IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 10TH DAY OF JULY 2019 PRESENT THE HON’BLE MR. JUSTICE L. NARAYANA SWAMY AND THE HON’BLE MR. JUSTICE P.S.DINESH KUMAR WRIT PETITION No.51979/2016 (GM-MM-S) BETWEEN:
SMT. SUNANDA V. ALLUM W/O SRI ALLAM VEERABARAPPA AGED ABOUT 60 YEARS R/O GADIGI PLACE, CAR STREET BELLARY-583 101 ... PETITIONER (BY SHRI. D.L.N. RAO, SENIOR COUNSEL FOR SHRI. ANIRUDH ANAND, ADVOCATE) AND:
1 STATE OF KARNATAKA REPRESENTED BY ITS SECRETARY DEPARTMENT OF COMMERCE AND INDUSTRIES (MSME, MINES & TEXTILE) VIKASA SOUDHA DR.AMBEDKAR VEEDHI BANGALORE-560 001 2. THE COMMISSIONER AND DIRECTOR DEPARTMENT OF MINES AND GEOLOGY KHANIJA BHAVAN, RACE COURSE ROAD BANGALORE-560 001 ... RESPONDENTS (BY SHRI. VIKRAM HUILGOL, HCGP) THIS WRIT PETITION IS FILED UNDER ARTICLES 226 & 227 OF THE CONSTITUTION OF INDIA, PRAYING TO QUASH THE ENDORSEMENT DTD:7.9.2016 REJECTING THE REQUEST OF THE PETITIONER FOR INCLUSION OF IRON ORE INTO ML NO.2636 VIDE ANNEXURE-F AND DIRECT THE RESPONDENTS TO PASS NECESSARY ORDERS TO INCLUDE IRON ORE INTO THE EXISTING MINING LEASE BEARING ML NO.2636.
THIS WRIT PETITION, HAVING BEEN HEARD AND RESERVED FOR ORDERS ON 25.03.2019, COMING ON FOR PRONOUNCEMENT OF ORDERS, THIS DAY, P.S.DINESH KUMAR J, PRONOUNCED THE FOLLOWING:-
ORDER This petition is presented with a prayer to issue a writ of certiorari and to quash endorsement dated 07.09.2016 (Annexure-F) and to direct the respondents to pass necessary orders to include ‘iron-ore’ mineral into the existing mining lease bearing ML No.2636 dated December 22, 2009.
2. We have heard Shri D.L.N.Rao, learned Senior Advocate for the petitioner and Shri Vikram Huilgol, learned HCGP for the State.
3. Briefly stated the facts of the case are, petitioner was granted mining lease bearing ML No.2636 on December 22, 2009 under the provisions of Mines and Minerals (Development and Regulation) Act, 1957 (for short ‘1957 Act’) and Mineral Concession Rules 1960 (for short ‘1960 Rules’) to extract manganese-ore over an area of 56.84 acres in Sy.Nos.45 and 46 of Shivasandra, Gubbi Taluk, Tumkur District for a period of 20 years with effect from 22.12.2009.
4. It is averred in the petition that for want of consent by the Karnataka State Pollution Control Board, petitioner could not start mining operation till 2013. After commencement of mining operations, petitioner found that low grade iron-ore was also available in the mine. On 15.03.2015, petitioner filed an application seeking inclusion of iron-ore in the mining lease as prescribed under Rule 27(1)(a) and (b) of 1960 Rules and Clause 9 of Part VII of lease deed.
Petitioner also submitted three reminders ending with reminder dated 10.05.2016.
5. By the impugned endorsement dated 07.09.2016, the Commissioner and Director of Mines and Geology has rejected petitioner’s request to include iron-ore in the mining lease on the ground that as per Rule 12(2) of Minerals (Other than Atomic and Hydro Carbons Energy Minerals) Concession Rules, 2016 (for short ‘2016 Rules’), a mining lease holder who is not granted through auction has no right over any other mineral discovered in the land. Feeling aggrieved by the said endorsement, petitioner has presented this writ petition.
6. Shri D.L.N.Rao submitted that State Government have granted mining lease to the petitioner in the year 2009 under the provisions of ‘1957 Act’ to extract Manganese ore. As per Clause 9 of the Lease Deed, petitioner has covenanted with the State Government to report discovery of any mineral which is not specified in the lease. Petitioner has fulfilled her obligation by reporting availability of low grade iron-ore and requested for including the said mineral in the lease deed. The Director of Mines has rejected petitioner’s -request by quoting 2016 Rules without noticing the fact that 2016 Rules have come into existence long after execution of the lease deed and all things done or omitted to be done before commencement of 2016 Rules have been saved under Rule 55 of the 2016 Rules.
7. In support of his contentions, he placed reliance on the following authorities:
a) 1996(4) SCC 297 Agricultural and Processed Food Products Vs.
Oswal Agro Furane and others b) 2000 (2) SCC 536 Kolhapur Canesugar Works Ltd. and another Vs. Union of India and others c) 2010 (9) SCC 266 Kalpnath Singh Vs. Udai Nath and others d) 2016(4) SCC 763 District Collector, Vellore District Vs. K.Govindraj 8. Shri.D.L.N. Rao, further submitted that iron- ore and manganese exist homogeneously. Petitioner’s mining lease is in force till 2029. The State Government cannot grant a separate lease to any other person to extract iron-ore. However, State can exercise right of pre-emption by paying the cost of production of mineral. If right of pre-emption is exercised, petitioner will be compelled to work and extract iron-ore mineral without any benefit. Accordingly, he prayed for allowing this writ petition.
9. Shri Vikram Huilgol, learned HCGP for the State arguing in support of the impugned endorsement submitted that under 2016 Rules, iron-ore cannot be included in the mining lease. In any event, petitioner will not be put to any loss if State were to exercise right of pre-emption as the cost of production will be reimbursed to the petitioner.
10. Learned HCGP has placed reliance on the judgment of the Hon’ble Supreme Court in State of Kerala and others Vs. Palakkad Heritage Hotels (2017) 13 SCC 672.
11. We have carefully considered rival contentions and perused the records.
12. Indisputable facts of the case are, petitioner has obtained mining lease to extract manganese-ore in the year 2009 for a period of 20 years. Petitioner has submitted an application on 13.05.2015 to include iron- ore in the lease deed. Her request has been rejected on 07.09.2016.
13. The principal argument advanced by Shri D.L.N.Rao is that in view of Rule 55 of 2016 Rules, all things done before the commencement of the said Rule shall stand saved.
14. Rule 55 of 2016 Rules reads as follows:
“55. Repeal and saving.- (1) On the commencement of these rules, the Mineral Concession Rules, 1960 shall cease to be in force with respect to all minerals for which the Minerals (Other than Atomic and Hydrocarbons Energy Minerals) Concession Rules, 2015 are applicable, except as regards things, done or omitted to be done before such commencement. (2) On the commencement of these rules, with respect to the minerals to which these rules apply, any reference to the Mineral Concession Rules, 1960 in the rules made under the Act or any other document shall be deemed to be replaced with Minerals (Other than Atomic and Hydrocarbons Energy Minerals) Concession Rules, 2015, to the extent it is not repugnant to the context thereof.”
15. Shri D.L.N.Rao relied upon paragraph No.20 of the judgment in Agricultural and Processed Food Products1, which reads as follows:
1 1996(4) SCC 297 ”20. Clause 15 is a saving provision and not an exemption clause. A saving provision or clause merely preserves what exists. In Statutory Interpretation by F.A.R. Bennion, Second Edn., at pp. 494 and 495 the learned author with regard to the saving clause has said that:
“A saving is a provision the intention of which is to narrow the effect of the enactment to which it refers so as to preserve some existing legal rule or right from its operation. A saving resembles a proviso, except that it has no particular form. Furthermore it relates to an existing legal rule or right, whereas a proviso is usually concerned with limiting the new provisions made by the section to which it is attached.”
Again at pp. 494 and 495 it is stated:
“A saving is taken not to be intended to confer any right which did not exist already.”
To the same effect is a decision of this Court in Shah Bhojraj Kuverji Oil Mills and Ginning Factory v. Subhash Chandra Yograj Sinha [(1962) 2 SCR 159 : AIR 1961 SC 1596] . While dealing with the effect of a proviso it was observed as follows:
“The law with regard to provisos is well settled and well understood. As a general rule, a proviso is added to an enactment to qualify or create an exception to what is in the enactment, and ordinarily, a proviso is not interpreted as stating a general rule. But, provisos are often added not as exceptions or qualifications to the main enactment but as savings clauses, in which cases they will not be construed as controlled by the section. The proviso which has been added to Section 50 of the Act deals with the effect of repeal.”
Dealing with the proviso to Section 7 of the Bombay General Clauses Act, 1904 (1 of 1904), the Court observed as under:
“The substantive part of the section repealed two Acts which were in force in the State of Bombay. If nothing more had been said, Section 7 of the Bombay General Clauses Act would have applied, and all pending suits and proceedings would have continued under the old law, as if the repealing Act had not been passed. The effect of the proviso was to take the matter out of Section 7 of the Bombay General Clauses Act and to provide for a special saving. It cannot be used to decide whether Section 12 of the Act is retrospective.”
16. Though Shri D.L.N.Rao contended that petitioner’s case falls under Rule 55 of the 2016 Rules, the fact remains that the 2016 Rules have come into effect from 04.03.2016. Petitioner’s application was considered and rejected by endorsement dated 07.09.2016, which is clearly after 2016 Rules coming into existence.
17. In the case of Palakkad Heritage Hotels2, while considering the aspect of date of consideration, the Hon’ble Supreme Court has held as follows:
“12. In our view the question as to what date should be reckoned as the date of consideration of licence has not been squarely dealt with in this decision. Indubitably, the processing of the application for grant of licence commences from the date of application. The final decision on the proposal is required to be taken by the State Government. The date on which a formal, final decision is taken by the competent authority, alone, would be the relevant date. The recommendation made by the subordinate authority, even if significant for taking a formal decision by the competent authority, will be of no avail.”
18. In the instant case, petitioner has submitted a request to include iron-ore in the mining lease. Subsequently, the law has changed. The vires of 2016 Rules are not under challenge. Admittedly, final decision has been taken by the competent authority 2 (2017) 13 SCC 672 after 2016 Rules came into force. Therefore, we find no error in the impugned order. Resultantly, this petition fails and it is accordingly dismissed.
No costs.
Sd/- JUDGE Sd/- JUDGE Yn.