# DOIWALA SEHKARI SHRAM SAMVIDA SAMITI LTD v. STA TE OF UTTARANCHAL AND ORS

- **Citation:** [2006] Supp. 10 S.C.R. 807
- **Court:** Supreme Court of India
- **Decided:** 2006-12-12
- **Case number:** Civil Appeal No. 800 of2005
- **Bench:** Dr. Ar. Lakshmanan, Tarun Chatterjee
- **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/doiwala-sehkari-shram-samvida-samiti-ltd-v-sta-te-of-uttaranchal-and-ors-21357
- **Pages:** 23

## Headnote

B
Uttaranchal Minor Mineral (Concession) Rules, 2001 (Adaptation and
Modification) Order, 2001-Rule 1(5)-Application for lease for mining of
minor mineral by private party - Rejection based on policy whereby such C
lease had to be granted to Government Corporations-Correctness ofHeld-No monopoly in favour of Government Corporation/Departments was
created as policy also permitted grant of license to private parties and no
genera/full restriction was imposed-After formation of State of Uttaranchal,
Order of 200 I was issued pursuant to Article 348(3) of Constitution of India,
1950, and notification regarding same was issued for general information- D
Therefore, changed conditions could be given effect to since suitable provisions ·
were incorporated in statutory rules-Amended rules and policy decisiun
were bona fide exercise of executive power of State Government and not its
misuse to advance own self interest~Rule 9A of U.P. Minor Minerals
(Concession) Rules, 1963.
Government Policy-Change of-Held-Government has a right to
denial of its policy from time to time according to the demands of time and
in public interest-However, power to change policy under executive power
E
is only when it does not preamble by any statute or rules-Also, policy
decision cannot come in the way as rights fructified much before it came into F
being.
Subordinate legislation-Validity of-Held-Nature, object and scheme
of parent stature, afld also area, over which power has been delegated under
statute, has to considered and then decision is to be taken whether subordinate
legislation conforms to parent statute-it has to be struck down where it is G
_directly inconsistent with a mandatory provision of parent statute-However,
if issue is of its inconsistency of non-conformity not with reference to any
specific provision of parent statute, but with object and scheme of parent
statute, Court should proceed with caution before declaring invalidity.
807
H
808
SUPREME COURT REPORTS [2006] SUPP. 10 S.C.R.
A
Constitution of India, 1950-Article 14-Equal treatment-Concept-""'
of-Held-Two wrongs cannot make on right -No one can claim that since
something wrong has been done in another case, directions should be given·
for doing another wrong-It would not be setting a wrong right but could
be perpetuating another wrong and in such matters, there is no discrimination
involved-Concept of equal treatment pre-supposes existence of similar· legal
B foothold-It does not countenance repetition of a wrong action to bring
wrongs at par-Affected parties have to establish strength of their case on
some other basis and not by claiming negative quality.
Appellant is engaged in business of mining minor minerals. They
C applied for grant of lease for mining of minor mineral under Rule 9-A of the
U.P. Minor Minerals (Concession) Rules, 1963. The erstwhile State of U.P.
got bifurcated and the impugned area fell under the newly formed respondent
State, which exercising power under Section 87 of the U.P. Re-organization
Act, 2000 extended to itself the Rules of 1963 with certain modification/
amendment. Respondent introduced a new policy of mining of minor mineral
D whereby as far as possible the lease for excavation/mining was to be granted
to the Governmerit Corporations. Based on this policy, the District Magistrate
rejected the application of appellant stating that the lease of excavation of
impugned areas had to be granted to Garhwal Manda! Vikas Nigam. Appellant
challenged the rejection order as well the Policy of the respondent by filling
E a Writ Petition. However, High Court dismissed the writ petition. Hence the
present appeal.
Appellant pleaded against the policy of respondent contending that (i) it
imposed complete ban of mining of all minor mineral by private persons and
created monopoly (ii) respondent was not competent to create monopoly by a
F policy decision exercising its powers as delegated authority under Section
15 of Minor Mineral Development (Regulations) Act, 1

## Text

_Characters 0–39,802 of 54,834. This is a partial read: ask again with offset=39802 for what follows._

DOIWALA SEHKARI SHRAM SAMVIDA SAMIT! LTD.
A
v.
STA TE OF UTTARANCHAL AND ORS.
DECEMBER 12, 2006
[DR. AR. LAKSHMANAN AND TARUN CHATTERJEE, JJ.]
B
Uttaranchal Minor Mineral (Concession) Rules, 2001 (Adaptation and
Modification) Order, 2001-Rule 1(5)-Application for lease for mining of
minor mineral by private party - Rejection based on policy whereby such C
lease had to be granted to Government Corporations-Correctness ofHeld-No monopoly in favour of Government Corporation/Departments was
created as policy also permitted grant of license to private parties and no
genera/full restriction was imposed-After formation of State of Uttaranchal,
Order of 200 I was issued pursuant to Article 348(3) of Constitution of India,
1950, and notification regarding same was issued for general information- D
Therefore, changed conditions could be given effect to since suitable provisions ·
were incorporated in statutory rules-Amended rules and policy decisiun
were bona fide exercise of executive power of State Government and not its
misuse to advance own self interest~Rule 9A of U.P. Minor Minerals
(Concession) Rules, 1963.
Government Policy-Change of-Held-Government has a right to
denial of its policy from time to time according to the demands of time and
in public interest-However, power to change policy under executive power
E
is only when it does not preamble by any statute or rules-Also, policy
decision cannot come in the way as rights fructified much before it came into F
being.
Subordinate legislation-Validity of-Held-Nature, object and scheme
of parent stature, afld also area, over which power has been delegated under
statute, has to considered and then decision is to be taken whether subordinate
legislation conforms to parent statute-it has to be struck down where it is G
_directly inconsistent with a mandatory provision of parent statute-However,
if issue is of its inconsistency of non-conformity not with reference to any
specific provision of parent statute, but with object and scheme of parent
statute, Court should proceed with caution before declaring invalidity.
807
H
808
SUPREME COURT REPORTS [2006] SUPP. 10 S.C.R.
A
Constitution of India, 1950-Article 14-Equal treatment-Concept-""'
of-Held-Two wrongs cannot make on right -No one can claim that since
something wrong has been done in another case, directions should be given·
for doing another wrong-It would not be setting a wrong right but could
be perpetuating another wrong and in such matters, there is no discrimination
involved-Concept of equal treatment pre-supposes existence of similar· legal
B foothold-It does not countenance repetition of a wrong action to bring
wrongs at par-Affected parties have to establish strength of their case on
some other basis and not by claiming negative quality.
Appellant is engaged in business of mining minor minerals. They
C applied for grant of lease for mining of minor mineral under Rule 9-A of the
U.P. Minor Minerals (Concession) Rules, 1963. The erstwhile State of U.P.
got bifurcated and the impugned area fell under the newly formed respondent
State, which exercising power under Section 87 of the U.P. Re-organization
Act, 2000 extended to itself the Rules of 1963 with certain modification/
amendment. Respondent introduced a new policy of mining of minor mineral
D whereby as far as possible the lease for excavation/mining was to be granted
to the Governmerit Corporations. Based on this policy, the District Magistrate
rejected the application of appellant stating that the lease of excavation of
impugned areas had to be granted to Garhwal Manda! Vikas Nigam. Appellant
challenged the rejection order as well the Policy of the respondent by filling
E a Writ Petition. However, High Court dismissed the writ petition. Hence the
present appeal.
Appellant pleaded against the policy of respondent contending that (i) it
imposed complete ban of mining of all minor mineral by private persons and
created monopoly (ii) respondent was not competent to create monopoly by a
F policy decision exercising its powers as delegated authority under Section
15 of Minor Mineral Development (Regulations) Act, 1957 (iii) it was only an
exercise of its executive powers whereas it required legislative sanction (iv)
it was against Section 17 A(2) of Act of 1957 that required the State before
reserving any area exclusively for itself to obtain approval from the Central
Government which had n'ot been done (v) the policy decision cannot come in
G the way of grant of lease to them as their right fructified much before the
policy came into being (vi) rejection of their application was violative of Art.
14 of the Constitution of India as several other persons have been granted .
mining lease.
Disposing of the appeals, the Court
DOIWALA SEHKARI SHRAM SAMVIOA SAMIT! LTD.''· STATE OF UTTARANCHAL
809
HELD: 1.1. No monopoly of mining of minerals in favour of the A
Government Corporations/Departments has been created, nor have the
fundamental rights as enshrined under the Constitution been violated. In
paragraph 2.5 of amended Mineral Policy announced by Government Order
No. 3498 dated 17.10.2002 there is a provision for grant of license permitting
private parties for mining of the minerals and nowhere the general and full B
restriction has been imposed. [820-D, El
1.2. The Uttaranchal Minor Mineral (Concession) Rules, 2001
(Adaptation and Modifications) Order, 2001 was issued in pursuance of the
provisions of clause (3) of Article 348 of the Constitution of India. The
Governor ordered publication of the Notification dated 30.4.2001 for general C
information. Under Sub-Rule (5) of rule 1 of the above amended Rules of 2001
the rights of the Government to get the mining activities done by the
Government Departments, Government Corporations etc. was not affected.
Therefore, the changed conditions can be given effect to since suitable
provisions were incorporated in the statutory rules. (828-D, El
1.3. The amended Rules and the policy decision of the Government are
in bona fide exercise of executive power of the State Government and not in
its misuse to advance its own self interest. (824-G-HJ
State o/Tamil Nadu v. Mis, Hind Stone & Ors,, [198112 SCC 205, relied
on
2.1. The Government has a right to denial of it policy from time to time
according to the demands of the time and in the public interest. (825-F)
1982 All Law Journal 582, relied on.
2.2. The State Government has a power to change the policy under
executive power only when it does not preamble by any statute or rules.
Union of India & Anr v. International Trading Company & Anr., (2003)
5 sec 437, relied on.
3.1. The policy decision would not have come in the way of grant of lease
and fructified much before the policy came into being. The appellant would be
entitled to have the lease till the expiry of ten years from the date of the grant
of lease in their favour. The rights of the appellants get crystalised on the
date of commencement of the litigation and, therefore, the appellant is entitled
D
E
F
G
H
810
SUPREME COURT REPORTS (2006) SUPP. IO S.C.R.
A to the relief of continuing the lease till the expiry of the lease for ten years.
The appellant must be allowed to operate the mine for the full period oflease
subject to adjustment for the period for which he has already operated and
subject to the payment of lease amount and other dues etc. 1816-D; 827-C-D]
Beg Raj Singh v. State of U.P. & Ors., 12003) 1SCC726 and Union of
B India & Anr v. International Trading Company & Anr., 12003) 5 SCC 437,
relied on.
3.2. The appellant shall not be entitled to continue the lease or renewal
thereof after the expiry of the period of ten year~. {827-D, E]
C
4. Two wrongs do not make one right. The appellant cannot claim that
since something wrong has been done in another case, directions should be
given for doing another wrong. It would not be setting a wrong right but could
be perpetuating another wrong and in such matters, there i.s no discrimination
involved. The concept of equal treatment on the logic of Art. 14 cannot be
D pressed into service in such cases. But the concept of equal treatment preE
, supposes existence of similar legal foothold. It does not countenance repetition
of a wrong action to bring wrongs at par. The affected parties have to establish
strength of their case on some other basis and not by claiming negative quality.
In case, some of the persons have been granted permits wrongly, the appellant
cannot claim the benefit of the wrong done by the Government.1824-C-D]
Union of India & Anr v. International Trading Company & Anr., (2003)
5 sec 437 relied on
5. The Court considering the validity of a subordinate legislation will
have to consider the nature, object and scheme of the enabling Act, and also
F the area over which power has been delegated under the Act and then decide
whether the subordinate legislation conforms to the present statue. When a
rule is directly inconsistent with a mandatory provision of the statute, then,
of course, the task of the Court is simple and easy. But where the contention
is that the inconsistency or non-conformity of the rule is not with reference
G to any specific provision of the enabling Act, but with the object and scheme
of the parent Act, the Court should proceed with caution before declaring
invalidity. (828-B-CJ
·H
State of TN. & Anr. v. P. Krishnamurthy & Ors., (2006) 4 SCC 517 and
Govind Prasadv. R.G. Parsad & Ors., [1994) l SCC 437, referred to.
001\VALA SEHKARI SHRAM SAMVIDA SAMITI LTD."· STATE OF UTTARANCHAL (LAKSHMANAN. J.(
811.
CIVIL APPELLATE JURISDICTION : Civil Appeal No. 800 of2005.
A
, From the Final Judgment and Order dated 3.12.2003 of the High Court
of Uttaranchal at Nainital in Writ Petition No. 48 (MIB) of 2003.
WITH
Civil Appeal Nos. 678 & 679 of 2005.
Amit Kumar, Amit Anand Tiwari and Shobha for the Appellants.
Avtar Singh Rawat;AAG, State ofUttaranchal, Rajeev Kumar Bansal,
B
D. Bharathi Reedy, Jatinder Kumar Bhatia, Irshad Ahmad forthe Respondents. C
The Judgment of the Court was delivered by
DR. AR. LAKSHMANAN, J. Civil Appeal No. 800 of 2005 was filed
against the order passed by the learned single Judge dismissing the writ
petition filed by the appellant challenging the order of the District Magistrate D
refusing to grant lease to the appellant as well the Policy dated 17.10.2002 of
the State of Uttaranchal whereby the State created monopoly in respect of
mining of minor minerals.
Civil Appeal No. 678 of 2005 was filed by Maya Ram against the final
judgment and order dated 3.12.2003 passed by the High Court ofUttaranchal E
in W.P. No. 258(M/B) of2003 vide which the writ petition filed by the appellant
was dismissed.
Civil Appeal No. 679 of 2005 was filed by one Yograj Singh against the
judgment and order dated 3.12.2003 passed by the High Court o(Uttaranchal
in Writ Petition No. 70(M/B) of 2003 whereby the High Court dismissed the F
writ petition filed by the appellant.
The respondents in all the appeals are one and the same. The appellant
in Civil Appeal No. 800 of2005 is Doiwala Sehkari Shram Samvida Samiti Ltd.
which is engaged in mining business and has vast experience of minor
minerals with expertise, applied for grant of lease for mining of minor mineral G
under Rule 9-A of the U.P. Minor Minerals (Concession) Rules, 1963 for a
period of ten years in respect of 25 acres in Lot No. 2 on Tons River in Kalsi
Block and 28.42 acres in Lot No.3 Block No. I village Rampur Mandi, District
Dehradun. According to the appellant, the Samiti is the discoverer of the
H
812
SUPREME COURT REPORTS [2006) SUPP. 10 S.C.R.
A aforesaid two areas and entitled for preferential treatment under the Rules.
The District Magistrate after finding the application of the appellant complete
in all respect vide order dated 3.8.1998 directed the sub-Divisional Magistrate,
Division Forest Officer and Deputy Director, Geology and Mining to submit
their report on the application. The Divisional Forest Officer, sub-Divisional
Magistrate and the Deputy Director, Mining and Geology submitted their
B report dated 22.8.1998, 9.9.1998 and 11.9.1998 respectively recommending the
grant of lease in favour of the appellant for ten years. The Divisional Forest
Officer, in pursuance ofNotification No. 2380 dated 5.6.1997 which requires
the decision on the application to be taken by a Committee headed by District
Magistrate and consisting of Divisional Forest Officer and Deputy Director,
C Mining and Geology, wrote a letter dated 4.12.1998 to constitute the committee
to take a decision on the application as delay was causing monetary loss to
the Forest Department. Despite these recommendations, no Committee was
constituted by the District Magistrate as required for decision on the application
of the appellant. The appellant preferred an appeal under Rule 77 of the Rules
before the Court of Commissioner, Garhwal for constitution of the Committee.
D The appeal was allowed vide order dated 9.8.2001 by reviving the applications
of the appellant and directed the District Magistrate to decide the application
of the appellant for grant of lease. While the appeals of the appellant were_
pending, the State ofU.P. passed order dated 4.9.1999 granting lease to the
U.P. Forest Corporation for ten years. The appellant challenged the order for
E grant of lease before the High Court of Allahabad by filing a writ petition.
The High Court vide order dated 25.9.2002 directed the District Magistrate to
consider the application of the appellant. On 30.4.2001, the erstwhile State
of U.P. was bifurcated and the area under question fell under the newly
formed State of Uttaranchal which exercising power under Section 87 of the
U.P. Reorganisation Act, 2000 extended the U.P. Minor Minerals (Concession)
F Rules, 1963 with certain modification/amendment to the newly formed State
of Uttaranchal. On 17.10.2002, a new policy creating complete and general
ban of mining of minor mineral by private persons was introduced by the
State executive. The salient features of the policy decision are as under:
G
H
"In the State of Uttaranchal, the Mineral Policy, 2001 dated
30.04.2001 was formulated to ensure the mining of various mineral by
modem methods, to conserve the environment and to explore new
mineral by modern Techniques and also to do away the monopoly in
excavation/ mining of minor minerals.
(2) That having considered the necessity of extensive review of mineral
.
<•
' ,
DOJWALA SEHKARI SHRAM SAMVIOA SAMITI LTD."· STATE OF UTTARANCHAL ILAKSHMANAN. J.J
813
the policy 2001 of the State in view of impeding needs of Environment A
conservation, Revenue income easy availability of minor minerals at
proper rate to the consumers and development institutions and to
create opportunity of employment for the local people. The Government
has taken following decision to make the present mineral policy more
effective and development oriented in respect of the minerals available
in the State :
B
2.1. To remove the possibility of monopoly in respect of mining for
the areas full of minor minerals and for ensuring the conservation
of environment and for the mining/excavation work by scientific
method.
22. As far as possible the lease for excavation/mining shall be granted
to the Government corporations on river wise basis so as to
ensure better co-ordination and control. For this purpose lease
c
for mining/excavation in respect of all areas in district Dehradun
shall be granted to Garhwal Commissionary Development
Corporation and in respect of all areas in River Gola shall be D
granted to Uttaranchal Forest Development Corporation. But
because of excessive availability areas full of minor mineral in
District Haridwar, the lease of excavation/mining in forest areas
shall be granted to Uttaranchal Forest Development Corpn. and
in revenue areas to Garhwal Commissionary Development E
Corporation.
2.3. The excavation/mining work in respect of the left out areas
under the Mineral Policy 200 l, that is, Tanakpur (Sharda), Ram
Nagar, Kotdwar Satpuli and Shrinagar (Alaknanda) shall also be
carried out by the aforesaid Corporation. The concerned District F
Magistrate in respect of these rivers/areas is required to consult
with the officers of Forest Development Corporation/Garhwal
Commissionary Development
Corporation/Kumayun
Commissionary Development Corporation and submit a proposal
to the Government forthwith.
2.4. The small lots of minor minerals in Hill and plan regions where G
excavation/mining was being done and it is possible to do such
excavation/mining but is not being carrying out because of
absence of permission from the Government of India under the
Forest Conservation Act, 1980, than district wise proposals shall
be prepared by the concerned Corporations or Uttaranchal State H
A
B
c
D
E
F
G
H
814
SUPREME COURT REPORTS [2006J SUPP. IO S.C.R.
Cooperative Distribution Organisation and through the District
Magistrate same shall be communicated to the Government of
India for permission.
In the event of permission from the
Government of India under the Forest Conservation Act, 1980
for excavation/mining in the said areas the excavation shall be
carried out by the Government Corporations/Uttaranchal State
Cooperative Distribution Organisation. If for some reasons
aforesaid institutions are not in a position to carry out mining
activities themselves than same shall be ensured by aforesaid
institutions with the help of local people/institutions afte'r
obtaining the consent of the Government.
2.5. The land of private measurements except the land mentioned in
aforesaid paras 2.2. and 2.3 or for grant of licence for mining of
minor - minerals/lease for mining/short term mining, it is
compulsory to get prior permission from the Govt.
2.6. In addition to the aforesaid paras 2.2 and 2.3 in any other
condition the prior approval from the Government shall be
necessary for the grant of lease/short time permit for excavation
mining of minor minerals on the district level.
2.7. With the object to prevent misuse of minor minerals and loss. of
revenue, the District Magistrate shall ensure time to time checking
of the quantity of minor minerals into stone crushers and the
entering of goods prepared and effective invigilation on exit of
minor minerals from the stone crushers.
2.8
·····················
2.9
·····················
2.10
Sd/-
(illegible)
S.Krishnan
Chief Secretary"
Pursuant to the order dated 25.9.2002, the District Magistrate decided
the application and rejected the same in view of policy dated 17 .10.2002. The
rejection Order reads as follows:
From : District Magistrate. Dehradun.
DOIWALA SEHKARI SHRAM SAMVIDA S,\l>tlll LTD. v. STATE OF UTTARANCHAL ILAKSHMANAN. !.I
815
To
Sri Sushil Kumar,
President,
Doiwala Sahakari Shram Samvida Samiti Ltd.,
Markhand Grand, P.O. Doiwala,
District Dehradun.
A
B
Sub:
Regarding Applicatio~s dated 3.8.98 for excavation lease of
minor minerals, available in Lot No. 2 & 3 ofChakrata Forest Division.
Sir,
In compliance of order, passed on Writ Petition No. 1206/MB/2001 C
dated 25.09.2002, filed by you in Hon'ble High Court Nainital, on the
subject mentioned above, it is to infonn you that an amendment has
been made in mineral policy vide Uttaranchal State G.O. No. 3498/
0.V./22-kha/2001dated17.10.2002.
According to paras 2.1 and 2.2, in respect of all the areas of D
District Dehradun, lease of excavation has to be granted to Garhwal
Manda! Vikas Nigam.
In the light of above order both of your
applications for excavation lease dated 3.8.98 has been dismissed.
Sincerely,
Sd.1- E
(Illegible)
(Radha Ratani)
District Magistrate
Dehradun."
We heard Mr. L.N. Rao, learned senior counsel assisted by Mr. Amit F
Kumar and Mr. Amit Anand Tiwari, learned counsel and Ms. Shobha, leameCI
counsel appearing for the appellants and Mr. Avtar Singh Rawat, learned
Additional Advocate General for the State of Uttaranchal and Mr. Jatinder
Kumar Bhatia and Mr. Irshad Ahmad, learned counsel appearing for the
respondents.
Mr. L.N. Rao, learned senior counsel appearing for the appellant in
C.A.No. 800 of 2005 submitted that the High Court has failed to appreciate
that the State in exercise of its executive powers cannot put a complete and
G
· general ban of mining of all minor mineral by private persons. He submitted
that the complete and general ban of mining of all minor mineral by private H
816
SUPREME COURT REPORTS (2006] SUPP. JO S.C.R.
A persons would require legislative sanction. For this proposition, he relied on
the judgment of this Court in State of Tamil Nadu v. Mis Hind Stone & Ors.,
[1981] 2 SCC 205 and in State ofT.N. & Anr. v. P. Krishnamurthy & Ors.,
[2006] 4 sec 511.
Learned senior counsel further submitted that the policy of the State
B imposing complete ban and creating monopoly is without any legislative
sanction, against the provisions of Statute. Moreover under Section 17 A(2)
of the Minor Mineral Development Regulation Act, 1957, the State before
reserving any area exclusively for itself h25 to obtain approval from the
Central Government which has not been done in the present case. Therefore,
C the policy does not conform with the requirements as stipulated by the
statute as well as law laid down by this Court and, therefore, the same is ultra
vires. For this proposition, he relied on the judgments of this Court in Indian
Express Newspapers (Bombay) Private Ltd & Ors. v. Union of India & Ors.,
[l 985] 1 SCC 641 and Union of India & Anr. v. International Trading Co. &
Anr., [2003] 5 SCC 437. He further submitted that the State Government is not
D competent to create monopoly by a policy decision exercising its powers as
delegated authority under Section 15 of MMDR Act, 1957.
The policy
decision would not have come in the way of grant of lease to the appellants
as their right was fructified much before the policy came into being. He
submitted that this Court has held consistently that the ordinary rule of law
E is that the rights of the parties stand crystalised on the date of commencement
of litigation and right of relief should be decided by reference to the date on
which the appellant entered the portals of the Court as held in Beg Raj Singh
v. State of U.P. & Ors., [2003] I SCC 726. Since in the present case, the
appellants were consistently prosecuting their case with diligence, the
subsequent policy could not have prevented the grant of lease to the appellants.
F
Arguing further, learned senior counsel submitted that the High Court
upheld the policy solely on the ground that the policy is in public interest.
It was submitted that the policy which do not conform to the requirement of
law laid down by this Court was bad. He also submitted that the High Court
G failed to appreciate that the State by creating monopoly through a policy
decision had rendered Rule 9A of the Rules giving preferential rights to
certain private persons, otiose and hence the policy is contrary to the statute.
Ms. Shobha, learned counsel appearing for the appellant in Civil Appeal
No. 678 of2005 after adopting the arguments of Mr. L.N. Rao submitted that
H the view taken by the High Court is contrary to the consistent view taken by
t
'
DOIWALA SEHKARI SHRAM SAMVIDA SAMITI LTD."· STATE OF UTTARANCHAL ILAKSHMANAN. I.I
817
this Court that the executive orders can be issued to fill up the gaps in the A
Rules if the Rules are silent on the subject provided the same is not inconsistent
with the Statutory Rules already framed as was held in the case of Indra
Sawhney & Ors. v. Union of India & Ors., [1992] Suppl. 3 SCC 217 and to
Laxman Dhamanekar & Anr. v. Management of Vishwa Bharata Seva Samiti
& Anr., [2001] 8 sec 378. She also submitted that the statutory Rules cannot
be overridden by executive orders or executive practice and merely because B
the Government had taken a decision to amend the Rules does not mean that
the Rule stood obliterated and till the rule is amended, the Rule applies as
observed in K. Kuppusamy & Anr. v. State ofT.N. & Ors., [1998] 8 SCC 469.
The High Court though found force in the submission of the appellant C
that the earlier Notification dated 30.4.2001 does not impose a complete ban
over grant of lease to private persons, but despite this failed to appreciate
that if that is so then no such ban can be imposed by way of a Government
Order issued in contradiction to the said Gazette Notification.
She also invited our attention to the rejection order dated 21.5.2003 D
wherein it has been stated that in view of Government Order No. 3498/
Industrial Development-22 Kha/200 I dated 17. I 0.2002 in connection with the
amendment of Mining Policy-200 I issued by the Government in continuati9n
of Uttaranchal Minor Mineral Concession Rules, 200 I that mining work from
the rivers/lots situated in the District be carried out by Garhwal Manda)
Development Corporation Dehradun and in the forest areas the said work E
should be got done through Uttaranchal Forest Development Corporation
alone. The Additional District Magistrate, therefore, rejected the application
made by the appellant for grant of mining lease for ten years and informed
the appellant to take back his application fee and preliminary expenses of
Rs.3000/-.
She also submitted that the State before reserving any area F
exclusively has to obtain approval from the Central Government which has
not been done in the present case.
Mr. A vtar Singh Rawat, learned Additional Advocate General, in reply
to the arguments, submitted that the State Government amended the Rules
and the policy decision of the Government is in bona fide exercise of executive G
power of the State Government and not in its misuse to advance its own self
interest. It was submitted that the State Government has a power to change
the policy by executive action when it is not trammeled by any statute or rule.
He further submitted that the Government has constituted a Committee of
Cabinet Council for making recommendations for amending the Mining Policy H
818
SUPREME COURT REPORTS [2006] SUPP. 10 S.C.R.
A 2001 and after accepting the recommendations by the Uttaranchal Council !lf
Ministers the amendment has been made in the Mining Policy 2001 by the
Government Order No. 3498 dated 17. 10.2002. It was further contended that
the State Government has not misused any of its rights for establishing the
monopoly of the Government Companies/Corporations in the mining sector.
The factual position is that under para 2.5 of the amendment dated 17.10.2002
B the provision has been made to grant mining permits/mining lease to the
private parties on their private lands also. The learned Additional Advocate
General further submitted that the recommendations by the Council of Ministers
constituted for amendment in Mining Policy 2001 have been approved and
admitted and that the State Government while exercising the powers conferred
C under section 87 of the U.P. Reorganisation Act, 2000 and the U.P. SubMineral (Remission) Regulations, 1963 has been adapted by the Council of
Ministers by making the same conformable/adaptable in the light of Uttaranchal
State, in sequence of which itself, Government's Order No. 1187 dated 30.4.2001
has been issued by which Uttaranchal sub-Mineral (Remission) Regulation
has been made.
It was further submitted that by exercising the powers
D conferred under Section 87 of the U.P. Reorganisation Act~ .2000, the U.P.
E
F
Sub-Mineral (Remission) Regulation 1963 has been formulated. Section 87 of
the U.P. Reorganisation Act, 2000 reads as under:
"87. For the purpose of facilitating the application in relation to the
State of Uttar Pradesh or Uttaranchal of any law made before the
appointed clay, the appropriate Government may, before the expiration
of two years from that day; by order, make such adaptations and
modifications of the law, whether by way of repeal or amendment, as
may be necessary or expedient, and thereupon every such law shall
have effect subject to the adaptations and modifications so made until
altered, repealed or amended by a competent Legislature or other
competent authority.
Explanation - In this section, the expression "appropriate
Government" means as respects any law relating to a matter enumerated
in the Union List, the Central Government, and as respects any other
G
law in its application to a State, the State Government."
Relying upon Section 87, learned Additional Advocate General submitted
that under the above Section, U.P. Sub-Mineral (Remission) Regulation, 1963
has been formulated by the Council of Ministers while making the same
adaptable in the light of the Uttaranchal State. It was further submitted that
H the State Government while exercising the powers conferred under Section 87
I r
..
OOIW ALA SEHKARI SH RAM SAMVIDA SAMIT! LTD. v. ST A TE OF UTI ARANCHAL (LAKSHMANAN. I.)
819
of the Reorganisation Act has adopted.the U.P. Upkhanij (Parihar) Niyamavali, A
1963 in the perspective of the State of Uttaranchal, in pursuance whereof the
Government Order No. 1187 dated 30.4.2001 has been issued by which the
Uttaranchal Upkhanij (Parihar) Niyamavali has been formulated. As already
stated, the policy decisions were taken by the Council of Ministers and after
approval of Council of Ministei;s, the mining policy 200 l has been amended B
by Government Order No. l 031 4ated 30.4.2001 and the Government Order No.
3498 dated 17.10.2002 has been 'ssued and any general and full restriction has
not been imposed on the mining of the. Upkhanijs.
We have carefully considered the rival submissions made by the parties
with reference to the records, the Government Orders and annexures filed in C
these appeals.
The Parliament has enacted the Mines and Minerals (Regulation &
Development) Act, 1957. Section 4 of the Act prohibits all prospecting or
mining operation except under a licence or a lease granted under the Act and
Rules made thereunder. Section 15 empowers the State Government to make D
Rules for regulating the grant of quarry leases, mining leases and other
mineral concessions in respect of minor mineral and purposes connected
therewith. Pursuant to the powers vested in it under Section 15 of Mines and
Minerals (Regulation & Development) Act, 1957 the State ofU.P. has made
U.P. Minor Mineral (Concession) Rules, 1963 which has been adopted by the
State ofUttaranchal with certain modifications on 30.4.2001 exercising power E
under Section 87 ofU.P. Reorganisation Act, 2000. The State ofUttaranchal
further amended its policy decision on 17 .10.2002 whereby it was decided that
as far as possible the lease for excavation/mining shall be granted to the
Government Corporations on river wise basis so as to ensure better
coordina~ion and control.
This decision was taken keeping in view the F
excavation of the minor mineral with the modem techniques, to do away with
the monopoly in the excavation/mining and for the purpose of the conservation
and development of minor mineral available at the reasonable rate as also to
increase the employment opportunity apart from the aspect of revenue.
However, the provision was included if for some reasons the Government
Institutions are not in a position to carry out mining activities themselves G
. then the same shall be ensured by the Institutions with the help of local
people/institutions after obtaining the consent of the Government. Thus it
was submitted that no policy decision has been taken by the State Government
against the Rules and the Act. It was also submitted that the High Court is
fully justified in upholding the policy and that the policy is not contrary to H
820
SUPREME COURT REPORTS [2006) SUPP. 10 S.C.R.
A Rules and the provisions of the Act. It is pertinent to notice that an argument
advanced by the learned counsel that the High Court fell in error in holding
that the State Government is competent to frame a policy creating a monopoly
in favour of Government Companies/Corporations exercising delegated
legislative power conferred by the Parliament under Section 15 of the Mines
and Minerals (Regulations) Act, 1957. This argument, in our view, is without
B any basis. The State Government, in the instant case, has not amended the
mining policy for creating any monopoly of the Government company or
Government Corporation.
The Government has not made any exclusive provlSlon for State/
C Companies/Corporations etc. in the mineral policy under the amended Mineral
Policy dated 17.10.2002. In this context, our attention was drawn to Para 2.5
of the amended Mineral Regulation dated 17.10.2002 reproduced in paragraph
supra.
In paragraph 2.5 provisions have been made for sanction mining/
D collection leases/short term mining licenses on private "NAAP" land under
which short term mining leases/temporary mining licenses have been
sanctioned in the different Districts
in Uttaranchal State. In our view, no
monopoly of mining of minerals in favour of the Government Corporations/
Departments has been created, nor have the fundamental rights as enshrined
under the Constitution been violated. As already noticed, by Government
E Order No. 3498 dated 17.10.2002 in paragraph 2.5 there is a provision for grant
of license permitting private parties for mining of the minerals and nowhere
the general and full restriction has been imposed. In the instant case, the
State Government has exercised its right as conferred under Section 87 of the
U.P. Reorganisation Act, 2000 for the first time and U.P. Sub-Minerals Remission
F Regulation (Exemption), 1963 were adapted and in sequence of which the
Government's order No. I 187 dated 30.4.2001 has been issued. The newly
created Uttaranchal State in view of making Mineral Policy more effective and
developing for ensuring the mining/collection work of sub minerals available
in the State in a scientific manner while keeping the environment preserved
and for ruiing out the possibility of monopoly in mining area covered with
G the sub-minerals as far as practicable, provisions are made to sanction river
wise mining/collection leases to the Government Corporations so that better
coordination and control might be ensured. The Mineral Policy, 200 I of
Uttaranchal State has been declared by the Government Order dated 30.4.200 I
under which in the Forest Areas, keeping in view the Forest Conservation,
H provisions have been made for getting the work of mining and collection of
DOIWALA SEHKARI SHRAM SAMVIDA Sl\MITI LID.'· STATE OFUTIARANCHAL ILAKSHMANAN, J.I
821
the sub-minerals, done through Uttaranchal Forest Development Corporation. A
The area in question applied for by the appellant is concerned with forest
area.
We may also usefully reproduce the Notification dated 30.4.2001 issued
by the Government in pursuance of the provisions of Clause (3) of Article 348
of the Constitution of India. The Notification reads as under:
B
"In pursuance of the provision of clause (3) of Article 348 of the
Constitution of India the Governor is pleased to order the publication
of the following English translation of the notification No. 1187 /Ind.
Dev./2001-22Kha/2001 Secretariat, Dehradun dated April 30, 2001 for
general information.
Notification
c
Whereas under the provision of the Section 86 of the Uttar Pradesh
Reorganisation Act, 2000 the Uttar Pradesh Minor Mineral (Concession)
Rules, 1963 is applicable to the State of Uttaranchal. Now, therefore, D
in the exercise of the power conferred under Section 87 of the Uttar
Pradesh, Reorganisation Act, 2000 (Act No. 29 of2000), the Governor
of Uttaranchal is pleased to direct that the Uttar Pradesh Minor
Mineral (Concession) Rules, 1963 shall have applicability to the State
of Uttaranchal subject to the provisions of the following order :-
The Uttaranchal Minor Mineral (Concession) Rules, 2001 (Adaptation
and Modification) Order, 2001.
l. Short title and commencement
E
(i)
This order may be called the Uttaranchal Minor Mineral F
(Concession) Rules; 2001 (Adaptation and Modification) Order,
2001.
(ii)
It shall come into force at once.
2. Uttaranchal to be read in place of Uttar Pradesh :
In the Uttar Pradesh Minor Mineral (Concession) Rules, 1963
wherever the expression "Uttar Pradesh" occurs, it shall be read as
"Uttaranchal".
In the sub-Rule (5) of Rule I of the above amended Uttaranchal Minor
G
H
822
SUPREME COURT REPORTS [2006] SUPP. 10 S.C.R.
A Mineral (Concession) Rules, 2001 the following shall be added:
"In the sub-rule (5) of the Rule 1 of the above amended Uttaranchal
Minor Mineral (Concession) Rules, 2001, the following shall be added:-
"Thi~ rule shall not affect the right of the Government to get the
B
mining activities done by the Government Departments, Government
Corporations or Judicial Corporations".
c
In the sub rule (2) of the rule J of the above amended The
Uttaranchal Minor Mineral (Concession) Rules, 2001 before the word
"any''. the following shall be added :-
"Excluding where the mining activities are done by the Government
Departments, Government Corporations or Judicial Corporations".
It is thus seen that under the above amended Rule, the rights of the
Government to get the mining activities done by the Government Departments,
D Government Corporations etc. was not affected. The rights of the Government,
as already noticed, mining trade in respect of the minor minerals and lease is
regulated by Section 15 of the Mines· and Minerals (Regulation and
Development) Act, 1957 under which the State Government has been
empowered to make Rules to give effect to the provisions of the Aci: There
is no restriction under the Act that the minor minerals lease would be confined
E to State or its agencies and as such the policy decision of the State of
Uttranchal which creates an embargo on the right of the appellant is ultra
vires the provisions of 1957 Act and the Rules. The right to trade is guaranteed
under Article 19(6) of the Constitution oflndia and that can only be regulated
by means of a valid law and n.ot by the notification, which has been done
by the State of Uttranchal in the present case. It is also seen from the
F Notification dated 30.4:2001 that it did not deprive the appellants' right of
consideration of his application as no monopoly or right was created excluding
any private person.
It was argued by the learned senior counsel that the appellant has
G preferential right of consideration under Rule 9(a) of 1963 Rules and the
District Magistrate while rejecting the application has not considered this
aspect. To appreciate the argument of Mr. L.N. Rao, it will be proper to
mention certain provisions of 1957 Act and the Rules of 1963.
Section 15 of the Mines and Minerals (Regulation & Development) Act, "
H 1957 gives power to State Government to make rules in respect of minor
-
....
DOIWALA SEHKARI SHRAM SAMVIDA SAMITI LTD. v. STATE OF\fITARANCHAL (LAKSHMANAN. J.(
823
minerals.
The State ofU.P. framed the U.P. Minor Minerals (Concession) Rules:
1963 under Section 15 of the Mines and Minerals (Regulation & Development)
Act, 1957.
A
Rule 3 Sub-clause 1 of the rules provides that no person shall undertake B
any mining operation in any area within the State except under and in
accordance with the terms and conditions of a mining lease or mining permit
granted under these Rules. Rules 3 sub-clause II speaks that no mining lease
or mining permit shall be granted otherwise than in accordance with the
provisions of the Rules. Rule 9(A) gives preferential right to certain persons C
in respect of mining lease for sand etc. Rule 27 provides procedure for grant
of lease by auction. Under Rule 72 if any area, which was held under a mining
lease, under Chapter-II or as reserved under Section 17(A) of the Act becomes
available fo; re-grant on mining lease, the District Officer shall notify the
availability of the area through a notice inviting for applications for grant of
milting lease specifying a date.