Mines and Minerals (Development and Regulation) Act, 1957 – s. 10-A – Mines and Minerals (Development and Regulation) Amendment Act, 2015 – Concession Rules, 2016 – r.61 and Proviso – Directions issued to the government of West Bengal to execute a mining lease in favour of respondent no.1-M/s. Chiranjilal (Mineral) Industries of Bagandih:

[2023] 12 S.C.R. 277 : 2023 INSC 824

STATE OF WEST BENGAL AND ANOTHER

v.

M/S. CHIRANJILAL (MINERAL) INDUSTRIES OF

BAGANDIH AND ANOTHER

(Civil Appeal No. 8238 of 2022)

SEPTEMBER 12, 2023

[SANJIV KHANNA* AND ARAVIND KUMAR, JJ.]

Issue for consideration: Intra-court appeal preferred by the

State of West Bengal before the High Court was dismissed with

the direction to the Appellant No. 2 – Joint Secretary, Department

of Industries, Commerce and Enterprises, West Bengal or any

authorised officer to execute a mining lease in favour of the

Respondent No. 2, sole proprietor of Respondent No. 1 - M/s.

Chiranjilal (Mineral) Industries of Bagandih.

Mines and Minerals (Development and Regulation) Act, 1957

– s. 10-A – Mines and Minerals (Development and Regulation)

Amendment Act, 2015 – Concession Rules, 2016 – r.61 and

Proviso – Directions issued to the government of West Bengal

to execute a mining lease in favour of respondent no.1-M/s.

Chiranjilal (Mineral) Industries of Bagandih:

Held: It is the stand of the appellants – State of West Bengal,

that they are owners of 20.87 acres of the land in question and to

this extent, they have no difficulty in executing the mining lease –

This being the stated stand, which has also been affirmed, there

should be no difficulty in granting of mining lease for the said area

to the Respondent No. 1-M/s. Chiranjilal (Mineral) Industries of

Bagandih – So, it is directed that the government of West Bengal

will execute a mining lease for 20.87 acres of land in favour of the

Respondent No. 1 – The claim of the Respondent No. 1 towards

the balance area for the grant of mining lease will be treated as

rejected and dismissed. [Paras 20 and 22]

Mines and Minerals (Development and Regulation) Act,

1957 – sub-section (1) to Section 10-A Mines and Minerals

(Development and Regulation) Amendment Act, 2015 – Object

and purpose of amendment – Application of exceptions or the

saving clauses in three kinds of situations:

* Author

278 [2023] 12 S.C.R.

SUPREME COURT REPORT: DIGITAL

Held: The object and purpose of the Amendment Act, 2015 is

to ensure that allocation of mineral resources is done through

auctioning – This is the reason why sub-section (1) to Section 10-A

of the MMDR Act, 1957 mandates that all applications received

prior to 12.01.2015 shall become ineligible – The exceptions or

the saving clause applies to three kinds of situations specified in

sub-section (2) to Section 10-A of the MMDR Act, 1957 – The first

category is where an application has been received u/s. 11-A of the

MMDR Act,1957 – The second category is where a reconnaissance

permit or a prospecting licence has been granted the permit holder

or the licensee has the right to obtain a prospecting licence followed

by a mining lease and the State Government is satisfied that the

permit holder or the licensee has complied with the requirements

specified in sub-clauses (i) to (iv) of clause (b) of sub-section

(2) to Section 10-A of the MMDR Act, 1957 – The reason for

protecting this class of cases is on account of the fact that they

had altered their position by spending money on reconnaissance

operations or prospecting operations – Accordingly, the principle

of legitimate expectation is applied – The third category is where

the Central Government had already communicated their previous

approval or the State Government had issue Letter of Intent for

grant of mining lease before coming into force of the Amendment

Act 2015 – The raison dêtre, it is observed therein, is that certain

rights had accrued to these applicants inasmuch as all necessary

procedures and formalities had been complied with and only formal

lease remains to be executed. [Para 14]

Mines and Minerals (Development and Regulation) Act, 1957 –

Mines and Minerals (Development and Regulation) Amendment

Act, 2015 – A Grant Order dated 16.07.2015 was issued by

the Deputy Secretary, Commerce and Industries Department,

West Bengal for Dolomite mining in favour of Respondent No.

1 - M/s. Chiranjilal (Mineral) Industries of Bagandih in respect

of 76 acres of land, subject to certain conditions – Whether

approval of the Central Government required or not:

Held: Though in the present case, post notification No. S.O. 423(E)

dated 10.02.2015, Dolomite was notified as a minor mineral and

hence, the approval of the Central Government was not required

for the reason that the Grant Order dated 16.07.2015 was hedged

with pre-conditions, including the requirement to submit consent

letters of the owners of the land in question (Raiyats) before the 

[2023] 12 S.C.R. 279

STATE OF WEST BENGAL AND ANOTHER v. M/S. CHIRANJILAL

(MINERAL) INDUSTRIES OF BAGANDIH AND ANOTHER

execution of the lease deed, or there was to be a stipulation that

a condition to this effect would be incorporated in the draft lease

– Therefore, the Grant Order dated 16.07.2015 is provisional, and

is subject to fulfilment of the conditions therein. [Para 16]

West Bengal Land Reforms Act, 1955 – sub-section (10) to

section 2 and sub-section (2A) to section 4 – Raiyat Land –

Meaning – Rights of Raiyat in respect of land:

Held: Raiyat land is to be used for cultivation, etc., and not for

mining – Once the mining activity is undertaken, the Raiyats will not

be able to use the land – In terms of sub-section (10) to Section 2

of the WBLR Act, 1955, a Raiyat means a person or an institution

holding land for any purpose whatsoever – However, the rights

of Raiyat in respect of the land in terms of sub-section (2A) to

Section 4 of the WBLR Act, 1955 does not permit any other person

to quarry sand from his holding, dig or use, or permit any person

to dig or use, earth or clay of his holding for the manufacture of

bricks or tiles except with previous permission in writing of the State

Government – In case of breach of the condition, the prescribed

authority may, after giving notice and opportunity to a Raiyat to

show cause, can levy a monetary penalty. [Para 17]

West Bengal Land Reforms Act, 1955 – s. 4B – Preservation

of character of land:

Held: Section 4-B of the WBLR Act, 1955 stipulates that every

Raiyat holding any land shall maintain and preserve such land in

a manner that the area is not diminished or its character is not

changed or the land is not converted for any purpose other than

the purpose for which it was settled or previously held except

with the previous permission of the Collector in writing. [Para 17]

Mines and Minerals (Development and Regulation) Act, 1957

– West Bengal Land Reforms Act, 1955 – s. 14 Y – A Grant

Order dated 16.07.2015 was issued by the Deputy Secretary,

Commerce and Industries Department, West Bengal for

Dolomite mining in favour of Respondent No. 1 - M/s. Chiranjilal

(Mineral) Industries of Bagandih in respect of 76 acres of

land, subject to certain conditions, including the requirement

to submit consent letters of owners of the land in question

(Raiyats) – Another stipulation mentioned therein was the need

for permission u/s. 14-Y of the WBLR Act, 1955 for holding

the required land and furnishing of Conversion Certificate for 

280 [2023] 12 S.C.R.

SUPREME COURT REPORT: DIGITAL

plots of land from the appropriate authority in terms of s.4-C

of the WBLR Act, 1955:

Held: The controversy relating to Section 4-C of the WBLR Act,

1955, cannot simply be decided on the basis of Memo No. V/

RTI/775/15 dated 06.03.2017 issued by the Deputy District Land

and Land Reforms Officer, Purulia, that as per the revenue records

the land was recorded as ‘Dungri’ – The reason is that Raiyat land

is not for mining – Thus, a contradiction arises, as the grant of

Raiyat land and the classification of the same land as ‘Dungri’ is

contradictory – Further, whether the consent letter of the owners

of the land in question (Raiyats) obtained by the Respondent No.

1still hold good, would be relevant as there could be a change of

hands on account of transfer, inheritance, etc – Connected with

this are the legal issues – First, whether the Respondent No. 1

had altered its position post the issue of the Grant Order dated

16.07.2015, but before enforcement of the Concession Rules, 2016,

to get the benefit of Rule 61 of the Concessions Rules, 2016? – It is

necessary to ascertain the facts and then alone one can adjudicate

and decide the question whether the Respondent No. 1 is entitled

to the benefit of the proviso to Rule 61 of the Concession Rules,

2016 – This has not been verified and ascertained – An issue

would arise on whether the application filed by the Respondent

No. 1 way back in 1998 would still hold good as at the time, when

the application was filed, approval of the Central Government

was required – Another difficulty is that WBMDTCL has not been

impleaded as a party, though it was always contesting the claim

made by the Respondent No. 1 – However, these issues are not

being examined in the light of the directions issued – Further, that

the remand order cannot be passed at this distinct point of time.

[Paras 18 and 19]

Bhushan Power and Steel Limited v. S.L. Seal, Additional

Secretary (Steel and Mines), State of Odisha and Others,

(2017) 2 SCC 125:[2016] 11 SCR 149; Bhushan Power

and Steel Limited and Others v. State of Orissa and

Another, (2012) 4 SCC 246:[2012] 5 SCR 16; Sandur

Manganese and Iron Ores Ltd. v. State of Karnataka,

(2010) 13 SCC 1:[2010] 11 SCR 240; Bhushan Power

and Steel Limited v. Rajesh Verma, (2014) 5 SCC

551:[2014] 5 SCR 493; Rishi Kiran Logistics Private

Limited v. Board of Trustees of Kandla Port Trust

and Others, (2015) 13 SCC 233:[2014] 5 SCR 411; 

[2023] 12 S.C.R. 281

STATE OF WEST BENGAL AND ANOTHER v. M/S. CHIRANJILAL

(MINERAL) INDUSTRIES OF BAGANDIH AND ANOTHER

Rajasthan Cooperative Dairy Federation Limited v.

Maha Laxmi Mingrate Marketing Service Private Limited

and Others, (1996) 10 SCC 405:[1996] 6 Suppl. SCR

368; Thressiamma Jacob and Others v. Geologist,

Department of Mining and Geology and Others, (2013)

9 SCC 725:[2013] 7 SCR 863 – referred to.

CIVIL APPELLATE JURISDICTION : CIVIL APPEAL NO.8238 OF

2022

[From the Judgment and Order dated 04.10.2018 of the High Court

at Calcutta in FMA No.1458 of 2017]

Anand Grover, Sr. Adv., Ms. Mantika Haryani, Shreyas Awasthi, Ms.

Astha Sharma, Advs. for the Appellants.

Respondent in Person.

The Judgment of the Court was delivered by

SANJIV KHANNA, J.

This appeal, by way of special leave, takes exception to the judgment of

the division bench of the High Court of Calcutta, whereby the intra-court

appeal preferred by the State of West Bengal and Others in F.M.A. No.

1458 of 2017 with CAN No. 6596 of 2017 has been dismissed with the

direction to the Appellant No. 2 – Joint Secretary, Department of Industries,

Commerce and Enterprises, West Bengal or any authorised officer to

execute a mining lease in favour of the Respondent No. 2 – Dinesh

Agarwal, sole proprietor of Respondent No. 1 - M/s. Chiranjilal (Mineral)

Industries of Bagandih.

2. The facts are rather chequered, albeit are required to be noticed

in detail. On 07.08.1985, West Bengal Mineral Development and

Trading Corporation Limited1

 had filed an application for grant of long

term mining lease for Dolomite, Limestone and Quartzite at the plots

in Mouza - Khariduara, Kumari and Boch. An application was also

filed by WBMDTCL for grant of long term mining lease for Iron Ore,

Manganese and Fireclay at the plots in Mouza - Khariduara, Kumari,

Boch and Kangametya. Grant Order dated 07.04.1986 was issued

in favour of WBMDTCL by the Assistant Secretary, Commerce and

Industries Department, Mines Branch, West Bengal.

1 For Short,’ WBMDTCL’.

282 [2023] 12 S.C.R.

SUPREME COURT REPORT: DIGITAL

2.1 On 06.03.1998, Respondent No. 1 - M/s. Chiranjilal (Mineral)

Industries of Bagandih. had filed an application before the

Mining Officer-in-charge, Purulia Zone, Directorate of Mines and

Minerals, West Bengal, for the grant of a mining lease for the

purpose of extracting Dolomite at Mouza - Khariduara, Kumari

and Boch, in 76 acres of land.

2.2 The Respondent No. 1 - M/s. Chiranjilal (Mineral) Industries of

Bagandih filed Writ Petition No. 7808 (W) of 2001 before the High

Court of Calcutta, seeking disposal of their application for grant

of mining lease. The High Court vide order dated 13.06.2001,

directed the State authorities to dispose of the application of

Respondent No. 1 - M/s. Chiranjilal (Mineral) Industries of

Bagandih at an early date and in accordance with law.

2.3 The Joint Secretary, Commerce and Industries Department,

West Bengal, vide order dated 13.03.2003, rejected the

application of Respondent No. 1 - M/s. Chiranjilal (Mineral)

Industries of Bagandih, on the ground of non-availability of land

in view of the previous application of WBMDTCL. By another

order dated 26.03.2003, the Joint Secretary, Commerce and

Industries Department, West Bengal reiterated that the mining

application of Respondent No. 1 - M/s. Chiranjilal (Mineral)

Industries of Bagandih overlaps with the area applied for in

the previous application by WBMDTCL. The application of

the Respondent No. 1 - M/s. Chiranjilal (Mineral) Industries of

Bagandih was accordingly rejected.

2.4 Aggrieved, the Respondent No. 1 - M/s. Chiranjilal (Mineral)

Industries of Bagandih had filed Writ Petition No. 7505 (W)

of 2003 in the High Court of Calcutta challenging the orders

passed by the Joint Secretary, Commerce and Industries

Department, West Bengal, dated 13.03.2003 and 26.03.2003.

During the pendency of the said Writ Petition, the Joint

Secretary, Commerce and Industries Department, West Bengal,

reviewed the aforesaid orders and passed a fresh order dated

13.10.2006 for apportionment of land between WBMDTCL and

the Respondent No. 1 - M/s. Chiranjilal (Mineral) Industries

of Bagandih. This order states that two hearings were held

on 24.05.2006 and 19.06.2006 to review the matter, and 

[2023] 12 S.C.R. 283

STATE OF WEST BENGAL AND ANOTHER v. M/S. CHIRANJILAL

(MINERAL) INDUSTRIES OF BAGANDIH AND ANOTHER

thereupon at the hearing dated 19.06.2006, in the presence of

the representatives of WBMDTCL and the Respondent No. 1 -

M/s. Chiranjilal (Mineral) Industries of Bagandih, it was agreed

that Respondent No. 1 - M/s. Chiranjilal (Mineral) Industries of

Bagandih will be granted the whole of the mining area of 76

acres, and the lease for the rest of the area will be granted in

favour of WBMDTCL. No other reason has been stated and

indicated in the said order. Thus, the orders dated 13.03.2003

and 26.03.2003 rejecting the application of the Respondent

No. 1 - M/s. Chiranjilal (Mineral) Industries of Bagandih were

recalled. Consequently, the Letter of Intent dated 26.10.2006

was issued in favour of the Respondent No. 1 - M/s. Chiranjilal

(Mineral) Industries of Bagandih for an area of 76 acres of land

subject to fulfilling/submission of various documents, including

approval of the Mining Plan duly approved by the Chief Mining

Officer, Asansol and Clearance Certificate from the Ministry of

Environment and Forests, Government of India.

2.5 However, the order dated 13.10.2006 was cancelled or revoked

vide order dated 03.12.2010 by the Joint Secretary, Commerce

and Industries Department, Mines Branch, West Bengal, inter

alia, recording that this order was passed without ascertaining

the exact position of the land and in ignorance of the fact that

the rejection orders dated 13.03.2003 and 26.03.2003 had

already been challenged before the High Court in Writ Petition

No. 7505 (W) of 2003. The authorities had not ascertained the

status of the case. The order of cancellation or revocation dated

03.12.2010 was not challenged by the respondents.

2.6 This order dated 03.12.2010 was also not brought to the notice

of the High Court, when the Writ Petition No. 7505 (W) of 2003

was disposed of ex-parte vide order dated 25.03.2014 by relying

upon the supplementary affidavit filed by the Respondent No.

1 - M/s. Chiranjilal (Mineral) Industries of Bagandih, which had

referred to the recalled order dated 13.10.2006. This order of

the High Court states that a decision as to whether a lease

or licence to be granted in favour of the Respondent No. 1 -

M/s. Chiranjilal (Mineral) Industries of Bagandih shall be taken

within a period of eight weeks and Respondent No. 1 - M/s. 

284 [2023] 12 S.C.R.

SUPREME COURT REPORT: DIGITAL

Chiranjilal (Mineral) Industries of Bagandih would be accordingly

informed. It was made clear that the decision as to the grant

will be on the basis of the law and the rules applicable at the

time of consideration.

2.7 By the order dated 09.07.2014 passed by the Joint Secretary,

Commerce and Industries Department, West Bengal, the

application filed by the Respondent No. 1 - M/s. Chiranjilal

(Mineral) Industries of Bagandih was rejected inter alia relying

upon the earlier application filed by WBMDTCL. Significantly, this

order mentions that the two rejection orders dated 13.03.2003

and 26.03.2003 were recalled by the Joint Secretary vide his

order dated 13.10.2006. This order also refers to the factum

that the Grant Order dated 07.04.1986 to WBMDTCL for Iron

Ore, Manganese and Fireclay in the plots in question had been

revoked and the application for Long-Term Mining Lease filed

by WBMDTCL for Dolomite and Limestone was rejected by a

common order dated 24.09.2009. The order dated 24.09.2009

has not been placed on record, though it is necessary to

ascertain and know the reasons for cancellation and rejection

in favour of WBMDTCL. WBMDTCL had applied earlier in point

of time, and is a government of West Bengal undertaking. The

order dated 09.07.2014 does indicate that the cancellation

and rejection against WBMDTCL had something to do with

the Respondent No. 1 - M/s. Chiranjilal (Mineral) Industries of

Bagandih, and possibly the order dated 13.10.2006 in favour

of the Respondent No. 1 - M/s. Chiranjilal (Mineral) Industries

of Bagandih. This is reflected from the reason given in the

order dated 09.07.2014, which states that since the recall

order dated 13.10.2006 was cancelled or revoked vide order

dated 03.12.2010, the rejection orders dated 13.03.2003 and

26.03.2003 were still valid and the application for mining lease

dated 07.08.1985 for Dolomite and Limestone by WBMDTCL still

subsists. Thereupon, reference in the order dated 09.07.2014

is made to sub-section (2) to Section 112

 of the Mines and

2 11. Preferential right of certain persons . - (1) Where a reconnaissance permit or prospecting licence

has been granted in respect of any land, the permit holder or the licensee shall have a preferential right for

obtaining a prospecting licence or mining lease, as the case may be, in respect of that land over any other

person:

[2023] 12 S.C.R. 285

STATE OF WEST BENGAL AND ANOTHER v. M/S. CHIRANJILAL

(MINERAL) INDUSTRIES OF BAGANDIH AND ANOTHER

Minerals (Development and Regulation) Act, 19573

, which states

that in cases where the State Government has not notified in

the Official Gazette an area for grant of reconnaissance permit,

prospecting licence for mining lease, and two or more persons

had applied for the permit, licence or mining lease, the person

whose application received earlier in point of time shall have

preferential right for grant of permit, licence or lease over the

Provided that the State Government is satisfied that the permit holder or the licensee, as the case may be, -

(a) has undertaken reconnaissance operations or prospecting operations, as the case may be, to establish

mineral resources in such land;

(b) has not committed any breach of the terms and conditions of the reconnaissance permit or the prospecting licence;

(c) has not become ineligible under the provision of this Act; and

(d) has not failed to apply for grant of prospecting licence or mining lease, as the case may be, within three

months after the expiry of reconnaissance permit or prospecting licence, as the case may be, or within such

further period as may be extended by the said Government.

(2) Subject to the provisions of sub-section (1),where the State Government has not notified in the Official

Gazette the area for grant of reconnaissance permit or prospecting licence or mining lease, as the case may

be, and two or more persons have applied for a reconnaissance permit, prospecting licence or a mining

lease in respect of any land in such area, the applicant whose application was received earlier, shall have a

preferential right to be considered for grant of reconnaissance permit, prospecting licence or mining lease, as

the case may be, over the applicant whose application was received later:

Provided that where an area is available for grant of reconnaissance permit, prospecting licence or mining

lease, as the case may be, and the State Government has invited applications by notification in the Official

Gazette for grant of such permit, licence or lease, all the applications received during the period specified in

such notification and the applications which had been received prior to the publication of such notification in

respect of the lands within such area and had not been disposed of , shall be deemed to have been received

on the same day for the purposes of assigning priority under this subsection.

Provided further that where any such applications are received on the same day, the State Government,

after taking into consideration the matters specified in sub-section (3), may grant the reconnaissance permit,

prospecting licence or mining lease, as the case may be, to such one of the applicants as it may deem fit.

(3) The matters referred to in sub-section (2) are the following:-

(a) any special knowledge of, or experience in, reconnaissance operations, prospecting operations or mining

operations, as the case may be, possessed by the applicant;

(b) the financial resources of the applicant;

(c) the nature and quality of the technical staff employed or to be employed by the applicant;

 (d) the investment which the applicant proposes to make in the mines and in the industry based on the

minerals;

(e) such other matters as may be prescribed.

(4) Subject to the provisions of sub-section(1), where the State Government notifies in the Official Gazette

an area for grant of reconnaissance permit, prospecting licence or mining lease, as the case may be, all the

applications received during the period as specified in such notification, which shall not be less than thirty

days, shall be considered simultaneously as if all such applications have been received on the same day

and the State Government, after taking into consideration the matters specified in sub-section(3), may grant

the reconnaissance permit, prospecting licence or mining lease, as the case may be, to such one of the applicants as it may deem fit.

(5) Notwithstanding anything contained in sub-section (2), but subject to the provisions of sub-section (1), the

State Government may, for any special reasons to be recorded, grant a reconnaissance permit, prospecting

licence or a mining lease, as the case may be, to an applicant whose application was received later in preference to an applicant whose application was received earlier:

Provided that in respect of minerals specified in the First Schedule, prior approval of the Central Government

shall be obtained before passing any order under this sub-section.

3 For short, ‘MMDR Act, 1957’

286 [2023] 12 S.C.R.

SUPREME COURT REPORT: DIGITAL

person whose application was received later. The order states

that WBMDTCL is very much interested in mining Dolomite

and Limestone in the area and has confirmed the said fact in

writing vide letter dated 05.06.2014.

2.8 The Respondent No. 1 - M/s. Chiranjilal (Mineral) Industries

of Bagandih challenged the order dated 09.07.2014 passed

by the Joint Secretary, Commerce and Industries Department,

West Bengal in Writ Petition No. 21358 (W) of 2014 before

the High Court of Calcutta. This petition was disposed of vide

order dated 10.09.2014 observing that the Joint Secretary, who

had passed the order dated 09.07.2014 had failed to exercise

jurisdiction vested in him as the applications filed by WBMDTCL

had been rejected vide common order dated 24.09.2009 and

were therefore not pending. Direction was issued by the High

Court to grant a long term lease in respect of 76 acres of land

to the Respondent No. 1 - M/s. Chiranjilal (Mineral) Industries

of Bagandih by observing that the respondent had a Rayati

status and that the remaining land can be given to WBMDTCL.

It may be relevant to note here that this order records that the

files relating to the application of WBMDTCL were untraceable.

WBMDTCL was not made a party to the said writ petition.

Notably, the application filed by WBMDTCL, being earlier in

point of time in terms of the applicable rules was to be given

preference, whereas the application filed by the Respondent

No. 1 - M/s. Chiranjilal (Mineral) Industries of Bagandih was

rejected vide orders dated 13.03.2003 and 26.03.2003. However,

the rejection orders were recalled vide order dated 13.10.2006

and the Letter of Intent dated 26.10.2006 was issued in favour

of the Respondent No. 1 - M/s. Chiranjilal (Mineral) Industries

of Bagandih. Subsequently, the Grant Order dated 13.10.2006

in favour of the Respondent No. 1 - M/s. Chiranjilal (Mineral)

Industries of Bagandih was cancelled and recalled vide order

dated 13.12.2010. This order dated 13.12.2010 was never

challenged and has attained finality. It is during the period

between the order dated 13.10.2006 and the order dated

13.12.2010 that the request/application of WBMDTCL was

rejected and the mining lease cancelled vide order dated

24.09.2009. 

[2023] 12 S.C.R. 287

STATE OF WEST BENGAL AND ANOTHER v. M/S. CHIRANJILAL

(MINERAL) INDUSTRIES OF BAGANDIH AND ANOTHER

2.9 On 10.02.2015, vide notification No. S.O. 423 (E), Dolomite

was notified as a minor mineral, and accordingly henceforth,

fell under the legislative and administrative jurisdiction of the

State Government.

2.10 A Grant Order dated 16.07.2015 was issued by the Deputy

Secretary, Commerce and Industries Department, West

Bengal for Dolomite mining in favour of Respondent No. 1 -

M/s. Chiranjilal (Mineral) Industries of Bagandih in respect of

76 acres of land, subject to certain conditions, including the

requirement to submit consent letters of owners of the land

in question (Raiyats) before the execution of the lease deed,

or a condition to this effect would be incorporated in the draft

lease. Another stipulation mentioned therein is the need for

permission under Section 14-Y4 of the West Bengal Land

Reforms Act, 19555

 for holding the required land and furnishing

of Conversion Certificate for plots of land from the appropriate

authority in terms of Section 4-C6

 of the WBLR Act, 1955. It

4 14-Y. Limitation on future acquisition of land by a raiyat.—If at any time, after the commencement

of the provisions of this Chapter, the total area of land owned by a raiyat exceeds the ceiling area applicable

to him under Section 14-M, on account of transfer, inheritance or otherwise, the area of land which is in

excess of the ceiling area shall vest in the State and all the provisions of this Chapter relating to ceiling area

shall apply to such land:

Provided that a person intending to establish a tea garden, mill, factory or workshop, livestock breeding

farm, poultry farm, or dairy, or township in accordance with the provisions of the West Bengal Town and

Country (Planning and Development) Act, 1979, may, with the previous permission, in writing, of the State

Government and on such terms and conditions and in such manner as the State Government may by rules

prescribe, acquire and hold land in excess of the ceiling area applicable to him under Section 14-M:

Provided further that if such person, having been permitted by the State Government, does not utilise within

two years of the date of such permission such land for the purpose for which he has been so permitted by

the State Government to acquire and hold it, then, all the provisions of this Chapter relating to ceiling area

shall apply to the area of land which is held in excess of the ceiling area applicable to him under Section

14-M.

Explanation.—For the purpose of this section, “person” includes an individual, a firm, a company, an institution, or an association or body of individuals, whether incorporated or not.

5 For short, ‘WBLR Act, 1955’.’

6 4-C. Permission for change of area, character or use of land.—(1) A raiyat holding any land may

apply to the Collector for change of area or character of such land or for conversion of the same for any

purpose other than the purpose for which it was settled or was being previously used or for alteration in the

mode of use of such land.

(2) On receipt of such application, the Collector may, after making such inquiry as may be prescribed and

after giving the applicant or the persons interested in such land or affected in any way an opportunity of being heard, by order in writing either reject the application or direct such change, conversion or alteration, as

the case may be, on such terms and conditions as may be prescribed.

(3) Every order under sub-section (2) directing change, conversion or alteration shall specify the date from

which such change, conversion or alteration shall take effect.

(4) A copy of the order passed by the Collector directing change, conversion or alteration, if any, under subsection (2), or in an appeal therefrom shall he forwarded to the Revenue Officer referred to in Section 50 or 

288 [2023] 12 S.C.R.

SUPREME COURT REPORT: DIGITAL

is also stipulated that the Grant Order and the subsequent

execution of the lease deed are subject to the No Objection

Certificate to be obtained from the Central Government since

Dolomite was a major mineral at the time of the order dated

10.09.2014 passed by the High Court.

2.11 Aggrieved by the conditions and the requirements stipulated in

the Grant Order dated 16.07.2015, the Respondent No. 1 - M/s.

Chiranjilal (Mineral) Industries of Bagandih filed two Contempt

Petitions in W.P. 21358 (W) of 2014. These contempt petitions

were disposed of, inter alia, observing that the Respondent

No. 1 - M/s. Chiranjilal (Mineral) Industries of Bagandih was

required to fulfil the conditions, including furnishing of the

Conversion Certificate under Section 4-C of the WBLR Act,

1955 and No Objection Certificate from the Government of

India. The court, therefore, found that there was no wilful, or

contumacious violation of the order dated 10.09.2014. However,

liberty was granted to the Respondent No. 1 - M/s. Chiranjilal

(Mineral) Industries of Bagandih to question the Grant Order

dated 16.07.2015.

2.12 The Respondent No. 1 - M/s. Chiranjilal (Mineral) Industries of

Bagandih thereupon preferred Writ Petition No. 20309 (W) of

2016 before the High Court of Calcutta. However, WBMDTCL

was not a party to this writ petition. In the meanwhile, a

clarification was sought by the Deputy Secretary, Commerce

and Industries Department, West Bengal and vide clarification

dated 26.08.2016 issued by the Government of India, Ministry

of Mines, it was clarified that even prior to 10.02.2015, Dolomite

was a Non-Scheduled major mineral, for which prior approval

of the Central Government was not required under sub-section

(1) to Section 5 of the MMDR Act, 1957.

Section 51, as the case may be, and such Revenue Officer shall incorporate in the record-of-rights changes

effected by such order and revise the record-of-rights in accordance with such order.

(5) If the Collector is satisfied that any land is being convened for any purpose other than the purpose for

which it was settled or was being previously held, or attempts are being made to effect alteration in the mode

of use of such land or change of the area or character of such land, he may, by order, restrain the raiyat from

such Act.

[2023] 12 S.C.R. 289

STATE OF WEST BENGAL AND ANOTHER v. M/S. CHIRANJILAL

(MINERAL) INDUSTRIES OF BAGANDIH AND ANOTHER

2.13 This Writ Petition No. 20309 (W) of 2016 vide judgment and

order dated 12.04.2017 has been allowed inter alia observing

that Dolomite had become a minor mineral with effect from

10.02.2015 and hence prior approval of the Central Government

is not required under Section 5(1) of the MMDR Act, 1957. On

the question of requirements under Section 14-Y and 4-C of

the WBLR Act, 1955, it is observed that the land in question is

recorded as ‘Dungri’ as per information provided by the Deputy

District Land and Land Reforms Officer, Purulia vide Memo No.

V/RTI/775/15 dated 06.03.2017 and that the land classified as

‘Dungri’ is only used for the purpose of mining lease and thus,

there is no need for a conversion certificate under Section 4-C

of the WBLR, Act, 1955. The clarification dated 07.04.2016 was

issued by the Additional District Magistrate and District Land

and Land Reforms Officer, Purulia, stating that the Respondent

No. 1 - M/s. Chiranjilal (Mineral) Industries of Bagandih had

procured a No Objection Certificate in respect of the major

portion of Raiyati land from different owners and that the State

Government itself was the owner of 20.87 acres of land, thus

Section 14-Y of the WBLR Act, 1955 would not be applicable as

the Respondent No. 1 - M/s. Chiranjilal (Mineral) Industries of

Bagandih has not acquired land in excess ceiling limit prescribed

under Section 14-M of the WBLR Act, 1955.

2.14 This judgment was challenged by the State of West Bengal

in an intra-court appeal being F.M.A. No. 1458 of 2017 with

CAN No. 6596 of 2017 which has been dismissed vide the

impugned judgment dated 04.10.2018. Agreeing with the findings

recorded by the Single Judge, the division bench has held that

the provisions of the West Bengal Minor Minerals Concession

Rules, 20167

 will not be applicable as the Respondent No. 1 -

M/s. Chiranjilal (Mineral) Industries of Bagandih had made the

application in March 1998, and more so as the Joint Secretary,

Government of West Bengal had passed the order dated

13.10.2006 to grant mining lease. The High Court’s direction

given in Writ Petition No. 21358 (W) of 2014 vide judgment

7 For short, ‘Concession Rules, 2016’.

290 [2023] 12 S.C.R.

SUPREME COURT REPORT: DIGITAL

dated 10.09.2014 are prior to the enforcement of the Concession

Rules, 2016.

3. We have heard the learned Senior Advocate appearing for the State

of West Bengal and the Respondent No. 2 – Dinesh Agarwal, who

has appeared in-person. They have also submitted their written

submissions.

4. We begin our discussion by first referring to Rule 61 of the Concession

Rules, 2016, which reads as under:

“61.Decleration of ineligibility of the pending minor mineral

applications for mining lease including the applications of

reclassified major minerals.- All applications for mining lease of

minor minerals including the reclassified minor minerals vide SO No423 (E) dated 12th February,2015 received prior to the giving-effect

to this rules irrespective of its duration of pendency shall become

ineligible.

Provided that if the applicant has been issued a Grant Order or

Letter of Intent (LoI) or any other Government Order requiring the

alteration of applicant’s position then his mining lease application

may be considered after due compliance of the all the necessary

conditions”

5. An almost corresponding amendment was made to the MMDR

Act, 1957 by incorporating Section 10-A vide Mines and Minerals

(Development and Regulation) Amendment Act, 20158

, which reads

as under:

10-A. 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 date of commencement of the Mines and

Minerals (Development and Regulation) Amendment Act, 2015—

(a) applications received under Section 11-A of this Act;

8 For short, ‘Amendment Act, 2015’.

[2023] 12 S.C.R. 291

STATE OF WEST BENGAL AND ANOTHER v. M/S. CHIRANJILAL

(MINERAL) INDUSTRIES OF BAGANDIH AND ANOTHER

(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

licensee shall have a right for 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 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 of reconnaissance permit

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 a 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 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:

292 [2023] 12 S.C.R.

SUPREME COURT REPORT: DIGITAL

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.

6. Rule 61 of the Concession Rules, 2016 states that all applications for

mining lease of minor minerals including reclassified minor minerals

vide S.O. No. 423 (E) dated 12.02.2015 received prior to giving

effect to the Concession Rules, 20169

, irrespective of its duration of

pendency shall become ineligible. In other words, these applications

are not to be considered. The proviso makes an exception and

states that if an applicant, who had made an application prior to

29.07.2016, had been issued a Grant Order or a Letter of Intent, or

any other order requiring alteration of the applicant’s position, his

application for mining lease may be considered after due compliance

of all necessary conditions. The question is whether the respondents’

case is covered by the exception in terms of the proviso to Rule

61 of the Concession Rules,2016. We have already referred to the

reasoning given by the division bench of the High Court dealing with

the Concession Rules, 2016, and would like to quote the findings

which hold that the proviso would not be applicable to the facts of

the present case. These observations read:

“25. ….Neither such recent policy nor can the provisions of the

West Bengal Minor Minerals Concession Rules, 2016 can apply

to the application of the writ petitioners made in March, 1998 and

more so as the order of the Joint Secretary to grant lease is dated

13th October, 2006 and that of this Court directing grant of long term

lease is dated 10th September, 2014 are prior to such policy and

prior to the said Rules came into operation. It further appears that

necessary mining plan taking into account the environmental aspect

has been submitted by the writ petitioners and the appellant/State

has raised no grievance in respect thereof.”

7. The policy referred to in the aforesaid paragraph is in terms of the

letter dated 02.02.2018 issued by the Principal Secretary, State of

West Bengal, wherein it is specified that obtaining a Conversion

9 The Concession Rules, 2016 came into effect on 29.07.2016

[2023] 12 S.C.R. 293

STATE OF WEST BENGAL AND ANOTHER v. M/S. CHIRANJILAL

(MINERAL) INDUSTRIES OF BAGANDIH AND ANOTHER

Certificate is a mandatory condition for the purpose of a mining

lease. Reference in the impugned judgment to the order dated

13.10.2006, or for that matter, the Letter of Intent dated 26.10.2006

is inconsequential as the said orders were recalled and revoked

on 03.12.2010. The orders did not survive and continue to operate

thereafter. Writ Petition No. 7505 (W) of 2003 was disposed of exparte, without noticing that the order dated 13.10.2006 had been

recalled or cancelled, albeit the judgment had directed that the

application for grant of lease would be considered in accordance

with law and the rules applicable at the time of consideration. The

order dated 03.12.2010 was never challenged by the Respondent

No. 1 - M/s. Chiranjilal (Mineral) Industries of Bagandih and has

attained finality. At best, the case of the Respondent No. 1 - M/s.

Chiranjilal (Mineral) Industries of Bagandih is that the application

dated 06.03.1998 should be considered in accordance with law.

8. The Respondent No. 1 - M/s. Chiranjilal (Mineral) Industries of

Bagandih has relied upon judgment of this Court in Bhushan

Power and Steel Limited v. S.L. Seal, Additional Secretary

(Steel and Mines), State of Odisha and Others10. In the said case,

the predecessor-in-interest of the petitioner therein had made an

application for grant of lease before the State of Odisha for mining

of Iron Ore in an area measuring 1250 acres. The application

was in view of the proposal to set up a steel plant in the district

of Sambalpur, Odisha. The rejection for the grant of the mining

lease to M/s. Bhushan Power and Steel Limited was challenged

in a Writ Petition in the High Court, which was dismissed, but the

appeal preferred before this Court was allowed vide judgment dated

14.03.2012 in Bhushan Power and Steel Limited and Others v.

State of Orissa and Another11, setting aside the order of the State

Government dated 09.02.2016, with the following directions:

“41. In the light of the above, the High Court erred in holding that it

could not interfere with the decision of the State Government calling

upon the appellants to sign a fresh MoU with the Government, during

subsistence of the earlier MoU. Since the State Government has

10 (2017) 2 SCC 125.

11 (2012) 4 SCC 246.

294 [2023] 12 S.C.R.

SUPREME COURT REPORT: DIGITAL

already made allotments in favour of others in relaxation of the Mineral

Concession Rules, 1960, under Rule 59(2) thereof, no cogent ground

had been made out on behalf of the State to deny the said privilege

to the appellants as well. Accordingly, we allow the appeal and set

aside the judgment and order of the High Court of Orissa and also

the decision of the State Government dated 9-2-2006, rejecting the

appellants’ claim for grant of mining lease.

42. During the course of hearing, we have been informed that

Thakurani Block A has large reserves of iron ore, in which the

appellants can also be accommodated. We, accordingly, direct the

State of Orissa to take appropriate steps to act in terms of the MoU

dated 15-5-2002, as also its earlier commitments to recommend

the case of the appellants to the Central Government for grant of

adequate iron ore reserves to meet the requirements of the appellants

in their steel plant at Lapanga.”

9. The State of Odisha thereafter filed an application for review of

the judgment in Bhushan Power and Steel Limited and Others

v. State of Orissa and Another12 (supra) which was rejected vide

order dated 11.09.2012.

10. Alleging non-compliance and in-action of the judgment dated

14.03.2012, a contempt petition was filed by M/s Bhushan Power

and Steel Limited. The contempt petition was contested by the

State of Odisha on several grounds, including that the judgment

dated 14.03.2012 is incapable of enforcement, for which reliance

was placed on a subsequent judgment of this Court in Sandur

Manganese and Iron Ores Ltd. v. State of Karnataka13. This

stand did not find favour with this Court and the officers of the State

Government were found to be in contempt of the judgment dated

14.03.2012 vide judgment dated 22.04.2014 in Bhushan Power

and Steel Limited v. Rajesh Verma14. Under these circumstances,

the judgment dated 22.04.2014 had given one more opportunity

to the State Government to send requisite recommendation to the

Central Government inter alia observing that this Court cannot lose

12 (2012) 4 SCC 246.

13 (2010) 13 SCC 1.

14 (2014) 5 SCC 551.

[2023] 12 S.C.R. 295

STATE OF WEST BENGAL AND ANOTHER v. M/S. CHIRANJILAL

(MINERAL) INDUSTRIES OF BAGANDIH AND ANOTHER

sight of the fact that there is a judgment inter se the parties, which

has become final. Accordingly, the contention that the judgment of

this Court in Sandur Manganese and Iron Ores Limited (supra)

will not undo the directions given in the judgment dated 14.03.2012

was rejected. The relevant observations in the judgment dated

22.04.2014 read as under:

“21. We cannot lose sight of the fact that there is a judgment, inter

partes, which has become final. Even when the civil appeal was

being heard, certain other parties claiming their interest in these very

lands had moved intervention applications which were dismissed.

At that time also it was mentioned that there are 195 applicants.

However, notwithstanding the same, this Court issued firm directions

to the State Government to recommend the case of the petitioners

for mining lease in both the areas. In view of such categorical and

unambiguous directions given in the judgment which has attained

finality, merely because another judgment has been delivered by

this Court in Sandur Manganese case , cannot be a ground to undo

the directions contained in the judgment dated 14-3-2012. Insofar

as law laid down in Sandur Manganese is concerned, that may be

applied and followed by the State Government in respect of other

applications which are still pending. However, that cannot be pressed

into service qua the petitioner whose rights have been crystallised

by the judgment rendered in its favour. It cannot be reopened, that

too at the stage of implementation of the said judgment.

22. …. Once we hold that the respondents are bound to implement

the direction contained in the judgment dated 14-3-2012, insofar as

the State Government is concerned, it is obliged to comply therewith

and such matters, along with other relevant considerations, can be

left to the wisdom of the Central Government while taking a decision

on the recommendation of the State Government.

xx xx xx

24. …. However, we are giving one final opportunity to them to

purge the contempt by transmitting requisite recommendations to

the Central Government.  It would be for the Central Government

to consider the said recommendations on its own merits and in

accordance with law. In case the recommendation is sent within 

296 [2023] 12 S.C.R.

SUPREME COURT REPORT: DIGITAL

one month from the date of copy of receipt of this order, we propose

not to take any further action and the respondents/contemnors shall

stand discharged from this contempt petition. However, in case the

respondents do not purge in the manner mentioned above, it would

be open to the petitioners to point out the same to this Court by

moving appropriate application and in that event the contemnors

shall be proceeded against.”

(emphasis supplied)

11. Consequent to the directions dated 22.04.2014, the State Government

had sent the requisite recommendation to the Central Government for

grant of mining lease of the area in question. The Central Government,

however, took the stand that having regard to the amendments in

the MMDR Act, 1957, vide the Amendment Act, 2015 introducing

Section 10-A, the request made by M/s Bhushan Power and Steel

Limited stands invalidated. In view of the aforesaid stand, the Central

Government had written letters to the State Government, with a copy

sent to M/s Bhushan Power and Steel Limited. In the letter dated

13.05.2015, the Central Government had stated that the proposal

for according the prior approval for grant of mineral concession was

ineligible in terms of sub-section (1) to Section 10-A of the MMDR

Act, 1957 and, therefore, should be treated as closed. However, the

State Government might ascertain whether the proposal was safe from

ineligibility under Section 10-A of the MMDR Act, 1957 and thereupon

the State Government could take action accordingly. Similar view

was also expressed by the Central Government in the letter dated

29.05.2015 therein. Consequent to these communications, the State

government vide letter dated 09.07.2015 had informed M/s Bhushan

Power and Steel Limited that their applications for grant of mining

lease had become ineligible as per sub-section (1) to Section 10-A

of the MMDR Act, 1957.

12. This Court in M/s Bhushan Steel and Power Limited15 (supra),

specifically examined the contention whether in the facts of the said

case, clause (c) to sub-section (2) to Section 10-A of the MMDR

Act, 1957 could be invoked in view of the contention raised by M/s

15 (2012) 4 SCC 246.

[2023] 12 S.C.R. 297

STATE OF WEST BENGAL AND ANOTHER v. M/S. CHIRANJILAL

(MINERAL) INDUSTRIES OF BAGANDIH AND ANOTHER

Bhushan Steel and Power Limited that the Letter of Intent was issued

by the State Government for grant of mining lease and, therefore,

their application stands protected. The submission was that the

recommendation dated 24.05.2014, given by the State Government

should be treated as a Letter of Intent by “whatever name called”,

as it signifies the intention to grant mining lease insofar as the

State Government is concerned. It was also argued that under the

new regime contained under Section 10-A of the MMDR Act, 1957,

approval of the Central Government was not even required and the

State Government could have proceeded further and granted the

lease.

13. The aforesaid arguments did not find favour of this Court in the case

of M/s Bhushan Steel and Power Limited (supra) in spite of the

earlier judgment of this Court dated 14.03.2012 and the order passed

in the contempt petition dated 22.04.2014 with the observations

therein that there was failure of the State Government to comply with

the directions. This Court rejected the submissions in M/s Bhushan

Steel and Power Limited (supra) and held as under:

“17.  Undoubtedly, as per sub-section (1) of Section 10-A, all

applications received prior to coming into force of the Amendment

Act, 2015, become ineligible. Reason for interpreting such a provision

is not far to seek. Before the passing of the Amendment Act, 2015, it

was the Central Government which had the ultimate control over the

grant of licences insofar as mining of major minerals is concerned.

As per the procedure then existing, the State Government could

recommend the application submitted by any applicant for grant of

mining lease to the Central Government and the Central Government

was given the power to grant or refuse to grant the approval. Thus,

“previous approval” from the Central Government was essential for

grant of lease, without which the State Government could not enter

into any such lease agreement with the applicant. Shortcomings of

this procedure were noticed by this Court in its judgment rendered

in Centre for Public Interest Litigation v. Union of India [(2012) 3 SCC

1] (for short “CPIL case”) and also in Natural Resources Allocation, In

re, Special Reference No. 1 of 2012 [Natural Resources Allocation,

In re, Special Reference No. 1 of 2012, (2012) 10 SCC 1] . In these

judgments, this Court expressed that allocation of natural resources 

298 [2023] 12 S.C.R.

SUPREME COURT REPORT: DIGITAL

should normally be by auction. Judgment in CPIL case had a direct

relevance to the grant of mineral concessions as the Government

found that it was resulting in multipurpose litigation which was

becoming counterproductive. Mining Ordinance, 2015 was passed on

12-1-2015 which was ultimately replaced when Parliament enacted

the Amendment Act, 2015.

18. The exhaustive Statement of Objects and Reasons reveals that

the extensive amendment in the Act were effected after extensive

consultations and intensive scrutiny by the Standing Committee on

Coal and Steel, who gave their Report in May 2013. As is evident

from the Statement that difficulties were experienced because the

existing Act does not permit the auctioning of mineral concessions.

It was observed that with auctioning of mineral concessions,

transparency in allocation will improve; the Government will get an

increased share of the value of mineral resources; and that it will

alleviate the procedural delay, which in turn would check slowdown

which adversely affected the growth of mining sector.

19.  The Amendment Act, 2015, as is evident from the objects,

aims at: (i) eliminating discretion; (ii) improving transparency in

the allocation of mineral resources; (iii) simplifying procedures; (iv)

eliminating delay on administration, so as to enable expeditious

and optimum development of the mineral resources of the country;

(v) obtaining for the Government an enhanced share of the value

of the mineral resources; and (vi) attracting private investment and

the latest technology.

20. The Amendment Act, 2015 ushered in the amendment of Sections

3, 4, 4-A, 5, 6, 13, 15, 21 and First Schedule; substitution of new

sections for Sections 8, 11 and 13; and, insertion of new Sections

8-A, 9-B, 9-C, 10-A, 10-C, 11-B, 11-C, 12-A, 15-A, 17-A, 20-A, 30-B,

30-C and Fourth Schedule.

21. These amendments brought in vogue: (i) auction to be the sole

method of allotment; (ii) extension of tenure of existing lease from the

date of their last renewal to 31-3-2030 (in the case of captive mines)

and till 31-3-2020 (for the merchant miners) or till the completion

of renewal already granted, if any, or a period of 50 years from the

date of grant of such lease; (iii) establishment of District Mineral 

[2023] 12 S.C.R. 299

STATE OF WEST BENGAL AND ANOTHER v. M/S. CHIRANJILAL

(MINERAL) INDUSTRIES OF BAGANDIH AND ANOTHER

Foundation for safeguarding interest of persons affected by mining

related activities; (iv) setting up of a National Mineral Exploration

Trust created out of contributions from the mining lease-holders,

in order to have a dedicated fund for encouraging exploration and

investment; (v) removal of the provisions requiring “previous approval”

from the Central Government for grant of mineral concessions in

case of important minerals like iron ore, bauxite, manganese, etc.

thereby making the process simpler and quicker; (vi) introduction of

stringent penal provisions to check illegal mining prescribing higher

penalties up to Rs 5 lakhs per hectare and imprisonment up to 5

years; and (vii) further empowering the State Government to set up

Special Courts for trial of offences under the Act.”

14. Thus, the object and purpose of the Amendment Act, 2015 is to ensure

that allocation of mineral resources is done through auctioning. This

is the reason why sub-section (1) to Section 10-A of the MMDR Act,

1957 mandates that all applications received prior to 12.01.2015 shall

become ineligible. The exceptions or the saving clause applies to

three kinds of situations specified in sub-section (2) to Section 10-A

of the MMDR Act. 1957. The first category is where an application

has been received under Section 11-A of the MMDR Act,1957. The

second category is where a reconnaissance permit or a prospecting

licence has been granted the permit holder or the licensee has the

right to obtain a prospecting licence followed by a mining lease and

the State Government is satisfied that the permit holder or the licensee

has complied with the requirements specified in sub-clauses (i) to

(iv) of clause (b) of sub-section (2) to Section 10-A of the MMDR Act,

1957. The reason for protecting this class of cases is on account of

the fact that they had altered their position by spending money on

reconnaissance operations or prospecting operations. Accordingly,

the principle of legitimate expectation is applied. The third category

is where the Central Government had already communicated their

previous approval or the State Government had issue Letter of Intent

for grant of mining lease before coming into force of the Amendment

Act 2015. The raison dêtre, it is observed therein, is that certain

rights had accrued to these applicants inasmuch as all necessary

procedures and formalities had been complied with and only formal

lease remains to be executed.

300 [2023] 12 S.C.R.

SUPREME COURT REPORT: DIGITAL

15. Delving on the question of whether the letter for approval dated

22.05.2014 granted by the State Government can be treated as a

Letter of Intent predicated on the words by whatever name, which

expression, it was submitted, should be given a broad interpretation in

view of the words ‘by whatever name called’ was examined in-depth

and in detail. Reference was made to the legal dictionary for the

meaning of the term ‘Letter of Intent’ as a preliminary understanding

between the parties who intend to make a contract or join together

for further action. Reference was also made to decisions of this Court

in Rishi Kiran Logistics Private Limited v. Board of Trustees of

Kandla Port Trust and Others16 and Rajasthan Cooperative Dairy

Federation Limited v. Maha Laxmi Mingrate Marketing Service

Private Limited and Others17 However, the said contention was

rejected inter alia holding as under:

“26. Applying the aforesaid meaning, can it be said that Letter dated

24-5-2014 of the State Government would constitute a letter of intent?

We are afraid, answer has to be in the negative. Reason is simple.

As mentioned above, in order to enable the State Government to

enter into any lease agreement/contract with the prospecting licensee,

“previous approval” of the Central Government was essential. Unless

such approval came, the State Government could not communicate to

the prospecting licensee/lessee its intention to enter into any contract

as the prerequisite prior approval would be lacking. Therefore, no

promise could be held by the State Government to any applicant

showing its intention to enter into a contract in the future. Position

would have been different had Letter dated 24-5-2014 been issued

after receiving previous approval of the Central Government.

However, that is not so. This letter to the Central Government

was only recommendatory in nature and ultimate decision rested

with the Central Government. It is a different thing if the Central

Government refuses to give its approval on any extraneous reasons

or mala fides or does not take into consideration relevant factors/

material while rejecting the application, which may form a different

cause of action and may become a reason to challenge the action

of the Central Government rejecting the application on the grounds

16 (2015) 13 SCC 233.

17 (1996) 10 SCC 405.

[2023] 12 S.C.R. 301

STATE OF WEST BENGAL AND ANOTHER v. M/S. CHIRANJILAL

(MINERAL) INDUSTRIES OF BAGANDIH AND ANOTHER

that are available in law to seek judicial review of such an action.

However, we are not dealing with that situation in the instant case.

Our discussion is confined to the plea raised before us viz. whether

Letter dated 24-5-2014 can be termed as “letter of intent”. For the

reasons stated above, we are of the view that it was not a letter

of intent. The application of the petitioner, therefore, would not be

covered by clause (c) of Section 10-A of the Act.

27.  We are conscious of the fact that the petitioner herein had

originally succeeded in the appeal inasmuch as judgment dated 14-

3-2012 was rendered giving direction to the State Government to

recommend the case of the petitioner, in terms of the MoU entered

into between the parties, to the Central Government. This was not

done and the decision was reiterated in orders dated 22-4-2014

passed in Bhushan Power and Steel Ltd. v. Rajesh Verma [. It is

possible that had the State Government acted promptly and sent

the recommendations earlier, the Central Government might have

accorded its approval. However, whether it could have done so or

not would be in the realm of conjectures. Insofar as the Central

Government is concerned, no direction was ever given by this Court.

On the contrary, it was categorically observed in the order dated 22-4-

2014 in Bhushan Power and Steel Ltd. v. Rajesh Verma that it would

be for the Central Government to consider the recommendations of

the State Government on its own merits and in accordance with law.

If that has not been done by the Central Government, it cannot be

the subject-matter of present contempt petition.”

16. The aforesaid judgment is relevant for our purpose, though in the

present case, post notification No. S.O. 423(E) dated 10.02.2015,

Dolomite was notified as a minor mineral and hence, the approval

of the Central Government was not required for the reason that

the Grant Order dated 16.07.2015 was hedged with pre-conditions,

including the requirement to submit consent letters of the owners

of the land in question (Raiyats) before the execution of the lease

deed, or there was to be a stipulation that a condition to this effect

would be incorporated in the draft lease. Therefore, in our opinion,

the Grant Order dated 16.07.2015 is provisional, and is subject to

fulfilment of the conditions therein. This is clear from the terms of

the Grant Order dated 16.07.2015, which are reproduced below:

302 [2023] 12 S.C.R.

SUPREME COURT REPORT: DIGITAL

“

xx xx xx

(a) You have to furnish a Draft Mining Lease Deed in the model

form K us prescribed in the Mineral Concession Rules, 1960,

as amended upto date (1 rule 31 of MC Rules, 1960),

(b) The Draft Mining Lease Deed should be prepared in durable

papers neatly and sufficient space should be kept in between

two lines in order to permit, if necessary, correction therein,

(c) The Deed of Lease, after execution, shall be registered by you

at your own cost and no mining operation should be started

before registration of the Deed,

(d) You shall have to furnish the approved Mining Plan, if not

submitted rules 22(4) and 22A of MC Rules, 1960,

(e) You shall have to furnish the Environment Clearance (EC), if not

submitted from the M1EF Environment of Protection Act, 1986,

(f) You shall have to furnish Consent to Establish and Consent to

Operate from the WBPCB before execution of Deed of Lease

[Section 25 and 26 of Water Act ,1974 and Section 21 of Air

Act, 1981],

(g) You shall have to raise annually a minimum quantity of minerals

as stipulated in the approved Mine Plan [rules 22A and 45(ia)

of MC Rules, 1960],

(h) You shall have to deposit Rs. 10,000/ (Rupees ten thousand)

only as Security for due observance of the terms and conditions

of the lease, under appropriate Head of Account which shall be

refundable to you after expiry of the period of Lease, unless the

whole or a part of it is withheld or forfeited by the Government

for any default on you part including default in payment of

amount due to the Government [rule 32 of MC Rules, 1960],

(i) You shall have to submit consent letter(s) of the owner(s) of the

land under consideration before execution of the Lease Deed

(Consent of the Raiyats) or a condition to that effect should be

incorporated in the Draft Deed (rule 22(3)(i)(1t)),

[2023] 12 S.C.R. 303

STATE OF WEST BENGAL AND ANOTHER v. M/S. CHIRANJILAL

(MINERAL) INDUSTRIES OF BAGANDIH AND ANOTHER

(j) You shall have to furnish the N.O.C., of the Forest Authority in

proper format in case the applied area falls in the forest area

as notified by the Appropriate Authority, alongwith the Draft

Lease Deed or a condition to that effect should be incorporated

in the Draft Deed [Section 2 of Forest Conservation Act, 1980],

(k) For actual operation of quarrying or digging, ten (10) yards clear

margin shall be kept from the outer boundary of the adjacent 1

plot or plots and maintain throughout the operation and you shall

have to give a written undertaking to that effect or corporate a

condition in the Draft Lease Deed,

(l) You shall have to incorporate all the conditions as mentioned

in the M.C. Rules, 1960 in the Draft Lease Deed,

(m) You shall have to furnish up to date Royalty Clearance, Income

Tac Clearance and VAT Clearance certificates before execution

of the Deed,

(n) You shall have to submit, along with the Draft Deed, a GeoReference Map duly vetted by the DL&LRO and DMM, West

Bengal, if not submitted,

(o) You shall have obtained the permission under Section 14Y of

WBLR Act, 1955 for holding the required land,

(p) You have to furnish the Conversion Certificate for plots of land

from the Appropriate Authority (Section 4C of WBLR Act, 1955),

(q) You have to furnish the current Land Availability Report (LAR)

from the Appropriate Authority.

(r) In the event of non-execution of the deed within the stipulated

period on compliance with the above mentioned conditions

the order sanctioning the lease shall be liable to be revoked,

(s) You shall have to comply with all the statutory requirements

before presenting the Deed of Lease of execution to this

Department,

(t) This Grant Order and subsequent execution of Lease Deed are

subject to the No Objection Certificate (NOC) to be obtained

by this Department form the Govt. of India since the applicant

prayed for mining lease on the ground that the Letter of Intent 

304 [2023] 12 S.C.R.

SUPREME COURT REPORT: DIGITAL

(Lol) was issued for the mineral Dolomite which was a major

mineral at the time of order dated 10.09.2014 of the Hon’ble

High Court.

xx xx xx”

17. Raiyat land is to be used for cultivation, etc., and not for mining.

Once the mining activity is undertaken, the Raiyats will not be able

to use the land. In terms of sub-section (10) to Section 2 of the

WBLR Act, 1955, a Raiyat means a person or an institution holding

land for any purpose whatsoever. However, the rights of Raiyat in

respect of the land in terms of sub-section (2A) to Section 4 of the

WBLR Act, 1955 does not permit any other person to quarry sand

from his holding, dig or use, or permit any person to dig or use, earth

or clay of his holding for the manufacture of bricks or tiles except

with previous permission in writing of the State Government. In

case of breach of the condition, the prescribed authority may, after

giving notice and opportunity to a Raiyat to show cause, can levy

a monetary penalty. Further, on an order being passed, the land

shall vest in the State free from all encumbrances. Section 4-B of

the WBLR Act, 1955 stipulates that every Raiyat holding any land

shall maintain and preserve such land in a manner that the area

is not diminished or its character is not changed or the land is not

converted for any purpose other than the purpose for which it was

settled or previously held except with the previous permission of the

Collector in writing. Equally significant for our purpose is Section 3A

of the WBLR Act, 1955, which states that the rights and interests

of all non-agricultural tenants and under-tenants shall vest in the

State free from all encumbrances and provisions of Section 5 and

5A of the West Bengal Estates Acquisition Act, 1953 shall apply. An

exception is carved out by sub-section (2) to Section 3A of the WBLR

Act, 1955, where a non-agricultural tenant or under-tenant is holding

khas possession of any land, in which case he is entitled to retain the

land as Raiyat. There are also provisions relating to the transferability

of land by the Raiyat. If cultivation was not being undertaken at the

land in question, the classification requires a change.

18. The controversy relating to Section 4-C of the WBLR Act, 1955,

cannot simply be decided on the basis of Memo No. V/RTI/775/15 

[2023] 12 S.C.R. 305

STATE OF WEST BENGAL AND ANOTHER v. M/S. CHIRANJILAL

(MINERAL) INDUSTRIES OF BAGANDIH AND ANOTHER

dated 06.03.2017 issued by the Deputy District Land and Land

Reforms Officer, Purulia, that as per the revenue records the land

was recorded as ‘Dungri’. The reason is that Raiyat land is not for

mining. Thus, a contradiction arises, as the grant of Raiyat land

and the classification of the same land as ‘Dungri’ is contradictory.

19. Further, whether the consent letter of the owners of the land in

question (Raiyats) obtained by the Respondent No. 1 - M/s. Chiranjilal

(Mineral) Industries of Bagandih still hold good, would be relevant as

there could be a change of hands on account of transfer, inheritance,

etc. Connected with this are the legal issues. First, whether the

Respondent No. 1 - M/s. Chiranjilal (Mineral) Industries of Bagandih

had altered its position post the issue of the Grant Order dated

16.07.2015, but before enforcement of the Concession Rules, 2016,

to get the benefit of Rule 61 of the Concessions Rules, 2016? It is

necessary to ascertain the facts and then alone one can adjudicate

and decide the question whether the Respondent No. 1 - M/s.

Chiranjilal (Mineral) Industries of Bagandih is entitled to the benefit of

the proviso to Rule 61 of the Concession Rules, 2016. This has not

been verified and ascertained. An issue would arise on whether the

application filed by the Respondent No. 1 - M/s. Chiranjilal (Mineral)

Industries of Bagandih way back in 1998 would still hold good as

at the time, when the application was filed, approval of the Central

Government was required. Another difficulty is that WBMDTCL has

not been impleaded as a party, though it was always contesting the

claim made by the Respondent No. 1 - M/s. Chiranjilal (Mineral)

Industries of Bagandih. On the question of cancellation or rejection

of the application made by WBMDTCL, we have made observations

supra. However, we need not examine these issues in light of the

order and directions we are issuing. Further, we feel that the remand

order should not be passed at this distinct point of time.

20. Having said so, it is the stand of the appellants – State of West

Bengal, that they are owners of 20.87 acres of the land in question

and to this extent, they have no difficulty in executing the mining

lease. This being the stated stand, which has also been affirmed

before us, there should be no difficulty in granting of mining lease

for the said area to the Respondent No. 1 - M/s. Chiranjilal (Mineral)

Industries of Bagandih.

306 [2023] 12 S.C.R.

SUPREME COURT REPORT: DIGITAL

21. During the course of arguments before us, reference was made

by the appellants to the provisions of the WBLR Act, 1955 and

the judgment of this Court in Thressiamma Jacob and Others v.

Geologist, Department of Mining and Geology and Others18.

We have not examined the said aspects which are left open and

not adjudicated upon. However, we deem it appropriate to observe

that the judgment of this Court in Thressiamma Jacob and Others

(supra) is prior to the enforcement of the Amendment Act, 2015

and the Concession Rules, 2016. The amendments made by the

Amendment Act, 2015 were not subject matter of decision in the

said case and would have to be considered by the courts and the

authorities as a judgment’s binding ratio depends upon the legal

provisions considered, interpreted and applied in a given judgment.

When the law changes by an amendment in the legislation, the

amended legal provisions have to be considered, interpreted and

applied.

Accordingly, and for the reasons stated, we partly allow the present appeal

and set aside the impugned judgment with a direction that the government

of West Bengal will execute a mining lease for 20.87 acres of land in favour

of the Respondent No. 1 - M/s. Chiranjilal (Mineral) Industries of Bagandih.

The Writ Petition No. 20309 (W) of 2016 will be treated as allowed to

the extent as indicated above. The claim of the Respondent No. 1 - M/s.

Chiranjilal (Mineral) Industries of Bagandih towards the balance area for

the grant of mining lease will be treated as rejected and dismissed. In the

facts of the present case, there will be no order as to costs.

Headnotes prepared by: Ankit Gyan Result of the case : Appeal partly

allowed.

18 (2013) 9 SCC 725.