para 3 , 4 , 5 , 6) |
| 3. petitioners challenge laws related to mining royalties. (Para 8 , 9 , 10 , 11 , 24) |
| 4. arguments supporting the petitioners' stance. (Para 12 , 13 , 14) |
| 5. court's consideration of legal provisions and arguments. (Para 15 , 16 , 21) |
| 6. estoppel does not apply against legislation concerning fundamental rights. (Para 20) |
| 7. determination of rules' ultra vires status. (Para 30 , 32 , 33) |
| 8. ultra vires ruling concerning subordinate legislation. (Para 31) |
| 9. court's conclusion to invalidate rules and allow petitions. (Para 34 , 35) |
ORDER
Per: Hon'ble Shri Justice Suresh Kumar Kait, Chief Justice:
1. The facts and issues involved in these petitions are same and similar, therefore, present petitions are being disposed of by this common order. The facts and annexures shall be discussed with reference to Writ Petition No.28431 of 2021, however, facts of other petitions shall not be repeated for the sake of brevity being similar.
2. The petitioners have filed these petitions under Article 226 of the Constitution of India praying for the following reliefs:
(i) To Issue a writ/orders/directions more particularly in the nature of certiorari thereby setting aside /quashing Rule 10(3) and Rule 12(5) of Madhya Pradesh Rules regarding Sand (Mining, Transportation, Storage and Trading), 2019 being without competence and being ultravires of Section. 15(3) of the Mines and Minerals (Development and Regulation) Act, 1957;
(ii) To Issue a writ/orders/directions more particularly in the nature of certiorari thereby setting aside/quashing the show cause notice dated 28.10.2021 and 26.11.2021 along with the orders / letter dated 26.10.2021, 07.12.2021 and 07.12.2021 issued by the Respondent no. 4 being without authority and jurisdiction;
(iii) To Issue a writ/orders/directions more particularly in the nature of mandamus thereby directing SIEAA / Respondent no. 5 to consider the application of the Petitioner for grant of permission / clearance of the 13 sand quarries pending for approval before the said authority.
(iv) To issue a writ/order/direction more particularly in the nature of quo warranto thereby calling upon the Respondent no. 4 to show cause that under what authority show cause notice dated 28.10.2021 and 26.11.2021 was issued to the Petitioner.
(v) To issue a writ/order/direction more particularly in the nature of certiorari thereby setting aside / quashing the termination letter dated 31.12.2021(ANNEXURE P-27) passed by the Respondent no. 4 and further hold that the termination letter dated 31.12.2021 issued by the Respondent no.4 being without authority and jurisdiction;
(vi) That this Hon'ble Court may be pleased to summon the record relating to the Show Cause Notice dated 28th of December, 2021 (ANNEXURE P-26) and after perusing the same may be pleased to quash and set aside the same;
3. The factual matrix of the case is that the respondent No.4 State Mining Corporation invited tenders for excavation of minor mineral sand from 118 quarries situated at district Hoshangabad for a period of three years vide e-Notice Inviting Tender dated 12.06.2020 (Annexure P/3) stipulating that a prospective bidder could mine around 80,00,000 cubic meter of sand per year from the said quarries and the bidder who offers to pay the highest royalty to the State Government each year over and above the upset price of Rs.110 Crores will be contracted for a period of three years.
4. In pursuance of the said NIT, petitioner submitted its bid for an amount of Rs.262 Crores (Rs.327.50 per cubic meter of sand). Being the highest bidder, the State Government issued a letter of intent dated 04.12.2020 (Annexure P/4) in favour of petitioner for mining sand to the extent of 80 lakhs cubic meter every year for a period 13.01.2021 to 30.06.2023. An agreement, Annexure P/5 was executed in this respect on 13.01.2021 between the p
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Subordinate legislation must align with the parent Act; regulations exceeding authority are invalid. Royalty payment under mining laws can only be for minerals actually removed or consumed.
Royalty is a contractual obligation distinct from taxes; amendments to regulations cannot retrospectively apply to existing contracts unless explicitly stated.
The methodology for computing royalty under the MMDR Act is a policy decision, and courts should exercise restraint in reviewing such economic policies unless they violate constitutional provisions.
Royalty, under the MMDR Act, is not a tax but a contractual consideration for mineral rights. State legislatures retain the power to tax mineral-bearing land, but this power is subject to any limita....
Point of Law : MMDR Act, 1957, though takes away power of State to make laws under Entry 23 of List II, by S.15 of MMDR Act, power to regulate quarry leases, mining leases or other mineral concession....
Royalty obligations under the Assam Minor Mineral Concession Rules 2013 do not extend to private construction projects, only applying to government-related works.
The Minerals Vesting Act, 2021 is constitutional; state cannot levy royalty for self-extracted minerals by landowners prior to the Act's enforcement.
The demands raised by the Deputy Director of Mines were found to be unsustainable in the eye of law, in view of the law laid down in National Mineral Development Corporation Limited v. State of M.P.,....
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