M/S.Bagalkot Cement And ... vs The Special Land Acqusition ...
2023 Latest Caselaw 4113 Kant

                                                   -1-


                           IN THE HIGH COURT OF KARNATAKA AT DHARWAD

                                DATED THIS THE 07TH DAY OF JULY, 2023

                                               :PRESENT:
                                  THE HON'BLE MR. JUSTICE R.DEVDAS
                                                  AND
                                THE HON'BLE MR. JUSTICE RAJESH RAI.K

                                    MFA NO.102892 OF 2019 (LAC)
                                               C/W
                                    MFA NO.102894 OF 2019 (LAC),
                                    MFA NO.102895 OF 2019 (LAC)
                                    MFA NO.102897 OF 2019 (LAC),
                                    MFA NO.102898 OF 2019(LAC),
                                    MFA NO.102899 OF 2019 (MC) &
                                    MFA NO.102900 OF 2019 (LAC)

                        IN MFA NO.102892 OF 2019

                        BETWEEN
                        M/S BAGALKOT CEMENT & INDUSTRIES LTD.,
SHIVAKUMAR
HIREMATH                (FORMERLY CEMENT DIVISION OF
                        BAGALKOT UDYOG LIMITED) A COMPANY
                        INCORPORATED UNDER
Digitally signed by
SHIVAKUMAR
                        THE COMPANIES ACT, 1956,
HIREMATH
Location: High Court
                        AND HAVING ITS REGISTERED OFFICE
of Karnataka, Dharwad
Date: 2023.07.12
                        AT 6 FLOOR, BLOCK NO.1,
15:55:13 +0530
                        STADIUM HOUSE, VEER NARIMAN ROAD,
                        CHURCHGATE, MUMBAI-400020
                        AND ITS MANUFACTURING UNIT
                        AT BAGALKOT-587111
                        REPRESENTED BY ITS MANAGER LEGAL
                        & AUHTHORIZED REPRESENTATIVE
                        MR. A.R. NIDASESHI.
                                                                   ...APPELLANT
                        (BY SRI. ASHOK HARANAHALLI, SR. COUNSEL FOR
                            SRI. S.B. HEBBALLI, SRI. ANKIT RAJGARHIA,
                             -2-


        MS. YASHODHARA GUPTA AND
        SRI. MEERAN MAQBOOL, ADVOCATES)

AND
1.      THE SPECIAL LAND ACQUISITION OFFICER,
        BAGALKOT TOWN DEVELOPMENT
        AUTHORITY (BTDA), BAGALKOT
        PIN: 587101

2.      THE DEPUTY COMMISSIONER,
        BAGALKOT, PIN: 587101
                                        ...RESPONDENTS

(BY SRI. G.K. HIREGOUDAR, ADVOCATE FOR R1 SRI. PRABHULING NAVADAGI, ADVOCATE GENERAL SMT. VIDYAVATHI M. KOTTURSHETTAR, AAG & SRI. V.S. KALASURMATH, HCGP FOR R2)

THIS MFA IS FILED UNDER SECTION 54(1) OF LAND ACQUISITION ACT, 1984, AGAINST THE JUDGMENT AND AWARD DTD.25.04.2019 PASSED IN LAC NO.173/2003 ON THE FILE OF THE II ADDL. SENIOR CIVIL JUDGE BAGALKOT, PARTLY ALLOWING THE REFERENCE PETITION FILED U/S 18 OF L.A.ACT 1894.

IN MFA NO.102894/2019

BETWEEN:

M/S.BAGALKOT CEMENT AND INDUSTRIES LTD., (FORMERLY CEMENT DIVISION OF BAGALKOT UDYOG LIMITED) A COMPANY INCORPORATED UNDER THE COMPANIES ACT, 1956, AND HAVING ITS REGISTERED OFFICE AT 6 FLOOR, BLOCK NO.1, STADIUM HOUSE, VEER NARIMAN ROAD, CHURCHGATE, MUMBAI-400020 AND ITS MANUFACTURING UNIT AT

BAGALKOT-587 111 REPRESENTED BY ITS MANAGER LEGAL AND AUTHORIZED REPRESENTATIVE MR. A.R. NIDASESHI.

..APPELLANT (BY SRI.ASHOK HARANAHALLI, SENIOR COUNSEL FOR SRI.S.B.HEBBALLI, SRI.ANKIT RAJGARHIA, MS.YASHODHARA GUPTA AND SRI.MEERAN MAQBOOL, ADVOCATES)

AND:

1. THE SPECIAL LAND ACQUSITION OFFICER, BAGALKOT TOWN DEVELOPMENT AUTHORITY (BTDA), BAGALKOT.

PIN: 587101

2. THE DEPUTY COMMISSIONER, BAGALKOT.

PIN: 587101 ...RESPONDENTS

(BY SRI.G.K.HIREGOUDAR, ADV. FOR R1, SRI.PRABHULING NAVADAGI, ADVOCATE GENERAL, SMT.VIDYAVATHI M.KOTTURSHETTAR, AAG AND SRI.V.S.KALASURMATH, HCGP FOR R2)

THIS MFA IS FILED U/SEC.54(1) OF LAND ACQUISITION ACT, 1894, AGAINST THE JUDGMENT AND AWARD DTD:25.04.2019 PASSED IN LAC.NO.178/2003 ON THE FILE OF THE II ADDITIONAL SENIOR CIVIL JUDGE AND JUDICIAL MAGISTRATE FIRST CLASS, BAGALKOT, PARTLY ALLOWING THE REFERENCE PETITION FILED UNDER SECTION 18 OF L.A.ACT.

IN MFA NO.102895/2019

BETWEEN:

M/S.BAGALKOT CEMENT AND INDUSTRIES LTD., (FORMERLY CEMENT DIVISION OF BAGALKOT UDYOG LIMITED) A COMPANY INCORPORATED UNDER THE COMPANIES ACT, 1956, AND HAVING ITS REGISTERED OFFICE AT 6 FLOOR, BLOCK NO.1, STADIUM HOUSE, VEER NARIMAN ROAD, CHURCHGATE, MUMBAI-400020 AND ITS MANUFACTURING UNIT AT BAGALKOT-587 111 REPRESENTED BY ITS MANAGER LEGAL AND AUTHORIZED REPRESENTATIVE MR. A.R. NIDASESHI ...APPELLANT (BY SRI.ASHOK HARANAHALLI, SENIOR COUNSEL FOR SRI.S.B.HEBBALLI, SRI.ANKIT RAJGARHIA, MS.YASHODHARA GUPTA AND SRI.MEERAN MAQBOOL, ADVOCATES) AND:

1. THE SPECIAL LAND ACQUSITION OFFICER, BAGALKOT TOWN DEVELOPMENT AUTHORITY (BTDA), BAGALKOT, PIN.587101.

2. THE DEPUTY COMMISSIONER, BAGALKOT, PIN.587101.

...RESPONDENTS (BY SRI.G.K.HIREGOUDAR, ADV. FOR R1, SRI.PRABHULING NAVADAGI, ADVOCATE GENERAL, SMT.VIDYAVATHI M.KOTTURSHETTAR, AAG AND SRI.V.S.KALASURMATH, HCGP FOR R2)

THIS MFA IS FILED U/SEC.54(1) OF LAND ACQUISITION ACT, 1894, AGAINST THE JUDGMENT AND AWARD DTD:25.04.2019 PASSED IN LAC.NO.179/2003 ON THE FILE OF

THE II ADDITIONAL SENIOR CIVIL JUDGE AND JUDICIAL MAGISTRATE FIRST CLASS, BAGALKOT, PARTLY ALLOWING THE REFERENCE PETITION FILED UNDER SECTION 18(1) OF L.A.ACT, 1894.

MFA NO.102897/2019

BETWEEN:

M/S.BAGALKOT CEMENT AND INDUSTRIES LTD., (FORMERLY CEMENT DIVISION OF BAGALKOT UDYOG LIMITED) A COMPANY INCORPORATED UNDER THE COMPANIES ACT, 1956, AND HAVING ITS REGISTERED OFFICE AT 6 FLOOR, BLOCK NO.1, STADIUM HOUSE, VEER NARIMAN ROAD, CHURCHGATE, MUMBAI-400020 AND ITS MANUFACTURING UNIT AT BAGALKOT-587 111 REPRESENTED BY ITS MANAGER LEGAL AND AUTHORIZED REPRESENTATIVE MR. A.R. NIDASESHI.

...APPELLANT (BY SRI.ASHOK HARANAHALLI, SENIOR COUNSEL FOR SRI.S.B.HEBBALLI, SRI.ANKIT RAJGARHIA, MS.YASHODHARA GUPTA AND SRI.MEERAN MAQBOOL, ADVOCATES)

AND:

1. THE SPECIAL LAND ACQUSITION OFFICER, BAGALKOT TOWN DEVELOPMENT AUTHORITY (BTDA), BAGALKOT

2. THE DEPUTY COMMISSIONER, BAGALKOT.

...RESPONDENTS (BY SRI.G.K.HIREGOUDAR, ADV. FOR R1,

SRI.PRABHULING NAVADAGI, ADVOCATE GENERAL, SMT.VIDYAVATHI M.KOTTURSHETTAR, AAG AND SRI.V.S.KALASURMATH, HCGP FOR R2)

THIS MFA IS FILED U/SEC.54(1) OF LAND ACQUISITION ACT, 1894, AGAINST THE JUDGMENT AND AWARD DTD:25.04.2019 PASSED IN LAC.NO.180/2003 ON THE FILE OF THE II ADDITIONAL SENIOR CIVIL JUDGE AND JUDICIAL MAGISTRATE FIRST CLASS, BAGALKOT, PARTLY ALLOWING THE REFERENCE PETITION FILED UNDER SECTION 18 OF L.A.ACT.

IN MFA NO.102898/2019 BETWEEN:

M/S.BAGALKOT CEMENT AND INDUSTRIES LTD., (FORMERLY CEMENT DIVISION OF BAGALKOT UDYOG LIMITED) A COMPANY INCORPORATED UNDER THE COMPANIES ACT, 1956, AND HAVING ITS REGISTERED OFFICE AT 6 FLOOR, BLOCK NO.1, STADIUM HOUSE, VEER NARIMAN ROAD, CHURCHGATE, MUMBAI-400020 AND ITS MANUFACTURING UNIT AT BAGALKOT-587 111 REPRESENTED BY ITS MANAGER LEGAL AND AUTHORIZED REPRESENTATIVE MR. A.R. NIDASESHI.

...APPELLANT (BY SRI.ASHOK HARANAHALLI, SENIOR COUNSEL FOR SRI.S.B.HEBBALLI, SRI.ANKIT RAJGARHIA, MS.YASHODHARA GUPTA AND SRI.MEERAN MAQBOOL, ADVOCATES)

AND:

1. THE SPECIAL LAND ACQUSITION OFFICER, BAGALKOT TOWN DEVELOPMENT AUTHORITY (BTDA), BAGALKOT.

2. THE DEPUTY COMMISSIONER, BAGALKOT.

...RESPONDENTS (BY SRI.G.K.HIREGOUDAR, ADV. FOR R1, SRI.PRABHULING NAVADAGI, ADVOCATE GENERAL, SMT.VIDYAVATHI M.KOTTURSHETTAR, AAG AND SRI.V.S.KALASURMATH, HCGP FOR R2)

THIS MFA IS FILED U/SEC.54(1) OF LAND ACQUISITION ACT, 1894, AGAINST THE JUDGMENT AND AWARD DTD:25.04.2019 PASSED IN LAC.NO.355/2005 ON THE FILE OF THE II ADDITIONAL SENIOR CIVIL JUDGE AND JUDICIAL MAGISTRATE FIRST CLASS, BAGALKOT, PARTLY ALLOWING THE REFERENCE PETITION FILED UNDER SECTION 18(1) OF L.A.ACT, 1894.

IN MFA NO.102899/2019

BETWEEN:

M/S.BAGALKOT CEMENT AND INDUSTRIES LTD., (FORMERLY CEMENT DIVISION OF BAGALKOT UDYOG LIMITED) A COMPANY INCORPORATED UNDER THE COMPANIES ACT, 1956, AND HAVING ITS REGISTERED OFFICE AT 6 FLOOR, BLOCK NO.1, STADIUM HOUSE, VEER NARIMAN ROAD, CHURCHGATE, MUMBAI-400020 AND ITS MANUFACTURING UNIT AT BAGALKOT-587 111 REPRESENTED BY ITS MANAGER LEGAL AND AUTHORIZED REPRESENTATIVE MR. A.R. NIDASESHI.

...APPELLANT (BY SRI.ASHOK HARANAHALLI, SENIOR COUNSEL FOR SRI.S.B.HEBBALLI, SRI.ANKIT RAJGARHIA, MS.YASHODHARA GUPTA AND SRI.MEERAN MAQBOOL, ADVOCATES)

AND:

1. THE SPECIAL LAND ACQUSITION OFFICER, BAGALKOT TOWN DEVELOPMENT AUTHORITY (BTDA), BAGALKOT, PIN-587101.

2. THE DEPUTY COMMISSIONER, BAGALKOT, PIN-587101.

...RESPONDENTS (BY SRI.G.K.HIREGOUDAR, ADV. FOR R1, SRI.PRABHULING NAVADAGI, ADVOCATE GENERAL, SMT.VIDYAVATHI M.KOTTURSHETTAR, AAG AND SRI.V.S.KALASURMATH, HCGP FOR R2)

THIS MFA IS FILED U/SEC.54(1) OF LAND ACQUISITION ACT, 1894, AGAINST THE JUDGMENT AND AWARD DTD:25.04.2019 PASSED IN LAC.NO.87/2007 ON THE FILE OF THE II ADDITIONAL SENIOR CIVIL JUDGE AND JUDICIAL MAGISTRATE FIRST CLASS, BAGALKOT, PARTLY ALLOWING THE REFERENCE PETITION FILED UNDER SECTION 18(1) OF L.A.ACT, 1894.

IN MFA NO.102900/2019

BETWEEN:

M/S.BAGALKOT CEMENT AND INDUSTRIES LTD., (FORMERLY CEMENT DIVISION OF BAGALKOT UDYOG LIMITED) A COMPANY INCORPORATED UNDER THE COMPANIES ACT, 1956, AND HAVING ITS REGISTERED OFFICE AT 6 FLOOR, BLOCK NO.1 STADIUM HOUSE, VEER NARIMAN ROAD CHURCHGATE, MUMBAI-400020 AND ITS MANUFACTURING UNIT AT BAGALKOT-587 111

REPRESENTED BY ITS MANAGER LEGAL AND AUTHORIZED REPRESENTATIVE MR. A.R. NIDASESHI.

...APPELLANT (BY SRI.ASHOK HARANAHALLI, SENIOR COUNSEL FOR SRI.S.B.HEBBALLI, SRI.ANKIT RAJGARHIA, MS.YASHODHARA GUPTA AND SRI.MEERAN MAQBOOL, ADVOCATES)

AND:

1. THE SPECIAL LAND ACQUSITION OFFICER, BAGALKOT TOWN DEVELOPMENT AUTHORITY (BTDA), BAGALKOT, PIN-587101.

2. THE DEPUTY COMMISSIONER, BAGALKOT, PIN-587101.

...RESPONDENTS

(BY SRI.G.K.HIREGOUDAR, ADV. FOR R1, SRI.PRABHULING NAVADAGI, ADVOCATE GENERAL, SMT.VIDYAVATHI M.KOTTURSHETTAR, AAG AND SRI.V.S.KALASURMATH, HCGP FOR R2)

THIS MFA IS FILED U/SEC.54(1) OF LAND ACQUISITION ACT, 1894, AGAINST THE JUDGMENT AND AWARD DTD:25.04.2019 PASSED IN LAC.NO.356/2005 ON THE FILE OF THE II ADDITIONAL SENIOR CIVIL JUDGE AND JUDICIAL MAGISTRATE FIRST CLASS, BAGALKOT, PARTLY ALLOWING THE REFERENCE PETITION FILED UNDER SECTION 18(1) OF L.A.ACT, 1894.

THESE APPEALS HAVING BEEN HEARD AND RESERVED FOR JUDGMENT ON 17.04.2023 COMING ON FOR PRONOUNCEMENT OF JUDGMENT THIS DAY, R.DEVDAS J., DELIVERED THE FOLLOWING:

COMMON JUDGMENT

These Miscellaneous First Appeals are filed by a

common appellant-M/s. Bagalkot Cement & Industries

Limited, aggrieved of the common judgment dated

25.04.2019 passed in LAC No.173 of 2003 and

connected matters by the II Additional Senior Civil

Judge & JMFC, Bagalkot (hereinafter referred to as

'Reference Court' for short) under the provisions of

Section 18 of the Land Acquisition Act, 1894

(hereinafter referred to as 'the L.A. Act') rejecting the

claim of the appellant for award of compensation in

respect of the sub-soil/minerals underneath the soil of

the acquired properties. Since the parties to the

proceedings are common and the issue raised is also

common, these appeals are disposed of by this

common judgment.

2. At the threshold, we should make it clear that

although prayers are made in all these appeals

seeking enhancement of compensation even in respect

of the acquired lands (top-soil), nevertheless, no

arguments have been canvassed on behalf of the

appellant in that regard. Therefore, these appeals are

confined to the issue as to whether the appellant is

entitled for award of compensation in respect of the

minerals lying underneath the sub-soil of the acquired

lands.

3. Earlier too, the appellant was before this

Court by filing MFA Nos.20112/2011 (LAC) c/w 20113-

20120/2011 (LAC) aggrieved by the common

judgment passed by the Reference Court in LAC

No.173 of 2003 and connected matters, wherein the

Reference Court enhanced the compensation at

Rs.630/- per sq.mtr. in certain cases and in certain

other cases at Rs.800/- per sq.mtr. and Rs.880/- per

sq.mtr. along with 12% additional market value on

the enhanced compensation amount from the date of

4(1) notification till the date of possession. 30%

solatium was also granted on the enhanced market

value. Further, in terms of Section 28 of the L.A.Act,

the interest on the compensation was directed to be

paid at the rate of 9% per annum on the enhanced

compensation amount for the 1st year and thereafter

at the rate of 15% per annum for the subsequent

years till deposit of the enhanced compensation

amount. This Court having found that since sufficient

evidence is not available on record in respect of the

extent of limestone deposit beneath the sub-soil, the

matter requires reconsideration at the hands of the

Reference Court. It was also held that the Reference

Court was required to take into consideration various

judgments considered by this Court, including the

case of Thressiamma Jacob and Others Vs.

Geologist, Department of Mining and Geology

and Others, (2013) 9 SCC 725 and consider

whether the appellants were entitled for award of

compensation in respect of the minerals lying beneath

the sub-soil. On remand, fresh evidence were lead on

behalf of the appellant-company examining 7

witnesses and several documents were also got

marked. Having regard to the judgments cited by the

learned Counsels, including the case of Thressiamma

Jacob (supra), the Reference Court was of the opinion

that the appellant-company was not holding a valid

mining licence and the mining activities were carried

on without a valid licence. Accordingly, the claims of

the appellant for compensation in respect of the

limestone deposits were rejected.

4. The learned Advocate General appearing on

behalf of the respondents submitted that one

important provision of law which would clearly

establish the sovereign rights of the minerals lying

beneath the sub-soil in favour of the State is Section

70 of the Karnataka Land Revenue Act, 1964. On the

other hand, learned Senior Counsel Sri.Ashok

S.Haranahalli, appearing on behalf of the appellant

submitted that there is a separate enactment which

deals with the grant of compensation in respect of the

mines and minerals in The Land Acquisition (Mines)

Act, 1885. Learned Senior Counsel submitted that in

terms of the said statute and its provisions, more

particularly, Section 3, whenever a notification is

published under Section 6(1) of the L.A.Act, a

declaration is also required to be made by the

appropriate Government making a statement as to

whether the mines of coal, iron-stone, slate or other

minerals lying in the soil are not needed. Section 4

requires a notice to be given to any person who is

entitled to extract the mines and minerals.

Opportunity is required to be given to such persons

who are otherwise entitled to extract the mines and

minerals. Section 5 provides that if the works

undertaken consequent to the acquisition proceedings

would cause harm to the interest of such persons

having rights over the mines and minerals, then the

appropriate Government is required to give a

declaration of its willingness to pay compensation

either in respect of mines or minerals remained un-

extracted or to pay compensation to all such persons

in consideration of their intrinsic rights in respect of

the mines and minerals. Learned Senior Counsel

would therefore submit that the Reference Court

having accepted the contention that the appellant is

the owner of the lands and for that matter having

awarded compensation in respect of the acquired

lands, cannot deprive the appellant of its rights to

seek compensation for the minerals lying beneath the

soil, more so, because the appellant-Company which

was carrying on the business of production of cement

was extracting the limestone required for the said

purpose from the lands after having obtained the

required licence.

5. However, when it was pointed out that both

these provisions were not brought to the notice of the

Reference Court and in the normal course, the matter

will have to be reconsidered by the Reference Court,

the learned Advocate General and the learned Senior

Counsel submitted that since it is a question of law,

the same can be decided by this Court. It was agreed

that if this Court comes to a conclusion that the

appellant-Company is entitled for award of

compensation in respect of the limestone deposits

lying in the lands in question, then the matter may be

remitted to the Reference Court for determination of

the compensation to be awarded.

6. This Court, therefore, proceeds to consider

the question of law as to whether the appellant herein

is entitled for award of compensation in respect of the

limestone deposits in the acquired land.

7. Insofar as Section 70 of the Karnataka Land

Revenue Act, 1964 is concerned, the provision saved

all rights of mines, minerals and mineral products in

terms of any express provisions of law which were in

force before the commencement of the Act, in favour

of the owners of the land. However, the provision was

sought to be amended by Act No.20 of 1993,

substituting the words 'save as otherwise expressly

provided under' by 'notwithstanding anything

contained in', thereby taking away the legitimate

rights of the owners of the land in respect of the

minerals lying beneath the soil. The amended

provision was challenged by some of the owners of

the land before this Court. Two conflicting decisions

were rendered and consequently, the matter was

considered by a Full Bench in the case of

State of Karnataka Vs. Dundamada Shetty, reported

in ILR 1993 KAR 2605. The Full Bench held that the

State Legislature wanted to introduce the Bill by which

ownership rights of minor minerals which were vested

in the pattadars were sought to be divested and

vested in the State. However, it was held that if the

State Legislature wanted to divest such rights, it could

not do so without giving any compensation. The

amending provision was therefore, held to be in

contravention of Article 254 (1) which provides that if

any provision of law made by the State Legislature is

repugnant to any provision of law made by Parliament

which Parliament is competent to enact, or to any

provision of an existing law with respect to one of the

matters enumerated in the Concurrent List, then,

subject to the provisions of Clause (2), the law made

by Parliament, whether passed before or after the law

made by the Legislature of such State, or, as the case

may be, the existing law, shall prevail and the law

made by the Legislature of the State shall to the

extent of the repugnancy, be void. Consequently, the

amended provision was struck down. As a

consequence, the provision once again reads as

follows:

"70. Right to mines and mineral products to vest in Government.- Save as otherwise expressly provided under any law in force before the commencement of this Act or under the terms of any grant made or of any other instrument of transfer executed, by or on behalf of Government for the time being, the right to mines, minerals and mineral products, shall vest absolutely in the State Government and the State Government shall, subject to the provisions of the Mines and Minerals (Regulation and Development) Act, 1957 (Central Act No.67 of 1957), have all the powers necessary for the proper enjoyment or disposal of such rights."

8. The Full Bench also decided the question as to

whether the owners of the land were entitled to mine

and extract the minerals lying beneath the soil,

without obtaining the requisite licence under the

provisions of the Karnataka Minor Minerals Concession

Rules, 1969, and such other laws. It was held in point

No.6 that insofar as the holders of patta lands in Ex-

Madras State areas which later formed part of

Karnataka State, they have partial ownership rights in

the minerals found in the sub-soil of their lands

occupied by them. The State has also a share in the

minerals and hence, the holders of such patta lands

will have to follow the provisions of Chapter-V of the

Karnataka Minor Minerals Concession Rules, 1969,

even if they themselves want to exploit the mineral

found in the sub-soil of their lands. They were also

required to follow the provisions of Rule 62A of the

said Rules, at the stage at which they seek to

transport the minerals quarried by them from their

own lands.

9. It was also declared that the holders of patta

lands situated in Ex-Mysore State territory now

comprised in Karnataka State and who are not holders

of lands granted under Karnataka Government Grant

Rules are full owners of sub-soil minor minerals

situated in their patta lands and they are entitled to

carry on quarrying operations by themselves qua the

minor minerals without any restrictions from the State

authority under the Minor Minerals Concession Rules,

subject to the rider that they have to follow Rule 62A

of the Rules at the stage of transporting the quarried

minerals insofar as the said Rule would apply to such

material sought to be transported. However, the

learned Advocate General and the learned Senior

Counsel Sri Ashok S.Haranahalli, agree in cohesion

that no decision is forthcoming from the Full Bench

insofar as the land holdings in Ex-Bombay territory

which are now within the State of Karnataka. We are

concerned with the lands which were earlier in the

Bombay province and now within the State of

Karnataka.

10. But, what is to be noticed is that the Hon'ble

Full Bench has in detail considered various provisions

in various statutes and rules while considering the

extent of rights of the pattadars in carrying out mining

operations to extract minor minerals. In that regard,

the Hon'ble Full Bench has held insofar as Ex-Mysore

State areas forming part of Karnataka State are

concerned that the owners of patta lands had full

ownership rights in the minerals and they need not

follow any regulatory procedure of Karnataka Minor

Minerals Concession Rules, 1969, save and except

Rule 62A of the Karnataka Minor Minerals Concession

Rules, while transporting such quarried minerals

insofar as Rule 62A being applicable to such material.

Having this in mind, when we consider the relevant

provisions of the Karnataka Minor Mineral Concession

Rules, 1994, in Chapter-V, we find that in this Chapter

pertaining to quarrying of minor minerals in private or

patta lands are concerned, Rule 32 mandates that no

person in possession of patta lands in Karnataka State

shall undertake quarrying operation of minor minerals

except with a quarrying licence granted under that

Chapter. In consonance with such requirement, it

appears that the appellant herein obtained mining

licence commencing from the year 1970. Even as per

the written submission of the learned Advocate

General, the appellant applied for renewal on

16.01.1989. The second renewal was sought on

29.10.1994, much prior to the issuance of the first

4(1) notification, which was issued in the year 1999.

11. It is noticeable that if such pattadar applies

for licence/permission under Rule 32, the competent

authority is required to confirm the title, status of land

with the Deputy Commissioner in case of specified

minor mineral and with the Tahsildar in case of non-

specified minor mineral. Further, in terms of sub-rule

(10) of Rule 32 of Rules, 1994, the pattadar, the

holder of licence, is required to pay in addition to the

royalty, an amount which is equal to the 'Average

Additional Periodic Payment' if the mineral right of

minor mineral do not vest with the pattadar. This

provision will have a direct bearing on the issue which

we are concerned with. It becomes clear that if in the

opinion of the competent authority, while issuing the

licence/permission in favour of a pattadar, the mineral

rights of minor mineral has not vested in the pattadar,

having regard to the applicable provisions of law,

depending on whether the land was earlier in the Ex-

Mysore province, Ex-Madras province, Ex-Bombay

province or Ex-Hyderabad province, the competent

authority would have levied and collected the Average

Additional Periodic Payment, in addition to the royalty.

The easiest way therefore, to find out as to whether

the mineral rights in the lands in question vested with

the appellant herein or not, we may look into the

mining licence/permission and the relevant records, in

terms of sub-rule (10) of Rule 32 of Rules, 1994.

12. In the matter of determining the

compensation payable in respect of the mineral rights

present beneath the sub-soil of an acquired land, it

would be relevant to notice paragraphs-74 to 77 of

the decision in Union of India Vs. Pramod Gupta and

Others, reported in (2005) 12 SCC 1. Paragraphs-74

to 77 read as follows:

"74. We are not suggesting, as at present advised, that mineral rights or rights over minerals can in no situation remain in the

hands of the private individuals. There may be cases where having regard to the statutory provisions, the mineral rights may continue to remain in the hands of the private owners. But while examining the question of computing the quantum of compensation, the Courts are required to bear in mind the extent of such rights and in particular the statutory provisions which prohibit carrying out mining operations without obtaining appropriate mining lease, prospective licence or permits. The Courts must also bear in mind that even in a case where owners are entitled to the minerals having regard to the provisions contained in the Punjab Minor Mineral Rules, 1934, the amount of compensation would be much less and with the acquisition of land the right to use the minerals would come to an end.

Compensation for such minerals may not be computed on the basis of the profits earned by a mining lessee having a valid mining lease therefor. Furthermore, a person having a right to use mines and minerals for his personal use and not for sale will still have to obtain an appropriate permit in terms of the statutory provisions. It may not be out of place to notice

that right to receive royalty is a mineral right as has been held by Wanchoo, J. in Hingir Rampur Coal Co. Ltd. vs. State of Orissa, AIR 1961 SC 459. [See also India Cement Ltd. and Others Vs. State of Tamil Nadu and Others, (1990) 1 SCC 12]

75. Minerals may be found in mineral-bearing land. Mineral-bearing land may, thus, contain mineral as the product of nature.

76. Thus, in a case it may be theoretically possible for the State to grant a mining lease of quarry or permit, in favour of an applicant in respect of an area over which a mineral right is also held by a private owner but in that event the private owner would be only entitled to royalty. The legislative intent contained in the 1957 Act envisages that even in certain cases the Central Government or the State Government, as the case may be, in the event of their undertaking of mining operations from the land belonging to the private owners may have to pay royalty to them. The rate of royalty, however, will be limited to the amount prescribed in the 1957 Act or the rules framed thereunder.

77. The amount of compensation, therefore, in view of the statutory provisions will depend upon several factors, as noticed hereinbefore. In any event, the profit earned by illegal mining i.e. carrying on mining operations contrary to the 1957 Act or the rules framed thereunder, would by no means be a safe criteria for determining the amount of compensation."

(Emphasis supplied)

13. The matter therefore stands remanded back

to the Reference Court specifically for the purpose of

looking into the mining licence/permission and other

relevant documents issued by the competent authority

in terms of Rule 32 of the Rules, 1994 or any other

Rules prior to the said Rules, holding the field, since

admittedly mining licence was granted in favour of the

appellant, first in the year 1970. The Reference Court

shall find out as to whether the competent authority,

while granting the mining licence in favour of the

appellant collected 'Average Additional Periodic

Payment' in addition to the royalty, as provided in

sub-rule (10) of Rule 32. If it is found that such

Average Additional Periodic Payment was collected

while issuing the licence in favour of the appellant,

then it can be concluded that the mineral rights of the

limestone deposits in the lands in question or any

other minor mineral did not vest with the appellant.

On the other hand, if such Average Additional Periodic

Payment was not collected, then it can be concluded

that the competent authority and the State have

admitted to the appellant's mineral rights of the minor

minerals in the lands in question. After arriving at

such decision, the Reference Court may proceed to

consider the claim of the appellant for award of

compensation in respect of the limestone deposits in

the acquired land and pass a judgment in accordance

with law.

14. While reconsidering the material already

available on record, if the Reference Court feels that

sufficient information is not available which would

throw light on whether the competent authority has

levied and collected the Average Additional Periodic

Payment or not, the Reference Court may call upon

the parties to lead further evidence and place

additional evidence on record.

15. For the reasons stated above, the

Miscellaneous First Appeals are partly allowed. The

impugned common judgment dated 25.04.2019

passed in LAC No.173 of 2003 and connected matters,

is hereby set aside.

16. The parties are directed to appear before the

II Additional Senior Civil Judge and JMFC at Bagalkot

on 01.08.2023, without waiting for further notice. The

learned Senior Civil Judge shall endeavor to dispose of

the cases as expeditiously as possible and at any rate

within a period of six months from 01.08.2023.

17. The parties are also directed to co-operate

with the Reference Court and ensure that the court

can dispose of the matters within the time stipulated

by this Court.

Ordered accordingly.

Pending I.As, if any, stand disposed of.

Sd/-

JUDGE

Sd/-

JUDGE

DL/JT