IN THE HIGH COURT OF KARNATAKA AT BENGALURU Dated this the 1st day of December, 2016 R PRESENT: THE HON’BLE MR SUBHRO KAMAL MUKHERJEE, CHIEF JUSTICE AND THE HON’BLE MR JUSTICE BUDIHAL R B Writ Petition Nos 36461-36463 of 2016 (GM-MM-S) Writ Petition No 42947 of 2016 (GM-MM-S) & & Writ Petition No 53285 of 2016 (GM-FOR) In Writ Petition Nos. 36461-36463 of 2016: BETWEEN: SMT A V SHAKUNTALA W/O VRUSHABHENDRA A H AGED ABOUT62YEARS OCC: BUSINESS R/O NEW NO68(OLD NO301B), #35 10TH MAIN ROAD, 36TH CROSS5H BLOCK, JAYANAGAR BANGALORE-560041 ... PETITIONER [By Sri Sajan Poovayya, Senior Advocate a/w Sri Gururaj Joshi, Advocate]. AND:
1. THE UNION OF INDIA MINISTRY OF MINES REPRESENTED BY ITS2 3. 2 UNION SECRETARY TO MINES SHASTRI BHAVAN RAJENDRA PRASAD ROAD NEW DELHI-110001 THE STATE OF KARNATAKA REPRESENTED BY ITS PRI. SECRETARY COMMERCE AND INDUSTRIES DEPT. (MSME AND MINES) GOVERNMENT OF KARNATAKA VIKAS SOUDHA DR AMBEDKAR VEEDHI BANGALORE-560001 THE DIRECTOR DEPARTMENT OF MINES & GEOLOGY KHANIJA BHAVAN NO49 RACE COURSE ROAD BANGALORE-560001 … RESPONDENTS [Sri K M Nataraj, Additional Solicitor General, a/w Sri K A Ariga, Central Government Counsel, for R-1; Dr Aditya Sondhi, Additional Advocate General a/w Sri I Tharanath Poojary, Additional Government Advocate, for R-2 & 3]. THESE PETITIONS ARE FILED UNDER ARTICLES226AND227F THE CONSTITUTION OF INDIA, PRAYING TO QUASH THE PROVISION OF RULE-8(1)(a) OF THE MINERALS (OTHER THAN ATOMIC AND HYDRO CARBONS ENERGY MINERALS) CONCESSION RULES, 2016, TO THE EXTENT OF "NOT SPECIFIED IN THE FIRST SCHEDULE TO THE ACT" WHICH IS INCONSISTENT TO THE AMENDED PROVISION OF SEC.10A-(2)(C) OF THE AMENDMENT ACT OF2015TO THE MINES AND MINERALS (DEVELOPMENT AND REGULATION) ACT, 1957, THE EXTRACT OF THE SAID PROVISION IS PRODUCED AS ANNEXURE-AH, AND ETC. 3 In Writ Petition No 42947 of 2016: BETWEEN: M/S BHARATHKUMAR P BORA BY SRI BHARATH KUMAR P BORA S/O SRI PARASMAL BORA MANAGING PARTNER AGED ABOUT57YEARS R/AT MARWADI GALLI ILKAL, HUNGUND TALUK BAGALKOTE DISTRICT PIN-587 125 ... PETITIONER [By Sri S Ganesh, Senior Advocate a/w Sri K N Srinivasa, Advocate) AND:
1.
2.
3. THE UNION OF INDIA REPTD BY ITS SECRETARY MINISTRY OF MINES3D FLOOR, "A" WING SHASTRI BHAVAN, NEW DELHI-110 001 STATE OF KARNATAKA DEPARTMENT OF COMMERCE & INDUSTRIES (MINES, SSI & TEXTILES) 1ST FLOOR, VIKASA SOUDHA BENGALURU-560 001 REPTD BY ITS SECRETARY THE DIRECTOR DEPARTMENT OF MINES AND GEOLOGY KHANIJA BHAVAN RACE COURSE ROAD BENGALURU-560 00 … RESPONDENTS [Sri K M Nataraj, Additional Solicitor General, a/w Sri K A Ariga, Central Government Counsel, for R-1; Dr Aditya Sondhi, Additional Advocate General a/w Sri I Tharanath Poojary, Additional Government Advocate, for R-2 & 3]. 4 THIS PETITION IS FILED UNDER ARTICLES226AND227OF THE CONSTITUTION OF INDIA, PRAYING TO DIRECT THE RESPONDENTS TO COMPLY WITH SECTION10(2)(C) OF THE MINES AND MINERALS (DEVELOPMENT AND REGULATION) ACT1957AND GRANT THE MINING LEASE OVER35HECTARES IN SY NO166AT AIHOLE VILLAGE, HUNGUND TALUK, BAGALKOT DISTRICT FOR IRON ORE TO THE PETITIONER, AND ETC In Writ Petition No 53285 of 2016: BETWEEN: SMT A V SHAKUNTALA W/O VRUSHABHENDRA A H AGED ABOUT62YEARS OCC: BUSINESS R/O NEW NO68(OLD NO301B) #35, 10TH MAIN ROAD, 36TH CROSS5H BLOCK, JAYANAGAR BANGALORE-560 041 ... PETITIONER [By Sri Sajan Poovayya, Senior Advocate a/w Sri Gururaj Joshi, Advocate]. AND:
1.
2. THE UNION OF INDIA MINISTRY OF ENVIRONMENT & FORESTS BY ITS SECRETARY TO ENVIRONMENT AND FORESTS PARYAVARANA BHAVAN, CGO COMPLEX, LODHI ROAD NEW DELHI-110 003 THE STATE OF KARNATAKA REPRESENTED BY ITS PRL. SECRETARY ENVIRONMENT AND FORESTS GOVERNMENT OF KARNATAKA1T GATE, M S BUILDING DR AMBEDKAR VEEDHI BANGALORE-560 001 3.
4.
5. 5 THE STATE OF KARNATAKA REPRESENTED BY ITS PRL. SECRETARY COMMERCE AND INDUSTRIES DEPT. (MSME AND MINES) GOVERNMENT OF KARNATAKA VIKASA SOUDHA DR AMBEDKAR VEEDHI BANGALORE-560 001 THE PRINCIPAL CHIEF CONSERVATOR OF FORESTS, ARANYA BHAVANA18H CROSS, MALLESWARAM BANGALORE-560 001 THE DIRECTOR DEPARTMENT OF MINES & GEOLOGY KHANIJA BHAVAN NO49 RACE COURSE ROAD BANGALORE-560 001 … RESPONDENTS [Sri K M Nataraj, Additional Solicitor General, a/w Sri K A Ariga, Central Government Counsel, for R-1; Dr Aditya Sondhi, Additional Advocate General a/w Sri I Tharanath Poojary, Additional Government Advocate, for R-2 to 5]. THIS PETITION IS FILED UNDER ARTICLES226AND227OF THE CONSTITUTION OF INDIA, PRAYING TO ISSUE A WRIT IN THE NATURE OF MANDAMUS TO THE R-1 FOR THE ISSUE OF PRIOR APPROVAL OF FOREST CLEARANCE U/S2OF THE FOREST CONSERVATION ACT, 1980 FOR THE SCHEDULE MINING AREA TO ENABLE THE R-3 & 5 TO GRANT THE MINING LEASE IN FAVOUR OF THE PETITIONER IN RESPECT OF THE SCHEDULE MINING AREA, WITHIN60DAYS, AND ETC. THESE PETITIONS, HAVING BEEN HEARD AND RESERVED, COMING ON FOR PRONOUNCEMENT OF
ORDER, THIS DAY, THE CHIEF JUSTICE PRONOUNCED THE FOLLOWING:- 6
ORDERThese writ petitions raise common questions pertaining to certain amendments to the Mines and Minerals (Development and Regulation) Act, 1957 (hereinafter referred to as ‘MMDR Act’) 2. The issues that arise for our consideration include the interpretation, the purport and the applicability of Section 10A of the MMDR Act, which was inserted to the parent Act by the Mines and Minerals (Development and Regulation) Amendment Act, 2015 (hereinafter referred to as the ‘Amendment Act’).
3. Another question that arises for consideration, particularly in Writ Petition Nos. 36461-36463 of 2016, is the constitutional validity of Rule 8(1)(a) of the Minerals (Other than Atomic and Hydro Carbons Energy Minerals) Concessions Rules, 2016, (hereinafter referred to as ‘Mineral Concession Rules, 2016’).
4. 7 The petitioners in these writ petitions have sought a writ of mandamus to command the respondents to comply with Section 10A(2)(c) of the MMDR Act, 1957 and grant mining leases over certain areas.
5. We have heard Mr.S.Ganesh, learned senior advocate along with Mr.K.N.Srinivasa, advocate and Mr.Sajan Poovayya, learned senior advocate along with Mr.Gururaj Joshi, advocate for the various petitioners. We have, also, heard Mr.K.M.Nataraj, learned Additional Solicitor General and Mr.Aditya Sondhi, learned Additional Advocate General for the Union and the State, respectively.
6. Given that the Petitioners have sought grant of mining leases for certain areas pursuant to the interpretation being attributed to Section 10A(2)(c) of the MMDR Act, the facts of each case assume importance. Insofar as Writ Petition Nos. 36461-36463 of 2016 and Writ Petition No.53285 of 2016 are concerned, the petitioner filed an application for grant of mining lease for 8 extraction of iron ore in respect of an area covering 705 acres (285 hectares) in Siddapura Village, Sandur Taluk, Bellary District. The Director, Mines and Geology Department, the respondent No.3, in his letter dated June 03, 1997 sought the opinion of Senior Geologist, Bellary, with regard to the petitioner’s applications. The Senior Geologist responded by his letter dated January 27, 1998 holding that the areas sought to be leased consisted of iron ore reefs and, further, by his order dated May 05, 2000, recommended the case of the petitioner.
7. By his letter dated April 15, 2004, the Director, Mines and Geology Department, sought from the petitioner various documents including a mining plan approved by the Indian Bureau of Mines, a no objection certificate from the Karnataka Pollution Control Board and a forest clearance from the forest department of the State.
8. The Petitioner obtained approval of the mining plans from the Indian Bureau of Mines on August 04, 2004 and, 9 also, obtained site clearance from the Ministry of Environment and Forests on September 09, 2006.
9. On considering the various documents submitted by the Petitioner, on September 25, 2006 the Principal Secretary, Commerce and Industries Department, Government of Karnataka, the respondent No.2 by his letter dated September 25, 2006, directed the Director of Mines and Geology Department to submit a suitable proposal for sanction of mining lease. Subsequently, on March 03, 2007 the Conservator of Forests, Bellary Circle, after conducting necessary inspection, recorded that the diversion of forest, as prayed for by the petitioner in her application, could be considered favourably. By the very letter he requested the Principal Chief Conservator of Forests to obtain forest clearance from the competent authority in favour of the petitioner.
10. On March 09, 2008 the Petitioner obtained environmental clearance from the Ministry of Environment 10 and Forests, Government of India. Further, a no objection certificate was issued by the Karnataka State Pollution Control Board on September 25, 2008.
11. As the State did not expeditiously act on the application of the petitioner, various representations were made to the Hon’ble Chief Minister, pursuant to which the authorities considered the petitioner’s case, culminating in a letter dated July 25, 2014, issued by the respondent No.2 to the respondent No.3 recording that except forest clearance the petitioner has produced all necessary approvals and, further, held that the land was suitable for mining.
12. The petitioner contends that the letters dated September 25, 2006 and July 25, 2014, both issued by the respondent No.3, read in conjunction with each other, clearly constitute a letter of intent by the State for grant of a mining lease in favour of the petitioner, subject to fulfilment of certain conditions. The petitioner submits 11 that the only condition that remains to be fulfilled is forest clearance and even as regards that aspect the petitioner has performed all tasks necessary leading to the letter dated March 09, 2007, issued by the Conservators of Forest, which records that diversion of forest land could be considered favourably in favour of the petitioner. By the very letter she, further, requested the Principal Chief Conservator of Forests to obtain forest clearance from the competent authority in favour of the petitioner. In this background, the petitioner has, also, filed Writ Petition No.53285 of 2016, seeking a writ of mandamus to the forest authorities to issue prior approval of forest clearance under Section 2 of the Forest Conservation Act, 1980.
13. The Respondent No.3, the Director, Mines and Geology Department in a communication dated January 11, 2016, communicated to the Petitioner that her application has been ineligible since prior approval has not been granted by the Central Government, as required under Section 10A of the MMDR Act. 12 14. Pursuant to a challenge by the petitioner before this Court in Writ Petition No.17026 of 2015, this Court directed the petitioner to submit a representation to the Respondent No.2, the Principal Secretary, Commerce and Industries Department and directed him to consider the representation uninfluenced by the communication dated January 11, 2016.
15. Subsequently, on April 28, 2016, the Government of India invited representatives of all State Governments for a meeting to expedite the cases that are pending under Section 10A(2)(c). The said meeting was held on May 10, 2016, the minutes revealed that it was clarified during the meeting that the ‘letter of intent’ denoted under Section 10A(2)(c) has to be construed to mean a letter issued by the competent authority in the State Government after following the due process enunciated in the MMDR Act, indicating the State’s willingness for grant of mining lease. 13 16. Pursuant to the orders of this Court in Writ Petition No.17026 of 2015, the petitioner submitted a representation to the State on May 02, 2016 and filed additional written submissions before the Respondent No.2 on June 01, 2016. However, the Respondent No.2 by an order dated June 14, 2016, rejected petitioner’s application on the ground that Section 10A(2)(c) could not be invoked in the case of the petitioner as the petitioner has not obtained the previous approval of the Central Government and, further, that the documents available with the petitioner did not constitute a letter of intent.
17. The order dated June 14, 2016 is impugned in addition to a prayer regarding constitutional validity of Rule 8 of the Minerals Concession Rules, 2016.
18. The case of the petitioner in Writ Petition No.42947 of 2016 is substantially similar and operates in the same field. The petitioner in Writ Petition No.42947 of 2016 made an application seeking grant of lease to an extent of 14 109 acres for extraction of iron ore at Aihole Village. In June 2004, the Respondent No.3, the Director of Mines and Geology Department, issued an inspection report stating that the mining lease could be granted in favour of the petitioner after obtaining the consent of the forest department. The petitioner undertook various activities between 2004 and 2010, pursuant to which the Respondent No.3 on March 08, 2011 sent a proposal to the State Government recommending the grant of mining lease to the petitioner.
19. On March 03, 2012 the State Government submitted its written recommendations for grant of mining lease to the petitioner and sought prior approval of the Central Government under Section 5(1) of the MMDR Act, which was followed by a letter dated January 17, 2013 by the Respondent No.3 to the Secretary, Ministry of Mines, Government of India, submitting various replies and clarifications to the questions that were raised by the Government of India. 15 20. On June 16, 2016, the Respondent No.3 issued a letter to the Secretary to the Government, recommending the granting of a mining lease to the petitioner on the basis that the restriction hitherto imposed by the order of the Hon’ble Supreme Court of India would not apply to Bagalkote District and particularly to the case of the Petitioner. However, subsequently on November 15, 2014 the Respondent No.2 withdrew the recommendation for grant of mining lease hitherto made on March 31, 2012.
21. The petitioner assails this withdrawal on the basis that no power is conferred on the State Government under the provisions of the MMDR Act to withdraw a recommendation already made and, further, that the combination of the various correspondence issued, clearly constitutes a letter of intent to grant mining lease and that petitioner is, therefore, entitled to a mining lease under Section 10A(2) (c) of the MMDR Act. 16 22. Section 10A was inserted into the MMDR Act by the Mines and Minerals (Development and Regulation) Amendment Ordinance, 2015, with effect from January 12, 2015. The Ordinance was repealed by the Mines and Minerals (Development and Regulation) Amendment Act, 2015, on March 27, 2016 with a provision that the amendment is deemed to have come into force on January 12, 2015. Section 10A is abstracted below: “10A. Rights of existing concession holders and applicants: (1) All applications received prior to the date of commencement of the Mines and Minerals (Development and Regulation) Amendment Act, 2015, shall become ineligible. (2) Without prejudice to sub-section (1), the following shall remain eligible on and from the commencement of the Mines and Minerals (Development and Regulation) Amendment Act, 2015:- (a) applications received under section 11A of this Act; 17 (b) where before the commencement of the Mines and Minerals (Development and Regulation) Amendment Act, 2015 a reconnaissance permit or prospecting licence has been granted in respect of any land for any mineral, the permit holder or the license shall have a right from obtaining a prospecting licence followed by a mining lease, or a mining lease, as the case may be, in respect of that mineral in that land, if the State Government is satisfied that the permit holder or the licensee, as the case may be, - (i) has undertaken reconnaissance operations or prospecting operations, as the case may be, to establish the existence of mineral contents in such land in accordance with such parameters as may be prescribed by the Central Government; (ii) has not committed any breach of the terms and conditions of the 18 reconnaissance permit or the prospecting licence; (iii) has not become ineligible under the provisions of this Act; and (iv) has not failed to apply for grant of prospecting licence or mining lease, as the case may be, within a period of three months after the expiry reconnaissance permit of or prospecting licence, as the case may be, or within such further period not exceeding six months as may be extended by the State Government; (c) where the Central Government has communicated previous approval as required under sub-section (1) of section 5 for grant of mining lease, or if a letter of intent (by whatever name called) has been issued by the State Government to grant a mining lease, before the commencement of the Mines and Minerals (Development and 19 Regulation) Amendment Act, 2015, the mining lease shall be granted subject to fulfilment of the conditions of the previous approval or of the letter of intent within a period of two years from the date of commencement of the said Act: PROVIDED that in respect of any mineral specified in the First Schedule, no prospecting licence or mining lease shall be granted under clause (b) of this sub-section except with the previous approval of the Central Government.” 23. Section 10A(1) clearly indicates that all applications received prior to the date of commencement of Amendment Act of 2015 shall become ineligible. Section 10A(2) provides that without prejudice to Section 10A(1) certain cases shall remain eligible. Section 10A(2)(a) deals with applications received under Section 11A of the MMDR Act. Section 10A(2) (b) deals with cases where a reconnaissance permit or prospecting licence has been granted in respect of any land for any mineral. 20 24. Section 10A(2)(c) deals with the cases that are applicable to the petitioners herein. Section 10A(2)(c) denotes that if a letter of intent, by whatever name called, has been issued by the State Government, for grant of mining lease before the commencement of Amendment Act, that is, before January 02, 015, the mining lease shall be granted subject to the fulfilment of the conditions of the letter of intent within a period of two years, that is, within January 11, 2017.
25. It is pertinent to observe that the proviso to Section 10A(2) qualifies only cases covered under Section 10A(2)(b) and no other. This is amply clear from the wording of proviso itself which specifies that in respect of any mineral specified in the First Schedule, no prospecting licence or mining lease shall be granted under clause (b) of Section 10A(2) except with the previous approval of the Central Government.
26. 21 It is the common stand of both petitioners that their cases do not fall within Section 10A(2)(b) and, therefore, the restriction applied through the proviso that in respect of minerals specified in the First Schedule no mining lease shall be granted except with the previous approval of the Central Government, does not apply to their case.
27. A plain reading of Section 10A makes it amply clear that the proviso, which imposes a restriction against granting of mining lease for a mineral specified in the First Schedule, except with the previous approval of the Central Government, applies to only cases enumerated under Section 10A(2)(b) and does not apply to cases under Section 10A(2)(c).
28. Consequently, we are unable to agree with the contention of the respondents that such a restriction should, also, be applied to cases covered under Section 10A(2)(c).
29. 22 It is trite that on a plain reading of a statute if no limitations are made out, such limitations should not be read into the statute so as to deprive the rights of any party. Further, Section 10A(2)(c) makes it amply clear that so far as a letter of intent by whatever name called has been issued by the State Government prior to January 12, 2015, it is only the condition contained in the letter of intent that will qualify the grant of a mining lease. So long as those conditions are fulfilled a mining lease shall be granted to the applicant. Although iron ore is specified in Part C of Schedule I to the MMDR Act, it cannot automatically be stated that under the amended scheme of the MMDR Act, a previous approval of the Central Government is necessary for the grant of mining lease in all cases.
30. As we have observed above, the proviso to Section 10A(2), which requires previous approval of the Central Government for grant of a mining lease in respect of any mineral specified in the First Schedule to the MMDR Act, 23 applies only to cases covered under Section 10A(2)(b) and does not in any manner qualify or control the cases covered under Section 10A(2)(c).
31. This understanding that one arrives by a plain reading of a statute is also buttressed by the contemporaneous understating of the union and the state authorities as well. The contemporaneous understanding of all concerned authorities of both the State Government and the Central Government shows that from the very beginning the authorities have consistently understood Section 10A(2)(c) as being applicable to major minerals such as iron ore, manganese etc. and not being confined to minor minerals.
32. Applying the doctrine of contemporanea expositio, the contemporaneous understanding of a statutory provision by the authorities whose task it is to implement the enactment assumes great importance. 24 33. The Hon’ble Supeme Court in Desh Bandhu Gupta and Co., v. Delhi Stock Exchange Association Limited reported in AIR1979SC1049and Spentex Industries Limited v. Commissioner of Central Excise and others reported in (2016) 1 SCC70observed that such contemporaneous understanding should not be departed from, by a court unless it has been found to be clearly violative of the statute or contrary to binding precedents.
34. Our attention is drawn to the case of The Municipal Corporation of Delhi v. Tek Chand Bhatia reported in (1980) 1 SCC158and Union of India v. Rabinder Singh reported in (2012) 12 SCC787 to support the contention that the restriction imposed by the proviso of Section 10A(2), should be read as being applicable not only to Section 10A(2)(b), but also to Section 10A(2)(c). Given that a plain reading of the proviso makes it ex facie clear that the proviso qualifies only those cases under clause (b), we are unable to accept such contention. 25 35. Rule 8 of the Mineral Concession Rules, 2016, which came into effect from March 04, 2015 is abstracted below: “8. Rights under the provisions of clause (c) of sub-section (2) of Section 10A (1) The applicant in whose favour – (a) the State Government has issued a letter of intent (by whatever name called) in writing before January 12, 2015, for grant of a mining lease for minerals not specified in the First Schedule to the Act; or (b) the Central Government has communicated the previous approval in writing before January 12, 2015, under sub-section (1) of section 5, for grant of a mining lease for minerals specified in Part C of the First Schedule to the Act, shall submit a letter of compliance to the State Government, of the conditions mentioned in the letter of intent or the conditions mentioned in the previous approval granted by the Central Government, as the case may be, and the State Government shall send a acknowledgement of receipt of the letter of compliance to the applicant 26 in Schedule I within a period of three days of receipt thereof. (2) After receipt of letter of compliance under sub-rule (1), the State Government shall issue an order for grant of the mining lease within a period of sixty days from the date of receipt of such letter subject to verification of fulfilment of the conditions mentioned in the letter of intent or previous approval of the Central Government, as the case may be: PROVIDED that in case the conditions as mentioned in the (i) letter of intent issued by the State Government, or (ii) previous approval granted by the Central Government are not fulfilled, the State Government shall, after giving the applicant an opportunity of being heard and for reasons to be recorded in writing and communicated to the applicant within a period of sixty days from the date of receipt of letter of compliance, refuse to grant a mining lease for non-compliance of conditions mentioned in the letter of intent or the previous approval of the Central Government, as the case may be. 27 (3) Upon issuance of an order of grant of mining lease under sub-rule (2), the applicant shall- (a) furnish a performance security to the State Government in the form of a bank guarantee in the format specified in Schedule IV or as a security deposit for an amount equivalent to 0.50% of the value of estimated resources, which may be invoked by the State Government as per the terms and conditions of the Mine Development and Production Agreement, published by the Government of India in the Ministry of Mines, vide Part I, Section-1 of Gazette of India, dated the 2nd July, 2015, and the mining lease deed. The performance security shall be adjusted every five years to correspond to 0.50% of the reassessed value of estimated resources; and (b) sign a Mine Development and Production Agreement with the State Government in the format specified by the Central Government after compliance of conditions specified in this sub-rule. (4) Where an order for grant of mining lease has been issued under sub-rule (2), the mining 28 lease shall be executed with the applicant in the format specified in Schedule VII and registered on or before 11th January, 2017, failing which the right of such an applicant under clause (c) of sub-section (2) of Section 10A for grant of a mining lease shall be forfeited and in such case, it would not be mandatory for the State Government to issue any order in this regard. (5) The State Government may, for reasons to be recorded in writing and communicated to the applicant, reduce the area applied for at the time of grant of the mining lease. (6) The date of the commencement of the period for which a mining lease is granted shall be the date on which a duly executed mining lease deed is registered.” 36. No doubt Rule 8(1)(a) indicates that for cases covered under Section 10A(2)(c), the entitlement of an applicant for grant of mining lease would be for minerals not specified in the First Schedule to the Act. On a plain reading, Rule 8(1)(a) imposes a restriction not contained in 29 Section 10A(2)(c). The limitation contained in Rule 8(1)(a) to the effect that mining leases under Section 10A(2)(c) should only be granted for minerals specified in the First Schedule, is a limitation that travels beyond the parent Act. Further, the amendment to the parent Act was brought in with effect from January 12, 2015, and, therefore, there would have been many cases similar to the present petitioners, who would have been conferred with rights under Section 10A(2)(c) as on January 12, 2015. Such rights cannot be limited or restricted by virtue of the rules that were framed and notified only on March 04, 2016. The Rule, therefore, cannot be imposing a retrospective limitation on the rights of the petitioners even assuming that the Rule was consistent with the parent Act.
37. In District Collector v. K.Govindraj reported in (2016) 4 SCC763 it was held that a rule could be applied retrospectively where it dealt merely with a matter of procedure. 30 38. Be that as it may, in our view retrospective operation of the rule or otherwise is of no consequence, for the rule ex facie travels beyond the parent Act and imposes and restriction not contained in the parent Act.
39. In the instant case, it is prima facie apparent that Rule 8(1)(a) travels beyond the scope of the parent Act and in particular runs contrary to Section 10A(2)(c) insofar as it applies an additional restriction that the mining leases would only be for minerals not specified in the First Schedule to the Act.
40. It is also pertinent to note that rule making power is contained in Section 13 of the MMDR Act. Section 13(1) delegates the general power of rule making to the Central Government whereas Section 13(2) delegates specific powers to the Central Government regarding making rules pertaining to specific sections of the parent Act. The power to make rules specifically for section 10A(2)(c) cases, is not specified and delegated to the Central Government under 31 Section 13(2). Therefore, the Central Government can only fall back on the general rule making power delegated under Section 13(1) of the MMDR Act.
41. The Supreme Court has held in Kunj Behari Lal v. State of Himachal Pradesh and others reported in (2000) 3 SCC40that the delegated power to legislate by making rule for carrying out the purpose of the Act is a general delegation without laying down any guidelines and, therefore, it could not be so exercised as to bring into existence substantive rights or obligations or disabilities not contemplated by the provisions of the Act itself.
42. In the instant case, the additional limitation imposed by Rule 8(1)(a), is a disability that is not contemplated under Section 10A(2)(c) of MMDR Act and, therefore, the Rule ought to be declared invalid and struck down as being ultra vires the parent Act, insofar as such additional limitation is concerned, that is, insofar as the Rule attempts to limit mining leases under Section 10A(2)(c) 32 only to those minerals not specified in the First Schedule to the Act.
43. A subordinate legislation ought to be struck down if it fails to conform to the statute under which it is made or if it exceeds the limits of the authority conferred by the parent Act. As observed by the Supreme Court in Cellular Operators Association of India v. Telecom Regulatory Authority of India and Others reported in (2016) 7 SCC703 when a rule has been directly inconsistent with a mandatory provision of the statute under which it has been made, then of course the task of the court has been simple and easy.
44. When the power to make rules is delegated, the exercise of this power is hedged in with the condition that it must be exercised consistently with the Act and in order to carry out the purpose of the Act. It is, also, trite that a limitation or a disqualification imposed, must be defined and not uncertain and requisite guidelines in respect 33 thereof should be laid down in the statute itself. It is well settled that essential legislative function cannot be delegated. In the light of the above, it is clear that Rule 8(1)(a) imposes a limitation not contained in Section 10A(2)(c) of the Act and consequently, the rule has to yield to the parent statute and, therefore, the limitation contained in Rule 8(1)(a) is ultra vires the MMDR Act, 1957.
45. We now proceed to deal with the interpretation that ought to be attributed to the term ‘letter of intent’. Section 10A(2)(c) of the Act uses the term ‘a letter of intent by whatever name called’. This clearly expresses the legislative intent that a broad interpretation ought to be afforded to the words ‘letter of intent’ contained in Section 10A(2)(c). The Supreme Court in Rishi Kiran Logistics Pvt. Ltd v. Board of Trustees of Kandla Port Trust and others reported in (2015) 13 SCC233 relying upon the observations in Dresser Rand S.A. v. Bindal Agro Chem.Ltd. and others reported in (2006) 1 SCC75134 held that a letter of intent merely indicates a party’s intention to enter into a contract with the other party in the future. It need not contain a contractual arrangement with any specificity.
46. In the instant case, insofar as the petitioner in Writ Petition No.36461-36463 of 2016 is concerned, the communication issued by the respondent No.3 on May 15, 2004 read with the letter of the respondent No.2 dated September 25, 2006 in conjunction with the letter of the respondent No.2 dated July 25, 2014 clearly constitutes a letter of intent demonstrating the intention of the state to sanction and grant a mining lease in favour of the petitioner, subject to certain conditions.
47. Insofar as the petitioner in Writ Petition No.42947 of 2016 is concerned, the communication issued by the respondents on March 08, 2011 in conjunction with the letter dated June 16, 2014 constitutes a letter of intent 35 regarding the intention of the State to grant mining lease subject to the conditions contained therein.
48. The Amendment Act that was introduced Section 10A to the MMDR Act came into force on January 12, 2015, and it has conferred certain rights on the petitioners, which would expire by efflux of time, in a period of two years from the date of the amendment, that is, on January 11, 2017. Valuable rights of the petitioners recognised by the statutory amendments would be lost by efflux of time on January 11, 2017, if the respondents do not act with a sense of urgency and consider the cases of the petitioners for grant of mining leases.
49. For instance, insofar as the petitioner in Writ Petition Nos. 36461-36463 of 2016 is concerned, she has complied with all conditions that were imposed by the State Government except for obtaining forest clearance. Even as regards forest clearance, the petitioner applied as early as in the year 2006 and despite the recommendation by the 36 Conservator of Forest, Bellary Circle, on March 09, 2007, the Principal Chief Conservator of Forest has failed to obtain forest clearance from the competent authority in favour of the petitioner. This is despite the fact that the Conservator of Forest recorded in his letter dated March 09, 2007, that the diversion of forest land for mining purposes as sought for in the application could be considered favourably. We are conscious that inaction on the part of the state authorities will lead to valuable rights recognised by the amendment to the MMDR Act being rendered futile merely by efflux of time.
50. In the light of the above, we are of the opinion that the petitioners in the instant cases have received letters of intent by the State Government for grant of mining leases subject to the conditions contained therein and, consequently, their cases ought to be considered under Section 10A(2)(c) of the MMDR Act dehors the limitations prescribed under Rule 8(1)(a) of the Mineral Concession Rules, 2016. 37 51. Accordingly we pass the following :
ORDERWrit Petition Nos. 36461-36463 of 2016 are allowed. (i) (ii) Rule 8(1) of the Minerals (other than Atomic and Hydro Carbons Energy Minerals) Concession Rules, 2016, insofar as it imposes the limitation of ‘minerals not specified in the First Schedule to the Act is declared ultra vires to the Mines and Minerals (Development and Regulation) Act, 1957 and consequently quashed; The Order dated June 14, 2016, issued by the respondent No.2, the Secretary, Commerce and Industries Department rejecting the petitioner’s application for grant of mining lease is quashed; (iii) Mandamus is issued directing the respondents to process the application of the petitioner 38 pursuant to the letters of intent dated September 25, 2006, and July 25, 2014, for grant of mining lease, dehors the limitations contained in Rule 8(1)(a) within a period of four weeks.
52. Writ Petition No.42947 of 2016 is, also, allowed. (i) Letter dated October 13, 2014 issued by the respondent No.1 and the letter dated November 15, 2014 issued by the respondent No.2 are quashed. (ii) Mandamus is issued directing the respondent No.2 to process the application of the petitioner pursuant to the letters of intent dated March 08, 2011, and June 16, 2014, for grant of mining lease, dehors the limitations contained in Rule 8(1)(a), within a period of four weeks. 39 53. Writ Petition No.53285 of 2016 is also allowed. (i) Mandamus is issued to the respondent No.1 to consider and grant requisite forest clearances to the petitioner within a period of two weeks in accordance with law. We, however, make no order as to costs. Sd/- CHIEF JUSTICE Sd/- JUDGE54 * DKB/SNB