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“Royalty paid ore” is the mineral removed from the mines and brought to the jetties: SC

Chowgule And Company Private Ltd. v. Goa Foundation & Ors.

M.A.NO.1260 OF 2020 IN Civil Appeal No. 839 of 2020 With

M.A.Nos.13851387/2020 In Civil Appeal Nos.840842 of 2020; M.A.No.1384/2020 In Civil Appeal No. 843 of 2020; M.A.No.1345 /2020 In Civil Appeal No.848 of 2020; M.A.No.1344/2020 In Civil Appeal No. 847 of 2020; M.A.No.1625/2020 In Civil Appeal No.839 of 2020 - 13 October, 2020.

The Hon’ble Supreme Court comprising of Chief Justice of India S.A.Bobde, Justice A.S.Bopanna and Justice V.Ramasubramanian held in a case that the order dated 11.05.2018 in SLP(C)No.12449 of 2018 used the expression “royalty paid ore”, in the context of the mineral removed from the mines and brought to the jetties on or before 15.03.2018.

In Goa Foundation vs. Union of India[(2014) 6 S.C.C. 590], the Court held that all iron ore and manganese ore leases had expired on 22.11.2007 and that any mining operation carried out beyond the said date was illegal. While holding so, the Supreme Court also pointed out that for a second renewal of the mining lease, an order is required to be passed by the State; The observations regarding second renewal of the mining leases, gave rise to a fresh set of litigations, which culminated in the decision in Goa Foundation vs. Sesa Sterlite Ltd.[(2018) 4 S.C.C. 218] In paragraph 154 of the said decision, this Court recorded 9 conclusions

The aforesaid directions led to a fresh bout of litigation, that culminated in the order by this Court on 30.01.2020 in Civil Appeal Nos.839848 of 2020. The controversy that revolved around paragraph 154.6 Goa FoundationII Was as to whether the time given to the lease holders to manage their affairs up to 15.03.2018 would include the time to remove the mined mineral. This controversy was resolved by this Court in the judgment dated 30.01.2020 which we may call Goa FoundationIII. This Court held therein: (1) that the only prohibition imposed by paragraph 154.6 of Goa FoundationII was for carrying out mining operations and not transportation; and (2) that the policy decision of the State of Goa dated 21.03.2018, to permit the transportation of mineral mined prior to 15.03.2018 was valid. (iv) After so interpreting paragraph 154.6 of Goa FoundationII, the Supreme Court also took note of Rule 12(1)(gg) of The Minerals (Other than Atomic and Hydro Carbons Energy Minerals) Concession Rules, 2016, which also allows a period of six months for the lessees to remove the excavated material, on the expiry or sooner termination of the term of lease. Accordingly, the Supreme Court, by its order dated 30.01.2020, granted a period of 6 months to all lease holders to transport the mineral already excavated on or before 15.03.2018;

The time granted by the Supreme Court to the lease holders, by the order dated 30.01.2020 expired on 30.07.2020. A lock down was clamped on 24.03.2020 due to the pandemic. Therefore, a few lessees have come up with the aforesaid applications for extension of time by six months with effect from 01.10.2020 for the transportation of the mineral allegedly extracted by them on or before 15.03.2018; Contending that the benefit of extension of time should be granted also to them, a lessee who did not challenge the order of the High Court by way of a civil appeal has come up with an application for intervention, in the disposed of Civil Appeals;

The issues in the present case were:

1) whether the right to remove the mined minerals is only in respect of “the royalty paid ore” or upon payment of royalty at the time of movement and disposal; and

(2) whether the State Government ought to have invoked Rule 12 (1)(hh) of the Rules or not?

The lessee’s application for extension for time was based on two grounds. namely, (1) the delay on the part of the statutory authorities in issuing transit permits for the transportation of the royalty paid ore; and (2) the imposition of lockdown within two months of the judgment of this Court dated 30.01.2020.

The respondent raised the following contentions: (1) that the ore on which royalty had not already been paid, can never be removed; (2) that even as per the affidavit of the Chief Secretary of the State, the ore inside the leasehold area on which advance royalty had already been paid, was only 73,850.26 tonnes; (3) that in terms of Rule 12(1)(hh) of The Minerals (Other than Atomic and Hydro Carbons Energy Minerals) Concession Rules, 2016, the mineral not removed within a period of six calendar months is liable to be confiscated to the Government; and (4) any extension of time is bound to be misused by the lessees.

The court before entering the issues dismissed the intervention application filed in M.A.No.1653 of 2020 with the following observations;

5. Let us first take up the intervention application, as it is capable of being disposed without much ado. The applicants in M.A. No.1653 of 2020 did not challenge the order of the High Court before this Court. Even if he had benefited by the judgment dated 30.01.2020, by virtue of the policy of the State dated 21.03.2018, which we upheld, the applicant cannot now seek the benefit of extension. Therefore, the application for intervention is dismissed.

The court, after explaining section 9(2) of the Mines and Minerals (Development and Regulation) Act, 1957 and how the same is applicable I the present situation, observed the following:

13. The question whether royalty had already been paid or not assumed significance in the second round of litigation, in respect of the minerals excavated/mined on or before 15.03.2018 and removed to jetties. The order dated 04.04.2018 in SLP(C)Nos.8483 & 8484 of 2018, and the order dated 11.05.2018 in SLP(C)No.12449 of 2018 used the expression “royalty paid ore”, in the context of the mineral removed from the mines and brought to the jetties on or before 15.03.2018. Therefore, the first objection of Goa Foundation cannot be sustained. In any case the acceptance of the said objection would tantamount to reviewing the judgment dated 30.01.2020, without an application for review.

The Court, after referring to Rule 12(1)(gg) of The Minerals (Other than Atomic and Hydro Carbons Energy Minerals) Concession Rules, 2016, and brining out the twin conditions ro be satisfied, answered the second issue in the following words:

16. Therefore, Goa Foundation may be right in contending that the State Government should have invoked Rule 12(1)(hh) to confiscate the mineral allegedly lying at site for the past more than 2½ years. But the difficulty today is that Rule 12(1)(hh) was not pressed into service before this Court, when this Court rendered its judgment dated 30.01.2020. As a result, the judgment dated 30.01.2020 giving six months’ time to the lessees to remove the material, has attained finality. If the lessees had removed the material within the six months’ period prescribed in the judgment 30.01.2020, Goa Foundation could not have come up with this contention. In fact, the application for clarification/ direction in M.A.No.1625 of 2020 was filed only in September, 2020, after the expiry of six months’ period granted by this Court by the judgment dated 30.01.2020.

In the above regard the court went onto dispose of the petitions with the following effect:

19. (1) The lessees are granted time up to end of January, 2021 for the removal of the minerals excavated/mined on or before 15.03.2018 subject to payment of royalties and other charges;
(2) The quantity of mineral to be removed by each of the lessees shall be determined by the concerned officials with reference to the records of the Government maintained at the relevant point of time;
(3) If within the time stipulated above, the lessees could not remove the mineral, the Government shall invoke the power under Rule 12(1)(hh).

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