The court found that including processed minerals in the definition of 'Mineral' exceeds delegated legislative power, violating the parent Act and fundamental rights, thus rendering the amendment ultra vires.

1. In this batch of writ petitions, the petitioners called in question the legality and validity of the Andhra Pradesh Mineral Dealers Rules, 2000 (for short, 'the Rules') notified by respondent No.1 vide G. O. Ms. No. 537, Industries and Commerce (M.I) Department, dated 11.10.2000.

2. The petitioners, most of whom are industrial units involved in the processing and pulverizing of mineral and some of them who are lessees to extract mineral such as Granite, Dolamite, White Shale, Lime Stone, steatite have mainly felt aggrieved by the definition of 'Mineral' contained in R.2(1)(h) of the Rules as amended by G. O. Ms. No. 330 dated 14.06.2001.

3. The Petitioners' Case:
The case of the petitioners in short is that the definition of 'Mineral', which enlarged the scope of mineral as defined in S.3(a) of the Mines and Minerals (Regulation and Development) Act, 1957 (for short, 'the Act') is far beyond the delegated power of respondent No.1. The petitioners averred that by enlarging the scope of the definition of Mineral, the respondents have brought the processed minerals and the finished products within their regulatory control, which resulted in violation of their fundamental rights guaranteed under Art.19(1)(g) of the Constitution Of India, 1950.

4. The Respondents' Stand:
The Act as it stood before its amendment introduced with effect from 20.11.1999, contained S.21, which provides for penalties for contravention of the rules made under the Act. The Andhra Pradesh Minor Mineral Concession Rules, 1966 framed by respondent No.1 contained R.26, which provides for penalties for unauthorized quarrying. These provisions were found insufficient to check the illicit mining, storage, transport and trading of the mineral. In order to take measures for arresting the illegal mining, transportation, storage and processing, the Ministry of Mines, Government of India, constituted a Committee to suggest necessary measures. On the recommendations of the Committee, several amendments were introduced to the Act to curb illicit mining. The amendments have been introduced with effect from 20.11.1999 by inserting certain provisions, which inter alia include S.23C. The said provision empowered the State Governments to make Rules for preventing illegal mining, transportation and storage of minerals. In exercise of its rule making power, the Government of Andhra Pradesh framed the Rules, which came into force with effect from 01.04.2001. The main features of these Rules include bar on persons other than lease holder or a holder of Dealers Registration to stock, sell or offer for sale any minerals in any place except under Dealers Registration issued by the competent authority; to transport, carry by any means or cause to transport or carry any mineral from the places of raising or sell at any place without a valid permit. If these Rules are contravened, the