Sarda Mines Private Limited And vs Joint Director Of Mines
2021 Latest Caselaw 6122 Ori

              IN THE HIGH COURT OF ORISSA AT CUTTACK

                             W.P.(C) No.6905 of 2021


            Sarda Mines Private Limited and      ....            Petitioners
            another
                                         Mr. Kapil Sibal, Senior Advocate
                                  along with Mr. S.S. Mohanty, Advocate
                                       -versus-
            Joint Director of Mines, Joda and    ....       Opposite Parties
            another
                                        Mr. A.K. Parija, Advocate General

                      CORAM:
                      THE CHIEF JUSTICE
                      JUSTICE K.R. MOHAPATRA
                                       ORDER

07.06.2021 Order No.

06. I.A. No.7690 of 2021

1. This matter is taken up by video conferencing mode.

2. For the reasons stated, the I.A. for amendment of the writ petition is allowed. The amended writ petition be filed within one week.

I.A. No.7623 of 2021

3. This interlocutory application has been filed by the Petitioner seeking stay of the operation of the communications dated 20th and 21st May 2021, issued by the Joint Director of Mines, Joda, District-Keonjhar (Opposite Party No.1). By the first mentioned letter dated 20th May, 2021 the Opposite Party No.1 informed that the Petitioner should not exceed the pro-rata limit of

// 2 //

production of iron ore as against the quantity stipulated in the Environmental Clearance (EC) dated 22nd September 2004 in respect of the Thakurani Block-B Iron Mines.

4. By the second communication dated 21st May 2021, the Petitioner was informed that the Petitioner had already achieved production of 22,75,848 MT which had crossed the pro-rata limit of production.

5. The Petitioner states that on the above basis, the Petitioner is being prevented from producing and dispatching the already mined quantity of iron ore and all its operations would cease in due course thus causing it tremendous losses.

6. Notice was issued in this application on 31st May 2021. In response to the reply filed, a rejoinder has also been filed thereto.

7. This Court has heard the submission of Mr. Kapil Sibal, learned Senior Counsel for the Petitioner and Mr. Ashok Kumar Parija, learned Advocate General for the State (Opposite Parties).

8. Mr. Kapil Sibal, learned Senior counsel for the Petitioner submits that both the above letters have been issued without any prior intimation to the Petitioner and by misconstruing the clarification issued by the Ministry of Environment, Forest and Climate Change (MoEF) in regard to the earlier EC granted on 22nd September, 2004.

// 3 //

9. The genesis of the present issue lies in the judgment dated 2nd August, 2017 of the Supreme Court of India in Writ Petition (Civil) No.114 of 2014 (Common Cause v. Union of India) where inter alia while discussing the report of the Central Empowered Committee CEC) constituted by the Supreme Court on the issue of calculations made of the quantity of both iron ore and manganese ore mined in excess of the mining plan, the Supreme Court explained that the basis of the calculation as follows:

"(a) the production during the year 1993-94 has been considered as the permissible production during each year till the mining lease did not have the environmental clearance;

(b) the permissible production for the year in which the environmental clearance was obtained for the first time has been considered on pro rata basis of (a) the prescribed annual production and (b) the date of the grant of the environmental clearance. For this purpose the environmental clearance granted on or before 15th of a month has been considered valid for the entire month. Where the environmental clearance has been granted after 15th of a month it has been considered valid from the subsequent month. For example if the environmental clearance for a mining lease has been granted say on 10th October, 2008 for an annual production of say 12 lakh MT then in that case the permissible production for the mining lease for the year 1008-09 would be taken as 6 lakh MT (12x6/12 lakh MT) and 12 lakh MT per annum in the subsequent year; and

(c) wherever a mining lease having environmental clearance has been granted revised environmental clearance for a higher production the permissible

// 4 //

annual production for the year, during which the revised environmental clearance has been granted, has been considered on pro rata basis of the quantities prescribed in the earlier environmental clearance and the revised environmental clearance. For example if the mining lease was having environmental clearance for annual production of 12 lakh MT and say on 28th September, 2009 it has been granted revised environmental clearance for annual production of say 24 lakh MT then in that case the permissible production for the year 2009-10 would be taken as 18 lakh MT (12x6/12+24x6/12) and 24 lakh MT per annum in subsequent years".

10. Immediately relevant for the purpose of the present application is the observation in para (b) above where it was clarified that where the mining lease is granted to a party during the financial year the quantity that is permissible to be produced would be calculated pro rata for the balance period of that year. It may be noted also that specific to the Petitioner, a separate judgment dated 12th November 2018 was passed by the Supreme Court in I.A. Nos. 40 and 61 of 2015 and I.A. 111989 of 2018 in which inter alia it was noted that for the period 2017-21 the total Run of Mine (ROM) quantity permissible to be mined is 30.770 metric tonnes (MT).

11. As regards the issue whether the above requirement to work out the quantity pro rata is confined only to the first year, there appears to have been correspondence exchanged between the CEC on the one hand and the MoEF on the other. In response to a query raised in this behalf by the CEC by its letter dated 11th December 2018 specific to the case of the present Petitioner, the MoEF by its letter dated 21st December, 2018 clarified that the EC dated 29th October 2008 was

// 5 //

granted for enhancement of the production of iron ore from 4 million metric tonnes per annum (TPA) of lump iron ore (equivalent to 6.154 MTPA ROM) to 15 million TPA (ROM).

12. In particular the following comments of the MoEF in its letter dated 21st December, 2018 are relevant:

"(iii) The project proponent in its letter no. SLML/TIOM/0501, dated May 01, 2003 submitted to Ministry has mentioned that "the ultimate capacity of mine will be 4.00 mil.te/annum lump ore and this production will be achieved from 17th year onwards. Please refer Table 2.5 lat page 1-17 of EIA where it is mentioned that the lump ore and ROM produced during the last five years will be 20.00 mil.te/annum and ROM 6.154 mil.te/annum respectively". Copy of letter dated 01.05.2003 is enclosed at Annexure-V for your ready reference. In view of the above as mentioned in the EC dated 22.09.2004 to achieve the rated capacity of 4.0 MTPA during the 17th year, the ROM from the above table may be read as 6.154 MTPA (ROM) w.r.t. 4.0 Million Tonnes per annum (MTPA)] of Iron Ore (lump)." (emphasis in original)

13. As pointed out by the Petitioner, the issue has been further clarified on 21st April, 2021 by MoEF by a letter the relevant portion of which reads as under:

"1. This has reference to your representation dated 18.02.2021 wherein, a clarification has been sought from the Ministry in regard to the interpretation of Hon'ble Supreme Court judgment in WP(C) 114 of 2014 pertaining to the pro rata applicability of Environmental Clearance. It is also contended in the representation that one of mining members of PHDCC has been provided with an opinion of Justice Lokur, who was the presiding judge of the Hon'ble Supreme Court which delivered the Common Cause judgment by a mining lease holder. In the said opinion he has reiterated that the pro rata formula

// 6 //

is relevant only in the first year of the EC and not during subsequent years of operations. The production permitted as per the EC granted would be pro-rated only in the year of grant."

2. The matter has been examined in the Ministry and the legal opinion from the Department of Legal Affairs, Ministry of Law and Justice has been obtained. Based on the above, it is informed that as far as legal interpretation of Supreme Court judgment referred above is concerned, Ministry is also of the view that the pro-rata formula is relevant only in the first year of the EC and not during subsequent years of mining operations." (emphasis supplied)

14. In view of the above clarification in the MoEF the stand taken by the Opposite Party in the letter dated 21st May, 2021 that there was excess production of iron ore by the Petitioner beyond the stipulated quantity in terms of EC does not appear to be correct. Clearly the pro rata calculation of the permissible quantity to be produced was relevant only for the first year in which the EC was granted and not to the subsequent years.

15. In that view of the matter, it is directed that the letters dated 20th and 21st May, 2021 issued by the Opposite Party will not operate and the Petitioner will not, during the pendency of this petition, be prevented on the basis of the said two letters from producing and removing the quantity of iron ore subject of course to the Petitioner complying with all other applicable conditions in terms of the licence/lease and EC already granted in its favour, and as further clarified by the MoEF.

// 7 //

16. The I.A. is disposed of in the above terms.

W.P.(C) No.6905 of 2021

17. List on 5th October, 2021 the date already fixed.

18. As the restrictions due to resurgence of COVID-19 situation are continuing, learned counsel for the parties may utilize a printout of the order available in the High Court's website, at par with certified copy, subject to attestation by the concerned advocate, in the manner prescribed vide Court's Notice No.4587, dated 25th March, 2020 as modified by Court's Notice No.4798, dated 15th April, 2021.

(Dr. S. Muralidhar) Chief Justice

( K.R. Mohapatra ) Judge

S.K. Jena/PA