Skip to content


State of Orissa, Through the Secretary, Department of Mining and Geology Vs. Union of India (Uoi) and ors. - Court Judgment

LegalCrystal Citation
SubjectConstitution
CourtOrissa High Court
Decided On
Case NumberO.J.C. No. 486 of 1969
Judge
Reported inAIR1972Ori68
ActsMines and Minerals (Regulation and Development) Act, 1957 - Sections 13, 30, 58(1) and 58(2); Mineral Concession Rules, 1960; Constitution of India - Articles 14, 131 and 226
AppellantState of Orissa, Through the Secretary, Department of Mining and Geology
RespondentUnion of India (Uoi) and ors.
Appellant AdvocateAdv. General, ;B.K. Behura and ;D.P. Rath, Advs.
Respondent AdvocateSolicitor General, ;G.L. Sanghi, ;S.K. Dholakia, ;G. Rath, ;Y.S.N. Murty and ; R. Mohanty, Advs.
DispositionPetition dismissed
Cases ReferredUnion of India v. The Manager
Excerpt:
- motor vehicles act, 1988 [c.a. no. 59/1988]section 173(1) proviso; [d. biswas, amitava roy & i.a.ansari, jj] appeal without statutory deposit but within limitation/or extended period of limitation maintainability - held, if the provision of a statute speaks of entertainment of appeal, it denotes that the appeal cannot be admitted to consideration unless other requirements are complied with. the provision of sub-section (1) of section 173 permits filing of an appeal against an award within 90 days with a rider in the first proviso that such appeal filed cannot be entertained unless the statutory deposit is made. the period of limitation is applicable only to the filing of the appeal and not to the deposit to be made. it, therefore, appears that an appeal filed under section 173 cannot.....g.k. misra, c.j.1. the state oforissa through the secretary, department of mining and geology, is the petitioner. its case may be stated in short. it is the owner in possession of an area of 462.16 acres of land in village boula in the district of keonjhar. the said area contains chromite minerals ores. this area had been held under a mining lease by sri m.a. tulloch (hereinafter to be referred to as tulloch). the term of that lease expired on 1-6-1965. on 27-11-1964 tulloch applied, for renewal of the lease. by an order (annexure i) dated 27-5-1965 the application was rejected by the petitioner on the ground inter alia that the state government had decided not to grant lease of the area to private parties and the same was required for exploitation by the state itself. there was an.....
Judgment:

G.K. Misra, C.J.

1. The State ofOrissa through the Secretary, Department of Mining and Geology, is the petitioner. Its case may be stated in short. It is the owner in possession of an area of 462.16 acres of land in village Boula in the district of Keonjhar. The said area contains chromite minerals ores. This area had been held under a mining lease by Sri M.A. Tulloch (hereinafter to be referred to as Tulloch). The term of that lease expired on 1-6-1965. On 27-11-1964 Tulloch applied, for renewal of the lease. By an order (Annexure I) dated 27-5-1965 the application was rejected by the petitioner on the ground inter alia that the State Government had decided not to grant lease of the area to private parties and the same was required for exploitation by the State itself. There was an overall shortage of chromite in the State and it was intended that the ores raised from the area would feed the industries run by the State in the public sector.

On 10-6-1965 Tulloch filed a revision petition before the Union of India (opposite party No. 1) under Rule 54 of the Mineral Concession Rules, 1960 (hereinafter to be referred to as the Rules) against the order (Annexure I). Comments were invited from the petitioner by opposite party No. 1 under Rule 55, The petitioner in reply pointed out by the letter (Annexure II) dated 16-7-1966 that the State had a limited deposit of hard and lumpy chromite in the districts of Keonjhar, Cuttack and Dhenkanal and that the State Government had decided not to grant any mineral concession for chromite ore to private parties considering the importance of that ore for future industrial use and over-all shortage of chromite. The petitioner also pointed out that it had already set up a public undertaking in the name of Orissa Industrial Development Corporation which was going ahead with a ferro chrome plant and for that purpose both industrial and import licence had been obtained from the Government of India as it had been decided by the petitioner that the Orissa Mining Corporation, an undertaking of the Government itself, would work out the chromite ores held by the State. For utilisation of the ores in the ferro chrome plant and other industrial undertakings of the State the petitioner had recommended to opposite party No. 1 that the revision petition filed by Tulloch should be rejected. In Annexure III dated 19-6-1967 opposite party No. 1 rejected the revision petition with the following observation:--

'Since the State Government has decided not to grant mineral concession for chromite to private parties over the area as they want to exploit the mineral in the public sector, the State Government's order of rejection of the renewal application does not appear to be illegal and there are no grounds for interfering with the decision of the Government of Orissa.....'

Opposite party No. 2 applied for mining lease of 187.03 acres in respect of chromite mineral ores out of the total area of 462.16 acres. The application was not taken into consideration by the State Government as it did not want to lease out that area. As the application was not disposed of within nine months from the date of its receipt it was deemed to have been refused under Rule 24 (3) Opposite party No. 2 filed a revision petition before opposite party No. 1 under Rule 54. In Annexure IV dated 6-11-1968 the petitioner furnished its comments on the revision petition. Therein the petitioner stated that Tulloch's renewal application had been rejected on the ground that the State Government would not grant mineral concession over the area to any private party and the said decision had been affirmed by opposite party No. 1 in the public sector.

In exercise of its revisional powers under Rule 55 opposite party No. 1 directed the petitioner by an order (Annexure V) dated 18-2-1969 to grant mining lease for chromite over the area in favour of opposite party No. 2 after relaxing the provisions of Rule 58 (1) (b) under Rule 58 (2). The petitioner's point was that the ferro chrome plant set up by it in the public sector was expected to go into production shortly and would be up to 12,00,000 tonnes. Taking the future expansion of the plant into account it was estimated that the total requirement of chrome for the plant would go up to two million tonnes in future. The proved reserves of chromite ores in the State including the deposits in minesheld by private parties being less than the requirements estimated above and the present known deposit of hard and lumpy chromite ore in the mines vested in the State being very much inadequate, uncertainty hinged around the ferro chrome plant set up by the petitioner at a huge cost.

The petitioner's stand is that Rule 58 (2) could be invoked only when any area was available for grant and not when the area in question was not open to be leased out at all. The impugned order (Annexure V) on the face of it is discriminatory as the ground on which Tulloch's renewal application was rejected was not kept in mind when allowing the application of opposite party No. 2. The direction for grant of mining lease in favour of opposite party No. 2 was not in consonance with the Industrial Policy Resolution of 1956 wherein opposite party No. 1 declared that mining of ore was in the exclusive ownership of the State.

It was alleged that opposite party No. 1 did not disclose its interest in opposite party No. 2 which in fact it had through the Life Insurance Corporation of India and the Unit Trust of India, both of whom are stated to have invested in shares in opposite party No. 2 and there was no justification for exercising preference in favour of opposite party No. 2 adversely to the interest of the Orissa Industrial Development Corporation and the Orissa Mining Corporation.

The petitioner averred that Mines and Minerals (Regulation and Development) Act, 1957 (Central Act 67 of 1957) (hereinafter to be referred to as the Act) is ultra vires the Constitution. It was further asserted that the rules are also ultra vires the Constitution and the Act.

The two main prayers in the writ application are to declare the Act and the Rules ultra vires the Constitution, and quash the impugned order (Annexure V) whereby opposite party No. 1 directed the petitioner to grant lease of the disputed area for mining to opposite party No. 2.

2. Opposite Parties Nos. 1 and 2 filed two separate counter-affidavits. Essentially, however, their stand is the same. In paragraph 3 of the counter-affidavit of opposite party No. 1 it was admitted that the area in question was reserved by the State Government for exploitation in the public sector. The case of the opposite parties is that the area applied for by opposite party No. 2 which had been previously exploited by Tulloch contained good deposit of minerals and could be exploited immediately without further prospecting. Opposite party No. 2 had been granted an industrial licence for setting up a ferro chrome plant withforeign collaboration and had established the factory. The rules recognise the principle that parties who are in a position to make use of mineral for further production as opposed to parties who conduct mining operation only for the purpose of sale of minerals should be preferred. It is not in the interest of mineral development that the State Government should keep large area in the State idle. It was considered to be in the interest of mineral development of the State in case opposite party No. 2 was allowed to exploit immediately areas containing good deposit of chrome which is a very important item in the manufacture of high grade steel and other alloys greatly needed by the country. Considering all these factors the Central Government directed the State Government to grant mining lease in respect of this area.

Opposite party No. 1 took into consideration the fact that the State Government although it had reserved very large areas of more than 35 sq. miles for working mines in the public sector since long, it had not yet installed any factory based on the minerals in the area and prospecting in those areas had not been done by it. The State Government had no immediate scheme of prospecting or undertaking the mining operation in those areas. Besides, the Life Insurance Corporation and Unit Trust of India and the Andhra Pradesh Industrial Development Corporation had made investment in opposite party No. 2 which is also a kind of public limited company. In the best interest of the industrial development of the country there should be proper distribution of the area between the State and individual or between the public sector and private sector undertakings. There was a denial of the averment that opposite party No. 1 bypassed the Industrial Policy Resolution of 1956. The State Government had been keeping vast areas reserved for a long time without having any immediate scheme for mining them and the area in question was simply lying idle. The Act and the Rules are constitutional and the High Court of Orissa has no jurisdiction as under Article 131 of the Constitution any dispute between the State and the Union is entertainable only in the Supreme Court.

Opposite party No. 2 traversed almost the same grounds and took a further plea that the State Government cannot maintain the writ application under Articles 226 and 227 of the Constitution.

3. The learned Advocate-General for the State of Orissa raises the following contentions:--

(i) The Act is beyond the legislative competence of Parliament and the rules are ultra vires the Act and the Constitution.

(ii) Opposite party No. 1 had no jurisdiction to relax the requirement of Rule 58 (1) (a) and (b) under Rule 58 (2), the area being not available for grant as the same had been reserved by the State for its own exploitation and the impugned order interferes with the proprietary rights of the State and discharge of its executive functions in respect of subjects enumerated in List II of the Seventh Schedule of the Constitution.

(iii) The impugned order is contrary to, and inconsistent with the earlier order (Annexure III) dated 19-6-1967 rejecting Tulloch's application for renewal and is hit by Article 14 of the Constitution.

(iv) The impugned order shows undue, favour to opposite party No. 2 to the prejudice of the public sector undertakings set up by the petitioner and is mala fide inasmuch as opposite party No. 1 has interest in opposite party No. 2 through the Life Insurance Corporation of India and the Unit Trust of India.

4. Besides combating the aforesaid contentions it is urged on behalf of the opposite parties that (i) the dispute between the State of Orissa and the Union of India is entertainable only by the Supreme Court and Article 131 of the Constitution is a bar to the present writ application; and (ii) at the instance of the State Government a writ application under Articles 226 and 227 of the Constitution is not maintainable.

5. All the aforesaid contentions require careful examination.

6. We would first examine the contention whether the Act is unconstitutional and the rules are ultra vires the Act and the Constitution. Entry 54 in List I and Entries 18 and 23 in List II which have been pressed into service in this regard may be noticed.

List I

Entry 54. Regulation of mines and mineral development to the extent to which such regulation and development under the control of the Union is declared by Parliament by law to be expedient in the public interest.

List II

Entry 18. Land, that is to say, rights In or over land, land tenures including the relation of landlord and tenant, and the collection of rents; transfer and alienation of agricultural land; land improvement and agricultural loans; colonization.

Entry 23. Regulation of mines and mineral development subject to the provisions of List I with respect to regulation and development under the control of the Union.

It is open to Parliament to declare that it is expedient in the public interest that the control should rest in CentralGovernment To what extent such a declaration can go is for parliament to determine and this must be commensurate with public interest. Once declaration is made and the extent laid down, the subject of legislation to the extent laid down becomes an exclusive subject for legislation by Parliament. Any legislation by the State after such declaration and trenching upon the field disclosed in the declaration must necessarily be unconstitutional because that field is abstracted from the legislative competence of the State Legislature. The aforesaid view is concluded by AIR 1970 SC 1436. Baijnath Kedia v. The State of Bihar (see para 14).

In consonance with Entry 54 the following declaration as to the expediency of Union control was made in Section 2 of the Act

'It is hereby declared that it is expedient in the public interest that the Union should take under its control the regulation of mines and the development of minerals to the extent herein provided.'

The legal position after this declaration was observed by the Supreme Court thus:--

'We have thus not to look outside Act 67 of 1957 to determine what is left within the competence of the State Legislature but have to work it out from the terms of that Act.' (para 15)

7. It would thus be seen that Entry 23 in List II is wholly subordinate to Entry 54 in List I even though the State has the proprietary right in the mines and minerals.

Entry 18 has been held not to cover the topic relating to mines, although it touches land. (See para 19).

It is not necessary to refer to copious authorities and the matter is fully concluded by the aforesaid decision that the entire field of the exercise of control is indicated in the Act and the Act falls fairly and squarely within the ambit of Entry 54 in List I. The control is plenary even though the State has proprietary interest in mines and minerals. On account of the existence of this proprietary interest, the royalties are payable to the State. The Act is constitutional. Nothing has been brought to our notice as to how the rules are ultra vires the Act or the Constitution. We accordingly hold that the Act and the Rules are constitutional.

8. It is next contended by the learned Advocate General that the disputed area which was previously held by Tulloch was not available for grant inasmuch as there was no entry to the effect made in the Register of Mining Leases maintained by the State Government in Form M as required under Rule 40 (2) and the impugned order directing grantof such a lease was in contravention of Rule 58 (1) (a) and (b) and the Central Government had no power to relax the provision of Rule 58 (1), the application being premature under Rule 60. He also contends that at the time of refusal of the renewal application of Tulloch the State Government reserved the disputed area to work out in the public sector and the land was not available for grant under Rule 59.

9. To appreciate the aforesaid contention. Rules 58, 59 and 60 may be noticed:--

'58. Availability of areas for regrant to be notified:-- (1) No area which was previously held or which is being held under a prospecting licence or a mining lease or in respect of which an order had been made for the grant thereof but the applicant has died before the execution of a licence or lease, as the case may be, or in respect of which the order granting licence or lease has been revoked under Sub-rule (1) of Rule 15 or Sub-rule (1) of Rule 31 shall be available for grant unless--

(a) an entry to the effect is made in the register referred to in Sub-rule (2) of Rule 21 or Sub-rule (2) of Rule 40, as the case may be, in ink; and

(b) the date from which the area shall be available for grant is notified in the Official Gazette at least thirty days in advance.

2. The Central Government may for reasons to be recorded in writing, relax the provisions of Sub-rule (1) in any special case.

59. Availability of certain areas for grant to be notified:-- In the case of any land which is otherwise available for the grant of a prospecting licence or a mining lease but in respect of which the State Government has refused to grant a prospecting licence or a mining lease on the ground that the land should be reserved for any purpose, (.....) theState Government shall, as soon as such land becomes again available for the grant of a prospecting or mining lease, grant the licence or lease after following the procedure laid down in Rule 58.

60. Premature applications:-- Applications for the grant of a prospecting licence or a mining lease in respect of the areas in which--

(a) no notification has been issued under Rule 58 or Rule 59; or

(b) if any such notification has been issued the period specified in the notification has not expired;

shall be deemed to be premature and shall not be entertained and the fee, if any paid in respect of any such application shall be refunded.'

10. Rule 58 prescribes that the area covered by the four cases referredto in Sub-rule (1) shall not be available for grant unless there is an entry in the register of prospecting licences maintained under Rule 21 (2) in Form H and the register of mining leases maintained in Form M: Further, the date from which the area shall be available for grant is notified in the Official Gazette at least thirty days in advance. This procedure is followed so that every one will get a fair opportunity of making an application for grant of lease. It is brought to the notice of everybody interested in getting a prospecting licence or grant of a mining lease.

The Central Government has, however, got power under Rule 58 (2); for reasons to be recorded in writing to relax the provisions of Sub-rule (1) in any special case.

Ordinarily, however, an application for grant of a prospecting licence or a mining lease which is premature shall not be entertained and the fee, if any, paid in respect of any such application shall be refunded unless the conditions prescribed in Rule 60 (a) and (b) are fulfilled.

11. The learned advocate General's argument in terms of these rules may now be examined. His contention is that the Central Government by Annexure V dated 18-2-1969 relaxed in exercise of its power under Rule 58 (2) the provisions of Rule 58 (1) (a) and (b). This relaxation was subsequent to the filing of the application by opposite party No. 2 on 26-9-1966. At the time the application was filed by opposite party No. 2 it was premature and therefore there was no valid application and the impugned order passed on such application is void.

Though the argument prima facie appears to be attractive, it is untenable. In AIR 1932 PC 165, Nagendra Nath Dey v. Suresh Chandra Dey their Lordships had to consider the nature of an appeal filed after the period of limitation. They observed that there is no doubt that any application by a party to an appellate Court, asking it to set aside or revise a decision of a subordinate Court, is an appeal within the ordinary acceptation of the term, and that it is no less an appeal because it is irregular or incompetent. This was followed in AIR 1956 SC 367. Mela Ram and Sons v. Commr. of Income-tax, Punjab. On the principles so laid down their Lordships held that an appeal presented out of time is an appeal and an order dismissing it as time barred is one passed in appeal.

Doubtless, the application filed by opposite party No. 2 was initially premature. Even on such a premature application the competent authority has topass an order that the application is rejected because it was premature. It is also open to the competent authority to pass an order recommending relaxation of the ban imposed under Rule 58 (1) (a) (b). In either case it is an order passed on the application. Such an order is revisable under Section 30 and Rule 55.

12. Section 30 lays down that the Central Government may, of its own motion or on application made within the prescribed time by an aggrieved party, revise any order made by a State Government or other authority in exercise of the powers conferred on it by or under this Act. Thus the section vests in the Central Government plenary powers of revision. The amplitude of the power is very wide. Even an order passed by the State Government suo motu is revisable by the Central Government. As the application was premature the State Government did not take it into consideration. Under Rule 24 (3) if any application is not disposed of within the period specified it shall be deemed to have been refused. Thus, inaction on the part of the State Government on the premature application amounted to an order passed by the State Government refusing the application. Such an order is revisable under Section 30 and Rule 55.

13. It is in exercise of the revisional power that the Central Government relaxed the prohibitions in Rule 58 (1) (a) and (b) in the revisional order itself. It exercised the power under Rule 58(2) within jurisdiction which cannot be questioned.

14. It was contended that if the power under Rule 58 (2) is exercised in respect of a premature application at the stage of exercise of the revisional power it would cause injustice inasmuch as rival applicants would have no knowledge that a particular area is available for grant and the same would be discriminatory under Article 14 of the Constitution. This contention has no force in view of the restrictions imposed on the power of the Central Government in Rule 58 (2) whereby the discretion would be exercised within prescribed limitations. The conditions to be fulfilled are that the order of relaxation must record the reasons in writing and the power would be exercised only in any special case. Here, the Impugned order gave the reasons in writing and was alive to the fact that there was a special case for relaxing the conditions. A special case was noticed in favour of opposite party No. 2 as it had been granted an industrial licence for setting up a ferro chrome plant with foreign collaboration and it had already established a factory. The Central Government was also of opinion that in theinterest of mineral development the State Government should not keep large areas in the State idle. The granting of mineral lease in respect of the disputed area in favour of opposite party No. 2 was considered to be in the interest of mineral development. The Central Government also took note of the fact that the State had reserved large areas of chromite ore and it had not by then set up any factory to operate in the public sector. Where the conditions prescribed in Rule 58 (2) are adhered to the discretion is exercised in accordance with law and there is no question of any discrimination.

15. It was also contended by the learned Advocate General that the impugned order directing grant of mining lease was in contravention of Rule 59 inasmuch as the State Government had not declared that the land was available for grant and, on the contrary with the concurrence of the Central Government the land had been reserved for being exploited in the public sector by the State of Orissa when Tulloch's application for renewal was rejected.

The expression in Rule 59 'the State Government has refused to grant a prospecting licence or a mining lease on the ground that the land should be reserved for any purpose' would include a purpose consistent with the provisions of the Act and the rules. For instance, a particular area may be reserved for geological survey and on that ground the area might not be granted for mining lease. Reservation of a particular area for being exploited in the public sector by the State cannot be said to be a purpose for which it is to be reserved under Rule 59.

Even though the State has a proprietary title in the mines, by the passing of the Act the subject of the legislation becomes an exclusive subject for legislation by Parliament as has already been stated in paragraph 6 of this judgment Under the Act the State has no residuary power of working out mines and minerals without observing the conditions prescribed in the Act and the rules. In other words, even if the State desires to reserve a particular area for being exploited in the public sector, it must make the necessary application under the Act and the rules and in exercise of its revisional power it is open to the Central Government to set aside the decision of the State Government and direct grant of the same to other applicants to the exclusion of the State Government.

16. In this case by the date of the application on 26-9-1966 the land was not available for grant on account of the ban under Rule 58 (1) (a) and (b) not having been lifted. The refusal of Tulloch's application for renewal by the Central Government does not amount to an order directing grant of lease in favour of the State Government. In refusing that application the reason given was that the State Government wanted to exploit the area in the public sector. It is open to the Central Government to subsequently change its mind when other applications come to consider the need of the State. Before the Central Government, only the premature application of opposite party No. 2 was for consideration. It had to consider the rival claim of the State for reserving the area for exploitation in the public sector. In exercise of its re-visional power it is open to the Central Government to say that the same would not be reserved for the State and a mining lease is to be granted in favour of opposite party No. 2. The moment such a decision is taken, the ban prescribed in Rule 58 (1) (a) and (b) is to be lifted and the same has been relaxed in exercise of the power under Rule 58 (2).

17. We, therefore, close up this part of the discussion by saying that the Central Government exercised its power under Section 30 and Rule 55 and 58 (2) within jurisdiction.

18. In passing the impugned order the Central Government cannot be said to have passed an order inconsistent with its earlier order in Annexure III. While examining Tulloch's renewal application the Central Government took into consideration the fact that Tulloch would exploit the mineral ores for sale and not to use in its factory. It accordingly gave preference to the decision of the State Government to work out the mines in the public sector. By the time the application of opposite party No. 2 was taken up different considerations arose. Opposite party No. 2 had already set up a factory and chromite ores were essential for use in it The State of Orissa had not started any factory in the public sector by then and it had still some areas which could be exploited. The impugned order cannot therefore be said to be inconsistent with the earlier order when they were passed in altogether different circumstances.

19. The learned Advocate General further contended that the impugned order was actuated by mala fide; inasmuch as the Central Government had interest in opposite party No. 2 through the Life Insurance Corporation of India and the Unit Trust of India which were financing the undertaking set up by opposite party No. 2. We find no substance in this contention. Mala fides in the action of the Central Government are not to be judged from the fact that it is indirectly interested in many of the undertakings. The Central Governmenthas to play the main role in the economic development and social regeneration of the country. Various industries and undertakings are to be financed and supported through many of the Corporations set up by the Central Government This feature by itself would not establish mala fides on the part of the Central Government in passing the impugned order. We find no difficulty in rejecting the contention as being somewhat frivolous.

20. On the aforesaid analysis, we reject all the contentions advanced by the learned Advocate General as enumerated in paragraph 3 of this judgment We would now take up the contentions urged by the opposite parties.

21. The learned Solicitor General contends that this Court has no jurisdiction to entertain the writ application under Article 131 of the Constitution. Article 131, so far as relevant, runs thus:

'131. Subject to the provisions of this Constitution the Supreme Court shall, to the exclusion of any other Court, have original jurisdiction in any dispute:--

(a) between the Government of India and one or more States; or

(b) between the Government of India and any State or States on one side and one or more other States on the other; or

(c) between two or more States; i.e. and in so far as the dispute involves any question (whether of law or fact) on which the existence or extent of a legal right depends.'

The learned Solicitor General contends that the writ application essentially involves a dispute between the Union of India and the State of Orissa on the main question of law whether the Central Government has any power to direct grant of lease in a case where the State of Orissa decides to exploit the same in the public sector. We are not much impressed by this argument.

The impugned order (Annexure V) directing the grant of lease in favour of opposite party No. 2 vitally affects the State of Orissa in its decision which has therefore a cause of action both against the Union of India and opposite party No. 2 and unless the impugned order is assailed, the rights created by the order in favour of opposite party No. 2 cannot be touched. The State of Orissa cannot question the validity of the impugned order without impleading opposite party No. 2 who is a necessary party. If the impugned order is to be attacked in presence of opposite party No. 2, the same cannot be done in a proceeding in exercise of the original jurisdiction of the Supreme Court under Article 131. If the State of Orissa had filed an application under Article 131 and would have made opposite party No. 2 a party thereto the application would have been dismissed inlimine being in violation of the mandatory prescription as to who would be parties in such a case before the Supreme Court. The matter is concluded by AIR 1971 SC 385, Adi Pherozshah Gandhi v. H.M. Seervai.

Law is now well settled that opposite party No. 2 which is a company under the Indian Companies Act does not come within the definition of 'State' (see AIR 1969 SC 1306, Praga Tools Corporation V. C. V. Imanual) for Article 131.

On the aforesaid analysis, we find no substance in the preliminary objection raised by the learned Solicitor General.

22. It is next contended that the Impugned order cannot be questioned by a writ application under Articles 226 and 227 of the Constitution by the State of Orissa. No authority directly in support has been brought to our notice.

23. It has, however, been contended by the learned Solicitor General that the State Government is a statutory authority exercising its power of refusal of application for grant and renewal of mining lease either under Rule 26 or Rule 24 (3). In this case there is a deemed refusal under Rule 24 (3). The order of the State Government was set aside in exercise of the revisional power of the Central Government under Section 30 and Rule 55. The State Government being a subordinate statutory authority cannot question the legality and correctness of the impugned order by maintaining a writ application. Though the contention is not supported by any authority, we are inclined to give full effect to it. A subordinate statutory authority, unless the statute so expressly prescribes cannot question the correctness and legality of the higher judicial or quasi-judicial authority if exercised within jurisdiction. The order passed by the Central Government is not a nullity and cannot be ignored. It has full binding force as having been exercised within jurisdiction. A writ application at the instance of the State Government which functioned as a subordinate authority under the statute is not maintainable.

24. The learned Advocate General cited two decisions (i) a Bench decision of this Court in O.J.C. No. 58 of 1965 (Orissa) State of Orissa v. Workers Employed in Hirakud Dam Project and (ii) 1969 Lab IC 325 (Pat), Union of India v. The Manager, Dhori Colliery. Both these decisions are distinguishable. In the first case, before the industrial Tribunal the authorities of the Hirakud Dam Project representing the State of Orissa were parties. The order of the Industrial Tribunal was adverse to the interest of the State of Orissa. It accordingly filed an application against the adverse order. Moreover, the point was not directly raised or decided in that case. It is therefore no authority for the point in issue.

Under Rules 54 and 55 the State Government is not a party. Rules 54 and 55 show that the applicants and their rivals are parties to the application for revision. The State Government is not a party. It cannot accordingly challenge the impugned order by maintaining a writ application.

The second case is a Bench decision of the Patna High Court in which this point was also not decided. The award of the Industrial Tribunal in that case was not challenged by the Mazdoor Sangh and as on the merits the Union of India was not aggrieved, the abstract question of law raised therein was not examined and the writ application was dismissed.

Both these decisions are therefore of no assistance in answering the real issue whether the State Government can question the impugned order of the Central Government through a writ application.

25. The learned Advocate General however contends that the challenge in the writ application made by the State Government is not in the capacity of a subordinate statutory authority but in its independent role as the proprietor of the mines and minerals over which the Central Government has exercised arbitrary power. We have already said that after the passing of the Act the exercise of the Control by the Central Government is plenary and the field in which legislation has been passed by Parliament has been removed from the power of the State Legislature to make any legislation in respect thereof and correspondingly to pass any order in exercise of its executive power. We find no substance in this contention.

26. On the aforesaid analysis the writ application has no merit. It is accordingly dismissed; but in the circumstances without costs.

Ray, J.

27. I agree that this application shall be dismissed. I would, however, like to record that I have my doubts about the correctness of the contention that even though a premature application envisaged in Rule 60 of the Mineral Concession Rules, 1960 is prohibited from being entertained and thus is not disposable on merits, or at all, nevertheless, it may still be deemed to have been refused under Rule 24 (3) because it has not been disposed of within the period specified for the purpose in Sub-rule (1) thereof, so as to attract the revisional power of the Central Government either under Section 30 of the Minesand Minerals Act or under Rule 55 of the Mineral Concession Rules.


Save Judgments// Add Notes // Store Search Result sets // Organizer Client Files //