Patna High Court
M/S. Aditya Multicom Private ... vs The State Of Bihar, Through The ... on 9 March, 2022
IN THE HIGH COURT OF JUDICATURE AT PATNA
Civil Writ Jurisdiction Case No.11054 of 2021
======================================================
M/s Aditya Multicom Private Limited a Company incorporated under the
provisions of the Companies Act, 1956 having its registered office at 12,
Waterloo Street, 2nd Floor, Kolkata-700069, through its Authorized
Signatory, Pankaj Kumar Singh, aged about 29 years (male) son of Shri
Murali Singh, resident of Village-Balihar, P.O. Dullahpur, P.S. Simari, District
Buxar.
... ... Petitioner/s
Versus
1. The State of Bihar through the Commissioner-cum-Principal Secretary,
Department of Mines and Geology, Government of Bihar, Vikas Bhawan,
Bailey Road, Patna-800001.
2. The Principal Secretary cum Commissioner Mines, Department of Mines
and Geology, Government of Bihar, Vikas Bhawan, Bailey Road, Patna-
800001.
3. The Special Secretary cum Director, Mines and Geology Department,
Government of Bihar, Vikas Bhawan, Bailey Road, Patna.
4. The Assistant Director, Department of Mines and Geoldogy, Rohtas
Sasaram.
5. The District Magistrate-cum-Collector, Rohtas Sasaram.
... ... Respondent/s
======================================================
with
Civil Writ Jurisdiction Case No. 12178 of 2021
======================================================
M/s. Aditya Multicom Private Limited, a Company incorporated under the
provisions of the Companies Act, 1956, having its registered office at 12,
Waterloo Street, 2nd Floor, Kolkata - 700069, through its Authorized
Signatory, Pankaj Kumar Singh @ Pankaj Singh, aged about 29 years (male)
son of Shri Murali Singh, resident of Village Balihar, P.O. Dullahpur, P.S.
Simari, District- Buxar.
... ... Petitioner/s
Versus
1. The State of Bihar, through the Commissioner - cum - Principal Secretary,
Department of Mines and Geology, Government of Bihar, Vikas Bhawan,
Bailey Road, Patna.
2. The Principal Secretary, Department of Mines and Geology, Government of
Patna High Court CWJC No.11054 of 2021 dt.09-03-2022
Bihar, Vikas Bhawan, Bailey Road, Patna.
3. The Special Secretary - Cum- Director, Department of Mines and Geology,
Government of Bihar, Vikas Bhawan, Bailey Road, Patna.
4. The Assistant Director, Department of Mines and Geology Aurangabad.
5. The District Magistrate - cum - Collector, Aurangabad.
6. The Superintendent of Police, Aurangabad.
... ... Respondent/s
======================================================
Appearance :
(In Civil Writ Jurisdiction Case No. 11054 of 2021)
For the Petitioner/s : Mr. Suraj Samdarshi, Advocate
For the Respondent/s : Mr. Gyan Prakash Ozha (GA 7)
For Mining department : Mr. Naresh Dixit, Advocate
(In Civil Writ Jurisdiction Case No. 12178 of 2021)
For the Petitioner/s : Mr. Suraj Samdarshi
For the Respondent/s : Mr. Gyan Prakash Ojha ( GA 7 )
For Mining department : Mr. Naresh Dixit, Advocate
======================================================
CORAM: HONOURABLE MR. JUSTICE MOHIT KUMAR SHAH
CAV JUDGMENT
Date : 09-03-2022
Regard being had to the commonality of the
controversy in both the aforesaid writ petitions, it
was thought apposite to hear them analogously
and accordingly, they were heard together with the
consent of the parties and are being disposed of by
the present singular order.
2. The first writ petition i.e. C.W.J.C. No.
11054 of 2021 had originally been filed for
directing the respondents to remove the restriction
from generating e-challan on the portal
http://portal.biharmines.in/ forthwith and to allow
Patna High Court CWJC No.11054 of 2021 dt.09-03-2022
the petitioner to sell sand from the stock-hold
areas in the District of Rohtas, for which the
petitioner has obtained K-License under Rule 39 (1)
of the Bihar Minerals (Concession, Prevention of
Illegal Mining, Transportation & Storage) Rules,
2019 (hereinafter referred to as the 'Rules, 2019').
3. As far as the second writ petition i.e.
C.W.J.C. No. 12178 of 2021 is concerned, the same
had originally been filed for directing the
respondents to remove the restriction from
generating e-challan on the portal
http://portal.biharmines.in/ forthwith and to allow
the petitioner to sell sand from the stock-hold
areas in the District of Aurangabad, for which the
petitioner has obtained K-License under Rule 39 (1)
of the Rules, 2019.
4. During the pendency of the aforesaid two
writ petitions, some developments have taken
place leading to filing of number of Interlocutory
applications in both the cases. The petitioner, in
the first case, has filed one such interlocutory
Patna High Court CWJC No.11054 of 2021 dt.09-03-2022
application bearing I.A. No. 4 of 2021, wherein
additional relief has been sought for inasmuch as
now the petitioner seeks quashing of Memo No.
262 dated 07.07.2021 issued by the In-charge
Deputy Director, Mines and Geology, Patna Circle,
Patna, whereby and where under 17 K-licenses
issued to the petitioner in the district of Rohtas
have been cancelled. As far as the second case is
concerned, one such interlocutory application
bearing I.A. No. 2 of 2021 has also been filed
wherein an additional relief has been sought i.e.
regarding quashing of Memo No. 193 dated
17.8.2021, issued by the In-charge Deputy
Director, Mines and Geology, Magadh Circle, Gaya,
whereby and where under 11 K-licenses issued to
the petitioner in the district of Aurangabad have
been cancelled. Since the learned counsels for the
Respondents have not opposed the said
interlocutory applications, both the interlocutory
applications i.e the one bearing I.A. No. 4 of 2021
(in the first case) and the other bearing I.A. No. 2
of 2021(in the second case) are allowed. It may
Patna High Court CWJC No.11054 of 2021 dt.09-03-2022
stated that the counter affidavits filed by the
respondents also deal with the issue of
cancellation of the K-licenses of the petitioner,
hence no additional counter affidavit is required to
be filed as has also been averred by the learned
counsel for the respondents.
5. Apparently, the facts of both the cases are
more or less similar and the only difference is that
while in the first case i.e. C.W.J.C. No. 11054 of
2021, the respondents had settled the sand Ghats
situated in the District of Rohtas in favor of the
petitioner by executing an agreement dated
21.04.2015 for a period of five years i.e. from 2015
to 2019 for the purposes of extracting and
removing sand as per the provisions contained in
the Bihar Minor Mineral Concession Rules, 1972
and those contained in Government Notification
no. 277 dated 22.07.2014 as also as per the
concerned Government orders and notifications,
whereas in the second case i.e. CWJC No. 12178 of
2021 the sand Ghat situated in the District of
Aurangabad was settled in favor of the petitioner
Patna High Court CWJC No.11054 of 2021 dt.09-03-2022
vide agreement dated 24.07.2015 for a period of
five years i.e. from 2015 to 2019. Thus this Court
would be delving on the facts of the first case.
6. The brief facts of the case, according to
the petitioner of the aforesaid two cases are that
the State of Bihar had notified in the official
gazette a New Sand Policy, 2013 vide memo No.
2214 dated 27.8.2013, in pursuance to the
judgment rendered by the Hon'ble Supreme Court
in the case of Deepak Kumar Vs. The State of
Haryana, reported in (2012) 4 SCC 629, where-
after notification no. 2887 dated 22.07.2014 was
issued by the Department of Mines & Geology,
Government of Bihar, by which criteria and
procedure was laid down for settlement of sand
mines for the period 1.1.2015 to 31.12.2019.
Accordingly, the Respondent State Government
had amended the Bihar Minor Mineral Concession
Rules, 1972 w.e.f. 11.08.2014 so as to bring it in
consonance with the New Sand Policy, 2013.
Thereafter, the Department of Mines & Geology,
Government of Bihar had taken steps for initiating
Patna High Court CWJC No.11054 of 2021 dt.09-03-2022
the process of settlement of sand Ghats in various
Districts of Bihar and an advertisement was
published on behalf of the Department of Mines &
Geology, Government of Bihar for settlement of
sand Ghats by auction, for the District of Patna,
Bhojpur and Saran as one unit, Rohtas and
Aurangabad as one unit, Jamui and Lakhisarai as
one unit and other districts as individual units, for
a period of five years i.e. from 2015 to 2019.
7. The petitioner had also participated in the
auction process and was declared as the highest
bidder as far as the districts of Rohtas and
Aurangabad are concerned. Pursuant to the
issuance of the work order, an agreement was also
executed in between the parties on
21.4.2015/24.7.2015. After completion of the
requisite formalities, the petitioner had engaged in
extracting and removal of sand from the sand
Ghats in question for a period of five years and the
period of settlement / agreement had then come to
an end on 31.12.2019.
Patna High Court CWJC No.11054 of 2021 dt.09-03-2022
8. It is the further case of the petitioner that
all of a sudden, the State Government unilaterally
framed the Bihar Mining Policy-2019, which was
notified vide Notification dated 14.08.2019 and
then the State Government notified the Bihar
Minerals (Concession, Prevention of Illegal Mining,
Transportation & Storage) Rules, 2019 (hereinafter
referred to as the "Rules, 2019"), which was
published in the Bihar Gazette on 17.09.2019.
Thereafter, the Respondents had published notice
inviting e-auction for the purposes of settlement of
sand Ghats in various districts of Bihar in
accordance with the provisions contained in the
Bihar State Sand Policy 2019 and the Rules, 2019
for a period of five years, starting from the year
2020. However, it appears that the said process
was interdicted on account of a judicial
pronouncement by the National Green Tribunal,
Delhi, hence the State Government invoked the
provision contained in Rule 77(2) of the Rules,
2019. At this juncture it would be relevant to refer
to Rule 77 of the Rules, 2019 herein below:-
Patna High Court CWJC No.11054 of 2021 dt.09-03-2022
"77. Power of Government to relax the
operation of any provision of these Rules:-
(1) The State Government may, relax the
operation of one of more of the
provisions of these Rules, if, in the
opinion of the Government, such
relaxation is necessary in public interest.
(2) Notwithstanding anything contained
in these rules, the State Government, in
such case as it deems proper in public
interest, may grant a mining
lease/mining settlement and may also
authorize the grant of a quarrying permit
or movement permit to any person on
terms and conditions other than those
prescribed in these rules for reasons to
be recorded in writing:
Provided that the State Government may
grant a mining lease/settlement/in any
area under its jurisdiction to any
Government Department or State owned
Corporation on terms and conditions
other than those prescribed in these
Rules."
9. It is the further case of the petitioner that
prior to finalization of the aforesaid auction and
consequent settlement of Ghats for a period of five
Patna High Court CWJC No.11054 of 2021 dt.09-03-2022
years starting from the year 2020, the
Respondents came out with a resolution dated
27.12.2019, whereby and where-under, in exercise
of powers conferred under Rule 77(2) of the Rules,
2019, the settlement period of the existing settlees
of sand Ghats in the State of Bihar, which was to
come to an end on 31.12.2019, was extended till
31.10.2020 or till the new settlees obtain
environment clearance, whichever is earlier, upon
50% increase in the settlement amount over the
year 2019. Thereafter, the Respondent State vide
various notifications has been extending the
settlement period of the sand Ghats of the existing
settlees, which was again extended till 31.12.2020,
then till 31.03.2021 and finally till 30.09.2021,
however, upon increase in the settlement amount,
as stipulated in the various notifications issued by
the State Government from time to time. It is
stated that vide notification dated 31.03.2021, the
settlement period of the sand Ghats of the existing
settlees was extended by the Respondent State
from 01.04.2021 to 30.09.2021, upon 50%
Patna High Court CWJC No.11054 of 2021 dt.09-03-2022
increase in the settlement amount over and above
the settlement amount of the year 2020.
10. At this juncture, it is submitted by the Ld.
Counsel for the petitioner that the State
Government had come out with a resolution dated
16.12.2020, whereby and where-under the use of
trucks with 14 or more wheels for transport of sand
and stone chips was prohibited, resulting in huge
loss being suffered by the petitioner apart from the
fact that rampant illegal mining was prevailing in
the District of Rohtas and Aurangabad, hence the
petitioner was reluctant to accept the offer of
extension of settlement for the period 01.04.2021
to 30.09.2021, but it was pressurized by the
Department and finally the petitioner had
communicated its conditional acceptance to the
Department, vide letter dated 31.3.2021, wherein
it had categorically stated that in case use of
trucks with 14 wheels or more, for transport of
sand, is not allowed, it shall be constrained to
reconsider the entire matter and take appropriate
decision, including but not limiting to surrender of
Patna High Court CWJC No.11054 of 2021 dt.09-03-2022
its settlement for the remaining extended period,
without any liability to pay the royalty for the
remaining extended period. The petitioner, in
terms of the extension granted to it vide
notification dated 31.03.2021, was required to
deposit its first installment of royalty amount,
totaling to a sum of Rs. 25,47,72,242/- (in the first
case) on or before 31.03.2021, which the petitioner
had deposited by 05.04.2021 i.e. after a delay of
only five days. Thereafter, the petitioner was
directed to deposit the interest on delayed
payment, which was also deposited by the
petitioner. Subsequently, the petitioner, by its
letter dated 20.04.2021, sent to the District
Magistrate, had surrendered its settlement of sand
Ghats in the District of Rohtas and Aurangabad,
however, the same was rejected by the Collector
vide letter dated 27/29.04.2021 on the ground that
the petitioner had failed to comply with the
provisions contained in Rule 50 (1) of the Rules,
2019, hence, the petitioner was directed to deposit
the second installment of royalty amount. The
Patna High Court CWJC No.11054 of 2021 dt.09-03-2022
petitioner had then replied vide its letter dated
29.04.2021 clarifying that Rule 50(1) of the Rules,
2019 is not applicable to the petitioner and the
petitioner shall cease its mining activity w.e.f.
01.05.2021.
11. At this juncture, it would also be relevant
to quote Rules 39, 47 and 50 of the Rules, 2019,
which are reproduced herein below:-
39. (1) Every person who carried
business of minor/ major mineral beyond
any lease hold area shall obtain a
stockist license from the Mining Officer in
Form-K which shall be displayed at a
conspicuous place of business and shall
maintain proper accounts of purchase
and sale of all such minerals in a register
in form-H which shall be produced before
the Mines Commissioner, Director of
Mines, Additional Director of Mines or
Deputy Director of Mines or Mining
officer or any other officers authorised by
the Government, for inspection. Every
application for obtaining license in Form-
K shall be accompanied with a fee of Rs.
10,000/- (Ten Thousand Rupees)
Patna High Court CWJC No.11054 of 2021 dt.09-03-2022
(a) Every such license shall be valid for
one calendar year;
(b) Every such license may be
renewed on application which shall be
accompanied by a fee of Rs. 2000
(Two Thousand Rupees)
(2) Every such person as mentioned in
(1) shall issue a transport challan in
Form-'G' or in the prescribed format to
every carrier, while dispatching minerals
from his stock.
(3) If any person as mentioned in (1) fails
to maintain a register in form 'H' or
obtain license in Form 'K' or issue a
challan in Form 'G' or in the prescribed
format, shall be punishable with simple
imprisonment which may extend up to
one year or value of the mineral along
with a fine which may extend upto Rs
10,000/- or with both.
(4) No person shall be permitted to erect,
install or operate a stone crusher outside
a lease hold area.
Provided that the existing stockist license
held for stone mineral used for crusher
shall remain operational till the validity of
their license period, on the condition of
Patna High Court CWJC No.11054 of 2021 dt.09-03-2022
the licensee abiding by all the relevant
rules/provision of law / conditions stated
in their license/ conditions stated in CTE
& CTO issued by BSPCB failing which the
license shall be cancelled.
Provided further that the department
may allow installation of any crusher
including mobile crusher within a
periphery of 500 meters of the lease hold
boundary to the lease holder or person
directly engaged in construction activity
on conditions as decided by the
department.
47. Power to Suspend or Cancel
Mineral Concession. -
(1) The Collector shall be competent to
cancel / suspend any Mineral
Concession in his district.
(2) Subject to such restrictions as the
State Government may prescribe, the
Collector may suspend or cancel and
forfeit the Security Deposit/Earnest
Money Deposit of any mineral
concession in the following
circumstances after giving reasonable
opportunity of being heard -
(a) if wrong documents have been
Patna High Court CWJC No.11054 of 2021 dt.09-03-2022
furnished to obtain mineral
concession; or
(b) if the mineral concession is
transferred or sublet by the holder
thereof; or
(c) if any mining revenue payable by
the holder thereof is not duly paid; or
(d) in the event of any breach by the
holder of such mineral concession by
his servant or agent, or by any one
acting on his behalf, with his express
or implied permission, of any of the
terms and conditions of such mineral
concession; or
(e) if the holder of mineral concession
or his agent or employee is convicted
of an offence punishable under the Act
or these Rules or any other law for the
time being in force, relevant and
connected with mining matters or
matter relating to mining revenue or
of any cognizable and non-bailable
offence under any other relevant law;
or
(f) if the purpose for which the mineral
concession was granted ceases to
exist; or
Patna High Court CWJC No.11054 of 2021 dt.09-03-2022
(g) if the mineral concession has been
obtained through misrepresentation or
fraud; or
(h) If the Mineral Concession Holder
has violated any of the conditions
mentioned in these rules; or
(i) If the Mineral Concession Holder
fails to obtain the environmental
clearance or violates any of the
condition mentioned therein; or
(j) If the Mineral Concession Holder
fails to start mining operation within
three months from the date of
executing deed
(k) If, for any other reason, the
Collector is prima facie satisfied, that
the mineral concession is fit to be
cancelled.
(3) For any action taken under sub-rule
(1), the Mineral Concession Holder
shall not be eligible for any
compensation or refund whatsoever.
(4) Notwithstanding anything
mentioned above, in case of detection
of any violation of the Act, these rules
and any other condition of the mineral
concession the State Government or
Patna High Court CWJC No.11054 of 2021 dt.09-03-2022
the Collector may, apart from
cancelling the mineral concession,
also impose suitable financial
penalties and/or start criminal
prosecution.
(5) Any such penalties levied shall be
recoverable under the Public Demand
Recovery Act, 1914 (Act 4 of 1914).
50. Exit Option for Mineral
Concession Holder. -
(1) Any Mineral Concession Holder, at
any point of the Mineral Concession
period, may opt to exit the business
upon giving Six months' notice to the
Collector. However, this option is not
available to Mineral Concession Holder
who have not paid their bidding
amount or settlement amount or have
violated any condition of settlement.
(2) The Collector may allow such
Mineral Concession Holder to exit the
business and return any security
money deposited by the Mineral
Concession Holder after deducting
such dues as are recoverable.
(3) The Collector, thereupon, shall
initiate arrangement for a fresh
Patna High Court CWJC No.11054 of 2021 dt.09-03-2022
bidding.
(4) In case of fraud or violation of
mining or environmental conditions or
any other irregularities reported, no
exit option will be available to the
Mineral Concession Holder and their
security deposit shall be forfeited.
12. It is the further case of the petitioner
that the petitioner, in terms of Rule 39 of the Rules,
2019 had obtained K-License which is meant for
storage of minor mineral beyond any lease-hold
area, for which the licensee (petitioner in the
present case) is required to maintain a register in
Form-H, wherein the source of minor mineral has to
be disclosed. It is stated that any sand stored by
virtue of K- License necessarily has to suffer the
incidence of royalty which is paid by the settlee
and the transportation of such sand must precede
issuance of e-challan. Thus, it is submitted that the
entire stock held by the petitioner by virtue of K-
License has already suffered the incidence of
royalty, as such, no further tax is payable to the
Government and the only requirement is to
Patna High Court CWJC No.11054 of 2021 dt.09-03-2022
disclose the name of the consignee to the
Department. It is also the averment of the
petitioner that K-License has been issued to the
petitioner for different places in the district of
Rohtas and Aurangabad, which were valid upto
31.12.2021, nonetheless, the respondents did not
remove the restriction on selling sand from the
stock hold area, compelling the petitioner to file
representation before the learned Collector on
11.05.2021, requesting him to remove the
restriction on selling sand from the stock-hold
areas as also for directing the Mines Department to
remove the restriction on generation of e-challans
on the portal http://portal.biharmines.in/ so that
sand could be transported from stock-hold areas
for which the petitioner has K-License. The
Collector, in reply to the said representation of the
petitioner, vide letter dated 13.05.2021 informed
the Director Mines that the physical verification of
the stock-hold areas has been completed and
therefore, stockiest license of the petitioner be
restored. It is submitted that despite conduct of
Patna High Court CWJC No.11054 of 2021 dt.09-03-2022
physical verification of the stock at the stock-hold
areas, the respondents did not remove the
restriction on selling sand from the stock hold
areas and the suspension / blocking of generation
of e-challans on the portal
http://portal.biharmines.in/ continued, thus the
petitioner was not able to sell the sand stocked at
the stock hold areas for which it had already paid
royalty to the Government.
13. The learned counsel for the petitioner
has submitted that the stock lying in the stock hold
areas has already suffered the incidence of royalty
and there is no outstanding, hence, the petitioner
cannot be precluded from lifting and selling the
sand from the stock hold area of the petitioner. It is
further submitted that the K-License granted to the
petitioner is valid up to 31.12.2021 and moreover,
the petitioner has already paid advance royalty till
April, 2021, though the petitioner is not conducting
any excavation of sand currently. Thus, it is
submitted that the ownership of quantum of sand
stocked at the stock hold areas equivalent to the
Patna High Court CWJC No.11054 of 2021 dt.09-03-2022
royalty already paid by the petitioner, stands
transferred to the petitioner, hence, the petitioner
is definitely entitled to sell sand from the stock
hold area equivalent to the royalty already paid.
14. The learned counsel for the petitioner
has also submitted that no show cause notice has
been issued to the petitioner before suspension/
blocking of the e-challan. It is also submitted that
there is no provision in the Act/ Rules either for
cancellation or blocking of generation of e-challan.
Rule 47 of the Rules, 2019 lays down certain
circumstances wherein mining lease may be
suspended or cancelled. However, Rule 47(2) of
the Rules, 2019 provides that a reasonable
opportunity shall be given to the settlee for being
heard before such an action is taken. It is further
submitted that no discrepancy was found by the
Collector in the quantum of sand stocked at the
stock hold area of the petitioner, hence had
recommended for restoration of e-challan,
nonetheless, the respondents have failed to permit
the petitioner to lift/sell the sand from the stock
Patna High Court CWJC No.11054 of 2021 dt.09-03-2022
hold area. It is also the case of the petitioner that
K-license of the petitioner has been cancelled only
on account of surrender of settlement by the
petitioner, whereas the fact remains that the
petitioner cannot be debarred from K-license,
already issued to the petitioner. It is also submitted
that cancellation of K-licenses is bad in law and has
been done in violation of the principles of natural
justice inasmuch as no inspection was ever
conducted in presence of the petitioner and
moreover, no prior show cause notice has been
issued to the petitioner. It is further contended that
cancellation of K-licenses is completely dehors the
Act and Rules since there is no provision for
cancellation of K-license.
15. The learned counsel for the petitioner
has further submitted that K-licenses have not
been issued to the petitioner in the capacity of a
settlee inasmuch as K-licenses are issued for
storage of sand beyond 300 meters from river
bank and sale/ transportation of sand takes place
both from secondary loading area and K-license
Patna High Court CWJC No.11054 of 2021 dt.09-03-2022
sites and the login ID and password for K-license
and secondary loading area are separate. It is also
submitted that a settlee is free to transfer sand
from secondary loading area to K-license site and
the moment transit challans are generated for
transport of sand from secondary loading area,
deduction is made from the petitioner's capping
limit on the online portal. It is also stated that
grant of Settlement and issuance of K-license are
neither simultaneous nor co-terminus. In the
present case, the K-licenses are stated to have
been issued prior to the date of last extension and
are valid till 31.12.2021, way beyond the extension
period which was till 30.09.2021. Moreover,
according to the guidelines, K-license can be
granted to other individuals also and in the
Districts in question, there are other K-license
holders as well. It is further submitted that
issuance of K-license to the petitioner is not the
incidence of petitioner being a settlee whereas
relaxation in terms of K-license, viz as viz storage
capacity and territory of sale, are incidence of
Patna High Court CWJC No.11054 of 2021 dt.09-03-2022
petitioner being a settlee and relaxations are given
because settlee is paying a huge quantum of
royalty. Any other person who obtains a K-license
does so by paying a very small amount. It is stated
that relaxations are granted in order to protect the
interest of settlees like the petitioner and ensure
that they are able to generate sufficient revenue
and pay royalty.
16. The learned counsel for the petitioner
has further submitted that Rule 50 (1) of the Rules,
2019 applies only during mineral concession
period. According to Rule 16, duration of mineral
concession is five years. "Mineral Concession
Period" used in Rule 50(1) of the Rules, 2019
means the initial term of five years, which in the
present case was from 01.01.2015 to 31.12.2019
hence, Rule 50(1) of the Rules, 2019 does not
apply in the and circumstances of the present
case. It is also contended that since Rule 77 (2) of
the Rules, 2019 is a non-obstante clause, the same
will override the mechanism of exit option
prescribed under Rule 50(1) of the Rules, 2019,
Patna High Court CWJC No.11054 of 2021 dt.09-03-2022
hence the Rules, 2019 shall be restricted to the
procedural aspects, however, substantive aspects
like procedure of settlement, determination of
revenue etc. will not apply to the cases of
extension of lease.
17. It is also the contention of the petitioner
that admittedly, the outstanding demand against
the petitioner is regarding 2 nd, 3rd and 4th
installment of the extended period i.e 01.04.2021
to 30.09.2021. In this context it is submitted that
according to rule 26(4) of the Rules, 1972 and Rule
51(4) of the Rules, 2019, royalty is payable only for
mineral which is extracted, owned or removed,
however, since the petitioner has not conducted
any mining activity after 01.05.2021, no royalty is
payable for this period. Moreover, it is submitted
that it is not the contention of the respondents that
petitioner has extracted sand in excess of its
entitlement after paying the 1st installment. In so
far as the allegation of shortage of sand is
concerned, it is submitted that prior to cancellation
of K-license, the Sub-Divisional Officer, Dehri
Patna High Court CWJC No.11054 of 2021 dt.09-03-2022
conducted verification vide letter dated 04.05.2021
(Annexure-10 to the writ petition) and balance
stock of sand was quantified, however, no
allegation of shortage of sand was levelled in the
report. Thereafter, the Collector, Rohtas at
Sasaram, vide letter dated 21.06.2021 (Annexure-
13), directed to seize the mined sand available in
the stock/stores in the District of Rohtas to the
tune of 83,45,800 CFT and make the same
available to him whereafter, the Collector had
recommended for cancellation of K-license on
02.07.2021 but no allegation of shortage of sand
was levelled and then the K-license of the
petitioner was cancelled vide letter dated
07.7.2021. The department had then published an
advertisement on 10.07.2021 (Annexure-15) in
which the quantum of sand at the K-license sites in
Rohtas was shown to be 5,75,84,000 CFT. It is thus
submitted that since the department did not find
any shortage of sand at the K-license sites till
07.07.2021, and assumed ownership thereof w.e.f.
21.06.2021 (Annexure-13), it cannot now be said
Patna High Court CWJC No.11054 of 2021 dt.09-03-2022
that there was shortage of sand at the K-license
sites.
18. The learned counsel appearing for the
respondents Department of Mines & Geology,
Government of Bihar, Patna, Shri Naresh Dixit has
submitted that the respondents have taken action
against the petitioner on account of violation of the
conditions of settlement and the prevalent rules. It
is submitted that the Government has been taking
action against the illegal mining activity, however,
in terms of the settlement and the lease deed, it is
the duty of the settlees to mark their area and
protect the same and in case there is any illegal
mining, an FIR can very well be lodged. As far as
surrender of lease hold rights by the petitioner
w.e.f. 01.05.2021 is concerned, it is stated that the
same is totally malafide and against the statutory
provisions as also against the terms and conditions
of the work order dated 31.03.2021 issued by the
Collector, which has been unequivocally accepted
by the petitioner. It is stated that the tenure of
mining lease was extended till 30.09.2021with a
Patna High Court CWJC No.11054 of 2021 dt.09-03-2022
condition that during the rainy season there would
be no mining, however, the petitioner had, prior to
the rainy season, surrendered its lease w.e.f.
01.05.2021 with a view to deprive the State Govt.
of the settlement amount, which the petitioner was
obliged to pay for the entire period of extension. It
is stated that the petitioner is under obligation to
deposit all the installment amounts, which he had
to deposit for the period of extension of lease/
settlement period, which had been duly accepted
by it and in case the petitioner had desired to
leave the mining activities in between, it was
obliged to comply with the provisions of the Rules,
2019. Thus, it is the submission of the Ld. counsel
for the Respondents State that a settlee can leave
and surrender lease only by giving a 6 months
advance notice. It is further submitted that the
Collector had informed the petitioner company
vide letter dated 27.04.2021, in reply to its
irrelevant notice/ letter dated 20.04.2021, that
there is a clear provision contained in Rule 50 of
the Rules, 2019, which speaks about exit option of
Patna High Court CWJC No.11054 of 2021 dt.09-03-2022
a mineral concession holder, however, since the
petitioner's decision to surrender the sand
ghats/settlement made in its favor, as contained in
its letter dated 20.04.2021, is without either giving
any prior notice or paying the outstanding dues of
royalty etc., the same was being rejected and the
petitioner should deposit the 2nd installment
amount pertaining to the extended period, failing
which it was warned that necessary action would
be taken under Rule 47 of the Rules, 2019.
19. The learned counsel for the respondents
has further submitted that the petitioner has made
a false statement in the writ petition to the effect
that it has made payment of royalty of the sand
which has been stored/ stocked in the stock hold
area inasmuch as there are several demand
notices, which have been issued to the petitioner,
however, the petitioner has failed to make
payment. It is also submitted that after
surrendering the settlement, the petitioner herein
cannot use the K-license to sell sand in as much as
the said license was issued to the petitioner in the
Patna High Court CWJC No.11054 of 2021 dt.09-03-2022
capacity of a settlee, which allowed storage of
sand without any limit whereas, the general K-
license limits storage of sand to 30000 CFT only. In
fact, for a settlee, provision has been made
regarding issuance of appropriate e-challans to sell
sand from licensed place to other districts even
though there is no such provision for other licensee
for selling sand in other districts, thus the
contention of the petitioner that business from the
sand ghat and that via K-license is different, is not
correct in as much as K-license had been provided
to the petitioner only on account of him being a
settlee of the sand ghat in question. It is also
submitted that the petitioner, by taking advantage
of being a settlee, had accumulated large mass of
sand and then had surrendered the sand mining
lease w.e.f. 01.05.2021 as per a pre-designed plan
with the sole object of not paying the Government
royalty. It is thus submitted that once the petitioner
surrendered the settlement and the lease, it
ceased to be a settlee, hence it does not have the
right to continue with the K-license so granted in
Patna High Court CWJC No.11054 of 2021 dt.09-03-2022
that capacity.
20. The learned counsel for the respondents
has further contended that the Department of
Mines and Geology, Government of Bihar had
taken measures after surrender of the settlement/
lease by the petitioner by making an inspection
and several irregularities and illegalities have been
found as is apparent from the report dated
15.06.2021 (Annexure-D to the counter affidavit).
It is also stated that the Collector, Rohtas had also
conducted inspection of the licensed area, during
the course whereof, several irregularities and
violations had been noticed, hence, the Collector,
Rohtas had recommended for cancellation of K-
license of the petitioner by writing to the Director,
Mines and Geology Department. It is stated that
upon inspection it was found that there was no
sign boards, fencing was not in place, sand had not
been covered by tarpaulin, no arrangement had
been made for protection of the environment and
in fact the monthly return register was also not
found to have been maintained in the proper
Patna High Court CWJC No.11054 of 2021 dt.09-03-2022
format. Thus, the Deputy Director, Mines &
Geology Department, Bihar vide memo dated
7.7.2021 had cancelled all the 17 K-licenses issued
in favor of the petitioner's company (as far as the
first case is concerned) and directed it to deposit a
sum of Rs. 127.38 Crores.
As far as the second case is concerned, the
Collector, Aurangabad had also reported, vide
letter dated 08.07.2021, regarding several
irregularities having been found during the course
of inspection. In the said inspection it was found
that there was no sign boards, fencing was not in
place, sand had not been covered by tarpaulin, no
arrangement had been made for protection of the
environment, the monthly return register was not
being maintained in the proper format and huge
settlement amount to the tune of Rs. 95.79 crore
was outstanding, as against the petitioner, hence
the Collector, Aurangabad had recommended for
cancellation of the stock license/ K-licenses of the
petitioner. It was also found during the course of
inspection held on 25.06.2021 that the petitioner
Patna High Court CWJC No.11054 of 2021 dt.09-03-2022
had fraudulently removed/ sold sand stock worth
Rs. 45.39 crore from its stock hold area, hence FIRs
bearing Barun P.S. Case No. 176 of 2021 dated
6.7.2021 and Daudnagar P.S. Case No. 374 of 2021
were lodged against the K-licensee i.e. the
petitioner herein. In fact, thereafter, the Deputy
Director, Magadh Circle vide memo dated
17.08.2021 had cancelled all the 11 k-licenses of
the petitioner of the second case with immediate
effect.
21. The learned counsel for the respondents
has further stated, with reference to the first case,
that there was a stock of 5,75,84,000 Cft sand
when the petitioner was a valid k-license holder,
however, during the course of raid about
1,28,11,306 Cft sand was seized, hence apparently
there was/is huge deficiency of sand which shows
that the petitioner has fraudulently used the K-
license to remove/sell sand stock from the stock
hold area. It is also stated that deficiency to the
tune of Rs. 102.63 crore has been detected as
against the petitioner of first case, where-after FIRs
Patna High Court CWJC No.11054 of 2021 dt.09-03-2022
have been lodged and a certificate case has also
been instituted for recovery of the said amount. It
has also been pointed out that the petitioner has
failed to deposit the outstanding installment
amounts to the tune of Rs. 127.38 crore and it had
in fact stored large quantity of sand as a settlee
and paid the royalty only for the period upto
March, however, subsequent thereto it has failed to
pay the due amount of royalty. The learned counsel
for the respondents has also referred to the trend
of disproportionate transfer of sand from lessee to
K-license during the last three years i.e prior to the
month of surrendering of lease by the petitioner,
as is apparent from the following chart:-
District Rohtas
Month No. of stockiest challan to his own Quantity of
stockiest ID sand in CFT
April,2021 1042 6,01,200
The learned counsel for the respondents has
also referred to the schedule of payment of royalty
for the extended period i.e 01.04.2021 to
30.09.2021, with regard to the sand Ghats of the
Patna High Court CWJC No.11054 of 2021 dt.09-03-2022
Rohtas District, and its payment position which is
being depicted in a tabular form herein below:-
Installment Last date of Royalty amount to be Payment
payment paid position
1st Installment 31.3.2021 Rs.25,47,72,242/- PAID
2nd Installment 30.4. 2021 Rs.50,95,44,484/- NOT PAID
3rd
Installment 31.5. 2021 Rs.50,95,44,484/- NOT PAID
4th
Installment 30.6. 2021 Rs.25,47,72,242/- NOT PAID
The aforesaid payment position would show
that the petitioner has not paid any installment
w.e.f. April, 2021 in spite of several reminders,
hence, it is apparent that the petitioner has not
paid the settlement amount/ royalty amount for
the Rohtas district amounting to a sum of Rs.
127.38 crore, which was part of the conditions
prescribed for extending the lease and which had
been accepted by the petitioner.
22. As far as the second case is concerned,
the learned counsel for the respondents has also
referred to the trend of disproportionate transfer of
sand from lessee to K-license during the last three
years i.e prior to the month of surrendering of
lease by the petitioner, as is apparent from the
Patna High Court CWJC No.11054 of 2021 dt.09-03-2022
following chart:-
District Aurangabad
Month No. of stockiest challan Quantity of
to his own stockiest ID sand in CFT
April,2021 2890 15,70,500
The learned counsel for the respondents has
also referred to the schedule of payment of royalty
for the extended period i.e 01.04.2021 to
30.09.2021, with regard to the sand Ghats of the
Aurangabad District, and its payment position
which is being depicted in a tabular form herein
below:-
Installment Last date Royalty amount Payment
of to be paid position
payment
1st 31.3.2021 Rs.19,15,70,160/- PAID
Installment
2nd 30.4.2021 Rs.38,31,40,320/- NOT PAID
Installment
3rd Rs.38,31,40,320/-
31.5.2021 NOT PAID
Installment
4th Rs.19,15,70,160/-
30.6.2021 NOT PAID
Installment
The aforesaid payment position would show
Patna High Court CWJC No.11054 of 2021 dt.09-03-2022
that the petitioner has not paid any installment
w.e.f. April, 2021 in spite of several reminders,
hence, it is apparent that the petitioner has not
paid the settlement amount/ royalty amount for
the Aurangabad district amounting to a sum of Rs.
95.79 crore, which was part of the conditions
prescribed for extending the lease and which had
been accepted by the petitioner. In fact the
petitioner of the second case has fraudulently
removed sand stock worth several crore from the
stock hold area in an illegal manner.
23. The learned counsel for the parties have
been heard at length and during the course of
arguments, this Court has been taken through the
voluminous records of the aforesaid two cases,
which have been perused by me. In nutshell, the
case of the petitioner is that the petitioners were
granted mineral concessions of sand Ghat in the
district of Rohtas and Aurangabad for the period
01.01.2015 to 31.12.2019, whereafter agreements
dated 21.04.2015 and 24.07.2015 were executed.
When the five years lease period of the petitioner
Patna High Court CWJC No.11054 of 2021 dt.09-03-2022
was coming to an end, the Rules, 2019 were
notified on 17.09.2019. Thereafter, the
Respondents had published notice inviting e-
auction for the purposes of settlement of sand
Ghat in the various districts of Bihar in accordance
with the provisions contained in the Bihar State
Sand Policy, 2019 and the Rules, 2019 for a period
of 5 years starting from the year 2020, however,
the said process was interdicted on account of a
judicial pronouncement by the National Green
Tribunal, New Delhi, hence the respondent State of
Bihar invoked the provisions contained in Rule
77(2) of the Rules 2019 and came out with a
resolution dated 27.12.2019 whereby and where
under the settlement period of the existing settlees
of sand Ghats in the State of Bihar, which was to
come to an end on 31.12.2019 was extended till
31.12.2020 or till the new settlees obtained
environment clearance, whichever is earlier, upon
50% increase in the settlement amount over the
year, 2019. Thereafter, the respondent State has
been extending the settlement period from time to
Patna High Court CWJC No.11054 of 2021 dt.09-03-2022
time. The last of such extension of settlement
period of the existing settlees was done by a
notification dated 31.03.2021 whereby and where
under the settlement period of the Sand Ghats of
the existing settlees was extended by the
Respondent State for the period 1.4.2021 to
30.9.2021 on the general conditions mentioned
therein as also the same had postulated the mode,
manner and time of payment of the settlement
amount in four installments apart from it being
stipulated therein that the Rule, 2019 will have to
be followed. The petitioner is stated to have
accepted the said extension of the period of the
existing settlement of the sand Ghats appertaining
to the district of Rohtas and Aurangabad and had
also paid the first installment to the tune of Rs.
25,47,72,242/- and a sum of Rs. 19,15,70,160/-
respectively. However, the dispute started when
the petitioner had written a letter dated 20.4.2021
to the District Magistrate, Rohtas and Aurangabad
communicating its decision to surrender the
settlement of sand Ghats in the district of Rohtas
Patna High Court CWJC No.11054 of 2021 dt.09-03-2022
and Aurangabad with immediate effect. However,
the District Magistrate, Rohtas and Aurangabad
had informed the petitioner vide letters dated
27.04.2021 and 29.04.2021 respectively that there
is a clear provision contained in Rule 50 of the
Rules, 2019, which speaks about exit option of a
mineral concession holder, however, since the
petitioner's decision to surrender the sand
ghats/settlement made in its favor, as contained in
its letter dated 20.04.2021, is without either giving
any prior notice or paying the outstanding dues of
royalty etc., the same was being rejected and the
petitioner should deposit the 2nd installment
amount pertaining to the extended period, failing
which it was warned that necessary action would
be taken under Rule 47 of the Rules, 2019. The
petitioner had then replied vide its letter dated
29.04.2021 clarifying that Rule 50(1) of the Rules,
2019 is not applicable to the petitioner and the
petitioner shall cease its mining activity w.e.f.
01.05.2021.
24. This Court further finds that the
Patna High Court CWJC No.11054 of 2021 dt.09-03-2022
petitioner of the aforesaid two cases, in terms of
Rule 39 of the Rules, 2019, is stated to have
obtained K-license for storage of minor mineral
beyond the lease hold area and the same had been
renewed lastly vide Memo dated 18.03.2021 with a
validity up to 31.12.2021, however, subsequently
the Respondents had restricted selling of sand by
the petitioner from the stock hold area in as much
as generation of e-challan on the portal
http://portal.biharmines.in/ had been restricted by
the respondents leading to the petitioner filing
representations before the learned Collector,
Rohtas and Aurangabad on 11.05.2021, requesting
him to remove the restriction on selling sand from
its stock hold area as also for directing the Mines
Department to remove the restriction on
generation of e-challan on the portal
http://portal.biharmines.in/. It appears that
thereafter the Collector, Rohtas had also
conducted inspection of the licensed area, during
the course whereof, several irregularities and
violations had been noticed, hence, the Collector,
Patna High Court CWJC No.11054 of 2021 dt.09-03-2022
Rohtas had recommended for cancellation of K-
license of the petitioner by writing to the Director,
Mines and Geology Department. It is stated that
upon inspection it was found that there was no
sign boards, fencing was not in place, sand had not
been covered by tarpaulin, no arrangement had
been made for protection of the environment and
in fact the monthly return register was also not
found to have been maintained in the proper
format. Thus, the In-charge Deputy Director, Mines
and Geology, Patna Circle, Patna vide memo dt.
7.7.2021 had cancelled all the 17 K-licenses issued
in favor of the petitioner's company (as far as the
first case is concerned) and directed it to deposit a
sum of Rs. 127.38 Crores.
As far as the second case is concerned, the
Collector, Aurangabad had also reported, vide
letter dated 08.07.2021, regarding several
irregularities having been found during the course
of inspection. In the said inspection it was found
that there was no sign boards, fencing was not in
place, sand had not been covered by tarpaulin, no
Patna High Court CWJC No.11054 of 2021 dt.09-03-2022
arrangement had been made for protection of the
environment, the monthly return register was not
being maintained in the proper format and huge
settlement amount to the tune of Rs. 95.79 crore
was outstanding, as against the petitioner, hence
the Collector, Aurangabad had recommended for
cancellation of the stock license/ K-licenses of the
petitioner. It was also found during the course of
inspection held on 25.06.2021 that the petitioner
had fraudulently removed/ sold sand stock worth
Rs. 45.39 crore from its stock hold area, hence FIRs
bearing Barun P.S. Case No. 176 of 2021 dated
6.7.2021 and Daudnagar P.S. Case No. 374 of 2021
were lodged against the K-licensee i.e. the
petitioner herein. In fact, thereafter, the In-charge
Deputy Director, Mines and Geology, Magadh
Circle, Gaya vide memo dated 17.08.2021 had
cancelled all the 11 k-licenses of the petitioner of
the second case with immediate effect.
25. As far as the issue of surrender of
settlement / lease hold rights by the petitioner
w.e.f. 01.5.2021 is concerned, this Court finds that
Patna High Court CWJC No.11054 of 2021 dt.09-03-2022
after the work order dated 31.03.2021 was issued
by the Collector, Rohtas and Aurangabad
containing the terms and conditions of extension of
existing settlement period, the petitioner had
unequivocally accepted the same and in fact had
also deposited the first installment, both for the
District of Rohtas as also for the District of
Aurangabad and the tenure/period of mining lease
was extended till 30.09.2021, with a condition that
during the rainy season there would be no mining,
however, the petitioner had prior to the rainy
season circumspectly and unilaterally surrendered
its lease w.e.f. 01.05.2021 without depositing the
balance settlement amount. It would be relevant to
reproduce clause 18 of the Bihar Sand Mining
Policy, 2019, notified by the respondent State
Government vide notification dated 14.08.2019
herein below:-
"18. Surrender of Concession- Annual
settlement amount shall be paid before
surrender of said sand Ghat by settlee.
In case of surrender, the security deposit
along with other payments made by him
Patna High Court CWJC No.11054 of 2021 dt.09-03-2022
shall be forfeited."
Thus, it is apparent that in case the petitioner
had genuinely/legitimately surrendered its lease
w.e.f. 01.05.2021, it was also required to deposit
the remaining three installments which it did not
do. This Court further finds that since the petitioner
had accepted the work order dated 31.03.2021
unequivocally and had also paid the first
installment, its conduct shows acceptance of the
contract in question, meaning thereby that it had
accepted the extension of lease period up to
30.09.2021on the terms and conditions mentioned
therein. In such view of the matter, this Court holds
that the petitioner is also required to pay the entire
outstanding settlement amount for the period
1.4.2021 to 30.9.2021. Apparently, for the said
reason, the petitioner has rightly not challenged
the cancellation of settlement/ mineral concession
in question in as much as it has got no defence.
26. Now, coming to the issue of cancellation
of the K-licenses of the petitioner for the district of
Rohtas and Aurangabad, this Court would first of
Patna High Court CWJC No.11054 of 2021 dt.09-03-2022
all refer to the conditions prescribed in Memo
dated 18.03.2021, whereby and where under the K-
Licenses of the petitioner had been renewed till
31.12.2021, which are being reproduced herein
below:-
"1.License holder shall maintain proper
Accounts of minor minerals in Register in
Form 'H' in which day to day transaction
shall be entered.
2. License may be renewed on
application which shall be accompanied
by fee of Rs. 2000/- (Two thousand only),
if related rules are followed during the
license period.
3. In case of any dispute by raiyat
regarding land of license hold area, the
license issued may be cancelled.
4. License holder shall issue a transport
challan in form 'G' or e-challan to every
carrier/ truck/ Tractor or any vehicles
while dispatching minerals from their
stocks.
5. License holder if fail to maintain a
register in form 'H' or issue a challan in
form 'G' or e-challan shall be punishable
Patna High Court CWJC No.11054 of 2021 dt.09-03-2022
with a simple imprisonment which may
extend up to one year or value of the
mineral along with fine which may
extend upto 10,000/- (Ten thousand only)
or with both.
6. License holder shall submit every
month to the competent officer a true
and correct return for minerals in form-'l'
by the 15th day of the following month to
which it relates.
7. Every license holder shall give all
reasonable facilities to competent officer
to inspect/ verify and check the accounts
of the minerals.
8. JCB Machine will be operated on safe
side and far away from overload Electric
wire line.
9. License holder shall stock the Minor
Mineral away from 50 M from metalled
road/ public place.
10. On getting information about any
mining dues/ FIR in future, storage
license treated as self cancelled.
11. License holder shall arrange Parking
in his own license hold area. Sand loaded
vehicle will not be allowed during No
Entry period.
Patna High Court CWJC No.11054 of 2021 dt.09-03-2022
12. License holder shall also have to
display a sign board.
13. License Hold area shall be Properly
Fenced/ earmarked by license holder.
14. Storage of mineral shall not be
permitted to stock minor mineral below
or near the overhead wire line or near
any electric pole.
15. Minor minerals shall be properly
covered from all sides by tarpoline at
license holder area.
16. Proper arrangement for water spray
in and around license hold area through
water tanker/ water sprinklers shall be
made by the licence holder.
17. License holder shall take all possible
precautions for protection of
Environment and control of pollution.
18. The department may direct to license
holder to sale some proportion of their
mineral to the BSMC at prescribed rate of
department.
19. On cancellation of license, the minor
mineral lying on the land of stock holder
area shall become the absolute property
of the Govt. and shall be sold by the
Patna High Court CWJC No.11054 of 2021 dt.09-03-2022
BSMC/ mining office.
20. Measures shall be taken to prevent
dust emission by carrying of stocked
mineral during transportation.
21. The License Holder will have to obey
the directions given by the Department,
District Collector or the Mining Officer in
the public interest."
27. This Court further finds that as per the
guidelines issued by the Mining and Geology
Department, Government of Bihar, Patna vide
letter dated 28.01.2019, for the purposes of
issuance of K-Licenses, one of the condition is that
the mineral stored in the stock hold area shall not
be exceed 30 thousand Cft at any given moment of
time, however, for the settlees there shall be no
higher limit. These guidelines can be found at
running page no. 271 of the brief of the second
case.
28. Undeniably, as is apparent from the facts
and circumstances mentioned herein above in the
preceding paragraphs, on several occasions, the
stock of sand in the stock hold area of the
Patna High Court CWJC No.11054 of 2021 dt.09-03-2022
petitioner, both in the district of Rohtas and
Aurangabad has been found to be much more than
30 thousand Cft, hence, the case of the petitioner
that the K License issued to the petitioner has got
no relation with the Mineral concession/ settlement
of the sand Ghats in question is belied. Thus, in
case the contention of the petitioner is to be
accepted i.e. to the effect that the K License has
got no connection with the settlement of sand
ghats in its favour, then admittedly the petitioner
has violated the aforesaid guidelines in as much as
the stock in the stock hold area has been found to
be much more than 30,000 Cft. on numerous
occasions hence, this in itself is a valid and
sufficient ground for cancellation of the K Licenses
of the petitioner. This Court also finds that
admittedly the K-licenses issued to the petitioner is
linked with the settlement of sand Ghats made in
favour of the petitioner and once the petitioner has
surrendered the settlement of the sand Ghats, it is
precluded from using the K-License to sell the sand
in question. This Court also finds from the facts
Patna High Court CWJC No.11054 of 2021 dt.09-03-2022
and circumstances of the case, noted herein above
in preceding paragraphs that the stock lying in the
stock hold area of the petitioner has not suffered
the incidence of royalty, especially since the
petitioner has failed to pay the outstanding royalty/
settlement amount to the tune of Rs. Rs. 127.38
Crores and Rs. Rs. 95.79 crore respectively, hence
it does not lie in the mouth of the petitioner to
contend that it would still be entitled to sell the
sand from the stock hold area without paying the
outstanding royalty/ settlement amount.
29. As regards the issue raised by the
petitioner to the effect that the Orders cancelling
the K-licenses are bad in the eyes of law in as
much as Rule 47(2) provides for issuance of a show
cause before suspension/ blocking of e-challan and
cancellation of the K-license, which has not been
issued in the present case, it would suffice to state
that Rule 47(2) of the Rules, 2019 deals with the
power to suspend or cancel the mineral concession
and does not deal with K-Licenses, which is
covered by Rule 39 of the Rules, 2019, however,
Patna High Court CWJC No.11054 of 2021 dt.09-03-2022
the same does not provide for issuance of any
show cause prior to cancellation of the K-License in
cases of commission of irregularities and illegalities
by the holder of the K-License as also in case of
violation of the conditions mentioned in the memo
by which the license of the petitioner had been
renewed. This Court finds that the Collector Rohtas
and the Collector, Aurangabad had conducted
inspection of the stock hold area of the petitioner
and vide reports dated 15.06.2021, 25.06.2021
and 8.7.2021, it was found that the petitioner had
committed several irregularities inasmuch as there
was no sign boards, fencing was not in place, sand
had not been covered by tarpaulin, no
arrangement had been made for protection of the
environment, the monthly return register was not
being maintained in the proper format and huge
settlement amount was outstanding for payment
qua the petitioner. It was also found during the
course of inspections that the petitioner had
fraudulently removed/ sold sand stock worth
several crores of rupees from its stock hold area,
Patna High Court CWJC No.11054 of 2021 dt.09-03-2022
hence FIRs have also been lodged against the K-
licensee i.e. the petitioner herein, both in the
district or Rohtas as also in the district of
Aurangabad. Thus, this Court finds that the
conditions mentioned in the letter/Order by which
K-licenses of the petitioner were renewed have
definitely been violated, apart from violation of
Rule 39 (3) of the Rules 2019, resulting in lodging
of FIRs against the petitioner in terms of Rule 39(3)
and Rule 56(2) of the Rules, 2019. Hence,
considering the aforesaid facts and circumstances
of the case, this Court does not find any illegality
either in the Order dated 07.07.2021, passed by
the In-charge Deputy Director, Mines and Geology,
Patna Circle, Patna or the Order dated 17.8.2021,
passed by the In-charge Deputy Director, Mines
and Geology, Magadh Circle, Gaya, cancelling the
K-licenses of the petitioner and the same are held
to be legal and valid.
30. Having regard to the facts and circumstances
of the case and for the reasons mentioned herein
above, I do not merit in the present writ petitions
Patna High Court CWJC No.11054 of 2021 dt.09-03-2022
hence, the same are dismissed. Interim Orders, if
any stand vacated.
(Mohit Kumar Shah, J)
Tiwary/-
AFR/NAFR AFR
CAV DATE 29.09.2021
Uploading Date 10-03-2022
Transmission Date NA
