Uttar Pradesh Mining Minerals (Concession) Rules, 1963: Rules 68 and 40(h) – Mining lease – Extension of – Sought by the lease-holders – For the obstructed period of lease, due to judicial pronouncements – Held: The proposition that interdicts posed by a competent Court should not put a party at a disadvantage, cannot be a blanket proposition – The court has to consider the context in which the interdict was passed, in the present case it is to preserve the forest area – The right to extension of lease either flow from the statutory provisions or from the terms of the lease – The obstructed period by reason of judicial interdict, by itself will not give window to extend the lease – Extension of lease cannot be granted in exercise of Rule 68 as the same is worded in restrictive manner – The new mining policy of the State also has no provision for grant of extension of time for the obstructed period – Terms of the lease too do not provide for any such consequences – Only Rule 40(h) provides for the consequences of disruption – Therefore, the appropriate course would be not to extend the lease for the obstructed period, but to refund the security deposit and the amount deposited by lease-holders as advance royalties, in terms of Rule 40(h) – Since the monies have remained blocked and the mining was prevented for no fault of the lease-holders, in order to do complete justice, in exercise of power u/Art. 142 of the Constitution, the monies are directed to be refunded with simple interest @ 9% p.a.
Disposing of the appeals, the Court
HELD : 1. The right to extension of lease either flow from a statutory provision or from the terms of the lease between the concerned parties. If there has been an obstructed period by reason of a judicial interdict, that itself will not give window to extend the lease by not following the statutory provisions, especially when the terms of the lease do not provide for any consequences thereof. [Para 36][578-D-E]
Vijay Kumar Dwivedi v. State of Uttar Pradesh (2016)
4 All LJ 690 – approved.
2.1 The statutory provision of Rule 68 of the Uttar Pradesh Mining Minerals (Concession) Rules, 1963 is in the nature of a relaxation rule in special cases and has to be read with the Rules which provide the manner in which the exploitation of minerals should take place. The statute was worded in a restrictive manner deliberately giving only a restricted window and this legislative intent ought not to be defeated by supplanting it with any other interpretation. [Para 35][577-F-G; 578-A-B]
Sukhan Singh v. State of UP & Ors. (2015) 2 All LJ
619 – approved.
Mohammad Yunus Hasan v. State of UP & Ors. (2016)
4 All LJ 4 – referred to.
2.2 It is a well settled principle of interpretation that when the words of a statute are clear and unambigous, recourse to different principles of interpretation, other than the rule of literal construction, cannot be resorted to. If a fresh grant or extension has to be made under the Mining Rules, it must be in accordance with Chapter II, and the provision for auction of leases in Chapter IV is in furtherance of a transparent procedure. [Para 35][578-BC] Delhi Transport Corporation v. Balwan Singh and Ors. 2019 SCC Online SC 276 – relied on.
3. The State of UP had issued a New Mining Policy on 12.6.2017 and this policy has no provision for grant of extension of time for obstructed period of mining lease and all mining leases were to be permitted by e-tendering or e-auction alone. If the mining lease is extended for the obstructed period, it would amount to violation of this New Mining Policy and since the extension would have to be granted now, it cannot be accepted that this should relate back to the date of the lease and not as on date. [Para 39][579-B-D]
4. Rule 40(h) of the Mining Rules provides for the consequences of the disruption of mining operations in a lease area owing to any special circumstances and requires the DM, with the prior approval of the State Government, to adjust the amount equivalent to the installments payable during the disrupted period against forthcoming installments. Thus, monetary adjustment is all that has been provided for by the statute making the legislative intent obvious, i.e., that if some amounts have been paid as installments under the mining lease for the period when the beneficiary is not able to operate the mining area, only that amount is liable to be refunded. The State of UP is only liable to refund (i) any security deposit; or (ii) advance royalties paid to them, for this obstructed period – something to which the State of UP has already consented before this Court. [Para 40][579-D-G]
5. The proposition that interdicts posed by a competent court should not put a party at a disadvantage, cannot be a blanket proposition. The Court will have to consider the context in which the interdict was passed, i.e., to preserve the forest area. It is a different matter that some leases were ultimately found as within the restricted area and some outside (as is the case of the appellants). Even if the notification of the State of UP dated 31.7.2014 is taken into account, and the authorisation of the DMs to extend the lease where no third party interest was created and the leases were prevented from operation for no fault attributable to the leaseholders, the subsequent transparent policy of 2017 would weigh in favour of not exercising the jurisdiction to extend the leases for the obstructed period. [Para 41][580-C-F]
6.1 Therefore, the appropriate course of action to be adopted in the present case cannot be to extend the lease for the obstructed period but to direct that the security deposit, if not already refunded, should be refunded and the amount deposited by the appellants/leaseholders as advance royalties to the respondent/State be also paid back to them along with something more. [Para 42][580-F-G]
6.2 The appellants’ monies have remained blocked and mining was prevented for no fault of theirs, despite success in earlier legal proceedings, and this aspect has to be balanced with the statutory provision or for that matter, even the contractual provisions not providing for extension of leases. Therefore, by exercising jurisdiction under Article 142 of the Constitution of India to do complete justice inter se the parties, it is directed that the monies have remained blocked, the monies should carry simple interest @ 9% per annum. [Para 43][580-G; 581-A-B]
6.3 Insofar as the security deposit is concerned, if it has already been refunded, it would naturally not carry any interest and if not, then it will carry interest from the date it ought to have been refunded after the expiry of the lease till it is actually refunded in case of expired leases. On the other hand, so far as the advance royalties for the obstructed period are concerned, the said amounts will carry interest @ 9% per annum from the date the obstruction occurred, i.e., 29.8.2018 and 5.2.2019, as applicable to the respective appellants, till the date of payment. [Para 44][581-B-D]
Nar Narain Mishra v. The State of UP and Ors. 2013 SCC Online All 13919 ; Sulekhan Sing & Company and Ors. v. State of Uttar Pradesh & Ors. (2016) 4 SCC
663 : [2016] 1 SCR 91; Deepak Kumar and Ors. v. State of Haryana and Ors. (2012) 4 SCC 629: [2012]
4 SCR 819 – relied on.
Banwasi Seva Ashram v. State of U.P & Ors. (1986) 4 SCC 753: [1987] 1 SCR 336; Jagdish Prasad Nishad v. State of UP & Ors. (2015) 128 RD 150; Beg Raj Singh v. State of UP & Ors. (2003) 1 SCC 726: [2002]
5 Suppl. SCR 530 – referred to.
As published in the Supreme Court Reports, Supreme Court of India. Text from the Indian Supreme Court Judgments open data set (Dattam Labs), CC BY 4.0.
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