SC granted conditional entitlement of Jindal Steel and Power Ltd to lift and transport the iron ore

State of Odisha and Ors. Vs. M/s. Jindal Steel and Power Ltd. & Ors., Civil Appeal No. 850 of 2020, arising out of Special Leave Petition (Civil) No. 23644 of 2016 –  30.01.2020

The Bench comprising of Justice S.A. Bobde, Justice B.R. Gavai and Justice Surya Kant on 31.01.2020 allowed to complete the process of transportation of already mined ores.

The civil appeal is directed against the order of the Division Bench of Odisha High Court against the writ petition of the respondent M/s Jindal Steel and Power Ltd. Seeking a writ of mandamus against the appellant, State of Odisha for allowing the lifting of already mined ores.

Facts:

M/s Jindal Steel and Power Ltd. had entered into an arrangement with SMPL to purchase iron ores which has to processed into lump ores and fines and transported to JSPL’s plants. The stocks were handed over within SMPL’s premises. JSPL would process these ores and send them to dispatch point for transportation to Pellitisation Plant in Odisha and Integrated Steel Plant in Chhattisgarh. The appellant has already granted permission for selling ore, subject to payment of royalty at highest rate. On 31.03.2014, a letter issued by the Deputy Director of Mines stated that SMPL’s Environment Clearance for enhanced production had expired and hence the transit permit could not be granted. JSPL made numerous representations stating that they have duly paid the royalty and wanted to wallow the transportation of processed minerals. The Director of Mines granted transport clearances. The Commissioner-cum-secretary, Steel and Mines Department said that the material lay within the leasehold area of SMPL and could not be proceeded as it would form part of mining operations. JSPL approached the High Court for grant of permission for transportation. JSPL had valid clearance to mine for 20 years from 2004.

The term ‘mining operation’ defined under Section 3(d) of the Mines and Mineral (Development and Regulation) Act, does not include transportation of minerals. The constitutional bench in Bihar Mines Ltd. v. Union of India interpreted ‘mining operations’ to include only processes necessary to extract minerals from mines, the High Court held that transportation already raised would not be estopped though this court’s interim order. 

Therefore, JSPL contended that they had valid license and had paid all the necessary royalties and so they could not be stopped from transporting its ores mainly because it lays in the SMPL premises. Therefore, the High Court had no valid for the State of Odisha to stop transportation and quashed all the orders and directed the state to grant permission. JSPL also said that this will cause distress to the Steel Sector in India.

The State of Odisha contended that the SMPL had mined more than 4 MPTA and the ores sold to JSPL is also a part of this and hence it could not be termed as ‘validly procured’. They also contended that mere completion of sale under Sales of Goods act would not regularize the irregularities.

The Court after hearing both the parties came to a conclusion that the order sent to SMPL will be modified and a month’s time is given for repayment of all dues as assess by the CEC before 29th February. Once SMPL complies with this, JSPL can lift the already mined ores to its plants across the country. The Proceeds must be deposited with the Trust and Retention Account under the custody of SBI. Failure to this may result in the sale deemed legally void.

View/ Download the Judgment: State of Odisha and Ors. Vs. M/s. Jindal Steel and Power Ltd. & Ors.

– Vydurya Selvi Baskaran

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