M/S Kamlesh Metacast Pvt. Ltd vs State Of Rajasthan
2021 Latest Caselaw 2477 Raj/2

                                          (1 of 17)                 [CW-13426/2020]


      HIGH COURT OF JUDICATURE FOR RAJASTHAN
                  BENCH AT JAIPUR

                 S.B. Civil Writ Petition No.13426/2020

M/s Kamlesh Metacast Pvt. Ltd., Having Its Registered Office at
A-28, Basement Anita Colony, Bajaj Nagar, Jaipur-302015
Through Its Authorized Signatory Shri Inder Kumar, Son Of Shri
Parbhu Dayal Resident Of Village Kali Pahadi, Tehsil Nimrana,
District Alwar
                                                                     ----Petitioner
                                     Versus
1.     State Of Rajasthan, Through Additional Chief Secretary
       Department Of Mines & Petroleum, Government Of
       Rajasthan, Secretariat, Jaipur (Rajasthan) - 302001
2.     The Joint Secretary, Department Of Mines And Petroleum,
       Government Of Rajasthan, Secretariat Jaipur - 302001
3.     The Director, Department Of Mines And Geology, Khanij
       Bhawan, Shastri Circle, Udaipur - 313001
                                                                  ----Respondents

For Petitioner(s) : Mr. Kamlakar Sharma, Sr. Advocate with Ms. Alankrita Sharma For Respondent(s) : Mr. Jaivardhan Singh Shekhawat for Mr. R.P. Singh, AAG

HON'BLE MR. JUSTICE SANJEEV PRAKASH SHARMA

Judgment

RESERVED ON 21.05.2021

PRONOUNCED ON 25th June, 2021

REPORTABLE

1. Brief facts as set out by the petitioner-company which

are relevant for the purpose of adjudication of the issue

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involved in the present writ petition are being referred as

under:-

(i) The petitioner-company had applied for Prospecting

License (hereinafter referred to as "P.L.") for mining activity.

The area for mining lease was approved and demarcated on

24.12.2014. The order for granting P.L. was issued for a

period of three years and sanction was granted.

(ii) On 12.01.2015, the Mines and Mineral (Development

& Regulation) Amendment Act, 2015 (hereinafter referred to

as "the MMDR Act, 2015") came into force whereby it was

provided that all the pending applications would stand

rejected except those which have been saved under Clause

(a) to (c) of sub-section (2) of Section 10A, of the MMDR Act

as it existed.

(iii) A decision was taken by the State Government on

17.10.2015 to cancel all the permissions granted and LoIs

issued by the Mining Department for the period from

01.11.2014 to 12.01.2015 on the ground that the same were

issued contrary to the guidelines laid down by the Central

Government and the State Government. In pursuance

thereof, a show cause notice was issued under Section 4A(3)

to the petitioner-company on 03.03.2016 proposing to

terminate the P.L. issued to it. The petitioner-company

submitted its reply to the show cause notice. After receiving

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the reply, the State Government passed an order on

30.11.2016 cancelling all the LoIs and licenses.

(iv) The petitioner-company challenged the cancellation

of its P.L. in Revision Petition before the Mines Tribunal, GoI

(hereinafter referred to as "the Tribunal") assailing the orders

dated 17.10.2015 and 30.11.2016 (supra).

(v) A Revision Petition was decided on 19.09.2018

whereby the orders were quashed and the matter was

remanded back to the State Government to take up

appropriate action as per law. The Tribunal relied on the

judgment of M/s. Wonder Cement Limited and the

cancellation of P.L. was also quashed.

(vi) The State Government did not take any action and

petitioner-company filed SB Civil Writ Petition No.8906/2019

which was disposed of by this court vide its order dated

17.05.2019 with the following directions:-

"upon hearing the counsel for the petitioner and considering the nature of grievance raised and prayer addressed; the State respondents are directed to determine the claim of the petitioner as expeditiously as possible preferably within a period of two months from the date a certified copy of this order is presented."

(vii) The compliance was not made and a contempt petition

was filed wherein this Court passed an order on 13.10.2020

to take a decision within a period of 3 days on 15.10.2020.

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The decision was taken by the respondent-Mining Department

upholding its earlier order dated 30.11.2016 maintaining that

the P.L. was granted to the petitioner-company in

contravention of the guidelines dated 30.10.2014 issued by

the Central Government.

2. It is after this stage that the matter has come up before

this Court.

3. Learned Senior Counsel appearing for the petitioner-

company has strongly objected to the order passed by the

Department dated 15.10.2020 and submitted that the order

is absolutely illegal, malafide and arbitrary. It is objected that

once the orders dated 17.10.2015 and 30.11.2016 had been

quashed and set aside by the Tribunal, the State Government

had no authority to revive the order dated 30.11.2016 by the

impugned order dated 15.10.2020. It is urged that the

arguments, which have been made the basis for reviving the

order dated 30.11.2016 were already examined at length by

the Tribunal and it was found that the P.L. issued to the

petitioner-company cannot be said to be in violation of the

Mines and Minerals (Development and Regulation) Act, 2015

(hereinafter referred to as "MMDR Act 2015"). As the MMDR

Act 2015 came into force w.e.f 12.01.2015 while the P.L. had

been issued to the concerned petitioner-company on

24.12.2014.

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3.1 Learned Senior Counsel submits that the case of the

petitioner was similar to that of M/s. Wonder Cement Limited

whose P.L. had also been cancelled on account of the same

having been issued during the period between 01.11.2014

and 12.01.2015. The M/s. Wonder Cement Limited had also

approached Tribunal and Tribunal quashed the said order

whereafter the Department has granted lease to the M/s.

Wonder Cement Limited. Learned Counsel has relied on a

letter written by Director, Department of Mines and Geology

to the respondents on 04.04.2019 seeking compliance. The

case of the petitioner-company also relies on the internal

communication wherein recommendation has been made to

restore the P.L. of the petitioner-company dated 19.09.2019.

3.2 Learned counsel submits that the order has been

passed in-haste and with the only purpose to circumvent the

order passed by this court in contempt petition. It is further

submitted that in the written submissions filed by the

petitioner-company that it had applied for P.L. in the year

2011 and after the complete process was conducted of

earmarking the land, demarcating and approving the area

that the P.L. was issued. The process was thus completed

wayback before the amendment was brought into force on

12.01.2015. It is further submitted that before the

termination of P.L., the petitioner had already completed 75%

of the prospective operations.

(6 of 17) [CW-13426/2020]

3.3 It is submitted that there has been no application of

mind while passing the order dated 15.10.2020 and the self-

same grounds on which the earlier order dated 30.11.2016

was passed, have been reiterated. The provisions which were

prevailing prior to amendment allowed the P.L. to be granted

to the petitioner-company and there was no violation as per

the then existing provisions. The guidelines issued by the

Central Government on 30.10.2014 were infact brought into

force by the amendment, which was made effective from

12.01.2015. It is submitted that the guidelines were contrary

to the then existing procedure laid down under Mines and

Minerals (Development and Regulation) Act, 1957 and

therefore there is no case for violation of Rules or Regulations

while issuing P.L. to the petitioner-company. The respondents

were only required to revive the P.L. by issuing an order and

were required to handover the position of the area. The

Tribunal nowhere asked the respondents to again take a

decision regarding cancellation of the P.L. of the petitioner-

company.

3.4 It is submitted that the order passed by the Tribunal

was not complied with and the respondents are in contempt

as the order impugned dated 15.10.2020 goes against the

spirit of the order passed by the Tribunal. Learned counsel

has also pointed out that in the case of M/s. Wonder Cement

Limited, the mining lease was granted consequent upon the

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order from the Tribunal and the order of this court. Different

stand cannot be taken in relation to the petitioner-company.

It is further submitted that the order of cancellation which

had also been quashed cannot be revived by an executive fiat

and the entire intervening period should be treated as a dies

non.

3.5 It is further prayed that the petitioner-company be

allowed mining lease for the three years period with

additional four months for compliance as provided under

MMDR Act as the said period pending before revision, writ

petition and contempt ought not be counted and affect the

right of the petitioner-company.

4. Respondents have filed a reply to the writ petition.

4.1 Learned counsel for the respondents have argued that

the area measuring 1859.0275 hectares near Village Rohida

Tehsil Pindwara District Sirohi was initially marked and P.L.

No.7/2011 was issued vide order dated 24.12.2014. Sanction

was granted for a period of three years and agreement was

executed on 12.03.2015. A high level committee was

constituted on 05.10.2015 to review grant of LoI for the

period from 01.11.2014 to 12.01.2015. The Principal

Secretary, Mines wrote a letter on 17.10.2015 informing

about the decision of the State Government to cancel all the

LoIs issued during the said period on the basis of the

preliminary report of the committee and letter was also sent

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to the Central Government seeking prior approval of pre-

mature termination as per Section 4A(1) of the MMDR Act,

1957 whereafter Central Government asked the State to

provide opportunity of hearing to the petitioner-company.

Notice was therefore sent and the petitioner-company's reply

was found to be dis-satisfactory and thereafter Central

Government was asked to give approval whereupon the

Central Government replied stating that State Government

was competent to take decision after providing opportunity of

hearing. Thereupon vide order dated 30.11.2016, P.L. of the

petitioner-company was cancelled and declared null and void

in terms of Section 19 of the MMDR Act, 1957. Possession of

the area was taken over by the Mining Engineer, Sirohi on

15.12.2016.

4.2 In revision, the Tribunal set aside the order on

19.09.2018 with directions to take appropriate action as per

law. It is stated that guidelines had been issued by the

Central Government on 30.10.2014 and the P.L. was issued in

violation of Clause 5.2.4 and 5.2.5 of the said guidelines. As

the said order was issued on 24.12.2014, after the guidelines

had been issued on 30.10.2014, the sanction order was

banned. It is further submitted that the amended draft of

MMDR Act was uploaded on 17.11.2014 which was brought

into force from 12.01.2015 wherein it was provided that all

concessions shall be granted through auction only. In this

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circumstance, the State Government has rightly taken a

decision not to approve the P.L. which was granted earlier and

the termination of the P.L. on 30.11.2016 was found to be in

order and was therefore restored.

4.3 It is further submitted that the case of the M/s. Wonder

Cement Limited was different from that of the petitioner-

company and the chart has been placed to point out the

difference between M/s. Wonder Cement Limited and that of

the petitioner. It is further submitted that departmental

notings and internal communication cannot be construed as

final decision.

5. Having noticed the aforesaid arguments and submissions

of either side, this court finds that petitioner-company's

revision petition challenging the order of cancellation of P.L.

dated 30.11.2016 was allowed on 19.09.2018 and the order

was quashed and set aside. The said order which was

quashed by the Tribunal had been restored by the impugned

order dated 15.10.2020. The reason for restoration of the

order, which had been quashed, as given out by the

Department, is that the P.L. was issued in violation of the

guidelines issued by the Central Government.

6. A look at the order dated 19.09.2018 passed by the

Tribunal shows that the said argument was considered and

examined and it was found that the Act which provides for

issuing of license only by way of auction, came into force

(10 of 17) [CW-13426/2020]

from 12.01.2015, on the day when the petitioner applied the

provisions of MMDR Act and Rules the allowed mode and

issuance of license was by way of moving an application. This

court, therefore, finds that the application which the

petitioner-company had moved in 2011 was in confirmation

with the then existing laws. As the entire process was

completed and final license was sanctioned on 24.12.2014

therefore, the Tribunal has rightly quashed the order dated

30.11.2016. This court also further finds that the order of

Tribunal was not challenged by the State Government in any

proceedings either before this court or elsewhere. The State

Government authorities, therefore, had no authority or

jurisdiction to restore an order which stood already quashed

and set aside by the Tribunal which is empowered to hear

revision under Rule 36 of the MMDR Rules.

7. The contentions of the respondents of the sanction order

dated 24.12.2014 being in violation of Clause 5.2.5 and 5.2.4

is required to be examined. This court finds that the

guidelines issued by the Central Government on 30.10.2014

provided as under:-

"5.2.4. State Government should invite application for grant of mineral concessions by notification in the official Gazette and State Government's website for wide publicity. Notification, interalia, should indicate the date from which applications can be submitted, which should be a date 30 days or more from the date of notification. The due date for

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submitting applications should be indicated and should be reasonable to ensure that the period for accepting application is not kept indefinite.

5.2.5. Depending on the availability of exploration data and minerlization, an area should be notified for inviting applications for grant of PL or RP. An area should be notified for inviting application for grant of ML, only if mineralization in terms of UNFC 1997 (refer to para 2.2.2) by way of prospecting or otherwise has been established. The extent of mineralization should be mentioned in the notification."

8. The said guidelines became part of the amendment

made by the Central Government in the MMDR Act, 1957

w.e.f. 12.01.2015 and it was provided under the Mining

Amendment Act that the composite license of mining as well

as mining leases allotment shall be done exclusively by way

of auction.

9. A perusal of the aforesaid provisions of the guidelines

show that the said provisions are prospective in nature. Thus,

after 30.10.2014 the applications could have been accepted

by the State Government only by notifying in official gazette.

However, the said guidelines do not in any manner restrict

the pending applications, which were already considered and

examined and land was already earmarked.

10. In the present case, this court finds that approval has

already been given much earlier of issuing guidelines dated

30.10.2014 and it is a formal order which has been passed in

(12 of 17) [CW-13426/2020]

December, 2014. The Tribunal has also examined the said

aspect and therefore, there was no occasion for the

respondents to again reiterate the same submission and

restore the cancellation order dated 30.11.2016. In fact, in

terms of the order passed by the Tribunal in Revision Petition,

as noticed by this court earlier in the writ petition decided on

17.05.2019, the only needful action to be taken by the State

Government was to issue order for handing over the

possession of the earmarked and demarcated site relating to

the prospective license.

11. In the opinion of this court, once an order is quashed

natural corollary is that earlier order stands restored. That is

to say that once an order has been quashed by the Tribunal,

the possession which stood prior to the passing of the

impugned order which has been quashed shall stand revived.

12. In the case of M/s. Shree Chamundi Mopeds Ltd.

Versus Church of South India Trust Association,

Madras: AIR 1992 SC 1439, the Supreme Court explained

the distinction between the staying of an order and quashing

of an order in violation terms:-

"10. In the instant case, the proceedings before the Board under Sections 15 and 16 of the Act had been terminated by order of the Board dated April 26, 1990 whereby the Board, upon consideration of the facts and material before it, found that the appellant-company

(13 of 17) [CW-13426/2020]

had become economically and commercially non-viable due to its huge accumulated losses and liabilities and should be wound up. The appeal filed by the appellant-company under Section 25 of the Act against said order of the Board was dismissed by the Appellate Authority by order dated January 7, 1991. As a result of these orders, no proceedings under the Act was pending either before the Board or before the Appellate Authority on February 21, 1991 when the Delhi High Court passed the interim order staying the operation of the Appellate Authority dated January 7, 1991. The said stay order of the High Court cannot have the effect of reviving the proceedings which had been disposed of by the Appellate Authority by its order dated January 7, 1991.

While considering the effect of an interim order staying the operation of the order under-

challenge, a distinction has to be made between quashing of an order and stay of operation of an order. Quashing of an order results in the restoration of the position as it stood on the date of the passing of the order which has been quashed. The stay of operation of an order does not, however, lead to such a result. It only means that the order which has been stayed would not be operative from the date of the passing of the stay order and it does not mean that the said order has been wiped out from existence.

This means that if an order passed by the Appellate Authority is quashed and the matter is remanded, the result would be that the

(14 of 17) [CW-13426/2020]

appeal which had been disposed of by the said order of the Appellate Authority would be restored and it can be said to be pending before the Appellate Authority after the quashing of the order of the Appellate Authority. The same cannot be said with regard to an order staying the operation of the order of the Appellate Authority because in spite of the said order, the order of the Appellate Authority continues to exist in law and so long as it exists, it cannot be said that the appeal which has been disposed of by the said order has not been disposed of and is still pending. We are, therefore, of the opinion that the passing of the interim order dated February 21,1991 by the Delhi High Court staying the operation of the order of the Appellate Authority dated January 7,1991 does not have the effect of reviving the appeal which had been dismissed by the Appellate authority by its order dated January 7, 1991 and it cannot be said that after February 21, 1991, the said appeal stood revived and was pending before the Appellate Authority. In that view of the matter, it cannot be said that any proceedings under the Act were pending before the Board or the Appellate Authority on the date of the passing of the order dated August 14, 1991 by the learned Single Judge of the Karnataka High Court for winding up of the company or on November 6, 1991 when the Division Bench passed the order dismissing O.S.A.No. 16 of 1991 filed by the appellant company against the order of the learned Single Judge dated

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August 14, 1991. Section 22(1) of the Act could not, therefore, be invoked and there was no impediment in the High Court dealing with the winding up petition filed by the respondents.

This is the only question that has been canvassed in Civil Appeal No. 126 of 1992, directed against the order for winding up of the appellant company. The said appeal, therefore, fails and is liable to be dismissed."

Thus, there is a clear distinction between quashing and

staying of an order.

13. In the present case, the Tribunal has quashed the order,

meaning thereby the P.L. dated 24.12.2014 stood restored.

The respondents were required to handover the possession

which they have taken over of the mining area. However, the

respondent-State has adopted an approach as if the matter

had been remanded back for passing a fresh decision whether

P.L. was to be cancelled or not. While quashing the order

dated 30.11.2016, the Tribunal also quashed the order dated

17.10.2015 which was made the basis for issuing of show

cause notice. Thus, it cannot be said that possession was

restored to the situation where show cause notice was still in

vogue. The order dated 15.10.2020, thus, is found to be

without jurisdiction and without authority in law. The P.L.

sanctioned order dated 24.12.2014 which was declared null

(16 of 17) [CW-13426/2020]

and void stood restored after passing of the order by the

Tribunal dated 19.09.2018.

14. Accordingly, the respondents were required to handover

the possession of the mining area and the petitioner-company

was entitled to act according to the P.L. issued to them for

the period of three years. The order dated 15.10.2020 is,

therefore, liable to be set aside.

15. This Court further accepts the contention of the

petitioner-company that the period from 30.11.2016 till the

date of handing over possession in terms of the present

order, shall be treated as dies non and shall be excluded from

the period of three years license granted under the P.L. dated

24.12.2014. The amendments made subsequently in the

MMDR Act, 1957 during pendency of this writ petition would

not apply to the license granted on 24.12.2014 and the four

months additional time required for completing the

formalities shall be granted additionally.

16. Accordingly, in view of above findings and conclusions,

the order dated 15.10.2020 is quashed and set aside. The

respondents are now directed to handover the possession of

the area as earmarked earlier for the mining purposes in

terms of license granted to the petitioner-company dated

24.12.2014.

17. The writ petition is accordingly allowed. No costs.

(17 of 17) [CW-13426/2020]

18. All pending applications shall also stand disposed of.

(SANJEEV PRAKASH SHARMA),J

Karan Bhutani /

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