# D.K. TRIVEDI AND SONS AND ORS. ETC. ETC v. STATE OF GUJARAT AND ORS. ETC. ETC - **Citation:** [1986] 1 S.C.R. 479 - **Court:** Supreme Court of India - **Decided:** 1986-03-05 - **Bench:** V.D. Tulzapurkar, D.P. Madon - **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/d-k-trivedi-and-sons-and-ors-etc-etc-v-state-of-gujarat-and-ors-etc-etc-9276 - **Pages:** 91 ## Headnote J Mines and Minerals (Regulation and Development) Act, ~ 1957 (Act. No.67 of 1957), Section 15(1), Constitutionality of - Whether the State Government has the power to make rules under section 15 to enable them to charge dead rent and royalty during the subsistence of ~uch leases - Validity of Notifications/circular issued by the Gujarat Government under section 15 amending the Gujarat Minor Mineral Rules, 1966 and dated 29,11.74, 29.10,75, 4.6.76, 26.3,79, 12.2.81 and 18.6.81 - Validity of Rule 21B of the Gujarat Minor Mineral Rules, 1966. The Writ Petitioners and appellants, were persons to whom the State of Gujarat had granted quarry leases and mining leases in respect of minor minerals such as black trap, lime· stones, 1111rrum, bentonite, rubble, marble, sandstone, quartzite, etc. In exercise of the powers conferred by section 15 of the Mines and Minerals (Regulation and Development) Act, 1957, the Government of Gujarat made the Gujarat Minor Mineral Rules, 1966. The said Rules came into force on April 1, 1966. All the leases in .the matters before the Court were given in the form prescribed by the said Rules, Schedule I to the said Rules specified the rates at which royalty was payable and Schedule II specified the rates at which dead rent was payable. By the 1974 Notification the Government of Gujarat made the Gujarat Minor Mineral (Fourth Amendment) Rules, 1974 whereby Schedule I was substituted and Schedule II was amended with effect from December 1, 1974. Under the new Schedule I and the amended Schedule II the rates of royalty and dead rent in ' respect of certain minor minerals were enhanced. In view of several representations made to it, the ; {;overnment of Gujarat decided not to implement the 1974 Notification and to refund the amount.of royalty, if any, collected at the rates prescribed by the 1974 Notification. By the 1975 Notification the GOvernment of Gujarat made the Gujarat A B c D E F G H A 480 SUPREME COURT REPORTS [1986] i s.c.R. Minor Mineral {Second Amendment) Rules, 1975, whereby Rule 21 of the said Rules and Schedule I were substituted with effect '· from November 1, 1975. By the said substituted Schedule I the rates of royalty in respect of several items were enhanced. The Appellant in C.A. 706/81, Ambalal Manibhai Patel, B being aggrieved by the· said 1975 Notification, filed a Writ Petition in the Gujarat High Court (Sp.C.Ap.66/78) challenging the enhancement in the rate of royalty to Rs ,3 per metric , tonne in respect of black trap and hard Murrum specified in Item 4 of the said substituted Schedule I. The Writ Petition having been dismissed, the appellant filed LPA No.61/78 which C was heard along with several writ petitions rai!ling the same questions. The main contention raised in those matters was that under the proviso to section 15(3) of the 1957 Act, the rate of royalty .in respect of any m.inor mineral could not be enhanced by the State Government more than once during any period of four years and that the rate of roya.lty on black O trap and hard llllrrum having been increased by the 197 4 Notification, it could not be increased again in 1975, A ~ subsidiary contention raised was that the State G.>vernment had no power to classify building stones into black !;rap and hard llllrrum because by doing so what the State Government had done in effect and substance was to declare black trap and hard ~ murrum as m.inor minerals and that it was only the Central Government which possessed the power to declare any m.ineral not covered by the definition of the expre11sion "m.inor minerals" in clause (e) of section 3 of the 1957 Act to be a m.inor m.ineral. Both these contentions were rejected by a Division Bench of the Gujarat High Court by its judgment dated ~ 16/17 September 1980 holding that the 197'• Notification had not become operative and, therefore, in issuing the 1975 Notification the State Government had not violated the proviso to section 15(3), and that building stones having been alr ## Text _Characters 0–39,893 of 206,681. This is a partial read: ask again with offset=39893 for what follows._ 479 D.K. TRIVEDI AND SONS AND ORS. ETC. ETC. v. STATE OF GUJARAT AND ORS. ETC. ETC. MARCH 5, 1986 [V.D. TULZAPURKAR AND D.P. MADON, JJ,] J Mines and Minerals (Regulation and Development) Act, ~ 1957 (Act. No.67 of 1957), Section 15(1), Constitutionality of - Whether the State Government has the power to make rules under section 15 to enable them to charge dead rent and royalty during the subsistence of ~uch leases - Validity of Notifications/circular issued by the Gujarat Government under section 15 amending the Gujarat Minor Mineral Rules, 1966 and dated 29,11.74, 29.10,75, 4.6.76, 26.3,79, 12.2.81 and 18.6.81 - Validity of Rule 21B of the Gujarat Minor Mineral Rules, 1966. The Writ Petitioners and appellants, were persons to whom the State of Gujarat had granted quarry leases and mining leases in respect of minor minerals such as black trap, lime· stones, 1111rrum, bentonite, rubble, marble, sandstone, quartzite, etc. In exercise of the powers conferred by section 15 of the Mines and Minerals (Regulation and Development) Act, 1957, the Government of Gujarat made the Gujarat Minor Mineral Rules, 1966. The said Rules came into force on April 1, 1966. All the leases in .the matters before the Court were given in the form prescribed by the said Rules, Schedule I to the said Rules specified the rates at which royalty was payable and Schedule II specified the rates at which dead rent was payable. By the 1974 Notification the Government of Gujarat made the Gujarat Minor Mineral (Fourth Amendment) Rules, 1974 whereby Schedule I was substituted and Schedule II was amended with effect from December 1, 1974. Under the new Schedule I and the amended Schedule II the rates of royalty and dead rent in ' respect of certain minor minerals were enhanced. In view of several representations made to it, the ; {;overnment of Gujarat decided not to implement the 1974 Notification and to refund the amount.of royalty, if any, collected at the rates prescribed by the 1974 Notification. By the 1975 Notification the GOvernment of Gujarat made the Gujarat A B c D E F G H A 480 SUPREME COURT REPORTS [1986] i s.c.R. Minor Mineral {Second Amendment) Rules, 1975, whereby Rule 21 of the said Rules and Schedule I were substituted with effect '· from November 1, 1975. By the said substituted Schedule I the rates of royalty in respect of several items were enhanced. The Appellant in C.A. 706/81, Ambalal Manibhai Patel, B being aggrieved by the· said 1975 Notification, filed a Writ Petition in the Gujarat High Court (Sp.C.Ap.66/78) challenging the enhancement in the rate of royalty to Rs ,3 per metric , tonne in respect of black trap and hard Murrum specified in Item 4 of the said substituted Schedule I. The Writ Petition having been dismissed, the appellant filed LPA No.61/78 which C was heard along with several writ petitions rai!ling the same questions. The main contention raised in those matters was that under the proviso to section 15(3) of the 1957 Act, the rate of royalty .in respect of any m.inor mineral could not be enhanced by the State Government more than once during any period of four years and that the rate of roya.lty on black O trap and hard llllrrum having been increased by the 197 4 Notification, it could not be increased again in 1975, A ~ subsidiary contention raised was that the State G.>vernment had no power to classify building stones into black !;rap and hard llllrrum because by doing so what the State Government had done in effect and substance was to declare black trap and hard ~ murrum as m.inor minerals and that it was only the Central Government which possessed the power to declare any m.ineral not covered by the definition of the expre11sion "m.inor minerals" in clause (e) of section 3 of the 1957 Act to be a m.inor m.ineral. Both these contentions were rejected by a Division Bench of the Gujarat High Court by its judgment dated ~ 16/17 September 1980 holding that the 197'• Notification had not become operative and, therefore, in issuing the 1975 Notification the State Government had not violated the proviso to section 15(3), and that building stones having been already included in the definition of "m.inor m.inerals", there was no bar to the State Government classifying them into different varieties for the purpose of recovering royalty. Civil. Appeal 706/81 is by Special Leave of the Court against the said judgment. · ~ During the pendency of the said Courl: proceedings, the Government of Gujarat made the Gujarat Minor Mineral (Second Amendment) Rules, 1976, substituting Schedule II to the said ,... D.K. TRIVEDI v. STATE 481 Rules, changing the rates of dead rent for specified Minor Minerals and reclassifying the said nomenclature as "for quarry leases for any minor mineral" and "for quarry Parwana for any minor mineral." Pursuant to a policy decision dated March 26, 1979 announced on the floors of the Legislature by the Minister for -' Mines, the Gujarat Government by the 1979 Notification made the Gujarat Minor Minerals (Amendment) Rules, 1979 with effect from April 1, 1979. By this amendment a new Rule 21B waa inserted in the said Rules, Rule 22 was amended, Chapter IV of the said Rules which dealt with grant of quarrying permits in respect of lands in which minerals belonged to the Government was deleted, Form D was amended, Forms I, J and K were deleted, and Schedules I and 11 were substituted. By the substituted Schedule 1, the rate of royalty on all minor mineral was specified as ten paise per metric tonne. By the substituted Schedule 11 the rate of dead rent per hectare or t part thereof in respect of quarry leases was enhanced to Rs.1,200 in certain cases, Rs.1,500 in some other cases, Rs. 2, 000 in one case and Rs. 3, 000 in the remaining cases. So far as quarry parwanas were concerned, the rate was specified as one-tenth of the rate for quarry leases per parwana. Ambalal Manilal Patel again filed a writ petition, Sp.C.Ap.138 of 1978, in the Gujarat High Court challenging the enhancement in the rate of dead rent made by the 1976 Notification. The Writ Petition was dismissed leading to the filing of a Letters Patent Appeal. The said Letters Patent Appeal and 125 other writ petition challenging the 1979 Notification were allowed by the Division Bench. The Division Bench held that the conditions in a lease in respect of minor minerals relating to the financial liability of a lessee derived their authority from sub-section (3) of section 15 of the Mines and Minerals (Regulation and Development) Act, 1957, while conditions, other than those relating to a lessee's financial liability, regulating the grant of a lease derived their authoJrity from [Sub-section from] sub-section (1) of section 15, that the State Government had no power to enhance the rate of dead rent during the subsistence of a lease, and that Rule 21-B of the Gujarat Minor Mineral Rules, 1966 and 1979 Notification were ultra vires section 15 and sub-clause (g) of clause (1) of ArticleT9 of the Constitution. The Division A B c D E F G H A 482 SUPREME COURT REPORTS [1986] l S,C,R, Bench accordingly issued a writ of mandamus against the State Government directing it to desist from enforcing the said Rule 21-B and the 1979 Notification. The Division Bench also made the same declaration in respect of the 1976 Notification and issued the same mandamus in respect therebf, The said judgment of the Division Bench is reported as s.i:. Sonba1 Pethalji v. ... B State of Glljarat & Anr., reported in XXI (2) (1980) 2 Gujarat L.R. 530. The State of Gujarat accepted the said judgment and~ did not come in appeal to this Court. Cert.ain lessees of mining and quarry leases, however, appr'oached this Court by way of Appeals and Writ Petitions challenging the correctness of the judgment in S11t. Sonbai's case. c In view of the said judgment, the Government of Gujarat issued a circular addressed to all Collec:tors, District Development Officers and the Director, Geology and Mining, Ahmedabad, being Circular No. M.C.R.2190 (166) CllH dated February 12, 1981, stating that in view of the aforesaid D judgment of the Division Bench the position prior theretd would prevail and that Chapter IV of the said Rules which was deleted by the 1976 Notification woul!l stand r1!vived and would be applied. The Government thereafter made the Gujarat Minor Minerals (Amendment) Rules, 1981, by issuing the 1981 Notification which came into force on June 20, 1981, By the 1981 E Notification Rule 21-B was deleted, Rule 22 was amended, Chapter IV and certain Forms were inserted, Schedule I to the said Rules was substituted and Schedule 11 thereto deleted. Several lessees of mining and quarry leases .filed writ petitions in the Gujarat High Court challenging the validity of the 1981 Notification and the said Circular. These writ F petitions were rejected on the ground that as connected proceedings were pending in the Supreme Court, it was open to the petitioners to move this Court if they so desired. Accordingly, the said petitioners as also oth1!rs filed writ petitions in this Court challenging the validity of thl) 1981 Notification and the said Circular as also in some cases. G Appeals against the order rejecting the writ petitions. ' ~ Dismissing CA. Nos. 1525-26 of 1982, WP Nos.7103-7128 of 1981 and WP Nos. 4208-17 of 1983, alloVing from the lessee to the lessor is the rent for the area leased A (often called "surface rent"), dead rent and royalty. Since a B mining lease confers upon the lessee the right not merely to _A enjoy the property as under an ordinary lease but also to extract minerals from the land and to appropriate them for his own use or benefit, in addition to the usual rent for the area demised, the lessee is required to pay a certain amount in respect of the minerals extracted proportionate to the quantity so. extracted. Such payment is called "royalty". It C may, however, be that the mine is not worked properly so as not to yield enough return to the lessor in the shape of royalty. In order to ensure for the lessor a regular income, whether the mine is worked or not, a fixed amount is provided to be paid to him by the leBBee. This is called "dead rent". ~ (534 CHI; 535 A-BJ D "Dead rent" is calculated on the basis of the area leased while royalty is calculated on the quantity of minerals extracted or remved. Thus, while dead rent is a fixed return to the lessor, royalty is a return which varies with the quantity of minerals extracted or removed. Since dead rent and royalty are both a return.to the lessor in respect of the area leased, looked at frO. one point of view dead rent can be described as the minillllllll guaranteed amount of royalty payable to the lessor but calculated on the basis of the area leased and not on the quantity of minerals extracted or removed. Stipulations providing for the lessee's liability to pay surface rent, dead rent and royalty to the lessor are the usual covenants to be found in a mining lease. (535 B-E] The grant of a mining lease would thus provide for the consideration for such grant in the shape of surface rent, E F dead rent and royalty. The power to make rules for regulating G ) . the grant of such leases would, therefore, include the power ; to fix the consideration payable by the lessee to the lessor in the shape of ordinary rent or surface rent, dead rent and royalty. If this were not so, it would lead to the absurd result that when the Government grants a mining lease, it is granted gratis to a person who wants to extract minerals and H profit from them. Rules for regulating the grant of mining A B c D E F G H 488 SUPREME COURT REPORTS [1986] l S.C.R. leases cannot be confined merely to rules providing for the" fom in which applications for such leases are to be made, the factors to be taken into account in granting or refusing such applications and other cognate matters. Such rules 1111St necessarily include provisions with respect to the consideration for the grant. [535 E-H] The Legislature and the rule making authorities have ~ also throughout understood the power to make rules in respect of mining leases and minerals as including the power to charge dead rent and royalty. Rule 41 of the Mine1:al Concession Rules, 1949, made by the Central Government in exercise of the powers conferred by section 5 of the 1948 Act prescribed the conditions which were to be included in every mining lease. The said Rule 41 provided for payment of royalty on minerals at the rate specified in the First Schedule to the said Rules in force on the date of the grant of the lease .~ also to pay royalty at such revised rates as may be notifiecl from time to time. It also provided for payment of surface rent and further ~ provided for payment of dead rent with a proviso that the lessee was liable to pay dead rent or royalty, whichever was higher in amount, but not both. Rules made by the State Governments in respect of minor minerals also provided for payment of these charges. Under clause (1) of sec.tion 13(2) of the 1957 Act, the rules to be made by the Central Government can provide "for the fixing and the collection of dead rent, fines, fees or other charges and the collection of royalties". .... Although clause (i) of section 13(2) speaks of fixing and ,_ collection in the case of dead rent and only collection in the ~ case of royalties, the reason is not that the power to fix royalties. was not thought to be a comprehended in the general rule-making power of the Central Government under section 13(1). The reason was that a separate provision in that behalf was made by section 9 with respect to mining leases granted both before the conmencement of the 1957 Act as also after the commencement of the 1957 Act. Another reason for doing so was to specify the rates for royalties in respect ,Jf different -' minerals other than minor minerals in the Second Schedule to· , the 1957 Act in order to restrict the scope of subordinate legislation as pointed out in the Statement of Objects and Reasons to the Legislative Bill No. 83 of 1972. [536 B; E-G; 537 E-H; 538 A] 4.1 The sole repository of the power of the State Government to make rules and amendments thereto, including D.K. TRIVEDI v. STATE 489 _,-ndments enhancing the rates of royalty and dead rent, is sub-1!ection (1) of section 15, [564 D-E) 4.2 Sub-section (3) of section 15 does not confer upon the State Governments the power to make rules charging royalty A or to enhance the rate of royalty so charged from time to B time. [541 A-BJ .J 4,3 A proper reading of sunection (3) of section 15 shows that it does not confer any power upon the State Governments to make rules with respect to royalty. Royalty is payable by the holder of a quarry lease or raining lease or other mineral concession granted under rules made under sub-1!ection (r) of se<:tion 15. What sub-section (3) does is to make such holder liable to pay royalty in respect of minor minerals removed or consumed not only by him but also by his agent, manager, employee, contractor or sub-lessee. It thus casts a vicarious liability upon such holder to pay royalty in . respect of the acts of persons other than himself. The very ~act that under sub-1!ection (3) the liability of such holder is to pay royalty "at the rate prescribed for the time being. in the rules framed by the State Government in respect of minor minerals" shows that the prescribing of the rate of royalty in respect of minor minerals is to be done under the rule-making power of the State Governments which is to be found in sub-1!ection (1) of section 15. Yet another purpose of enacting sub-1!ection (3) is to be found in the proviso to that sub-1!ection which prohibits the State Government from J enhancing the rate of royalty in respect of any minor mineral _for more than once during any period of four years. 539 JH;) Section 9A was inserted in the 1957 Act by the Amendment Act of 1972 but it waa not inserted with retrospective effect. It was, therefore, not there when section 15(1) was placed upon the statute book while enacting the 1957 Act. Section 9A was enacted with a two-fold purpose. It casts a liability upon c D E F the holder of a mining lease, whether granted before or after G the commencement of the 1972 Act, tlu!t is, either before or ~fter September 12, 1972, to pay to the State Government dead rent at the rates specified for the time being in the Third Schedule to the 1957 Act "notwithstanding anything contained in the instrument of lease or in any other law for the time being in force." The purpose of inserting section 9A in the H A B c D E F G H 490 SUPREME COURT REPORTS [1986] 1 s.c.R. 1957 Act, as stated in the Statement of Objects and Reasons to ~ Legislative Bill No.83 of 1972, was to make a "provision of a statutory basis for calculation of dead rent". Section 9A also provides that the liability of the lessee would be to pay either royalty or dead rent whichever is greater, thus embodying in the Act what was contained in t.he proviso to clause (c) of Rule 27 of the Minor Mineral Concession Rules, 1960. Section 9A was inserted also with a view to prohibit the Central Government from enhancing the rate of d.ead rent more .._ th~ once during any period of four years. By the Amendment Act of 1972 section 9 was also a•mded. While under the original sub-section ( 1) of section 9 the liability of the holder of a mining lease was only to pay royaltj' in respect of any mineral removed by him, after the amendment he is made liable to pay royalty in respect of any miner.al "removed or consumed by him or by his agent, manager; employee, contractor of sub-lessee". By the Amendment Act of 1972 the power to the Central Government to amend by notification the Second Schedule which specifies the rate of royalty was also ( ~ curtailed by inserting a proviso to section 9 3) in order to provide that the Central Government shall not e~thance the rate of royalty in r::espect of any mineral more than once during any period of four years. The amendments made by the' Amendment Act of 1972 have, therefore, no relevance for ascertaining the scope of the rule-malting power of the State Gov·ernments under section 15(1). [540 A-G] s.t. Sonbai Petbalji v. State of Gujarat & Anr., XXl (2) 1980 (2) Guj. L.R. 530 reversed. M.V. Subba Rao v. State of Audhra Pradesh and Anr., A.I.R. 1978 AP 453 overruled. ). Laddu Mal and Ors. v. 'Ibe State of B:lhar and Ors., A.I.R. 1965 Patna 491; Banku Bihari Saha v. St:ate GoverlWllt r,;: Madhya Pradesh and Ors., A.I.R. 1969 M.P. 2'.10; Dr. Sbaatl Saroop Sharma and Anr. v. State of Punjab and Ors., A.I.R. 1969 Punj. & Har. 79; H/s. Amar Singh Modi Lal v. State o~ Baryana and Ors., A.I.R. 1972 Punj. & Har. 356; K/a. Brflltd: Bricks, Bharatpur v. State of Rajastban and Am~., A.I.R. 1972 Raj. 145 distinguished. D.K. TRIVEDI v. STATE 491 ,.J, Sbeo Varan Singh v. State of U.P., A.I.R. 1980 All. 92; Bal !kJlwnd Arora etc. v. State of llajastll.'ln and Ora., A. I.R. 1981 Raj. 95 approved. A 5.1 The power to make rules under section 15(1) includes B the power to amend the rules so made, including the power to amend the rules so as to enhance the rates of royalty and dead rent. [541 ~] 5.2 Rules under section 15(1), though made by the State Governments, are rules made under a Central Act end the provisions of the General Clause& Act, 1897, apply to such rules. Under section 21 of the General Clauses Act, where by any Central Act, a power to make rules is conferred, then thst power includes a power, exercisable in the like manner and subject to the like sanction and conditions if any, to add to, amend, vary or rescind any rules so made. The power to amend the rules is therefore, comprehended within the power to make ~ rules and as section 15(1) confers upon the State Governments the power to make rules providing for payment of dead rent and royalty, it also confers upon the State Governments the power to amend those rules so as to alter the rates of royalty and dead rent so prescribed, either by enhancing or reducing such rates. The source of the power to enhance the rate of royalty is not contained in su~ection (3) of section 15. The purpose of inserting the said su~ection in section 15 with retrospective effect was an entirely different Qlle. [541 C-F] 5.3 A State Government is entitled to 11111end the rules c D E ~ under section 15(1) enhancing the rates of royalty and dead F rent even as regards leases subsisting at the date of such amendment. [542 A-Bl 5.4 Su~ection (3) of section 15 does not confer any power to amend the rules made under section 15(1), for the power to amend the rules is comprehended within the power to G make the rules conferred by su~ection (1) of section 15. The . j construction sought to be placed upon the word "grant" in ! "section 15(1) is misplaced. While granting a lease it is open to the grantor to prescribe conditions which are to be observed during the period of the grant and also to provide for the forefeiture of the lease on breach of any of those H conditions. If the grant of a lease were not to prescribe such A B c D E F G H 492 SUPREME COURT REPORTS [1986] l s.c.R. conditions, the less..:. 11;1<1ld with impunity connit: breaches of "' the conditions of the lease. Ordinary leases of immovable property at times provide for periodic increases of rent and there is no reason why such increases should not be made in a mining or quarry lease or other mineral concession granted under a regulat;o;;y statute intended for the benefit of the public and e-;en les~ reason why such a atatute should not confer power t<'.i ;nake r.11.,.s providing for inc:rease11 in the rate of dead rent during cha subsistence of the 11~ase. In any ~ event, the power to make ~les under section 15(1) is also for purposes connected with the grant of mining and quarry leases and other mineral concessions and the express:lon "and for purposes connected therewith" read with the word "grant" would include the power to enhance the rate of dead rent dudng the subsistence of the lease. [542 B-F] 5, 5 A quarry lease, mining lease or other \id.neral concession in respect of a minor mineral does not stand on the same footing as an ordinary contract. These leases and • coucessions are granted by the State GovernmentE1 pursuant to rules made under the statutory power conferred upon them by a regulatory Act, Minerals are part of the mater:Lal resources which constitute a nation's natural wealth and if the nation is to advance industrially and if its ecollOlay is to be benefitted by the proper development and exploitation of these resources, they cannot be permitted to be frittiired away and exhausted within a few years by indiscriminate exploitation without any regard to public and national interest. It was for achieving the object set out above that both the 1948 Act and the 1957 Act were enacted. The long title of the 1957 Act is ~ "An Act to provide for the regulation of mines and the development of minerals under the control of the Union." The 1946 Act contained a preamble which stated "Whereas it is expedient in the public interest to provide for t.he regulation of mines and minerals and for the development of minerals to the extent hereinafter specified." The makers of the Constitution recognized the importance to the 118tion of the regulation of mines and mineral development and, therefore, . ~. enacted Entry 54 of the Union List and Entry 23 of the State List. In the exercise of the power conferred by Entry 54, Parliament has made a declaration in section 2 of the 1957 Act that "it is expedient in the public interest that the Union should take under its control the regulation of mines and the D. K. TRIVEDI v. STATE 493 ,( development of minerals to the extent hereinafter provided." The presumption is that an authority clothed with a statutory pnwer will exercise such power reasonably, · and if in the public interest and for the efficacious regulation of mines A and quarries of minor minerals and the proper development of B such minerals, a State Government as the delegate of the Union Government thinks fit to amend the rules so as to enhance the rate of dead rent, it cannot be said that it is prevented from -' doing so by the principles of the ordinary law of contracts. It may be.that in certain cases by enhancing the rate of dead rent the holders of leases 'in respect of certain types of minor minerals may be adversely affected but private interest c cannot be permitted to. override public interest. Conservation of minerals and their proper exploitation result in securing the maximum benefit to the conm.mity and it is open to the State Governments to enhance the rate of dead rent so as to ensure the proper conservation and development of minor · minerals even though it may effect a lessee's liability under o ~ a subsisting lease. [ 543 B-H; 544 A-Cl State of T...U Radu v. IUad Stone Etc., (1981] 2 s.c.R. 742 @ 751 relied on. 5. 6 Where a statute confers discretionary powers upon E the executive or an administrative authority, the validity or constitutionality of such power cannot be judged on the assumption that the executive or such authority will act in an arbitrary manner· in the exercise of the discretion conferred upon it. If the executive or" the administrative authority acts -1 in an arbitrary manner, its action would be bad in law and F liable to be struck down by the courts but the possibility of abuse of power or arbitrary exercise of power cannot invalidate the statute conferring the power or the power which lias been conferred by it. (544 C-E] 6.1 A State Government is not required to give an G opportunity of a hearing or of -making a representation to i:he J lessee who would be affected by any amendments of the rules ' before making such amendments. [ 544 G-H] 6.2 The enhancement in the rates of royalty. and dead rent is made in the exercise of the statutory power to amend H the rules framed under section 15(1). There is no such A B c D E F H 494 SUPREME COURT REPORTS [19861 1 s.c.R. - principle of law that before such a statutory power is ;.. exercised, persons who may be affected thereby should be heard. Whether any opportunity is to be given to per11ons affected to make representations to the Government would depend upon the form in which the rule ll&king power is conferred. It is for the legislative body which confers the rule making power to decide in what form such power should be conferred. In some acts it is provided that the draft of the rules proposed to be made as also any propc>sed amendment ~ · thereto should be published in the Official G•u:ette so that members of the public may have an opportunity of making such representations or raising such objections as they think fit. Some other Acts provide for rules to be laid before parliament or the Legislature for its approval and to be effective only after such approval is given or to continue in force with such modifications as Parliament or the Legislature may make, and if the approval is not given to cease to have 1my effect. It was, therefore, for Parliament to decide whether· rules and · notifications made by the State Governments under section 1 15(1) should be laid before Parliament or the Legislature of the State or not. It, however, thought i.t fit to do so with respect to llinerals other than minor minerals since these minerals are of vital importance to the country''s industry and economy, but did not think it fit to do so in the case of minor minerals because it did not consider them to be of equal importance. An amendment of the rules made under section 15(1), even though it may have the effect of enhancing the rates of royalty or dead rent does not, therefore, become bad in law because no opp0rtunity of being heard or malting a representation is given to persons who would be prejudicially~ affected thereby. Section 15(1) does not contain any provision 1 for giving any such opportunity and no such provision can be imported into that sub-section. (545 B-H] 7, A Quarry lease is a mining lease. Under clause (c) of section 3 "mining lease" inter alia means "a lease granted for the purpose of undertaking mining operations". Under clause (d) of section 3, the expression "mining operations" means~ "any operations undertaken for the purpose of winning any ' mineral", ~rrying minerals is, therefore, a 11d.ning operation in as much as it consists of an operation undertaken for the purpose of winning particular classes of minerSlls. Clause (vi) of Rule 2 of the Gujarat Rules defines "quarry lease" as D.K. TRIVEDI v. STATE 495 > meaning "a kind of mining lease in respect of a minor mineral granted under these rules." Quarry lease• are, therefore, ·included in the term "mining leases". [546 C-F) A 8, l By reason of the prohibition contained in the proviso to section 15(3}, a State cannot enhance' the rate of B royalty in respect of any minor mineral more than once during any period of four years. A State Government is also not enti_,_ tled to enhance the rate of dead rent more than once during any period of four years. Such a construction would be in consonance with practice, both past and present. The proviso to section 9(3) prohibits the Central Government from enhancing the rate of royalty in respect of any mineral other than a C minor mineral more than once during any period of four years. The proviso to section 9A(2) also prohibits the Central GQvernment from enhancing the dead rent in respect of any area 1110re than once during any period of four years. [548 A-CJ ~ 8. 2 During any period of four years, however, the State Government can enhance both dead rent and royalty, but only once. [ 548 F) Although in one sense dead rent may partake of the nature of royalty, there is a substantial difference between both.