# COMMON CAUSE v. UNION OF INDIA AND ORS

- **Citation:** [2017] 13 S.C.R. 361
- **Court:** Supreme Court of India
- **Decided:** 2017-08-02
- **Bench:** Madan B. Lokur, Deepak Gupta
- **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/common-cause-v-union-of-india-and-ors-31921
- **Pages:** 95

## Headnote

Mines and Minerals - Illegal mining of enonnous proportions
in districts of Odisha - Writ petition partly based on reports given
by Justice MB. Shah Commissions of Inquiry sought directions,
inter alia, to Union of India and Government ofOdisha to immediately
stop forthwith all illegal mining in the State of Odis ha and for CBI
investigation into such illegal mining - Plea of mining lease holders
that reports given by Commission were v,itiated as they were not
given notice u/ss.8B, 8C of the 1952 Act. and thus. the very
foundation of the writ petition goes away - Held: First report given
by Commission was a general, overall perspective on the subject -
A
B
c
D
No irregularity or illegality has been committed so as to vitiate the
first report - Second report went into specific details of several
mining lease holders, but herein one is not concerned with those
specifics - Therefore. whether notices were issued or not to the
E
lease holders who were the subject matter of discussion in the second
report is of no consequence -However. the reports of the
Commission are not being relied upon for the purpose of present
judgment and order - Further. for now, no direction is being given
with regard to any investigation by CBI - Expert Committee be set
up under the guidance of a retiredjudge of Supreme Court to identifY
the lapses occ1:l'red over the years enabling rampant illegal or
unlawful mining in Odisha and measures to prevent this ji·om
happening in other parts of the country - Furthe1; directions issued -
Commissions of Inquiry Act. 1952 - ss.8B. 8C.
Committees:
Central Empowered Committee (CEC)- Constitution of-Held:
CEC was first constituted by Supreme Court in T. N. Godavarma11
case as an interim body -
Thereafter, it was constituted by
notification issued uls.3(3) of the 1986 Act - It has continued
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[2017] 13 S.C.R.
A fimctioning and is now an established body which renders extremely
valuable advice to this Court- Environment (Protection) Act, 1986 -
s.3(3).
Central Empowered Committee (CEC) -
Jurisdiction of -
Challenge to - Plea of lease holders that in giving the report on
B
mining. CEC tfXceeded its remit - Held: Not tenable - Jurisdiction
of CEC was not limited and it was expected to give a detailed report
on all aspecrs of illegal mining or mining being carried out without
any lawful authority in whatever manne1:
lllines and Minerals (Development and Regulatio11) Act, 1957
c (MMDR) - ss.4(1). 4(2). 5(2). IO. 12. 13. 18. 21 - Grant ofmi11ing
lease -- Schenie of - Discussed.
s. 6 - Maximum area for which a prospecting licence or
mining lease may be granted - Violation of by various companies -
If any - Discussed.
D
Mineral Concession Rules, 1960 (MCR):
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H
Distinction between A!CR and MCDR - Held: The distinction
is that the MCR deal. inter alia. with the grant of a mining lease and
not commencement of mining operations - However. the MCDR deal.
inter alia. with the commencement of mining operations and protection
of environmenr by preventing and controlling pollution which might
he caused by mining operations- Mineral Conservation and
Development Rules. 1988 (MCDR).
r.22A - Held: r.22A makes it clear that mining operations
shall be undertaken only in accordance with the duly approved
mining plan - Therefore. a mining plan is of considerable importance
for a mining lease holder and is in essence sacrosanct - A mining
scheme and a mining plan are a sine qua non for the grant of a
mining lease.
1:24A - Plea of mining lease holders that since many of them
were grantedfirst deemed statutory renewal of mining lease ulr.24A.
the requirements of Environment Impact Assessment (EJA) Notification
of 1994 (EIA 1994) would not be applicable - Held: Nor tenable -
For renewal qf mining lease. an application is required to be made
by mining lease holders and the deemed renewal clause ulr.24A will
come into operation onzv ajier an application for renewal is made
COMMON CAUSE v. UNION OF INDIA AND O

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[2017] 13 S.C.R. 361
COMMON CAUSE
v.
UNION OF INDIA AND ORS.
(Writ Petition (Civil) No. 114 of2014)
AUGUST 2, 2017
(MADAN B. LOKUR AND DEEPAK GUPTA, JJ.]
Mines and Minerals - Illegal mining of enonnous proportions
in districts of Odisha - Writ petition partly based on reports given
by Justice MB. Shah Commissions of Inquiry sought directions,
inter alia, to Union of India and Government ofOdisha to immediately
stop forthwith all illegal mining in the State of Odis ha and for CBI
investigation into such illegal mining - Plea of mining lease holders
that reports given by Commission were v,itiated as they were not
given notice u/ss.8B, 8C of the 1952 Act. and thus. the very
foundation of the writ petition goes away - Held: First report given
by Commission was a general, overall perspective on the subject -
A
B
c
D
No irregularity or illegality has been committed so as to vitiate the
first report - Second report went into specific details of several
mining lease holders, but herein one is not concerned with those
specifics - Therefore. whether notices were issued or not to the
E
lease holders who were the subject matter of discussion in the second
report is of no consequence -However. the reports of the
Commission are not being relied upon for the purpose of present
judgment and order - Further. for now, no direction is being given
with regard to any investigation by CBI - Expert Committee be set
up under the guidance of a retiredjudge of Supreme Court to identifY
the lapses occ1:l'red over the years enabling rampant illegal or
unlawful mining in Odisha and measures to prevent this ji·om
happening in other parts of the country - Furthe1; directions issued -
Commissions of Inquiry Act. 1952 - ss.8B. 8C.
Committees:
Central Empowered Committee (CEC)- Constitution of-Held:
CEC was first constituted by Supreme Court in T. N. Godavarma11
case as an interim body -
Thereafter, it was constituted by
notification issued uls.3(3) of the 1986 Act - It has continued
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SUPREME COURT REPORTS
[2017] 13 S.C.R.
A fimctioning and is now an established body which renders extremely
valuable advice to this Court- Environment (Protection) Act, 1986 -
s.3(3).
Central Empowered Committee (CEC) -
Jurisdiction of -
Challenge to - Plea of lease holders that in giving the report on
B
mining. CEC tfXceeded its remit - Held: Not tenable - Jurisdiction
of CEC was not limited and it was expected to give a detailed report
on all aspecrs of illegal mining or mining being carried out without
any lawful authority in whatever manne1:
lllines and Minerals (Development and Regulatio11) Act, 1957
c (MMDR) - ss.4(1). 4(2). 5(2). IO. 12. 13. 18. 21 - Grant ofmi11ing
lease -- Schenie of - Discussed.
s. 6 - Maximum area for which a prospecting licence or
mining lease may be granted - Violation of by various companies -
If any - Discussed.
D
Mineral Concession Rules, 1960 (MCR):
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Distinction between A!CR and MCDR - Held: The distinction
is that the MCR deal. inter alia. with the grant of a mining lease and
not commencement of mining operations - However. the MCDR deal.
inter alia. with the commencement of mining operations and protection
of environmenr by preventing and controlling pollution which might
he caused by mining operations- Mineral Conservation and
Development Rules. 1988 (MCDR).
r.22A - Held: r.22A makes it clear that mining operations
shall be undertaken only in accordance with the duly approved
mining plan - Therefore. a mining plan is of considerable importance
for a mining lease holder and is in essence sacrosanct - A mining
scheme and a mining plan are a sine qua non for the grant of a
mining lease.
1:24A - Plea of mining lease holders that since many of them
were grantedfirst deemed statutory renewal of mining lease ulr.24A.
the requirements of Environment Impact Assessment (EJA) Notification
of 1994 (EIA 1994) would not be applicable - Held: Nor tenable -
For renewal qf mining lease. an application is required to be made
by mining lease holders and the deemed renewal clause ulr.24A will
come into operation onzv ajier an application for renewal is made
COMMON CAUSE v. UNION OF INDIA AND ORS.
363
in Form Jin Schedule I of MCR - Even otherwise, renewal of a
A
mining lease would require a prior environmental clearance (EC)
in terms of EIA 1994.
r.37 - Violation of - Several mining lease holders entered
into raising contracts which were actually a transfer of lease as
postulated by r. 3 7 - Held: Rule 3 7 provides. inter alia, that a mining B
lessee shall not without the previous consem in writing of the State
Government or Central Government, as the case may be, assign.
sublet, mortgage, or in any other manne1; transfer the mining lease,
or any right,. title or interest therein - It will he appropriate if a
fresh look is given to the raising contracts entered into by mining
lease holders and the raising contractor - Committee appointed.
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Mineral Conservation and Development Rules, 1988 (MCDR):
Purpose and objective of - Held: Is to ~~sure that mining
operations are cmried out in a scientific manner with a high degree
of responsibility including responsibility in protecting and D
preserving the environment and the flora of the area.
r. 31 - Protection of environment under - Obligation of - Held:
Rule 31 provides that every holder of a mining lease shall take all
possible precautions for the protection of environment and control
of pollution while conducting any mining operations in the area -
E
Air (Prevention and Control of Pollution) Act, 1981 - Environment
(Protection) Act, 1986 - Water (Prevention and Control of Pollution)
Act. 1974.
Notijicatio11/Circular:
Environment Impact Assessment (E!A) Notification dtd. 27'"
Jan. 1994 - Nature of - Held: It is a prohibitory notification and
directs that on and from the date of its publication in the official
gazette: (i) expansion or modernization of any activity (if pollution
load is to exceed the existing one) and (ii) a new project listed in
Schedule I to the notification. shall not be undertaken unless it has
been accorded EC by the Central Government in accordance with
the procedure specified in the notification - Further. EIA 1994 is
also mandatory in character - It is applicable to all mining
operations, new mining projects and renewal of mining leases -
Environment (Protection) Act, 1986 - ss.3(1). 3(2){v) - Environment
(Protection) Rules. 1986 - r.5(3)(d).
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[2017] 13 S.C.R.
Environment Impact Assessment (EIA) Notification dtd. 27'''
Jan. 1994 - Grant under, of environment clearance (EC) - Purpose
of - Held: On receipt of an EC a mining lease holder can extract a
mineral only from a specified site, upto the sanctioned capacity
and only for a period of five years from the date of grant of EC -
Consequently. a mining lease holder would necessarily have to obtain
a fresh EC every five years and can also apply for an increase in
the sanctioned capacity - Environment.
Environment Impact Assessment (EIA) Notification dtd. 27"'
Jan. 1994 - Grant under. of EC- Operation of- Held: There is no
concept of a retr(Jspective EC - Its validity effectively starts only
from the day it is granted - It takes precedence over the mining
lease - Thus, mining operations under a mining lease are dependent
on and 'subordinate· to the EC - Environment.
Environment Impact Assessment (E/A) Notification dtd. 27"'
Jan. 1994 - EC - Requirement of. for ongoing mining project -
D
Exemption. when given - Held: An exemption is granted from the
requirement of obtaining an EC if there is no expansion and the
existing pollution load is not exceeded - However. a no objection
certificate from the SPCB is necessary for continuing the mining
operations - Env,ironment.
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Environment Impact Assessment (EIA) Notification dtd. 27"'
Jan. 1994 - Exprmsion and modernization of existing projects -
Base year for considering pollution load while proposing any
expansion activity - Determination of - Discussed - Environment.
Environme111 Impact Assessment (EIA) 14"' September. 2006 -
Requirement under - Environment Clearance (EC) - Held: EIA 2006
required prior EC for projects or activities mentioned in the Schedule
to it. both for major as well as minor minerals. if the leased area is
5 hectares or more - Environment.
Environme11t Impact Assessment (EIA) 14"' September. 2006 -
Environment Clearance (EC) - Grant of - If retrospective - Held:
An EC will come into force not earlier than the date of its grant -
The concept of an ex post facto or a retrospective EC is completely
alien to environmental jurisprudence - Environment.
Mines and Minerals:
Mining plan - Actual Production limit - Violations of - Held:
COMMON CAUSE v. UNION OF INDIA AND ORS.
365
A mining plan is valid for a period of five years - 20% deviation
A
from the mining plan (in terms of over-production) would he
reasonable and permissible - A mining lease holder cannot extract
the five year quantity (with a variation of 20%) in one or two years
only.
Illegal Mining - What is - Plea of lessees that a mining B
operation only outside the mining lease area would constitute 'illegal
mining· - Held: Not tenable -
J//egal mining takes within its fold
excess extraction of a mineral over the permissible limit even within
the mining lease area which is held under lawful authority. if that
excess extraction is contrary to the mining scheme. the mining plan,
the mining lease or a statutory requirement - Mines and Minerals
(Development and Regulation) Act. 1957 - s.23 C - Mineral
Concession Rules. 1960 - r.2(iia) .
Encroachment - lllegal mining outside the sanctioned mining
areas - Direction issued.
Consequences of lllegal mining - Discussed - Mines and
Minerals (Development and Regulation) Act. 1957 - s.21 (5).
Illegal mining - Penalty/Compensation for - Discussed -
Mines and Minerals (Development and Regulation) Act, 1957
(MMDR) - s.21(5).
Fore..vt (Conservation) Act, 1980 - s.2 - Violation of - Held:
Since defauWng mining lease holders had paid additional Net
Present Value (NPV) as well as an amount towards penal
compensatory afforestation. it must be assumed that violation of
the Act has been condoned to a limited extent - Environment.
Issuing directions, the Court
HELD:
Justice M.B. Shah Commission of Inquiry
c
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1. The first report given by the Commission was a general,
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overall perspective on the subject, therefore, there is absolutely
no question of any notice being Issued to any mining lease holder
under Section .SB or the right of cross examination being granted
to any mining lease holder under Section SC of the 1952 Act.
While the second report went into specific details of several mining
lease holders -but herein one is not concerned with these H
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specifics. Therefore, whether notices were or were not issued to
the lease holders who were the subject matter of discussion in
the second repQrt is of no consequence.No irregularity .or illegality
has been committed so as to vitiate the first report. A resume of
the procedure followed will indicate that full opportunity was given
to the lease holders to have their say. [Paras 32-34, 43] (394-E;
398-A-B, D; 401-C-DJ
Central Empofered Committee and Initial contention
2.1 The Central Empowered Committee or the CEC was
first constituted by this Court by an order in T.N.Godavar111a11 as
an interim body. Thereafter, it was constituted by a notification
issued under Section 3(3) of the Environment (Protection) Act,
1986. Jt has continued functioning and assisting this Court for
more than a decade and even though it has been criticized on a
couple of occasions, it is now an established hody which renders
extremely valuable advice to this Court and provides factual
material on the basis of which this Court can make some
recommendati'iJns and pass appropriate orders. The CEC as a
fact finding body has functioned impartially and it is only on the
conclusions arrived at hy the CEC on the basis of the facts
gathered that ~here can he some debate and discussion. [Paras
54, 55J [404-F-H; 405-C]
2.2 The jμrisdiction of the CEC was not limited and it was
expected to give a detailed report on all aspects of illegal mining
or mining being carried out without any lawful authority in
whatever manner. [Para 53] (404-E]
Statutory provisions
3.1 The grant of a mining lease is governed by the provisions
of the Mines and Minerals (Development and Regulation) Act,
1957 (or the MMDR Act}, the Mineral Concession Rules, 1960
(or the MCR) and the Mineral Conservation and Development
Rules, 1988 (or the MCDR).Section 4(1) of the MMDR Act
provides that no person shall undertake any mining operation in
any area except under and in accordance with the terms and
conditions of a mining lease granted under the MMDR Act and
the rules made thereunder. A mining operation is defined in
Section 3(d) of the MMDR Act as meaning any operation
COMMON CAUSE v. UNION Of INDIA AND ORS.
367
undertaken for the purpose of winning any mineral. Section 4(2)
A
of the MMDR Act provides that no mining lease shall be granted
otherwise than in accordance with the provisions of the said Act
and the rules made thereunder. Section 5(2) of the MMDR Act
provides for certain restrictions on the grant of a mining lease.·
(Paras 60-62) (406-H; 407-A-D)
B
3.2 ,Section 10 of the MMDR act provides for the procedure
for obtaining a mining lease. Section 13 of the MMDR Act
provides for the rule making power of the Central Government
in respect of minerals. The Mineral Concession Rules, 1960
(MCR) are.framed in exercise of power conferred by Section 13
of the MMDRAct. [Paras 63, 65) (407-D-E, G]
C
3.3 Section 18 of the MMDR Act makes it the duty of the
Central Government to take all such steps as may be necessary
for the conservation and systematic development of minerals in
India and for tl:te protection of the environment. The Mineral
Conservation and Development Rules, 1988 (MCDR) are framed D
in exercise of power conferred by Section 18 of the MMDR Act.
Section 21 of the MMDR Act deals with penalties. [Para 66, 68)
(407-H; 408-A, CJ
3.4 The distinction between the MCR and the MCDR is
that the MCR deal, inter alia, with the grant of a mining lease
E
and not commencement of mining operations. However, the
MCDR deal, inter alia, with the commencement of mining
operations and protection of the environment by preventing and
controlling pollution which might be caused by mining operations.
(Para 67) (408-B-C)
F
Mineral Concession Rules, 1960
4 .. 1 Rule 22, MCR provides for an application to be made
for the grant of a mining lease in respect of land in which the
mineral vests in the government. Sub rule (5) of Rule 22 deals
with a mining plan and it requires that a mining plan shall
G
incorporate, amongst other things, a tentative scheme of mining
and annual programme and plan for excavation for year to year
for five years. Rule 22A of the MCR makes it clear that mining
operations shall be undertaken only in accordance with the duly
approved mining plan. Therefore, a ·mining plan is of considerable H
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[2017] 13 S.C.R.
A importance for a mining lease holder and is in essence
sacrosanct.A mining scheme and a mining plan are a sine qua no11
for the grant of a mining lease. [Paras 69, 70] [408-E-H]
4.2 Rtjle 27 of the MCR deals with the conditions that every
mining lease is subject to. One of the conditions is that the lessee
B
shall comply with the MCDR. [Para 71) [409-A)
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4.3 Rlllc 37 of the MCR deals with the transfer of a lease
and provides, inter alia, that a mining lessee shall not without the
previous co11sent in writing of the State Government or the Central
Government, as the case may be, assign, sublet, mortgage, or in
any other manner, transfer the mining lease, or any right, title or
interest therein. The lessee shall not enter into or make any
bona fide arrangement, contract or understanding whereby the
lessee will or may directly or indirectly be financed to a substantial
extent in r:espect of its operations or undertakings or be
substantially controlled by any person or body of persons. Subrule (3) of Rule 37 of the MCR enables a State Government to
determine any lease if the mining lessee has committed a breach
of Rule 37 of the MCR or has transferred any lease or any right,
title or interest therein otherwise than in accordance with subrule (2) of ~ule 37 of the MCR. [Para 75] [409-E-G]
Mineral Conservation and Development Rules, t 988
5.1 Cl)apter V of the MCDR deals with "Environment".
Rule 31 of the MCDR provides that every holder of a mining
lease shall take all possible precautions for the protection of the
environment and control of pollution while conducting any mining
operations in the area. Rule 37 of the MCDR requires-certain
precautions to be taken against air pollution and obliges the
mining lease holder to keep air pollution under control and within
permissible limits specified under various environmental laws
including the Air (Prevention and Control of Pollution) Act, 1981
and the Environment (Protection) Act, 1986. The provisions of
the Water (Prevention and Control of Pollution) Act, 1974 are
required to be adhered to by the mining lease holder. [Paras 7981] [409-G-lll; 410-D-F, G]
5.2 The overall purpose and objective of the MMDR Act
as well as the rules framed there under is to ensure that mining
COMMON CAUSE v. UNION OF INDIA AND ORS.
369
operations are carried out in a scientific manner with a high degree
A
of responsibility including responsibility in protecting and
preserving the environment and the flora of the area. Through
this process, the holder of a mining lease is obliged to adhere to
the standards laid down under the Environment (Protection) Act,
1986 or the EPA as well as the laws pertaining to air and water B
pollution and also by necessary implication, the provisions of the
Forest (Conservation) Act, 1980 (for short 'the FC Act').
Exploitation .of the natural resources is ruled out. If the holder
of a mining lease docs not adhere to the provisions of the statutes
or the rules or the terms and conditions of the mining lease, that
person is liable to incur penalties under Section 21 of the MMDR C
Act. Jn addition thereto, Section 4A of the MMDR Act which
provides for the termination of a mining lease is applicable. (Para
83] (411-B-D]
Environment Impact Assessment Notification of 27!.h January,
1994
6.1 The Environment Impact Assessment Notification is a
prohibitory notification and directs that on and from the date of
its publication in the official gazette: (i) expansion or
modernization of any activity (if pollution load is to exceed the
existing one) and (ii) a new project listed in Schedule I to the
notification, shall not be undertaken unless it has been accorded
environmental clearance (for short EC) by the Central Government
in accordance with the procedure specified in the notification.
[Para 85] [411-E-F, H; 412-A-B)
6.2 The notification provides, among other things, that in
case of mining operations, site clearance shall be granted for a
sanctioned capacity and shall be valid for a period of five years
from commencing mining operations .. What this means is that on
receipt of an EC a mining lease holder can extract a mineral only
from a specified site, upto the sanctioned capacity and only for a
period of five years from the date of the grant of an EC. This is
regardless of the quantum of extraction permissible in the mining
plan or the mining lease and regardless of the duration of the
mining lease. Consequently, a mining lease holder would
necessarily have to obtain a fresh EC every five years and can
also apply for an increase in the sanctioned capacity. There is no
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concept of a uetrospective EC and its validity effectively starts
only from the day it is granted. Thus, the EC takes precedence
over the miqing lease or to put it conversely, the mining
operations u1nder a mining lease arc dependent on and
'subordinate' lo the EC. [Para 86] [412-B-D]
6.3 If at1y proposed expansion or modernization activity
results in an ~ncrease in the pollution load, then a prior EC is
required. The project proponent should approach the concerned
State Pollutiot1 Control Board (spcb) for certifying whether the
proposed expansion or modernization is likely to exceed the
existing pollution load or not. If the pollution load is not likely to
be exceeded, the project proponent will not be required to seek
an EC but a copy of such a certificate from the SPCB will require
to be submitted to the Impact Assessment Agency which can
review the certificate. [Para 88] [413-B-C]
6.4 Existing mining projects that have a no objection
certificate from the SPCB before 27'" January, 1994 will not be
required to obtain an EC from the Impact Assessment Agency.
Of course, this is subject to the substantive portion of EIA 1994.
However, if the existing mining project does not have a no
objection certificate from the SPCB, then an EC will be required
under EIA 1994. [Para 90] [413-F-G]
6.5 The base year would need to be the immediately
preceding year that is 1993-94. In its report, the CEC has taken
1993-94 as the base year and there is no error in this. If the
annual production of any year from 1994-95 onwards exceeds
the annual production of 1993-94 or its preceding years, it would
constitute expansion and if that expansion results in an increase
in the pollution load over the existing levels, then an EC is
mandated. [Para 92] [414-B-D]
6.6 EIA 1994 was intended to prevent the existing
environmental load from increasing based on the existing data of
the immediate past and not data of a few years gone by. The only
exception that could be made in this regard would be if there is
no production during 1993-94. In that event, the immediately
preceding year would be relevant. In respect of a project that
has commenced prior to 27'" January, 1994 there is an exemption
from the requirement of obtaining an EC if there is no expansion
COMMON CAUSE v. UNION OF INDIA AND ORS.
371
and the existing pollution load is not exceeded. In any event, a
A
no objection certificate from the SPCB is necessary for continuing
the mining operations. Consequently, even if any mining lease
holder does not have an EC or does not require an EC for
continuing mining operations (but has a no objection certificate
f~om the SPCB), the absence of an E.C would not have an adverse
impact on the mining lease holder unless of course, there was an
expansion in the mining operations without any certificate from
the SPCB. [Paras 93, 94] [414-G-H; 415-A-C]
6. 7 The approval of a mining plan does not imply that a
mining lease holder can commence mining operations. The mining
lease holder is nevertheless obliged to comply with statutory
provisions including the EPA and other laws. The EJA 1994 would
apply to the renewal of a mining lease that came up for
consideration post 27'" January, 1994. In other words, for the
renewal of a mining lease, an EC was required by the mining
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.. lease holder. EIA 1994 is mandatory in character; that it is
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applicable to all mining operations -expansion of production or
even increase in lease area, modernization of the extraction
process, new mining projects and renewal of mining leases. A
mining lease holder is obliged to adhere to the terms and
conditions of a mining lease and the applicable laws and the mere
fact that a mining plan has been approved does not entitle a mining
lease holder to commence mining operations. In M. C. Mehta this
Court concluded that EIA 1994 is clearly applicable to the renewal
E
of a mining lease. [Paras 103-105] [416-F-G; 418-C-D, G-H]
6.8 An EC is required to be obtained before the renewal of
a mining lease and the term 'expansion' would include an increase
in production or the lease area or both. It was submitted on
behalf of the mining lease holders that the possibility of getting
an ex post facto EC was a signal to the mining lease holders that
obtaining an EC was not mandatory or that if it was not obtained,
the default was retrospectively condonable. This submission is
liable to be rejected. [Paras 106-107] [419-B-C]
Environment Impact Assessment Notification of 14!!! September,
2006
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7.1 On 1411' September, 2006 another EIA Notification was
issued by the MoEF. This notification (for short EIA 2006)
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[2017) 13 S.C.R.
required prior EC for projects or activities mentioned in the
Schedule to it both for major as well as minor minerals if the
leased area is 5 hectares or more. Post EIA 2006, every mining
lease holder having a lease area of 5 hectares or more and
undertaking mining operations in respect of major minerals was
obliged to get an EC in terms of EIA 2006. [Paras 108, 114] [419E-G; 421-A-B]
7.2 A mining plan is subordinate to the EC and having an
approved 111ining plan does not imply that a mining lease holder
can commence mining operations. That being so, a modified
mining plan without a revised or amended EC, is of no
consequence. [Para 116] [421-D]
7.3 20% deviation from the mining plan (in terms of overproduction) would be reasonable and permissible. [Paras 118]
(422-A-BJI
7.4 For the purposes of renewal of the mining lease, an
application is required to be made by the mining lease holders
and the deemed renewal clause under Rule 24A of the MCR will
come into operation only after an application for renewal is made
in Form Ji in Schedule I of the MCR Even otherwise, in view of
EIA 1994, it is quite clear that the renewal of a mining lease
would require a prior EC. [Para 121] [423-B-C]
7.5 There is no doubt that the grant of an EC cannot be
taken as a mechanical exercise. It can only be granted after due
diligence and reasonable care since damage to the environment
can have a long term impact. ETA 1994 is therefore very clear
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that if expansion or modernization of any mining activity exceeds
the existing pollution load, a prior EC is necessary. Even for the
renewal of a mining lease where there is no expansion or
modernization of any activity, a prior EC is necessary. Such
importance having been given to an EC, the grant of an ex post
G facto environmental clearance would be detrimental to the
environment and contd lead to irreparable degradation of the
environment. The concept of an ex post facto or a retrospective
EC is completely alien to environmental jurisprudence including
EIA 1994 and EJA 2006. An EC will come into force not earlier
than the date of its grant. (Paras 123, 1241 [423-H; 424-A-C]
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COMMON CAlJSE v. UNION OF INDIA AND ORS.
Illegal Mining
8. The holder of a mining lease is required to adhere to the
terms of the mining scheme, the mining plan and the mining lease
as well as the statutes such as the EPA, the FCA, the Water
(Prevention and Control of Pollution) Act, 1974 and the Air
(Prevention and Control of Pollution) Act, 1981. If any mining
operation is conducted in violation of any of these requirements,
then that mining operation is illegal or unlawful. Any extraction
of a mineral through an illegal or unlawful mining operation would
become illegally or unlawfully extracted mineral. lllegal mining
·is not confined only to mining operations outside a leased area.
Such an activity is obviously illegal or unlawful mining. Illegal
.mining takes within its fold excess extraction of a mineral over
;the permissible limit even within the mining lease area which is
held under lawful authority, if that excess extraction is contrary
to the mining scheme, the mining plan, the mining lease or a
stat_ufory ·requirement. [Paras 128, 129] [425-B-D]
,Encroachments
'
9.1 Section 4(1) of the MMDR Act makes it clear that no
per.son can carry out any mining operations except under and in
accordance with the terms and conditions of a mining lease granted
under the MMDRAct and the rules made thereunder. Obviously
, therefore, any person carrying on mining operations without a
,!llining lease, is indulging in illegal or unlawful mining. This would
1 ~~o necessarily imply that if a mining lease is granted to a person
,!;V,hO ~arries out mining operations outside the boundaries of the
,P.J:i'!;ing lease, the mineral extracted would be the result of illegal
·,!Ir unlawful mining. In its report, the CEC has dealt with illegal
1 !Dining outside the sanctioned mining areas. It is stated that 82
.,mining leases for iron ore and manganese ore were identified by
,Jhe Commission where there were encroachments in the form of
,,illegal mining pits, illegal over-burden dumps etc. [Paras 130,
.. ,pl] (425-E-H]
· '"
9.2 A fresh Joint Survey to be conducted by concerned
,.<officers of the Government of Odisha from the Revenue
Department, the Forest Department, the Mining Department and
any· other department that may be deemed necessary. The J<'orest
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Survey of India, the MoEF, the Indian Bureau of Mines and the
Geological Sl)rvey of India should also be associated in the Joint
Survey. It would also be appropriate if the CEC is also associated
in the Joint Survey and the best and latest technology should be
made use of including satellite imagery and thereafter a report
be submitted in this Court after hearing the 82 lessees identified
by the Commission. [Para 134] [426-E-F]
Adherence tg the mining plan
10. A mining plan is valid for a period of five years but there
could be a 20% variation in extraction over and above the mining
c plan. This i$ the maximum that is stated to be reasonably
permissible according to the :vlinistry of Mines. In terms of Ruic
22(5) of the MCR a mining plan shall incorporate a tentative
scheme of mining and annual program and plan for excavation
from year to year for five years. At best, there could be a variation
in extraction of 20% in each given year but this would be subject
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to the overall mining plan limit of a variation of 20% over five
years. What this means is that a mining lease holder cannot
extract the five year quantity (with a variation of 20%) in one or
two years only. The extraction has to be staggered and continued
over a period, of five years. While mining in excess of permissible
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limits under the mining plan or the EC or FC on leased area may
not amount to mining on land occupied without lawful authority, it
would certail)ly amount to illegal or unlawful mining or mining
without auth$rity of law. (Paras 135, 139) (427-B; 428-E-F]
Section 21 of the MMDR Act
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11.1 Section 21(1) of the MMDR Act is clearly relatable to
a penal offence and applies if any one contravenes the provisions
of Section 4(1) of the MMDR Act. Section 4(1) of the MMDR
Act prohibits the undertaking of any mining operation in any area
except under and in accordance with the terms and conditions of
G a mining lease and the rules made thereunder. Therefore, when
a person carries out a mining operation in any area other than a
leased area or violates the terms of a mining lease, which
incorporates the mining plan and which requires adherence to
the law of the land, that person becomes liable for prosecution
under Section 21(1) of the MMDR Act. In the event of a
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conviction, he or she shall be punishable with imprisonment for a
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COMMON CAUSE v. UNION OF INDIA AND ORS.
375
term which may extend to five years and with fine which may
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extend to Rs.5 lakh per hectare of the area. [Para 141] [428-GH; 429-A-B]
11.2 There is no ambiguity in Section 21(5) of the MMDR
Act or in its application. Though Section 21(1) of the MMDR Act
might be in the realm· of criminal liability, Section 21(5) of the B
MMDR Act is certainly not within that realm. Section 21(5) of
the MMDR Act is applicable when any per ·~n raises, without
any lawful authority, any mineral from any land. In that event, the
State Government is entitled to recover from such person the
mineral so raised or where the mineral has already been disposed
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of, the price thereof as compen~ation. The words 'any land' ate
not confined to the mining lease area. As far as the mining lease
area is concerned, extraction of a mineral over and above what is
permissible under the mining plan or under the EC undoubtedly
attracts the provisions of Section 21(5) of the MMDR Act being
extraction without lawful authority. It would also attract Section
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. 21(1) of the MMDR Act. In any event, Section 21(5) of the Act is
certainly attracted and is not limited to a violation committed by
a person only outside the mining lease area - it includes a violation
committed even within the mining lease area. This is also because
the MMDR Act is intended, among other things, to penalize illegal
or unlawful mining on any land including mining lease land and
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also preserve and protect the environment. Action nnder the
EPA or the MCR could be the primary action required to be taken
with reference to the MCR and Rule 2(ii a) thereof read with the
Explanation but that cannot preclude compensation to the State
under Section 21(5) of the MMDR Act. The MCR cannot be
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read to govern the MMDR Act. [Paras 149, 150] [432-C-G]
11.3 There can be no compromise on the quantum of
compensation that should be recovered from any defaulting
lessee - it should be 100%. If there has been illegal mining, the
defaulting lessee must bear the consequences of the illegality
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and not be benefited by pocketing 70% of the illegally mined
ore. [Para 153] [433-D-E]
Calculations on merits
12. The base year of 1993-94 Is most appropriate; Some
lessees might lose.in the process while some of them might benefit H
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but that cannot Jlie avoided. In any event, each mining lease holder
is being given tl).e benefit of calculations only from 2000-01 and
Is not being 'penalized' for the period prior thereto. The
compensation should be payable from 2000-200 I onwards at
100% of the price of the mineral, as rationalized by the CEC.
[Paras 155, 156) [434-G-H; 435-BJ
Violation of Fo~est (Conservation} Act, 1980
13. Given the fact that the defaulting mining lease holders
have been asked! to pay and have paid additional NPV as well as
an amount towards penal compensatory afforestation, it must be
assumed the violation of the FCA has been condoned to a limited
extent. A violation of the FCA is condonable on payment of penal
compensatory afforestation charges. This obviously would not
apply to illegal or unlawful mining under Section 21(5) of the
MMDR Act, but it is made clear that the mining lease holders
would be entitled to the benefit of any Temporary Working
Permission granted. )Paras 178, 185] [440-C-D; 443-D)
Conclusions on the issues of mining without an EC or FC or both
14. To avoid any misunderstanding, confusion or ambiguity,
the following is made very clear: (1) A mining project that has
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commenced prior to 27"' January, 1994 and has obtained a No
Objection Cer~ificate from the SPCB prior to that date is
permitted to continue its mining operations without obtaining an
EC from the Impact Assessment Agency. However, this is subject
to any expansion (including an increase in the lease area) or
modernization activity after 27" January, 1994 which would result
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in an increase in the pollution load. In that event, a prior EC is
required. However, if the pollution load is not expected to ·
increase despite the proposed expansion (including an increase
in the lease are'1) or modernization activity, a certificate to this
effect is absolut~ly necessary from the SPCB, which would be
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reviewed by the Impact Assessment Agency; (2) The renewal of
a mining lease after 27'" January, 1994 will require an EC even if
there is no expansion or modernization activity or any increase
in the pollution load; (3)For considering the pollution load the
base year would be 1993-94, which is to say that if the annual
production after 27"' January, 1994 exceeds the annual production
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COMMON CAUSE v. UNION OF INDIA AND ORS.
377
of 1993-94, it would be treated as an expansion requiring an EC;
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(4) There is no doubt that a new mining project after 27'" January,
1994 would require a prior EC; (5) Any iron ore or manganese
ore extracted contrary to EIA 1994 or EIA 2006 would constitute
illegal or unlawful mining (as understood and interpreted) and
compensation at .100% of the price of the mineral should be B
recovered from 2000-2001 onwards in terms of Section 21(5) of
the MMDR Act, if the extracted mineral has been disposed of.
In addition, any rent, royalty or tax for the period that such mining
activity was carried out outside the mining lease area should be
recovered; (6) With effect from 141• September, 2006 all mining
projects having a lease area of 5 hectares or more are required C
to have an EC. The extraction of any mineral in such a case
without an EC would amount to illegal or unlawful mining
attracting the provisions of Section 21(5) of the MMDR Act; (7)
For a mining lease of iron ore or manganese ore of less than 5
hectares area, the provisions of EIA 1994 will continue to apply D
subject to EIA 2006; (8) Any mining activity carried on after 7'"
January, 1998 without an FC amounts to illegal or unlawful mining
in terms of the provisions of Section 21(5) of MMDR Act
attracting 100% recovery of the price of the extracted mineral
that is disposed of; (9) In the event of any overlap, that is, illegal
or unlawful mining without an FC or without an EC or without E
both would attract only 100% compensation and not 200%
compensation. In other words, only one set of compensation
would be payable by the mining lease holder; and (10) No mining
lease holder will be entitled to the benefit of any payments made
towards NPV or additional NPV or penal compensatory
afforestation. [Para 186) [443-E-H; 444-A-H; 445-A-B)
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Violation of Section 6 of the MMDR Act
15. As far as .Essel Mining and Industries Limited is concerned,
'this mining lease holder will be dealt with on another occasion
since even the CEC has placed this mining lease holder in a G
special category. Similarly, so far as Rungta Mines Limited,
Rungta Sons Pvt. Limited and M/s Mangilal Rungta are
concerned, although the CEC has come to the conclusion that
these persons have not acquired mining leases in violation of
Section 6 of the MMDR Act, there are some critical observations
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made by the Commission with regard to the 'Rungta Group'. The
Rungta companies will be heard to ascertain, inter alia, whether
there has been any violation of the provisions of Section 6 of the
MMDR Act. As far as Jindal Steel & Power Limited is concerned,
this company will be heard on another occasion since the
suggestion of the CEC is that it is the benami holder of Sarda
Mines Pvt •. Ltd. If it is so held to be a benami holder of Sarda
Mines Pvt. Lt<l. then there is a violation of Section 6 of the
MMDR Act. [Ilaras 192, 193, 194] [446-D-G]
Violation of Ru\e 37 of the Mineral Concession Rules, 1960
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16. It will be appropriate if in fact a fresh look is given to
the raising contracts entered Into by the mining lease holders
and the raising contractors. Such an order ought to be passed
with the consent of the mining lease holders since any delay in
disposal of the issue would not really sub-serve the interests of
anybody including the mining lease holders. The proposed
D Committee appointed in respect of the eight mining lease holders
will be entitled to lift the corporate veil, the importance of which
in cases such as the present, has been emphasized. [Paras 203,
204] [448-E, G]
Intergenerationail equity
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17. This is an aspect that needs serious consideration by
the policy and decision makers in our country in the governance
structure.