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H.M. Pavri Vs. Union of India and anr. - Court Judgment

LegalCrystal Citation
SubjectCivil
CourtDelhi High Court
Decided On
Case NumberCivil Writ Appeal Nos. 1823, 1823A, 1823B of 1979
Judge
Reported inILR1980Delhi1499
ActsMines and Minerals (Regulation and Development) Act, 1957 - Sections 10, 10(3) and 11(2)
AppellantH.M. Pavri
RespondentUnion of India and anr.
Advocates: V.A. Bobede,; A.K. Sanghi,; Vasudha Sanghi and;
Cases ReferredDeb v. State of Orissa and Others
Excerpt:
mines and minerals (regulation & development) act, 1957 and rules - to what extent a state government can reserve to itself or its agencies certain areas in the state for its own exploitation of the minerals trerein.; in these writ petitions, the question was to what extent a state government acting under the mines & minerals (regulation & development) act 1957 and the rules made there under, can exercise the power of reserving certain areas in the state to itself for its own exploitation of the minerals therein or for its agencies or the public sector and refuse to grant license/lease in respect thereof to a private party. dismissing the writ petitions.; 1. the mere making of an application by a petitioner does not confer a right on him to get a license/lease to exploit.....s. ranganathan, j. (1) these three writ petitions filed by the same petitioner raise a question as to the extent to which a state govrnment acting under the mines and minerals (regulation and development) act, (act 67 of 1957) hereinafter referred to as 'the act, and the rules made there under 'the rules', for short can exercise the power of reserving certain areas in the state for the exploitation of the minerals therein by itself, its agencies or the public sector and refuce to grant a license/lease in respect thereof to a private party. (2) we shall first set out the facts relating to c. w. 1823/79. h. v. pavre, the petitioner, obtained in 1969 a lease over an area of 25 acres in r. f. jamdi, village cirolls sakoli tehsil, district bhandara, in the state of maharashtra for the mining.....
Judgment:

S. Ranganathan, J.

(1) These three writ petitions filed by the same petitioner raise a question as to the extent to which a State Govrnment acting under the Mines and Minerals (Regulation and Development) Act, (Act 67 of 1957) hereinafter referred to as 'the Act, and the rules made there under 'the Rules', for short can exercise the power of reserving certain areas in the State for the exploitation of the minerals therein by itself, its agencies or the public sector and refuce to grant a license/lease in respect thereof to a private party.

(2) We shall first set out the facts relating to C. W. 1823/79. H. V. Pavre, the petitioner, obtained in 1969 a lease over an area of 25 acres in R. F. Jamdi, village Cirolls Sakoli Tehsil, District Bhandara, in the State of Maharashtra for the mining of Kyanite and Simillimanite. He has been working the mine and, during the period from 1-1-1970 to 30-6-1976, had paid Rs. 56,000 by way of royalty in respect thereof. He is also stated to have three mining leases for mica in Madhya Pradesh and also a lease of over 245 acres in Andhra' Pradesh in respect of Kyanite and Sillimanite.

(3) On 22-10-1971, the petitioner applied to the State of Maharashtra for a' mining lease for Kyanite and associated minerals in respect of 98.97 acres (subsequently restricted to 92.97 acres) of land in Bhandara District of the State. The land was situated in the villages of Digori, Sakra and Malda in the above District. The application was under Section 10 of the Act read with Rule 22. Section 10(3) of the Act provides that on receipt of such an application.

'THEState Government may having regard to the provisions of this Act and any rules made there under, grant or refuse the grant the license or lease.'

RULE24 which deals with the disposal of application for mining lease provides that such an application should be disposed of within 12 months from the date of its receipt (sub-rule 1) and, if not disposed of within the said period, 'shall be deemed to have been refused'. Rule 26 provides that 'the State Government may, for reasons to be recorded in writing and communicated to the applicant, refuse to grant or renew a mining lease over the whole or part of the area applied for.'

(4) The petitioner received a reply to his application from the State Government on 16.7.1976, which was a sort of a combined disposal under Rules 24(3) and 26. It stated that the petitioner's application dated 22-10-1971 'has been rejected by the State Government on the ground that the area of villages Digori, Sakra and Malda has been reserved for exploitation in the public sector by the Maharashtra State Mining Corporation (MSMC)'. It was added :

'Besides the said application is also more than 12 months old and it is deemed to have been refused under Rule 24(3)...'

In view of Rule 24(3) the petitioner should have preferred a revision petition to the Central Government under Section 30 read with Rule 54 against the deemed refusal of the application immediately on the expiry of the 12 months period (in 1972, itself). He did not do this but preferred a revision petition in September, 1976 against t4he order dad 16-7-1976. In its comments on the revision petition the State Government conceded that on 22.10.1971 the area had not been reserved for exploitation by the Msmc, for the Msmc had been constituted only on 14-11-1973. Reliance was however, placed on Rule 24(3). It was also stated that 'the Kyanite and Sillimanite bearing area of Bhandara District has been reserved for exploitation in the public sector' by a Government Notification dated 23.9.1974 and that, thereforee, the applications of private persons over the area could not be considered. The petitioner filed a reply but the Central Government considered it unnecessary to go into the rival contentions and held, by its order dated 23.4.1977 :

'The State Government's order of rejection, having been passed after expiry of more than 12 months from the date of the application is without jurisdiction and nullity. The Central Government... set aside the impugned order dated 16th July, 1976. The application of the petitioner was deemed to be rejected in 1974; and no further orders need be passed by the State Government thereon : as the rejection is not effected by the present orders of the Central Government.'

(5) As a result of this order which left undisturbed the deemed rejection of the application, the petitioner had to apply afresh for the lease and this he did on 28-4-1977. On 25-6-1978, the State Government informed the petitioner that the said application was deemed to have been refused under Rule 24(3). The petitioner thereupon preferred a revision petition to the Central Government which was disposed of on 7.7.1978. The Central Government 'set aside the deemed rejection' arising out of the State Governments. failure to pass orders within 12 months and directed :

'THEState Government should now pass final orders within a period not exceeding two hundred days from the issue of this order failing which the application will be deemed to have been rejected.'

(6) The State Government by an order dated 15.9.1978, rejected the application on the ground that the entire area of Bhandara District was 'reserved with immediate effect by the Government of Maharashtra for exploitation of the Kyanite, Sillimenite and other aluminium silicates by the Msmc or in the public sector' by a notification dated 25-8-1978. The petitioner preferred an application in revision to the Central Government but the same was rejected by the Central Government by its order dated 25.9.1979 (which is sought to be impugned in C. W. 1823179), The Central Government, relying on the decision of the Supreme Court in Amrit Lal Nathu Bhai Shah and Others v. Union of India : [1977]1SCR372 held that the State was within its right to reserve certain areas for exploitation in the public sector and deny mineral concessions over such area on the ground of such reservation and that such reservation could be done at any time. It was also held that there was no merit in the petitioner's contention that the reservation of the area for exploitation by a company (though it be in the public sector) would be had because the Msmc was an undertaking wholly owned by the Government of Maharashtra. The petitioner seeks a writ of certiorari quashing the order of the Central Government dated 25.9.1979 and a writ of mandamus directing the Central Government to direct the State Government to grant a mining lease to the petitioner over the area of 92.97 acres referred to earlier.

(7) C.S. 1823-A of 1979 arises in similar circumstances. The petitioner applied on 5-2-1973 for a lease for mining for the same minerals over an area of 13 acres in Girola village of Bhandara District. On 16-7-1976, the State Government passed an order similar to the one referred to in C. W. 1823/79 and on 29.4.1977 the Central Government passed an order in revision which left undisturbed the deemed rejection of the petitioner's application. On 4.5.1977 the petitioner made a fresh application but was informed on 23-6-1978 that it must be deemed to have been refused. The petitioner filed a revision petition to the Central Government which by its order dated 14-7-1978 set aside the deemed refusal and directed the State Government to dispose of the application dated 4-5-1977 within 200 days from 14.7.1978. On 21.9.1978 the State Government rejected the application on the same grounds as in' C. W. 1823 [79 and on the basis of the same order of reservation dated 25-8-1978. The petitioner again went in revision to the Central Government but this was dismissed by the order dated 25-9-1979 which is impugned in this writ petition.

(8) In C. W. 182318 of 1979 the facts are, according to the learned counsel for the petitioner, materially different. On 12-7-1976, the petitioner applied for a lease for running for the same minerals over an area of 27.75 acres in Village Baradkindi in District Bhandara An application was also filed in respect of the same area by the Msmc on 11.10.1976. Since the petitioner had applied earlier in point of time, he had a preferential right over Msmc under Section 11(2) of the Act. The State of Maharashtra, on 8.12.1976, gave the Msmc a 'working permission' in respect of 11.6 out of 27.75 acres applied for. On 7-3-1977 the petitioner filed a revision petition before the Central Government under Section. But there had been no order of rejection of the petitioner's application and the petitioner was not in a position to produce a copy of the order granting working premission to the MSMC. The revision petition was, thereforee, not entertained and was filed as 'incomplete' and this was communicated to the petitioner by a letter dated 14.7.1977. However, on the expiry of twelve months from the date of his application, the petitioners application become the subject of deemed refusal under Rule 24. It may be mentioned that by this time the Msmc had stopped mining in the area and the petitioner filed a revision petition against the deemed refusal on 18.8.1977 which was allowed by the Central Government on 22.9.1977 with a direction to the State Government to pass orders on the petitioner's application within 100 days. On 9.11.1977, the State Government, without making any reference to the order in revision, informed the petitioner that his application was deemed to have been refused under Rule 24(3) After some correspondance, the petitioner filed a revision petition on 21.3.1978 which was allowed by the Central Government on 7.4.1978, with directions again to the State Government to pass orders on the petitioner's application within 100 days. Eventually on 25-7-1978 the State Government passed orders rejecting the petitioner's application on the following five grounds :

(a) If the area is granted for mining, grazing of cattle of surrounding five villages will be affected; (b) The mining operations by blasting may be injurious to the villages; (c) Nistar facilities will be affected ; (d) Mining operation by blasting may affect climate; and (e) Abadi may be affected.

Subsequent to this, the State Government, by the notification dated 25.8.1978, already referred to, purported to reserve the mining rights over the entire area of Bhandra District 'for exploitation by the Msmc or in the public sector'. On 23.9.1978, the petitioner preferred a revision petition to the Central Government against the order dated 25.9.1978, contending that the reasons given for the rejection of the application were vague and untenable and that the refusal to grant a lease was, in the circumstances, malafide. While offering its comments on the revision petition some time in March/April, 1979 the State Government reiterated the above grounds for rejection and asserted that these grounds would also apply to the Msmc 'if they apply for this area' but also stated that these areas had been 'reserved for the public sector' and that they had since been 'reserved on 24.8.1978 for exploitation by the MSMC' (vide para 3 of the order of in revision). When the matter was heard by the Central Government on 20.9.1979, the representative of the State Government brought to the notice of the Central Government that the State Government ' had similarly rejected the application of the Msmc also for this area'. The Central Government was of opinion that the State Government had given cogent reasons for rejecting the application for mining lease and it, thereforee, rejected the revision petition by its order dated 25.9.1979.

(9) It is in the above circumstances that the petitioner has approached this court with prayers for the issue of writs, of certiorari quashing the three revisional orders of the Central Government dated 25.9.1979 and also for the issue of write of mandamus directing the Central Government to direct the State Governme'!t to grant the mining leases applied for by the petitioner.

(10) The Act was passed in 1957 with a view 'to provide for the regulation of mines and the development of the minerals under the control of the Union' and contains in Section 2 a declaration as to 'expediency of union control' as required by the Constitution. Section 18(1) declares it to be 'the duty of the Central Government to take all such steps as may be necessary for the conservation and development of minerals in India and enables the Government to make rules for that purpose. It is sufficient for our purposes to refer to a few of the provisions of the Act and the Rules. Section 4 declares that no person shall undertake any prospecting or mining operations in any area, except under and in accordance with the terms and conditions of a prospecting license or a mining lease and also provides that no prospecting license or mining lease shall be granted otherwise than in accordance with the provisions of the Act and the Rules. Section 19 supplements Section 4 by declaring that any lease or license granted. renewed or acquired in contravention of the orovisions of the Act or any rules or orders made there under shall be void and of no effect. Section 5 lays down the conditions to be fulfillled by an applicant for the grant of a license or lease. Section 10 which contemplates an application being made for the grant of a license or lease has already been referred to. Section 11 formulates certain preferantial rights one of which is (vide sub-section 2) that 'where two or more persons have applied for a prospecting license or a mining lease in respect of the same land, the applicant whose application was received earlier shall have a preferential right for the grant of the license or leave over an applicant whose application was received later'. Section 17 enables the Central Government, in consultation with the State Government to undertake subject to payment of fees, royalties, rents etc. like any other private operator prospecting, or mining operations in land the minerals in which vest in the State Government or any other person and the area of which is not already held under any license or lease. In such a case, however, there should be a notification in the Official Gazette giving the details of the minerals the area and the operations proposed. With a view to enabling it to exercise its powers under this section the Central Government in consultation with the State Government may, by like notification, 'declare that no prospecting license or mining lease shall be granted in respect of any land specified in the notification'.

(11) Turning now to the rules, Rules 22, 24, 26 and 54 have already been referred to. It is now necessary only to refer to Rules 58, 59 a,nd 60. Rule 58 refers .to an area in respect of which an existing license or lease subsists or in respect of which a' license or lease has been granted but the grant has become infructuous due to the death of the applicant or his failure to purpose the grant with appropriate steps under the rules. It says that no such area 'shall be available for grant' unless an entry to that effect is made in the register of licenses I leases maintained by the Government and unless the 'dale from which the area shall be available for grant is notified in' the official gazette at least thirty days in advance.' Sub-rule (2) empowers the Central Government to relax this provision in any special case for reasons to be recorded in writing. Rule 59 is important and reads ;

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

Rule 60 states that applications for licenses/leases in respect of areas in respect of which no notification has been issued under Rule 58 or Rule 59 or in respect of which such a notification has been issued but the period specified therein has not expired, 'shall be deemed to be premature and shall not be entertained.'

(12) The primary obstacle in the way of the petitioner's success is the notification by which the State Government has reserved the a,reas in the entire District of Bhandara 'for exploitation by the Msmc or in the public sector'. As has been referred to earlier the State Government, in one of the matters, had relied upon a notification of reservation dated 23-9-1974 but seems to have given this up later. The only reliance placed later and before us was on the notification dated 25-8-1978. Sri Bobde, appearing for the petitioner, had necessarily to attack the validity of this notification but the scope of his arguments in this regard had to be restricted in the liaht of the decision of the Supreme Court in Amritlal Nathu bhai Shah and Others v. Union Government of India and another : [1977]1SCR372 . In view of the above decision, it is not open to him to contend that the State Government has no powers at all to reserve any area for itself. Indeed, the existence of such power emerges, by clear implication, from Section 17 and Rule 59. In the above decision, the Supreme Court repelled the argument based on Section 17(2) and (4) that the Act does not contemplate or provide for reservation by any other authority or for any other purpose; it was pointed out that the above sub-sections do not cover the entire filed of the authority of refusing to grant a prospecting license or a mining lease to any one else and do not deal with the State Government's authority to reserve any area for itself. The authority of the State Government to order reservation flows from the fact that State is the owner of the mines and minerals within its territory which vest in it and the existence of such a power of reservation is clear from the provisions of Rule 59. The Supreme Court overruled the decision of the Orissa High Court in State of Orissa v. Union of India : AIR1972Ori68 and affirmed the view of the Gujarat High Court in the case under appeal : AIR1973Guj117 and the conclusion of the Patna High Court in M/s. S. Lal and Co. Ltd. v. The Union of India : AIR1975Pat44 that the State Government has the power 'to reserve certain areas for exploitation by itself or by a statutory corporation or in a public sector'.

(13) Sri Bobde tried to get over the order of reservation in three ways. He first contended that. in view of the orders of the Central Government setting aside the orders of deemed rejection and directing the State Government to dispose of the petitioner's application on the merits within a stipulated time, the State Government was hound to consider the petitioner's applications and could not refuse to entertain them altogether on the ground of reservation. He relied, for this contention, on the decision of the Supreme Court in Dharam Chand Jain v. State of Bihar : AIR1976SC1433 . We are of opinion that this contention cannot be accepted. In the case before the Supreme Court, the Central Government had by an order dated 24-3-1962 set aside an order of deemed rejection and directed the Central Government to dispose of the application within a specified time. This was not done and when the applicant went up again in revision, the Central Government, after obtaining the comments of the State Government and the applicant's counter comments, allowed the revision applications by its order dated 21.11.1964 and 'directed the State Government to grant the mining lease to the applicant in respect of a compact block to be selected by him'. This was not done and the application was again rejected by the State Government on the ground that it had laid down a policy that leases in the area were to be given only for persons who were prepared to set up a cement factory. There was another application for revision to the Central Government but by this time, the State Government had changed its policy above referred to and urged before the Central Government only a ground which had been put forward at the stage of the earlier revision. The Central Government accepted this ground and rejected the revision. This order was set aside by the Supreme Court. It was pointed out that the Central Government was a superior tribunal with revisional powers over the State Government and its order dated 21.11.1964 should have been implemented' by the State Government. The Court observed :

'The State Government, being a subordinate authority in the matter of grant of mining lease, was obligated under the law to carry out the orders of the Central Government as indicated above. But the State Government declined to do so on the ground that it had laid down a policy that the mining leases in respect of the area should be given only to those who were prepared to set up a cement factory. It was clearly not open to the State Government to decline to carry out the orders of the Central Government on this ground, particularly because the Central Government 'was a tribunal superior to the State Government. If a ground came into existence subsequent to the making of the order of the Central Government which wadranted a reconsideration of the order of the Central Government as indicated above, the State Government could have brought this ground to the notice of the Central Government. However, one thing is manifestly clear that the State Government could not have refused to implement the order of the Central Government unless the Central Government itself chose to revise it either on a reference by the State Government or suo motu. In fact to take the view that the State Government could decline to carry out the order of the Central Government on some ground which it thinks proper would be subversive of jujdicial discipline. thereforee, when. the appellant preferred a revision application to the Central Government against the refusal of the State Government to curry out the order of the Central Government by rejejcting his application, the Central Government should have proceeded to set aside the order of the State Government and directed the State Government to grant the ?.application of the appellant. Instead of doing this, the Central Government again appears to have entered into the merits of the question as if its earlier order was not in existence at all and sustained the rejection of the application of the appellant on the ground that the area in question was the subject-matter of the title suit in the Court of Hazaribagh, even though the appellant had pointed out to the Central Government that the injunction issued by the Court regarding the premises in dispute had been vacated. Even assuming for the sake of argument that the Central Government could revise its earlier order and putting the case of the Central Government at its highest, this could be done only if some fresh ground came into existence which warranted reconsideration of the earlier order. The fact that there was a litigation pending in the Hazaribagh Court in respect of the area in question was neither a new nor a fresh fact which came into existence for the first time after the order was made by the Central Government directing the State Government to grant the license to the appellant. The litigation was pending since 1954 and the Central Government was aware of this fact even when it passed its order dated November 21, 1964. In These circumstances, thereforee, there was absolutely no legal justification at all for the Central Government. to go back upon its earlier order. The earlier order of the Central Government stood unvaried and unvacated and the State Government was bound to implement it and. thereforee. the Central Government was in error in upholding the action of the State Government rejecting the revision application filed by the appellant and thus silently condoned the lapse committed by the State Government.'

It is clear that the decision of the Supreme Court cannot help the present petitioner. In that case the Central Government had on 21-11-1964 considered the petitioner's application on merits and passed an order directing the grant of license. This was a final order on the petitioner's application for license which only needed implementation by the State Government. It was neither possible for the State Government (which was a subordinate authority in this respect) to ignore that order nor was it correct for the Central Government to uphold the State Government's order of rejection so long as its earlier order stood and had not been revised or varied on some fresh ground which had come into existence subsequently. In the present case, however, the order of the Central Government (like the order of 24-3-196? in the case before the Supreme Court) only set aside the deemed rejection of the petitioner's application and restored it for consideration and disposal by the State Government within a stipulated lime. It is clear that the Central Government did not apply its mind to the merits of the application much less express any opinion thereon or give any directions in regard thereto. The result of the Central Government's orders was, thereforee, only to restore once again the petitioner's applications for consideration by the State Government on all aspects. It is, thereforee, not possible to accept the contention that the State Government had no option except to grant the leases asked for in favor of the petitioner.

(14) It is next contended on behalf of the petitioner that ic is not open to the State Government to reject the petitioner's application on the basis of a self-created disability viz., a reservation of these areas for exploitation in the public sector announced by it long after the dates of the applications made by the petitioner. It is argued that, on the dates when the petitioner made the application these areas had not been reserved by the Government and were thereforee, available for being leased out to applicants who conform to the conditions specified in the Act and Rules. The right of such an applicant to obtain a lease could not it is said, be defeated by a policy of reservation decided upon subsequently. In support of this contention, reliance is placed on a judgment of the Orissa High Court dated 12-12-1979 in Deb v. State of Orissa and Others (D. J. C. Nos. 764-5 of 1975) (5), a copy of which has been furnished to us. In that case, the writ petition, who had taken certain lends on lease in 1953 for extraction of iron ore, applied for the renewal thereof in 1972. The renewal applications not having been disposed of in time, the petitioner approached the Central Government in revision against the deemed rejection of its renewal application. The Central Government on 14-8-1975 had set aside the deemed rejection order, directed the State Government to dispose of the renewal application within 100 days of its order but this was not done. The petitioner, thereforee, filed two writ petitions before the High Court which, by an interim order dated 4-4-1977 therein, permitted the State Government to dispose of the renewal applications within a specified time . On 6-5-1977 the State Government issued a notification reserving the mine in question for exploitation in the public sector and, on 12-5-1977, rejected the renewal applications on the ground that the area was not free from grant. Yet, on the same day, the State Government granted working permission to Manganese Ore (India) Ltd. (MOIL for brief) to exploit the mine pending grant and execution of formal lease. Revision petitions to the Central Government having failed, the petitioner filed the two writ petitions in question challenging the rejection of its applications and the grant of working permission to Moil in respect of the same areas. An interesting development in the case was that State Government during the pendency of' the revision, had informed the Central Government that it had decided to exclude the area from reservation and to grant renewal in favor of the petitioner. It had also stated that it did not intend to grant any lease to Moil and had also cancelled the working permit which had been irregularly granted to it. It requested the revisional authority to 'kindly communicate their approval to the grant of renewal of mining lease for iron and manganese ore in favor of' Sri M. S. Deb and order to exclude the area from reservation'. But it appeared that in 1971, the Central Government had suggested lo the State Government that Moil was interested in the area and by the time the revisional order of 14-8-1975 was passed, the Central Government was already espousing its cause'. That is why it did not accept the revised stand of the State Government and dismissed the revision petitions filed by the petitioner. However, the Central Government made no return to the rule and it was only Moil that contested the writ petitions on the basis of the order of reservation and grant in its favor by correspondence and conduct. The Orissa High Court held that the orders of the State Government dated 12-5-1977 which proceeded on the footing of reservation of the areas in question could not be supported. In the course of the judgment R. N. Misra J observed :

'PETITIONER'Scontention that the State Government became bound by the quasi-judicial order of the revisional authority for disposing of the renewal applications within 100 days from the date of the orders which necessarily required the disposal of the renewal applications (on the basis of existing facts either on) the date of the order or at the most within 100 days there from and not on the basis of events which came into existence by the conduct of the Government, has not been seriously disputed. . .. . . : (missing words supplied)'

'WEare inclined to agree with the submissions of Mr. Rath for the petitioner that the order of reservation had been made mainly to find a ground for rejecting the applications of the petitioner. As already noticed, the State Government had already a time-bound order against it. Having defaulted to dispose of the proceeding within the time, it should not have invoked its power for reservation to defeat the applications and the applications should have been disposed of on the basis of existing facts either on the date of the application for renewal or within the time indicated by the Central Government for disposal at the most. An order of reservation made almost twelve months after the date of the revisional order should not indeed be accepted as a valid reservation so as to automatically bring about rejection of the two applications for renewal which had been long pending with the State Government. . ... .We are impressed with the argument that a party bound by an order should not be allowed to take advantage of its default and be given liberty to escape the rigour of the order by bringing about a change of situation by it? unilateral action.'

ANOTHER

(15) We are unable to read the above decision as laying down the very broad proposition that only the facts existing on the date of application can be taken into account and that, thereforee, a reservation notified subsequent to the date of such application will not be valid. The decision was rendered in the context of the special facts set out earlier. The most important fact in the case was that the revisional order of the Central Government dated 14-8-1957 had imposed a duty on the State Government to dispose of the renewal application within 100 days and it was held that the State Government could not take advantage of its own failure to comply with the revisional order and to issue a notification of reservation. The judgment also leaves no doubt that the reservation notified by the Government was malafide and was intended only to deprive the petitioner of a grant of renewal in Ins favor. In the present case, however. that is not the position, for the reasons set out earlier, the effective applications for the grant of a lease in his favor were made by the petitioner only on 28-4-1977. 4-5-1977 and 12-7-1976. Even In its comments on the revision petition that had been filed against the order dated 16-7-1976 (in Cw 1823/79) the State Government had referred to the decision of the State Government to reserve }the area for itself and indeed even a notification dated 23-4-1974 was referred to . This indicates that the proposal to reserve the area had been under consideration for long and was not for the first time thought of as a ground to reject the petitioner's applications. There was also no direction of the Central Government, as in the Orissa ease, which was sought to be circumvented by the notification of reservation as. in every one of the cases, the State Government has disposed of the petitioner's applications within the time stipulated by the Central Government in its revisional orders. Once these two distinguishing features are kept in view, it will be clear that the decision of the Orissa High Court will not help the petitioner. If, however. the Orissa High Court intended to go further and lay down, as Sri Bobde contends, that only the facts as on the date of the application and not subsequent facts can be taken into account in disposing of an application for license/lease, we would, with respect, differ from such a view. The mere making of an application does not confer a right on an applicant to get a license/lease in his favor. Section 10(3) confers very wide powers on State Government to grant or refuse the application subject only that it should have regard in the provisions of the Act and Rules. As already pointed out. the Act and rules do not in any way derogate from the powers of the state, as the owner of the minerals, to reserve any area for itself .and this power, we think, can be invoked by the State Government at any time before an actual grant is made, so long as the power is exercised bonafide and in accordance with law. That this is the only proper approach can be made clearly by two illustrations. Suppose a land has not been reserved and a person asks for a license/ lease to exploit it for a particular mineral, the State, as owner of the land, has the power not only to exploit the land itself but also to conserve the minerals therein, where necessary. This being so, it is clear that if the State Government decides that the particular mineral should not be exploited but should be conserved, it may refuse- the application even though the land was free for grant otherwise. Again, suppose that in respect of a land which has not been reserved, an application is made for a lease/license. but before the application is considered, certain developments take place rendering necessary the use of the area for strategic purposes or the Government finds that excavations in the area will be harmful and injurious to the public or the Government decides that it was not advisable to allow any mining operations on the plots of land in question. We do not think there can be any doubt that the State can refuse to grant the application. The correctness or otherwise of the reasons for refusal to grant should, we think, be judged as on the date the State Government considers the application and the rejection will have to the upheld so long as it is based on relevant considerations. The State's decision to reserve the area for itself is certainly a relevant consideration and when arrived at bonafide cannot be challenged by an applicant for lease as irrelevant or immaterial.

(16) Learned counsel for the petitioner next contended that while reservation of the land for use by the State as owner would be proper and permissible, the reservation of land for exploitation in favor of the public' sector (other than the Central or State Government) is too wide and would be discriminatory and vocative of Article 14 of the Constitution. It is pointed out that while the embargo in Section 4 of the Act against any person undertaking prospecting or mining operations in any area except under a license/ lease granted by the State Government cannot apply to the State Government itself, it would apply to a case where the mining or prospecting is to be carried on by any other porson whatsoever Thus, a company or corporation even if' it is completely owned or controlled by the State Government is a separate legal entity and can only operate under a license or lease for which it will have to make an application to the State Government like any other private party. A company or corporation in the public sector is, thereforee, in the same position as any private operator for the purposes of the Act. In this view of the matter, the reservation of an area in favor our of the 'public sector' in so far as it (contemplates a reservation in favor of a company or a corporation in the public sector would amount to a favored treatment, without valid reason, of one or two equally placed persons, thus offending Article 14 of the Constitution. It follows, argues Sri Bobde, that the reservation, in the instant case, in favor of Msmc is vocative of Article 14.

(17) The argument is interesting and does not appear to be concluded by the decision in Amrit Lal Nathu Bhai Shah (Supra) but we do not think it arises for consideration in the petitioners before us. We think the contention is premature so far as CWs 1823 and 1823 A are concerned and that it is possible to dispose of Cw 1823 on other grounds. So far as the first two petitions are concerned, the petitioner's application has been rejected on the ground that the area has been reserved 'for exploitation by the Msmc or in the public sector'. It is too early to say in what manner the State Government is likely to implement its reservation policy. If the minerals are exploited by the State itself directly, the petitioner can have no grievance. Perhaps, even if the State . exploits the area through some agency of its own, there can be no objection. It is too premature now to say whether the mode of exploitation that may be decided upon by the State Government would offend Article 14 or not. At present, all that the Government has decided is that the land will not be available for private operators but will beexploited by the Government and with this petitioner can have no quarrel. We are, thereforee, unable to interfere with the orders of rejection of the petitioner's applications. We need hardly say that, if, as and when the Government decides upon the method to be followed by it in working the lands, the petitioner is in any way aggrieved, it will be open to him to approach the Court, if so advised, for redress. CWs 1823 and 1823-A have. thereforee, to be dismissed.

(18) So far as Cw 1823-B is concerned the position is slightly different. The argument based on Article 14 does not arise here because the application of the Msmc has also been rejected by the State Government for the same reasons. Leaving this aspect out of consideration, in this case. the petitioner's application was rejected on certain grounds which have already been set out earlier. When the revision petition against the order of the State Government was heard by the Central Government these grounds were repeated but it was also brought to the notice of the revisional authority that the Kyanite areas of the District Bhandarn had been reserved for the public sector. The revisional authority has in the operative portion of its order only considered the objections contained in the order of rejection and has said nothing regarding the reservation of the area which was brought to its notice. Sri Bobde contended that so far as this application is concerned, the ground of reservation is not available to the Government because the Government had initially granted a working license in favor of Msmc but had subsequently rejected an applicaton by the Nsmc for a license lease for the same reasons as in the petitioner's case. It is, thereforee, contended that it must be taken that the area applied for by the petitioner in this case had ceased to be reserved for the public sector. The argument appears attractive but there are two difficulties in accepting the same. In the first place though the State Government had rejected the application made by Msmc, it does not follow that the policy reservation of this area for the public sector had been given up. The second objection is that the principle of Rule 59 is that if land reserved for any purpose by the State Government becomes available for the grant of a prospecting license or a mining lease, the procedure laid down in Rule 58 should be followed, i.e., an entry should be made in the appropriate register and title date from which the area shall be available for grain should be satisfied in the Official Gazette at least thirty days in advance there being no suggestion that. these requirements had been relaxed under Rule 58(2). In the present case it is no doubt, true that the State Government had not refused to grant the lease to the petitioner on the ground that the land had been reserved. That notification came later. But so long as that notification holds, the field and the land bus not been subsequently declared to be available it would not be possible for the Central Government to direct that the State Government should grant the lease in favor of any applicant. The notification of reservation, thereforee, will operate even in this case as an obstacle in the way of grant of the petitioner's application as in the other two cases. But even leaving this ground out of consideration because it has not been considered in the order of the Central Government or the State Government, we find it difficult to see how the orders of the two Governments in this respect can be quashed. The point made by Sri Bobde is that the reasons given in' the order for refusing to grant the lease are very general, vague, flimsy and irrelevant. There does appear to be some force in the contention of Sri Bobde for the reasons which have already been set out do appear to be of a very general nature and the petitioner had pointed out in his revisional application to the Central Government that these grounds were not tenable. It was pointed out that there were adequate grazing facilities for the cattle in the villages concerned, that blasting could be permitted subject to safeguards provided for in the safety regulations, that the abadi was not likely to he affected, that the nister facilities could be easily safeguarded and that the objection on the basis of climate was totally filmsy and unsustainable. The State Government had pointed out that one of the Gram Panchayats had objected to the grant of a mining lease and that the Collector of Bhandara had also supported the above objection. As against this the petitioner had produced before the revisional authority a certificate given by the Gram Panchayat of the village concerned stating that they had no objection to permission being granted subject to certain conditions. All these aspects have been considered by the revisional authority. Though one or two of the objections are indeed far-fetched, it is difficult to say that all of them are totally irrelevant. It does appear that some objections had been raised when an attempt was made by the Msmc to work the mines for a short time. It is not possible for this court to sit hi appeal over the decisions of the two Governments in this matter. We are unable to see how in a writ petition the correctness or adequacy of these grounds can be gone into by us though perhaps if the matter were being considered by us as the original or appellate authority we might have come to a different conclusion. All that the Act requires is that the application should be granted or refused for reasons to be stated in writing which means reasons relevant for the grant of the license or otherwise. If the State Government has come to the conclusion that having regard to the location and circumstances of this particular area it was not possible to grant the license, it is not possible for this court to intervene, review the decision on the merits and direct the grant of a license to the petitions possibly, if the State Government subsequently proceeds to exploit the area, that may be reason to argue that the ground given for the refusal arc filmsy, far-fetched and not genuine But, at present, there is no material on the basis of which we can consider the reasons given to be irrelevant or immaterial to the grant of a lease. We, thereforee, do not think that: the position in regard to Cw 1823-B in substance is different from that relating to the other two petitions though there is some difference on the facts.

(19) In the result, we see no grounds for interfering with the orders of the Central Government confirming the orders of refusal made by the State Government. The writ petitions arc dismissed. But in the circumstance, we make no order as to costs.


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