Kerala High Court Declares State Minerals Act Unconstitutional For Violating Fundamental Rights And Property Laws

In a landmark ruling that reinforces the protection of individual ownership, the High Court of Kerala has struck down the Kerala Minerals (Vesting of Rights) Act, 2021. A Division Bench comprising Dr. Justice A.K. Jayasankaran Nambiar and Justice Preeta A.K. delivered the verdict, declaring the legislation unconstitutional for its failure to provide adequate compensation to landowners for the deprivation of their rights over sub-soil minerals.

A Challenge to Proprietary Rights

The legal dispute originated from landowners in the Malabar region who were served with royalty demands for granite and other minor mineral extractions from their own soil. These landowners argued that, following the landmark Supreme Court decision in Thresiamma Jacob v. Geologist , they should be treated as owners of both the surface and the sub-soil. The State government, however, enacted the 2021 Act to retrospectively vest these rights in itself, aiming to standardize mineral rights across the state, mirroring pre-independence proclamations in the Travancore and Cochin regions.

The Constitutional Conflict

The petitioners mounted a multi-pronged attack on the 2021 Act, arguing that the State legislature lacked the competence to enact such a law and that it failed to honor the constitutional guarantee under Article 300-A. The Bench observed that while the state has regulatory powers, it cannot bypass the requirement of just and fair compensation.

"The impugned legislation effectively seeks to deprive a person of his property without specifying any procedure for effecting such deprivation of property, and without providing for any compensation," the Court noted in its detailed judgment.

Key Observations from the Bench

The Court emphasized that even if a law is ostensibly designed for public good, it cannot supersede the fundamental protections afforded to citizens. The Bench highlighted several pivotal points regarding the limits of State power:

• " Royalty is the consideration payable by the person extracting minerals to the owner of the minerals... only the owner of the minerals can claim royalty ."
• "In the absence of any protection offered through Article 31-A or 31-C of the Constitution of India, the validity of the impugned legislation must depend on the extent to which it can withstand a challenge under Articles 14, 19, 21 and 300-A ."
• "The court recognized the right to property as a basic human right ... the obligation to pay compensation, though not expressly included in Article 300-A , can be inferred."

Court’s Decision and Future Implications

The High Court held that the Act constitutes a violation of Articles 14, 19, 21, and 300-A of the Constitution. Consequently, the Court set aside the legislation and directed the State to refund all royalty amounts collected from the aggrieved parties within three months. This decision underscores that the “authority of law” required under Article 300-A cannot be invoked by the state to seize private assets without due process and compensatory justice, setting a crucial precedent for future state-level property legislation.