The allocation of surface rights by an Industrial Development Board under the KIAD Act, 1966, does not constitute a grant of mining rights under the MMDR Act, 1957; thus, the allotment process for surface land remains distinct from the specialized regulatory framework governing mineral concessions.

CORAM: HON'BLE MR. VIBHU BAKHRU, CHIEF JUSTICE

and

HON'BLE MR. JUSTICE C.M. POONACHA

C.A.V. JUDGMENT

(PER: HON'BLE MR. VIBHU BAKHRU, CHIEF JUSTICE)

1. The petitioner [hereafter ‘KUL’] has filed the present petition, inter alia, impugning a communication dated 03.07.2007 addressed by the Chief Executive Officer of the Karnataka Industrial Areas Development Board [KIADB] to the State Government of Karnataka seeking orders for allotment of land measuring 305 acres and 7 guntas at Naganapur and Hebbal villages, Mudhol Taluk, Bagalkot district [the subject land] for allotment of land in favour of respondent No.4 [hereafter ‘JKL’], which had offered an amount of `3,02,000/- per acre for the subject land. KUL also seeks directions from the respondent authorities to complete the process of allotment of the subject land to it as the successor to the leasehold rights of M/S. Shree Quality Cements Limited [hereafter SQCL].

2. KUL seeks to impugn the allotment of the subject land in favour of JKL and claims that it is entitled to the said allotment as a successor of SQCL. Thus, the principal controversy to be addressed in the present petition is whether KUL is entitled to claim the allotment of the subject land and whether the allotment of the same in favour of JKL is contrary to law.

3. The present petition was filed almost nineteen years ago, and some of the issues raised by KUL in the present petition have been concluded against KUL. Thus, the learned counsel appearing for the petitioner confined his arguments for challenging the allotment of the subject land in favour of JKL, essentially, on the ground that the same was in violation of Rule 59 of the Mineral Concession Rules, 1960 [MC Rules] read with Section 11 (4) of the Mines and Minerals (Development and Regulation) Act, 1957 [MMDR Act], as was in force prior to its amendment in the year 2015. KUL claims that it was impermissible for an area, which was previously held under a mining lease, to be made available for re-grant unless (i) the area is available for grant made under Rule 40 (2) of the MC Rules; and (ii) the availability of the area for grant is notified under the official gazette.

4. KUL further claims that the provisions of the Karnataka Industrial Areas Development Act, 1966 [KIAD Act] are inapplicable in respect of the land which is held under a mining lease.

THE CONTEXT

5. The aforesaid dispute arises in the context of the facts as stated hereafter.

6. One Sri B. N. Shah had applied for a grant of a mining lease in respect of the subject land, and the State Government of Karnataka executed the mining lease [ML No.1858] for a period of twenty years from 23.12.1982 and registered on 02.02.1983. The State Government executed the said mining lease for the extraction of limestone, clay, dolomite, sandstone, and gypsum. It is the KUL's case that the said lease was held on behalf of SQCL.

7. KIADB published a Preliminary Notification on 07.06.1984 for the acquisition of the subject land. Thereafter, KIADB published the Final Notification under Section 28(4) of the KIAD Act on 24.10.1987 for acquiring the land to the total extent of 293.38 acres (167.32 acres in Hebbal village and 126.06 acres in Naganapura village). KIADB also acquired the area of 35 acres and 15 guntas [hereinafter also referred to as the Factory Land] under the provisions of the KIAD Act. Apparently, KIADB proposed allotting the subject land to