Orissa High Court
M/S. Balasore Alloys Limited (Formerly ... vs State Of Odisha on 7 January, 2025
IN THE HIGH COURT OF ORISSA AT CUTTACK
W.P.(C) No.14221 of 2024
1. M/s. Balasore Alloys Limited (Formerly known as Ispat Alloys
Limited), a Company incorporated under the Companies Act, 1956,
having its registered office and works at Balgopalpur, P.O. Rasulpur,
Via-Mitrapur, Balasore, District: Balasore, Orissa- 756020, represented
through its President (Finance & Accounts) Sri Ram Gopal Agarwal,
S/o-Late Ganpat Ram.
...Petitioner
-Versus-
1. State of Odisha, represented by the Additional Chief Secretary to
Government, Department of Steel and Mines, At./P.O.- Bhubaneswar-
751001, Dist.- Khurdha, Odisha.
2. Odisha Mining Corporation Limited, having its registered office
At-OMC House, Unit-V, Bhubaneswar-751001 represented by its
Managing Director.
3. Director (Operations), Odisha Mining Corporation Limited, At
OMC House, Unit-V, Bhubaneswar-751001.
...Opposite Parties
Advocates appeared in the case:
For the Petitioner : Mr. Pinaki Mishra,
Senior Advocate
Mr. S. P. Mishra,
Senior Advocate, assisted
by Mr. Naveen Kumar,
Advocate
W.P.(C) No.14221 of 2024 Page 1 of 25
Mr. S. D. Das, Senior
Advocate assisted by
Mr. Haripad Mohanty,
Advocate
For Opposite Party No.1 : Smt. Suman Pattanayak,
Additional Government
Advocate
For Opposite Parties No. 2 and 3 : Mr. Sanjit Mohanty,
Senior Advocate along
with Mr. Pravat Kumar
Muduli, Advocate
For Intervener : Mr. Asok Mohanty,
Senior Advocate
Ms. Pallavi Mohanty,
Advocate
CORAM:
HON'BLE THE CHIEF JUSTICE
HON'BLE MISS JUSTICE SAVITRI RATHO
JUDGMENT
07.01.2025
Chakradhari Sharan Singh, CJ.
1. The petitioner is a Company incorporated under the provisions
of the Companies Act, 1956. It is one of the pioneer manufacturers of
different types of high carbon ferro chrome and has its factory at two
places, one at Balgopalpur in the district of Balasore and the other at
Sukinda in the district of Jajpur, Odisha. Chromite ore is the main raw
material required for the ferro chrome, which is manufactured by the
petitioner. The petitioner had applied for mining lease of chromite
mines at Kaliapani, which was allowed by the State with the condition,
inter alia, that the mineral raised from such mines shall be used by the
petitioner purely for captive purposes i.e., the minerals so raised could
only be used at the end-use-plant of the petitioner's company set up in
the State of Odisha; whereafter, it was continuing mining operations
over the mining lease area since September, 2000, upon obtaining all
statutory permits/approvals including Environmental Clearance ('EC'
in short).
2. In the background of facts set out in the writ petition, the
petitioner is seeking, in the present writ petition, direction to the
Odisha Mining Corporation Limited ('OMCL', in short) to allocate
chrome ore to the petitioner in terms of the Sales Agreement dated
20.04.2022 (Annexure-3) to the writ petition, and to allow the
petitioner to participate in the national e-auction for chromite ore in
terms of Long Term Linkage ('LTL' in short) Policy of minerals for
Odisha-based industries through OMC-2022 and 2023. It is the
petitioner's case that to ensure raw materials supply to the industries
set up inside the State, the Government of Odisha had formulated a
policy for LTL of Iron, Chrome Ore and other minerals through OMC
Limited in 2014 (LTL Policy, 2014), which was subsequently amended
through Notifications dated 30.04.2015, 18.11.2015 and 10.08.2018.
The petitioner being eligible under the said policy had approached for
LTL with the OMCL for allocation of chrome ore to both of its plants
set up in the district of Jajpur and Balasore as noted above. The
petitioner was communicated LTL for a period of five years by the
OMCL with an intimation that annual sales quantity allotted in favour
of the petitioner was 55091MT of chrome/chrome concentrate. The
petitioner was asked to sign LTL sales agreement for the period
January, 2020 to December, 2020. An agreement was accordingly
executed for LTL of chrome ore. After expiry of the term, the
petitioner again applied for execution of its agreement in terms of the
LTL Policy in vogue. Pursuant thereto, two "Sales agreement for
Chrome Ore" were executed between the petitioner and OMCL for a
period of five years from 01.04.2022 to 31.03.2027 in respect of the
two plants at Sukinda and Balgopalpur. Though the said sales
agreements were to remain valid for a period of five years in terms of
Clause 16 thereof, it clearly envisaged that if either of the parties
desired for any extension, they could request the other party with prior
notice in writing of its such intention, at least one month before expiry
of the period stipulated in the agreement.
2.1. There was, however, a condition in the agreements that the
same was on year-to-year basis depending on the performance of the
buyer every year and was liable to be extended to the next year at the
discretion of OMCL. The said stipulation in the agreements was
admittedly in the light of the General Principle of LTL Policy, 2014
which required annual review, based on the performance of the linkage
in terms of 'off take' trends, plant capacity enhancements, regularity of
off take and ability to make payments on time, etc..
3. It is the petitioner's contention that the said terms of the
agreements are at conflict with each other inasmuch as though the
terms/duration of the agreement was agreed to be 'five years', the same
was on year to year basis subject to extension at the sole discretion of
OMCL. Later, the State Government introduced "LTL Policy of
Minerals for Odisha Based Industries through Odisha Mining
Corporation Limited-2022" ('LTL Policy, 2022' in short) in order to
meet the practical problems faced in course of implementation of LTL
Policy, 2014 and considering increase in raising of minerals by OMCL.
4. One year after the date of execution of the said sale
agreements dated 20.04.2022, the same were reviewed by the OMCL
and amended sales agreements dated 06.04.2023 were executed with
reduced annual sales quantity of 1,44,100MT for the factory at
Balgopalpur and 14,300MT for the plant at Sukinda. Other terms of the
sales agreements dated 20.04.2022 remained unaltered, valid upto
31.03.2024. It is further case of the petitioner that consequent upon the
aforesaid amendment, the petitioner was receiving the chrome ore as
agreed till 31.03.2024 and as envisaged under the sales agreements
dated 20.04.2022 mandating review of the agreements in respect of
annual sales quantity of the petitioner, it submitted an application on
29.02.2024 before the Director, OMCL (O.P. No.3) for LTL allocation
for the financial year 2024-25. The petitioner in his LTL allocation
application disclosed its monthly requirement to be 13,662MT for
Balasore plant and 1,475MT for Sukinda plant. It further mentioned in
the application the total annual requirement of both the plants of the
petitioner was 40,650 TPA and the underground mines of the petitioner
being yet to be functional, only 2,19,997MT of chrome ore was
available for the captive mines of the petitioner at Kaliapani mines and
as such there was deficit of 1,81,653 TPA. The petitioner accordingly
applied for allocation of LTL chrome ore in terms of sales agreements
dated 20.04.2022 since it was valid for five years, upto 31.03.2027.
Finding no response from the opposite parties, the petitioner again
wrote a letter to the OMCL stating that though the petitioner had a
captive chrome ore mines at Kaliapani, Jajpur district and had an EC
for quantity of 6,00,000 MTPA, but owing to on site problems at mines
site, such as severe scarcity of dumping space, delay in start up of
underground mining and reaching ultimate pit limit for open cast
mining method, the petitioner was unable to meet its captive
requirement of 3,50,000 MTPA. In the said communication dated
30.04.2024, the petitioner also mentioned that it had approached the
State Government way back in 2016 for immediate allotment of ore
from OMC to meet shortfall quantity. The mining operations for
captive mines of the petitioner were suspended by the Deputy Director
Mines, Jajpur ('DDM' in short) vide letter dated 06.06.2022 for want
of statutory clearance until further orders and as a result of which, the
plants could not run properly. The situation worsened as Tata Power
Northern Odisha Distribution Limited disconnected power supply to
both the plants of the petitioner for non-payment of dues. The forest
clearance was subsequently granted and accordingly the order of
suspension of mining was revoked by the DDM, Jajpur by a
communication dated 15.02.2024, according to the petitioner.
5. It is the further case of the petitioner that in its communication
dated 30.04.2024, it had stated that taking all options available with it
till expiry of temporary working permit on 02.02.2025, there still
remained a gap of 1,81,653 MTPA and accordingly had requested for
supply of an earlier allotment of the said amount of chrome ore, and, to
allow it to take part in e-auction as usual for uninterrupted operation of
its plants. It is the petitioner's grievance that the opposite parties have
not responded to its communication dated 30.04.2024 as regards non-
allocation of the chrome ore from 01.04.2024 to 31.03.2025 nor the
petitioner is being allowed to participate in the e-auction for chrome
ore, though other similarly situated industries are being permitted to
participate in e-auction. The petitioner has grievance against the
opposite parties that even if the clause in the sales agreements dated
20.04.2022, to the effect that the same was on year-to-year basis
depending on the performance of the buyer every year was to be
applied on the ground that the OMCL was not satisfied with the
performance of the buyer (petitioner), it was incumbent upon the
OMCL to issue notice to the petitioner calling for its explanation or at
least bringing to the knowledge of the petitioner about its
underperformance. Abrupt stoppage of allocation of chrome ore in
terms of the sales agreements in the absence of any notice or intimation
and at the same time prohibiting the petitioner from participation in e-
auction for procurement of chrome ore is unsustainable, being violative
of the principles of natural justice, the petitioner contends. It is also the
petitioner's case that in view of the prevailing policy formulated by the
State in its Steel and Mines Department, the petitioner had a legitimate
expectation that in the event, there was a shortfall of minerals from its
captive mines or for another reason, it would be made available an
assured quantity of chrome as agreed. Relying on the General Principle
for sustained supply of minerals to State based industries through
OMCL as contained in LTL Policy 2022, which according to the
petitioner was in vogue on the date of execution of sale agreement, the
petitioner asserts that in terms of Part (A), Sub-Clause-(d), in case an
end-user industry is unable to produce the mineral in its own lease as
per the authorized production capacity due to reasons beyond its
control, the Allotment Committee has authority to allow linkage of
shortfall quantity by OMC through annual supply agreement to such
eligible State-based end-user industries. Further, Part (C) of LTL
Policy 2022, which deals with Chromite Ore Linkage stipulates that
State-based end-user plants having long-terms linkage can also take
part in National e-auction and OMCL is required to endeavour to meet
requirements of supply of chromite ore to such industries. This is the
factual background in which the writ petition has been filed seeking
direction, as has been noted hereinabove.
6. A counter affidavit has been filed on behalf of the OMCL
resisting the petitioner's claim. It has been stated that in order to ensure
supply of raw materials to industries set up inside the State, LTL
Policy was framed by the State Government by a notification dated
17.09.2014 for supply of iron ore, chrome ore and other minerals to the
MoU signed steel plant companies of Odisha through OMCL. The said
policy was superseded by the LTL Policy, 2022 dated 16.08.2022. The
said LTL Policy was further superseded by LTL Policy, 2023 vide
notification dated 21.06.2023, which is in force.
7. The LTL Policy, 2023 provides that the quantity to be assured
under LTL will be determined by an Allotment Committee consisting
of the Secretary, Steel & Mines Department, Secretary, Industries,
Director of Mines, Government of Odisha, MD, IPICOL and MD,
OMCL. The said Committee in its meeting held on 07.03.2024, fixed
the allotment criteria and decided that allotment be made after
deducting the EC Capacity of the end-user own mines. The petitioner
has a captive mine at Kaliapani and the quantity permitted in the EC is
6 lakh MT per annum, which is sufficient to meet the requirement of
both the plants of the petitioner. After deduction of the quantity
mentioned in the EC and taking into consideration the fact that
requirement of chrome ore of the petitioner is sufficient from its own
captive mines matching the EC capacity, no allotment has been made
in favour of the petitioner for the year 2024-25 by the Allotment
Committee. If the petitioner, who is having an existing mining lease
with all clearances to operate the mines without any hindrance, is
allowed to lift the chrome ore under the LTL agreement, then each and
every mining leaseholder of the State will claim execution of LTL
Sales Agreement and in that process, the main object of grant of
mining lease by the State Government for earning revenue will get
frustrated.
8. This is how opposite party No.2 has justified its action of non-
execution of LTL agreement for the year 2024-25 with the petitioner.
Since the petitioner is not an LTL holder for the year 2024-25, it
cannot be permitted to participate in the national e-auction.
9. It has been reiterated that the object of the LTL Policy is that
where a State based end-user industry after lifting of the LTL quantity
falls short of its requirement of ore, in such a case, the State based end-
user industry is allowed to participate in the National e-auction process
so that the short fall quantity can be made good. In case each and every
State based end-user industry is allowed to participate in the National
e-auction process, the very aim and object of grant of mining lease will
be frustrated.
10. The chrome ore being a scarce commodity, is allotted
judiciously and, therefore, those end-users having their own mines of
chrome ore are encouraged to produce chrome ores from their own
mines to cater to their end use requirements so that other end user
industries of the State who are having no captive mines for their
captive requirement and in need of chrome ore, can be allotted with the
chrome ore.
11. The Board of Directors of OMC in its meeting held on
13.07.2018 had decided not to allow the chrome ore lessees without
LTL agreement to participate in the National e-auction for chrome ore
and chrome concentrate.
12. It has also been asserted that the two sales agreement for
chrome ore for a period of 5 years were signed but with clear
stipulation that the said agreement was between the parties on year-to-
year basis. Clause 21 of both the sales agreements provide that
notwithstanding anything contained in any of the clauses of the sales
agreements, the agreements shall be reviewed every year. Accordingly,
in consonance with such clause of the sales agreement, the sales
contracts were reviewed and fresh sales agreements were executed with
the petitioner for the year 2023-24.
13. Further, the order of suspension of mining operation has been
revoked by the DDM, Jajpur by an order dated 15.02.2024 and thus,
the petitioner is allowed to continue with the mining operation. It has
also been stated that the production capacity of the mines at Kaliapani
is 5,12,746 MTPA as per the approved mining plan. The production
envisages 3,00,107 MTPA from opencast mining. Accordingly, the
production capacity of the petitioner is much more than the quantity of
minerals required.
14. Responding to the averments made in paragraph 18 of the writ
petition that owing to on site problems, the petitioner was unable to
meet its captive requirement of 3,50,000 MTPA, it has been stated in
the counter affidavit that the same is incorrect. The scarcity of dumping
space, delay in start-up of underground mining and non-reaching of the
ultimate pit limit, cannot be a ground not to continue with the mining
operation. The chrome ore production is limited.
14.1. The sum and substance of the stand of the OMCL in its
counter affidavit is that as per the declaration dated 04.03.2024 of the
petitioner, the existing captive production capacity of its mines is
5,12,746 MT per annum which is much more than the annual ore
requirement of 4,01,650 MT as per Consent to Operate (CTO) and,
accordingly, the Allotment Committee in its meeting held on
07.03.2024 did not allot any quantity for the year 2024-25 in favour of
the petitioner.
15. It has also been asserted that since no allotment was decided
to be made in favour of the petitioner for the year 2024-25, no LTL
agreement was signed for the said period. The petitioner being not an
LTL holder for the year 2024-25, cannot be permitted to participate in
the National e-auction.
16. A rejoinder has been filed to the counter affidavit, wherein by
reiterating the averments made in the writ petition, it has been asserted
that the reasons assigned by the Allotment Committee for non-
allotment of mineral and rejection of the request of the petitioner to
participate in e-auction was not communicated to the petitioner. The
reasons disclosed in the counter affidavit for denial of allotment of
mineral cannot be accepted in view of the law laid down by the
Supreme Court in the case of Mohinder Singh Gill v. The Chief
Election Commissioner, New Delhi: AIR 1978 SC 851. Various
statements have been made in the rejoinder to the counter affidavit
concerning the circumstance because of which the petitioner had to
face problems for operationalization of the mining lease from the year
2014 because of which the petitioner had decided to enter into some
agreement with the OMCL to procure the raw material. Despite the
best efforts, the petitioner was unable to produce minerals from its
mines and thus, was constrained to close its plants. The petitioner
genuinely requires such ore for operationalization of its two plants and
it has no other source for procurement.
17. Detailing the circumstance in which the captive mining lease
granted in favour of the petitioner is not fully operational because of
which it requires supply of the raw materials by the OMCL, it has been
stated in the rejoinder affidavit that in terms of the mining plan
approved by the Indian Bureau of Mines, chrome production is
bifurcated into two parts, namely, opencast mining and underground
mining. The opencast mining is further bifurcated with reference to
boundary pillars. The boundary pillar mining is not feasible as on date
because of various geological and logistical issues. As regards the
underground mining, no one in the State of Odisha has been successful
to commence and carry out the underground mining. In such
circumstance, the petitioner is unable to meet its requirement and
satisfy the need for the mineral in its plants, which factual scenario has
been ignored by the OMCL and has acted purely on mathematical
formula without any reference to legitimate and genuine need of the
petitioner. It has been asserted that refusal by the opposite parties to
allow the petitioner to participate in the National e-auction for
procurement of mineral is akin to blacklisting of the petitioner from
participating in e-auction process. Because of lack of raw materials,
both the plants of the petitioner have been closed. Mere fact that the
petitioner holds a captive mining is not a valid ground for not allotting
the ore and debarring the petitioner from participating in e-auction, in
the absence of any allocation that the petitioner is selling the said
mineral or hoarding the same.
18. An intervention application has been filed vide I.A. No.8784
of 2024 on behalf of M/s. Arrk Ferro Alloys, which is said to have set
up a Ferro Chrome plant at Sarua in the district Khurdha wherein, it
has been using chrome ore as the raw material. It has no captive mines
of chrome ore. It is the case of the intervenor that it is totally dependent
upon the OMCL for supply of chrome ore. It is further the case of the
intervenor that if the writ petitioner is allowed to lift chrome ore under
the LTL agreement by the OMCL and participate in the e-auction for
the ore, the plant of the intervenor-petitioner and other plants of the
State will be closed down and will suffer irreparable loss as they have
no captive mines.
19. We have heard Mr. Pinaki Mishra, learned Senior Counsel,
Mr. S.D. Das, learned Senior Counsel and Mr. S.P. Misra, learned
Senior Counsel assisted by Mr. Naveen Kumar and Mr. Haripad
Mohanty, learned counsel appearing on behalf of the petitioner. We
have also heard Mrs. Suman Pattanayak, learned Additional
Government Advocate (AGA), appearing on behalf of opposite party
No.1, Mr. Sanjit Mohanty, learned Senior Counsel assisted by Mr. P.K.
Muduli, learned counsel appearing on behalf of opposite parties No.2
and 3 and Mr. Ashok Mohanty, learned Senior Counsel assisted by Ms.
Pallavi Mohanty, learned counsel appearing on behalf of the
intervenor.
20. Mr. Pinaki Mishra, learned Senior Counsel appearing on
behalf of the petitioner has submitted that the refusal by the OMCL to
supply minerals to the petitioner and to allow it to participate in the
National e-auction is wholly arbitrary. He has submitted that it is true
that the petitioner has been granted mining lease of chromite mines at
Kaliapani purely for captive purposes, i.e., for use at the two plants of
the petitioner's company set up in the State of Odisha with the EC for
raising 6 lakh MTPA, because of various circumstances as mentioned
in the writ petition and the rejoinder affidavit, it could not raise
adequate amount of mineral from the said mines to cater to the needs
of the two plants, which was the reason why the petitioner had to
approach the OMCL for supply of raw materials under the LTL
Policies, 2014, 2022 and 2023. He has argued that the aforesaid two
sales agreements between the petitioner and the OMCL were for a
period of 5 years with effect from 01.04.2022. He has further argued
that after one year of the sales agreements, the same were reviewed and
fresh agreements were entered into on 06.04.2023 for one year.
Considering the requirement of the raw materials, the petitioner had
again requested for LTL allocation for the Financial Year 2024-25. The
opposite parties maintained silence and did not communicate their
decision to the petitioner as regards refusal for LTL allocation for the
said period. He has argued that the requirement per annum of both the
plants of raw material is 4,39,150 MTPA. Since underground mining
of the petitioner is yet to be functional, only 2,19,997 of chrome ore
can be produced up to 02.02.2025 from the petitioner's captive mines.
There is thus deficit of 2,19,153 MTPA. The denial to allocate LTL on
the sole ground that the petitioner has statutory clearance of 6 lakh
MTPA and, therefore, cannot participate in the National e-auction, is
arbitrary as there has been no objective assessment and considered
view of the Allotment Committee of the petitioner's inability to
produce mineral from its mines, the operations of which are critically
hit by various logistical factors such as water logging, requirement of
underground mining and resources. He has argued that in all the LTL
Policies of the State Government, it has been clarified that the State
based end-user plants having Long Term Linkage (LTL) can also take
part in the National e-auction. It means, he contends that State based
end-user plants without LTL or with LTL can take part in the National
e-auction. He has argued that in LTL Policy, 2022, there was
restriction as well as exemption with respect to approved limit under
the EC in a manner that EC limit could be excluded from LTL allotted
quantity. It was, however, subject to exemption to the effect that if the
entity was unable to achieve the approved limit under the EC due to
events beyond its control, the short fall can be made good by way of
allotment under LTL. In LTL Policy, 2023, however, the exemption
clause has been deleted and thus, all the LTL beneficiaries have been
left at the mercy of the OMCL, which can act arbitrarily based on
purely mathematical calculations. He argues that deletion of exemption
of clause is arbitrary and confers whimsical power on OMCL to deny
supply of mineral as per its wishes. He has also submitted that
according to the opposite parties, the Allotment Committee in its
meeting held on 07.03.2024, had fixed the allotment criteria and had
decided and recommended that allotment be made after deducting the
EC capacity of the end-user own mines. The said decision, he
contends, contradicted LTL Policy, 2023 notified on 21.06.2023,
which has no such provision.
21. Refuting the stand that the Board of Directors of OMC in their
meeting held on 13.07.2018 had decided not to allow the chrome ore
lessees without LTL agreement to participate in the National e-auction
for chrome ore and concentrate, Mr. Mishra submits that as per the
LTL Policy, 2023, only the Allotment Committee has the jurisdiction
to decide the allotment quantity of LTL and the National e-auction.
Therefore, he contends that the decision of the Board of Directors of
the OMC dated 13.07.2018 has no legal value as on date.
22. Mr. Sanjit Mohanty, learned Senior Counsel appearing on
behalf of opposite parties No.2 and 3 submitted that the relief which
the petitioner is seeking in the present writ petition should not be
entertained on the sole ground that it has statutory clearance of around
6,00,000 TPA and has the permission to commence the mining
operations and, therefore, it is not eligible under the LTL Policy and
consequently, it cannot participate in the national e-auction by opposite
party No.2. He has reiterated the stand taken in the counter affidavit
that the petitioner had signed two sales agreements for the chrome ore
for a period of five years with effect from 01.04.2022 wherein it is
clearly mentioned that the agreement between the parties is on year-to-
year basis. Clause-21 of both the sales agreements provide that
notwithstanding anything contained in any clauses of the sales
agreement, the agreement shall be reviewed every year. In consonance
with the said Clause of the sales agreements, the sales contracts for the
year 2023-24 were reviewed and fresh sales agreements were executed
with the petitioner for the year 2023-24. He has argued that the
Allotment Committee has not allowed any chrome ore in favour of the
petitioner to meet its requirements as it had already captive mining
lease with EC capacity of 6,00,000 MT and with production capacity
of 5,12,746 MT. He has argued that no case of discrimination is made
out in the decision of the Allotment Committee in its proceeding held
on 07.03.2024 whereby cases of three mining lease holders were
recommended for allotment after deducting the EC capacity of end-
user owned mines. Taking into account the fact that the requirement of
chrome ore of the petitioner was sufficient from its own captive mines
matching EC capacity, no quantity has been allotted in favour of the
petitioner for the year 2024-25 by the Allotment Committee. He has
reiterated that as no LTL agreement for the year 2024-25 has been
executed with the petitioner for the year 2024-25 as was done for the
year 2023-24, the petitioner cannot be permitted to participate in the
national e-auction.
23. Mr. Asok Mohanty, learned Senior Counsel appearing on
behalf of the intervener has relied on the Supreme Court's decision in
case of Bishambhar Dayal Chandra Mohan and others v. State of
Uttar Pradesh and others (1982) 1 SCC 39 with special reference to
paragraph-32 thereof. He has submitted that the fundamental right to
carry on trade or business guaranteed under Article 19 (1) (g) of the
Constitution has its own limitations. He has further argued that liberty
of an individual to do as he pleases is not absolute rather it must yield
to the common good. He has submitted that if the persons having
captive mining licenses are allowed to participate in national e-auction
also, it will adversely affect the rights of such players, who have small
plants as well as other plants of the State who have no captive mines
will be closed down and will suffer irreparable loss.
24. The foremost question which arises in the present writ petition
is as to whether the petitioner which has captive mines of chrome ore
with the permitted quantity above the meeting requirements of both the
plants of the petitioner can claim by way of height its participation in
national e-auction for further allotment of the chrome ore for the
purpose of meeting the requirement of the said two plants. The LTL
Policy, 2023 clearly provides that the LTL will be determined by the
Allotment Committee which has been empowered to determine the
allotment criteria, final allocation quantity, tenure and other terms and
conditions. The Allotment Committee in its proceeding held on
17.03.2024 has fixed the allotment criteria and it had been decided that
the allotment of ore be made after deducting the EC capacity of the
end-user owned mines. Whether such criteria fixed by the Allotment
Committee can be said to be arbitrary or violative of any legal right of
the petitioner in the facts and circumstances noted above, is a question.
25. Chrome ore is a scarce mineral resource. In one of the
affidavits filed on behalf of opposite parties No.2 and 3 (reply affidavit
to the rejoinder affidavit filed on behalf of the petitioner), it has been
asserted that the petitioner is in habit of artificially inflating its captive
requirement. For the financial year 2022-23, the petitioner had
submitted an application on 27.02.2022 for a total quantity of 4,01,650
MT. However, pursuant to the decision of the Allotment Committee,
without any objection the petitioner signed the agreement for a total
quantity of 2,23,971 for its both the plants. Similarly, for the financial
year 2023-24, the petitioner made an application on 28.01.2023 for a
total quantity of 3,77,460 MT. But, pursuant to the decision of the
Allotment Committee, the petitioner signed the agreements for a total
quantity of 1,58,400 MT. In the LTL policy issued on 21.06.2023,
procedure for allotment of chrome ore has been prescribed whereunder
expression of interest (EoI) is issued by OMC Limited for LTL for
eligible State based end-user industries of the State for purchase of
chrome ore before commencement of each financial year. Thereafter,
interested eligible State based end-user industries submit their
respective requirement of ore. The quantity allocation is determined by
a committee constituted as per the LTL policy known as the Allotment
Committee. The Allotment Committee has been granted the liberty to
determine the allotment criteria, final allocation quantity, tenure and
other terms and conditions. The applications received pursuant to the
EoI are placed before the Allotment Committee for consideration.
Considering the recommendations of the Allotment Committee, the
OMC executes the sales agreements with the State based end-user
agency. The Allotment Committee decided not to recommend the
petitioner's case, taking into consideration the petitioner's requirement,
which was sufficient from its own captive mines matching the EC
capacity for the financial year 2024-25. The reasons have been clearly
disclosed in the proceeding dated 07.03.2024.
26. In our considered view, the failure on the part of the petitioner
to produce the mineral from its captive mines as is being claimed in the
writ petition cannot be a ground for this Court to hold the decision of
the Allotment Committee arbitrary and therefore, unsustainable. The
decision of the allotment committee is in accordance with the LTL
Policy 2023. In the facts and circumstances noted above, no
interference is required in the present case under Article 226 of the
Constitution of the India.
27. This writ petition is devoid of any merit and is dismissed
accordingly.
28. All pending interlocutory applications stand disposed of.
(Chakradhari Sharan Singh)
Chief Justice
Savitri Ratho, J. I agree.
(Savitri Ratho)
Judge
M. Panda Signature Not Verified
S. Behera Digitally Signed
S.K. Guin Signed by: SUBASH KUMAR GUIN
Designation: Personal Assistant
Reason: Authentication
Location: High Court of Orissa, Cuttack
Date: 10-Jan-2025 09:35:47
