IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 18TH DAY OF MARCH, 2019 PRESENT THE HON’BLE MR. L. NARAYANA SWAMY ACTING CHIEF JUSTICE AND THE HON’BLE MR.JUSTICE P.S. DINESH KUMAR WRIT PETITION NO.62085 OF 2016 (GM-MM-S) BETWEEN:
M/S. KANHAIYALAL DUDHERIA A PARTNERSHIP FIRM REGISTERED UNDER THE PROVISIONS OF INDIAN PARTNERSHIP ACT, 1932 REGISTERED OFFICE AT OPP. BHANWAR KUNJ BEHIND KSRTC NEW BUS STAND BELLARY ROAD, SANDUR KARNATAKA – 583119 REPRESENTED BY ITS MANAGING DIRECTOR NAVRATANMAL BACHHAWAT, S/O. SRI. BHAWARALAL BACHHAWAT AGED ABOUT 66 YEARS REGD. OFFICE AT: OPP: BHANWAR KUNJ BEHIND KSRTC NEW BUS STAND BELLARY ROAD, SANDUR KARNATAKA - 583119 ... PETITIONER (BY SRI. D.L.N.RAO, SR. ADVOCATE FOR SMT.PALLAVI BARUAH, ADV.) AND:
1. STATE OF KARNATAKA REPRESENTED BY SECRETARY TO GOVERNMENT COMMERCE AND INDUSTRIES DEPARTMENT (MINES, MSME & SUGAR) #135, 1ST FLOOR, VIKASA SOUDHA DR.AMBEDKAR VEEDHI BENGALURU – 560 001, INDIA 2. THE DIRECTOR DEPARTMENT OF MINES & GEOLOGY “KHANIJA BHAVAN”
RACE COURSE ROAD, BANGALORE – 560001 3. DEPUTY DIRECTOR DEPARTMENT OF MINES AND GEOLOGY HOSPET 4. THE CHAIRMAN MONITORING COMMITTEE “KHANIJA BHAVAN”
RACE COURSE ROAD, BANGALORE - 560001 ... RESPONDENTS (BY SRI.BHANUPRAKASH V.G., AGA) ---
THIS WRIT PETITION IS FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA PRAYING TO DIRECT THE R-2 TO REFUND THE EXCESS ROYALTY AMOUNT OF RS.43,10,379/- (RUPEES FORTY THREE LAKHS TEN THOUSAND THREE HUNDRED AND SEVENTY NINE ONLY) WITHHELD BY THE R-2 WITHOUT AUTHORITY OF LAW, TOWARDS THE SECONDARY PERMIT, ALONG WITH INTEREST @ 18% VIDE ANNEXURE- H.
THIS PETITION COMING ON FOR PRELIMINARY HEARING ‘B’ GROUP THIS DAY, ACTING CHIEF JUSTICE, MADE THE FOLLOWING:
ORDER Petitioner has preferred this writ petition seeking a writ of mandamus to direct respondent No.2 to refund the excess royalty amount of Rs.43,10,379/- (Rupees Forty Three Lakhs Ten Thousand Three Hundred and Seventy Nine) withheld by respondent No.2 towards the secondary permit along with interest @ 18%.
2. Petitioner is a partnership firm engaged in extraction and sale of iron ore having Mining Lease bearing No.M.L.No.2563 with effect from 16.06.2000 for a period of twenty years as per Annexure-A.
3. It is submitted by the learned counsel for the petitioner that the petitioner had made an application to respondent No.2 on 25.02.2007 for a stockyard permit in order to store the iron ore mineral extracted out of their leased area before dispatching it to purchaser’s destination. Pursuant to the same, respondent No.2 has granted permission to the petitioner to establish a stockyard and the stockyard permit of the petitioner was annually renewed by respondent No.2. Subsequent to the same, petitioner in a routine manner applied for Mineral Dispatch permits for transportation of the Run-out of mine (ROM) iron ore out of the mining lease area to their stockyard, after making payment of royalty on the quantity of mineral-ore so extracted, as fixed by respondent No.2. Section 9 of the Mines and Minerals (Development and Regulation) Act, 1957, (for short hereinafter referred to as the ‘Act) empowers respondent No.2 to impose royalty charges on the mineral so removed or consumed by holder of mining lease, or by his agent, manager, employee, contractor or sub-lessee from the leased area). It is submitted that in the instant case, the petitioner in a routine manner was making payment of royalty to respondent No.2 as per Section 9 of the Act. It is the principal contention of the learned counsel for the petitioner that on the basis of purchase orders for supply of mineral by various purchasers, industries and consumers of iron ore, the petitioner was dispatching iron ore stored in its stockyard. While doing so, by misinterpretation of the position of law, the petitioner has paid royalty for the second time on the same batch of minerals, for the purpose of issuance of secondary mineral dispatch permits, as and when the minerals were being moved out of the stockyard to the purchaser’s destination. The petitioner was unaware that royalty was a ‘one time’ payment on a particular batch of mineral and in the instant case, it was already paid. Thus, the same batch of minerals had suffered royalty twice. In this background, the petitioner has submitted a representation to respondent No.2 with regard to double payment of royalty in respect of the same mineral and sought refund of the excess royalty paid.
4. It is further submitted that as per the Government notification bearing No.CI79:MMM.2013, Bangalore, dated 12.09.2013, petitioner has no dues payable to respondent No.2. As per communication produced at Annexure-G, respondent No.2 rejected the request of petitioner for refund of excess royalty payments made by the petitioner which is contrary to the mandate of Section 9 of the Mines and Minerals Development and Regulation Act. Hence, he has preferred this petition.
5. Learned counsel for respondent No.2 submits that as per endorsement dated 26.01.2016, (Annexure-G) the petitioner is due and liable to pay huge arrears. It is submitted that in the case of M/s. M.Hanumanth Rao, M.L.No.2505, the lessee therein had approached the Director Department of mining and Geology – 2nd respondent seeking refund of royalty on the Mineral (iron ore) transported from his Stockyard. The Director of Mines and Geology – 2nd respondent after seeking all the information from the lessee as well as from the concerned office, passed an order dated 02.02.2017 holding that the excess royalty amount paid by the lessee, if any, shall be adjusted towards any due or the amount payable by the lessee to the Department. Hence, excess royalty if at all paid during the transportation of Iron ore from the stockyard cannot be decided without reconciliation of payments. As per the notification dated 12.09.2013, (Annexure-J) 2nd respondent is the competent authority to recover any dead rent, royalty, penalty and dues or other sums payable to the Government by erstwhile holder of mining lease. It is submitted that the dues mentioned supra shall be calculated by the 2nd respondent. Hence, it is appropriate for the petitioner to approach the competent authority i.e., 2nd respondent with all the documents for reconciliation of royalty paid.
6. Heard the learned counsel appearing for both the parties.
7. The petitioner’s prayer for refund of excess amount paid as royalty is to be determined by the competent authority i.e., 2nd respondent. The 2nd respondent has collected the royalty as per the provisions of MMRD Act. Secondly, it is submitted by the petitioner that the royalty was collected by respondent No.2 from the petitioner twice, once while the iron ore mineral was being transported from the Mining lease area to the stockyard of the petitioner and again when the same iron ore material was transported from the stockyard of the petitioner at Jaisinghpur to the purchaser’s destination. The provisions of the act is clear with regard to payment of royalty. Royalty is a “One Time” payment. Petitioner claims to have paid royalty twice to the tune of Rs.43,10,379/-.
8. It is clear from the notification of the Ministry of Mines dated 31.08.2010 (Annexure-K) addressed to the Secretary, Mines, SSI & Textiles, Department of Industries and Commerce, that according to the Section 9 of Mines and Minerals (Development and Regulation) Act, 1957, (MMDR Act), royalty can be charged only once on mineral removed from the mine and it is also further clarified to ensure that charging of double royalty on mineral does not arise through any other interpretation of Section 9 of the Act.
9. Therefore, petitioner is directed to appear before the second respondent by making necessary application seeking refund of double royalty if any paid by the petitioner within a period of two weeks from the date of receipt of a copy of this order and if such application is filed, after issuance of notice to the petitioner, the second respondent is directed to consider the same within a period of eight weeks thereafter.
10. In order to consider the plea of the petitioner and to enable second respondent to pass appropriate orders on the application filed by the petitioner, the endorsement at Annexure-G dated 26.01.2016 is set aside and second respondent is directed to pass appropriate orders in accordance with law.
With the above observations, the writ petition is disposed of.
No costs.
Sd/-
ACTING CHIEF JUSTICE Sd/- JUDGE HJ