# THE GOA FOUNDATION v. M/S SESA STERLITE LTD. & ORS

- **Citation:** [2018] 2 S.C.R. 361
- **Court:** Supreme Court of India
- **Decided:** 2018-02-07
- **Bench:** Madan B. Lokur, Deepak Gupta
- **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/the-goa-foundation-v-m-s-sesa-sterlite-ltd-ors-32873
- **Pages:** 81

## Headnote

Mines and Minerals:
Mining leases - Renewal of - Propriety - Appointment of
Commission of Inquiry, pursuant to information regarding largescale illegal mining in contravention of provisions of relevant
laws - After the report of the Commission, Govt. of Goa by order
dated 10.9.2012 suspended all the mining operations in the State -
Ministry of Environment and Forest (MoEF) kept in abeyance the
environmental clearances in the State of Goa by order dated
14.9.2012 - PIL was filed by Goa Foundation in Supreme Court
seeking directions to Governments of Union and State of Goa to
take steps to terminate the mining leases where mining was carried
out in violation of various statutes - Writ petitions by mining leaseholders before High Court seeking quashing of the orders dated
10.9.2012 and 14.9.2012, were transferred to Supreme Court -
Supreme Court in *Goa Foundation case held that orders dated
10.9.2012 and 14.9.2012 were not liable to be quashed and would
continue till decisions are taken to grant fresh leases and fresh
environmental clearances for mining projects - Other writ petitions
were filed before High Court by several mining lease-holders for
consideration of their applications for second renewal of mining
leases - High Court held that the decision in *Goa Foundation case
was not an impediment in considering the applications for second
renewal; and that renewal of a lease is also a fresh grant - High
Court directed the State to execute the lease deeds u/s. 8(3) of MMDR
Act in favour of the lease-holders who have already paid the stamp
duty in accordance with Mineral Policy 2013 - Further directed
the State to decide the renewal applications u/s. 8(3), of those who
had not paid the stamp duty - State of Goa thereafter formulated
Goa Grant of Mining Leases Policy 2014 - Central Government
prepared draft of Mines and Minerals (Development and Regulation)
[2018] 2 S.C.R. 361
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Act, 2014 (amended Act) and uploaded the same on the website -
The proposed amendment inter alia by introducing s. 10B provided
for competitive bidding - Soon thereafter and till the date of
promulgation of Amendment Ordinance, State of Goa granted
second renewals to several mining lease-holders - Thereafter, the
State requested MoEF to lift the abeyance order (dated 14.9.2012)
on environmental clearances - Consequently MoEF by orders dated
20.3.2015 lifted the abeyance order in respect of 72 cases out of
139 - Held: The decision of State of Goa to grant second renewal
of mining leases was erroneous and contrary to decision in *Goa
Foundation case - State was obliged to grant fresh mining leases as
declaration in *Goa Foundation case was explicitly to grant fresh
leases - Grant of fresh lease is not the same as renewal of lease -
State was not under any constitutional obligation to grant fresh
mining leases through process of competitive bidding or auction -
However, the second renewals were unduly hasty, without taking
into consideration all relevant material and ignoring relevant
material, was not in the interest of mineral development - The
decision of renewal was only to augment the revenues of the State
which is outside the purview of s. 8(3) of 1957 Act - Therefore, the
second renewal granted by the State is liable to be set aside - MoEF
was obliged to grant fresh environmental clearance in respect of
fresh grant of mining leases in accordance with law and decision in
*Goa Foundation case and not by merely lifting the abeyance order
dated 14.9.2012 - High Court proceeded on the erroneous basis
that it could direct the State to grant second renewal notwithstanding
the direction in *Goa Foundation case - Mines and Minerals
(Development and Regulations) Act, 1957 - s.8(3) - Forest
(Conservation) Act, 1980 - Environment (Protection) Act, 1986.
Auction:
Natural Resource allocation - Through auction method -
Whether mandatory - Held: There is no constitutional or otherwise
mandate for allocat

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THE GOA FOUNDATION
v.
M/S SESA STERLITE LTD. & ORS.
(SLP (Civil) No. 32138 of 2015)
FEBRUARY 7, 2018
[MADAN B. LOKUR AND DEEPAK GUPTA, JJ.]
Mines and Minerals:
Mining leases - Renewal of - Propriety - Appointment of
Commission of Inquiry, pursuant to information regarding largescale illegal mining in contravention of provisions of relevant
laws - After the report of the Commission, Govt. of Goa by order
dated 10.9.2012 suspended all the mining operations in the State -
Ministry of Environment and Forest (MoEF) kept in abeyance the
environmental clearances in the State of Goa by order dated
14.9.2012 - PIL was filed by Goa Foundation in Supreme Court
seeking directions to Governments of Union and State of Goa to
take steps to terminate the mining leases where mining was carried
out in violation of various statutes - Writ petitions by mining leaseholders before High Court seeking quashing of the orders dated
10.9.2012 and 14.9.2012, were transferred to Supreme Court -
Supreme Court in *Goa Foundation case held that orders dated
10.9.2012 and 14.9.2012 were not liable to be quashed and would
continue till decisions are taken to grant fresh leases and fresh
environmental clearances for mining projects - Other writ petitions
were filed before High Court by several mining lease-holders for
consideration of their applications for second renewal of mining
leases - High Court held that the decision in *Goa Foundation case
was not an impediment in considering the applications for second
renewal; and that renewal of a lease is also a fresh grant - High
Court directed the State to execute the lease deeds u/s. 8(3) of MMDR
Act in favour of the lease-holders who have already paid the stamp
duty in accordance with Mineral Policy 2013 - Further directed
the State to decide the renewal applications u/s. 8(3), of those who
had not paid the stamp duty - State of Goa thereafter formulated
Goa Grant of Mining Leases Policy 2014 - Central Government
prepared draft of Mines and Minerals (Development and Regulation)
[2018] 2 S.C.R. 361
361
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Act, 2014 (amended Act) and uploaded the same on the website -
The proposed amendment inter alia by introducing s. 10B provided
for competitive bidding - Soon thereafter and till the date of
promulgation of Amendment Ordinance, State of Goa granted
second renewals to several mining lease-holders - Thereafter, the
State requested MoEF to lift the abeyance order (dated 14.9.2012)
on environmental clearances - Consequently MoEF by orders dated
20.3.2015 lifted the abeyance order in respect of 72 cases out of
139 - Held: The decision of State of Goa to grant second renewal
of mining leases was erroneous and contrary to decision in *Goa
Foundation case - State was obliged to grant fresh mining leases as
declaration in *Goa Foundation case was explicitly to grant fresh
leases - Grant of fresh lease is not the same as renewal of lease -
State was not under any constitutional obligation to grant fresh
mining leases through process of competitive bidding or auction -
However, the second renewals were unduly hasty, without taking
into consideration all relevant material and ignoring relevant
material, was not in the interest of mineral development - The
decision of renewal was only to augment the revenues of the State
which is outside the purview of s. 8(3) of 1957 Act - Therefore, the
second renewal granted by the State is liable to be set aside - MoEF
was obliged to grant fresh environmental clearance in respect of
fresh grant of mining leases in accordance with law and decision in
*Goa Foundation case and not by merely lifting the abeyance order
dated 14.9.2012 - High Court proceeded on the erroneous basis
that it could direct the State to grant second renewal notwithstanding
the direction in *Goa Foundation case - Mines and Minerals
(Development and Regulations) Act, 1957 - s.8(3) - Forest
(Conservation) Act, 1980 - Environment (Protection) Act, 1986.
Auction:
Natural Resource allocation - Through auction method -
Whether mandatory - Held: There is no constitutional or otherwise
mandate for allocation of natural resources (other than spectrum)
through auction method - But, auction process should not be given
a go-bye without any justification - The decision to give a go-bye
is judicially reviewable and would attract Art. 14 - Review is
permissible only when the allocation is for commercial pursuits of
profit de hors any social or welfare purpose - It will not be permissible
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if such allocation is for a social or welfare purpose - Judicial
Review - Constitution of India - Art. 14.
Judicial Review:
Judicial review of policy decision - In respect of disposal of
natural resources - Scope of - Held: Judicial review of a policy is
kept open if it does not serve the common good as understood in
Art. 39(b) and if violates Art. 14 - However, the courts must be very
cautious and circumspect in diluting or setting aside a policy and
must do so only if it is constitutionally unavoidable - Constitution
of India - Arts. 14 and 39(b) - Administrative Law.
Lease:
Renewal of lease vis-a-vis grant of fresh lease - Held: Grant
of a fresh lease is not the same as the renewal of a lease - Therefore,
renewal cannot be called amounting to grant of fresh lease.
Environmental Law:
The issues having impact on the environment and the people
of a community or a region or the State are required to be looked at
holistically - One or two violations may be wished away as
inconsequential, but multiple violations by several persons can result
in serious problems.
Disposing of the petitions, the Court
HELD: 1.1 The decision of the State of Goa to grant a second
renewal of the mining leases is erroneous, contrary to the decision
in *Goa Foundation case and must be and is quashed. In *Goa
Foundation case the Court was quite obviously aware that it was
concerned, inter alia, with the second renewal of mining leases
and yet it chose to recount the factual situation, make a declaration
and pass a direction without adverting to the possibility of a second
renewal of a mining lease. The Court was also conscious that the
mining lease holders had carried out indiscriminate and illegal
mining for about five years (from November 2007 to September
2012) and had made profits out of the illegal mining. The sequence
of events from September 2012 onwards, the appointment of a
Monitoring Committee to dispose of the illegally mined ore, the
declaration and direction unmistakably point to the intention of
the Court to end the sordid chapter of illegal mining by the lease
THE GOA FOUNDATION v. M/S SESA STERLITE LTD. & ORS.
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holders and start on a clean slate. Viewed in this perspective, the
Court really did intend the State of Goa to consider the grant of
fresh leases in accordance with law. [Paras 41, 58] [395-B-D; 400F-G]
1.2 The declaration of the Court in *Goa Foundation case
in paragraph 87.5 of Report is also quite clear, namely, "It is for
the State Government to decide as a matter of policy in what
manner mining leases are to be granted in future...." The
declaration was explicit and related to the grant of mining leases
and not a second renewal. Similarly, the direction given in
paragraph 88.4 of the Report that "The State Government may
grant mining leases of iron ore and other ores in Goa in
accordance with its policy decision....." was equally explicit and
related to the grant of mining leases and not a second renewal.
[Paras 42, 43] [395-E-F]
1.3 From a reading of the decision rendered by the High
Court in the present petition, it is evident that the State of Goa
understood the decision of this Court in *Goa Foundation case
to mean that fresh mining leases were required to be granted on
the basis of a policy yet to be framed by the State of Goa and the
issue of second renewals did not survive consideration. The High
Court noted that this Court was alive to the fact that the State of
Goa had granted in-principle second renewal to 28 mining leases
and had collected renewal fees or stamp duty from 27 mining
leases (presumably out of the 28 mining leases). Notwithstanding
the in-principle grant of second renewal of 28 mining leases and
collection of renewal fees or stamp duty, this Court in *Goa
Foundation case consciously required the State of Goa to grant
fresh leases. What is equally significant is that the State of Goa
also understood the decision of the Court in the same manner
and intended to act on that basis. [Paras 46-48] [396-D-E, 397-CE, F-G]
1.4 While this Court had required the State of Goa to grant
fresh mining leases and the State of Goa was willing to comply
with this direction, the High Court instead directed it to execute
mining leases under Section 8(3) of the MMDR Act in respect of
those who had paid the renewal fees or stamp duty. The High
Court also directed the State of Goa to decide their pending
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second renewal applications within a period of three months
keeping in mind the provisions of Section 8(3) of the MMDR Act
(presumably after paying the renewal fees or stamp duty in terms
of the Government order of 21st February, 2013). The
understanding by the High Court of the decision of this Court in
*Goa Foundation case is totally incorrect. [Para 49] [398-A-C]
1.5 It appears from the contents of the Grant of Mining
Leases Policy that in view of the decision of this Court in *Goa
Foundation case, the State was actively considering a policy for
granting fresh mining leases by considering several factors.
However, the decision and directions of the High Court
supervened leaving no choice, according to the State, but to
completely abandon the process of grant of fresh mining leases
through the process of competitive bidding for earning revenue
and justify the abandonment. [Para 50] [398-D]
1.6 There is no doubt that the renewal of a lease is virtually
the same as the grant of a fresh lease but a converse direction to
grant a mining lease cannot be understood to mean granting a
renewal of a mining lease. Obviously, the grant of a fresh lease is
not the same as the renewal of a lease and when the Court in
*Goa Foundation case required the State of Goa to grant a fresh
lease, it did not require the State to renew the existing (expired)
lease. The Court could have explicitly declared and directed the
State of Goa to grant a second renewal of the mining leases rather
than to say it in a roundabout manner that it should do so by
granting a fresh lease equivalent to a renewal. Therefore, it cannot
be said that the renewal of a mining lease is equivalent to or
amounts to the grant of a fresh lease. [Paras 52, 55] [399-F-G;
400-A]
Common Cause v. Union of India (2014) 14 SCC 155 :
[2014] 7 SCR 561 - distinguished.
Delhi Development Authority v. Durga Chand Kaushish
(1973) 2 SCC 825 : [1974] 1 SCR 535; Provash
Chandra Dalui v. Biswanath Banerjee (1989) Supp 1
SCC 487 : [1989] 2 SCR 401; M.C. Mehta v. Union of
India (2004) 12 SCC 118 : [2004] 3 SCR128; State of
West Bengal v. Calcutta Mineral Supply Company
Private Limited (2015) 8 SCC 655 : [2015] 9 SCR 230;
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Gajraj Singh v. State Transport Appellate Tribunal (1997)
1 SCC 650 : [1996] 6 Suppl. SCR 172 - referred to.
2.1 There is no constitutional requirement (let alone a
mandate) for allocation of natural resources through the auction
method (other than spectrum) but at the same time the auction
process should not be given a go-bye without any justification -
the decision to give a go-bye is judicially reviewable though the
scope of judicial review might be rather restricted. [Para 69] [406C-D]
2.2 Consequently, while there is no mandate, constitutional
or otherwise, that natural resource allocation must be only by
auction, it is certainly "a more preferable method". There are
exceptions, such as when the natural resource allocation is for a
"social or welfare purpose". On the other hand if the natural
resource allocation is "for commercial pursuits of profit
maximising private entrepreneurs" de hors any social or welfare
purpose, then judicial review would be permissible and Article
14 of the Constitution would be attracted and if the executive
action is found to be arbitrary, it would be struck down. Therefore,
when it comes to natural resource allocation, the executive has a
somewhat limited elbow room. [Para 69] [406-E-F]
3.1 Judicial review of a policy is kept open if it does not
serve the common good as understood in Article 39(b) of the
Constitution, if it violates Article 14 of the Constitution and
alienates natural resources for maximizing profits of private
entrepreneurs while sidelining Article 39(b) of the Constitution.
"The legislature and the executive are answerable to the
Constitution and it is there where the judiciary, the guardian of
the Constitution, must find the contours to the powers of disposal
of natural resources, especially Article 14 and Article 39(b) [of
the Constitution]. [Para 74] [410-G; 411-A]
3.2 Notwithstanding this, a Court must exercise restraint
and not set aside Government policy only because it disagrees
with it or because a better policy could be framed or simply
because it has the power to set aside the policy. Policies framed
by the State, after due consideration, must be respected and given
enough elbow room and flexibility for implementation. Of course,
there would be occasions when the implementation of a policy
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has teething problems or some lacuna is discovered at a slightly
later stage, but that does not mean that policy itself is defective.
Therefore, Courts must be very cautious and circumspect in
diluting or setting aside a policy and must do so only if it is
constitutionally unavoidable, otherwise good governance could
be a casualty. [Paras 75] [411-B-C]
3.3 There is no doubt that iron ore mining in Goa was solely
for commercial purposes. The State sacrificed maximizing revenue
for no apparent positive reason, virtually surrendering itself to
the commercial and profit making motives of private
entrepreneurs and ignoring the interests of Goan society in
general. Therefore, in principle, the decision of the State of Goa
to not auction the grant of mining leases was flawed in that it did
not serve the common or public or social good but primarily
assisted in filling the coffers of private entrepreneurs. [Para 93]
[419-D, F]
Sandur Manganese and Iron Ores Limited v. State of
Karnataka (2010) 13 SCC 1 : [2010] 11 SCR 240 -
distinguished.
4.1 In renewing the mining leases, the State of Goa
completely ignored several relevant and important and significant
factors giving the impression that the renewals were not quite
fair or reasonable. The State ignored the fact that every single
mining lease holder had committed some illegality or the other
in varying degrees. To identify these illegalities (although they
had already been identified by the Justice Shah Commission and
by the EAC), a Special Investigation Team had been set up as
also a team of Chartered Accountants. Instead of waiting for a
report from any one of these teams, the State acted in violation of
the Grant of Mining Leases Policy and renewed the mining leases.
[Paras 104-105] [423-F-H]
4.2 The undue haste in which the State acted gives the
impression that it was willing to sacrifice the rule of law for the
benefit of the mining lease holders and the explanation of
satisfying the needs of some sections of society for their livelihood.
The undue haste also needs to be looked at in the context that
the Grant of Mining Lease Policy was an in-principle decision
and was to be notified after it was vetted for legal requirements
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"from specific necessities as also from financial view points". In
other words, the Grant of Mining Leases Policy as published on
4th November, 2014 was not a final policy statement but only an
intent that would take final shape after due vetting. The Grant of
Mining Leases Policy was eventually published on 20th January,
2015 but it was acted upon even before it was gazetted. [Paras
106, 107] [424-E-F; 428-G-H]
4.3 An Ordinance to amend the MMDR Act was made
known to the general public on 5th January, 2015 and promulgated
by the President on 12th January, 2015 thereby mandating
competitive bidding or auction for the grant of mining leases.
The State of Goa perhaps anticipated this in view of the publication
of the draft Mines and Minerals (Development and Regulation)
Act, 2014 and therefore hurried into the second renewal of mining
leases (notwithstanding the Grant of Mining Leases Policy) to
defeat the introduction of the auction process. [Para 109] [425E-F]
4.4 The National Mineral Policy, 2008 clearly suggests that
for a period of five years between 2006 and 2012 the mining lease
holders committed various illegalities and irregularities in the
mining process. Irreparable damage was being caused by the
mining lease holders without any benefit to the domestic industry.
Therefore, while the mining lease holders may have contributed
virtually nothing to the domestic industry, they might have made
considerable profits through exports and might have also
benefited the foreign exchange reserves of the country, but the
real-time damage to the quality of health and life of the average
Goan and damage to the environment and ecology of Goa is
nevertheless incalculable or at least considerable - and export
benefits cannot be weighed against health or the environment.
[Para 113] [427-C-E]
4.5 There was no social or public purpose attached to the
mining operations. There was one and only one objective behind
the mining activity and that was profit maximization. The renewal
of the mining leases would give considerable profits to the mining
lease holders well beyond the benefits that could accrue to the
State or to the average resident of Goa. It was not kept in mind
that the material resources of the country should not be dissipated
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free of cost or at a consideration lower than their actual worth,
and mining leases were renewed for a small payment of stamp
duty and royalty. It is therefore clear that the considerations that
weighed with the State were not for the people of Goa but were
for the mining lease holders. This certainly cannot be described
as being "in the interests of mineral development."[Para 114]
[427-F-H]
Special Reference No. 1 - Natural Resources Allocation
(2012) 10 SCC 1 : [2012] 9 SCR 311 - relied on.
4.6 In this background, there is little to suggest that the
State considered the requirements of Section 8(3) of the MMDR
Act in that the interests of mineral development was secondary
while granting the second renewal of mining leases. The entire
exercise undertaken by the State was a hasty charade, regardless
of violations of the law by the mining lease holders, without any
benefit to the Indian industry and without any concern for the
health of the average Goan. [Para 116] [428-C]
4.7 It is informed that of the 88 mining leases that were
renewed, 38 of them are not working for a variety of reasons -
making their renewal an empty exercise. This also shows the
undue haste shown by the State of Goa in granting a second
renewal to the mining leases. [Paras 121, 122] [430-A-B]
4.8 It is possible that the State did have some serious
governance issues to contend with as mentioned in the Grant of
Mining Leases Policy. Nevertheless the State is bound by the
law, however uncomfortable it might be in granting a second
renewal in terms of Section 8(3) of the MMDR Act. Therefore,
on an overall consideration of all aspects of the case, the decision
of the State of Goa to quickly renew the mining leases while
ostensibly complying with the requirements of Section 8(3) of
the MMDR Act and thereby jettisoning the rule of law was
unjustified. [Paras 123, 124] [430-D-E, H; 431-A-B]
4.9 Thus, the second renewal of the mining leases granted
by the State of Goa was unduly hasty, without taking all relevant
material into consideration and ignoring available relevant
material and therefore not in the interests of mineral development.
The decision was taken only to augment the revenues of the State
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which is outside the purview of Section 8(3) of the MMDR Act.
The second renewal of the mining leases granted by the State of
Goa is liable to be set aside and is quashed. [Para 149] [440-B-C]
5.1 The Ministry of Environment and Forest (MoEF) was
obliged to grant fresh environmental clearances in respect of fresh
grant of mining leases in accordance with law and the decision of
this Court in *Goa Foundation case and not merely lift the
abeyance order of 14th September, 2012. [Para 149] [440-D]
*Goa Foundation v. Union of India (2014) 6 SCC 590 :
[2014] 5 SCR 302; Goa Foundation v. Union of India
(2014) 6 SCC 738; State of M.P. v. Krishnadas Tikaram
1995 Supp (1) SCC 587 : [1994] 3 Suppl. SCR 747 -
relied on.
Centre for Public Interest Litigation v. Union of India
(2012) 3 SCC 1: [2012] 3 SCR 147; Manohar Lal
Sharma v. Principal Secretary (2014) 9 SCC 516 :
[2014] 8 SCR 446; M/s. Ajar Enterprises Private
Limited v. Satyanarayan Somani 2017 (10) SCALE 346;
Tata Iron & Steel Co. Ltd. v. Union of India (1996) 9
SCC 709 : [1996] 3 Suppl. SCR 808; Property Owners'
Association v. State of Maharashtra (2013) 7 SCC 522 -
referred to.
5.2 The MoEF acted without any application of mind in
lifting the order placing all the environmental clearances in
abeyance. Since the entire exercise carried out by the MoEF on
20th March, 2015 was mechanical, at the behest of the State of
Goa, without due application of mind, without considering the
multiple illegalities and irregularities committed by the mining
lease holders or passing on the buck to the State of Goa and
without considering relevant material such as the report of the
EAC and the Expert Committee appointed by this Court, the
exercise of lifting the abeyance order on 20th March, 2015 by the
MoEF must be held void and as directed by the Court in Goa
Foundation case all the mining lease holders must obtain fresh
environmental clearance for their mining project. [Para 136] [435C-E]
5.3 Issues impacting society are required to be looked at
holistically and not in a disaggregated manner. An overall
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perspective is necessary on such issues including issues that
have impact on the environment and the people of a community
or a region or the State. One or two violations here and there
may be wished away as inconsequential, but multiple violations
by several persons can result in serious problems. Therefore,
the Mineral Policy, the Grant of Mining Leases Policy, the
amendment to the MMDR Act, the report of the EAC and the
report of the Expert Committee must be considered in the larger
context of constitutionalism, the rule of law, environmental
jurisprudence as well as the fundamental right of the people of
Goa to have clean air and protection of the fragile ecology.
Governance cannot and should not be carried out de hors the
interests of the people and some uncomfortable decisions may
be inevitable for balancing the equities. [Para 138] [436-B-E]
5.4 It is not correct to say that if environmental clearance
is granted and mining operations commence within the five year
period, then the environmental clearance under EIA 1994 is valid
till the project or the mining lease period is over. Such a view
overlooks the decisions in # M. C. Mehta case and ## Common
Cause case which accept the view that the validity of an
environmental clearance granted under EIA 1994 is only five years
as also the view that a valid environmental clearance is necessary
for the renewal of a mining lease. No notification of the MoEF
can overrule decisions of this Court. As far as EIA 2006 is
concerned, this provides that the environmental clearance would
be valid for the estimated project life subject to a maximum of 30
years. [Para 145] [438-E-G]
# M.C. Mehta v. Union of India (2004) 12 SCC 118 :
[2004] 3 SCR 128;
## Common Cause v. Union of India (2017) 9 SCC 499
- referred to.
5.5 The renewal of a lease, whether under the provisions
of the Forest (Conservation) Act, 1980 or otherwise cannot be
granted without the lease holder complying with the necessary
statutory requirements particularly since the grant of renewal is
a fresh grant and must be consistent with law. [Para 132] [433-G;
434-A]
Ambica Quarry Works v. State of Gujarat (1987) 1 SCC
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213 : [1987] 1 SCR 562; Rural Litigation and
Entitlement Kendra v. State of U.P. (1989) Supp 1 SCC
504 : [1988] 2 Suppl. SCR 690;
State of M.P. v.
Krishnadas Tikaram (1995) Supp 1 SCC 587 : [1994]
3 Suppl. SCR 747 - relied on.
6. The High Court proceeded on the erroneous basis that
it could direct the State of Goa to grant a second renewal of the
mining leases notwithstanding the direction in *Goa Foundation
case. [Para 148] [439-F]
S. N. Mohanty v. Union of India 2012 SCC OnLine
Del 4000 - distinguished.
Case Law Reference
[2014] 5 SCR 302
relied on
Para 8
(2014) 6 SCC 738
relied on
Para 18
[1974] 1 SCR 535
referred to
Para 52
[1989] 2 SCR 401
referred to
Para 53
[2004] 3 SCR128
referred to
Para 53, 131
[2015] 9 SCR 230
referred to
Para 54
[1996] 6 Suppl. SCR 172
referred to
Para 54
[2014] 7 SCR 561
distinguished
Para 57
[2012] 3 SCR 147
referred to
Para 60
[2014] 8 SCR 446
referred to
Para 61
[2012] 9 SCR 311
relied on
Para 61
2017 (10) SCALE 346
referred to
Para 73
[2010] 11 SCR 240
distinguished
Para 95
[1996] 3 Suppl. SCR 808
referred to
Para 111
(2017) 9 SCC 499
referred to
Para 131
[1987] 1 SCR 562
relied on
Para 132
[1988] 2 Suppl. SCR 690
relied on
Para 132
[1994] 3 Suppl. SCR 747
relied on
Para 132
2012 SCC OnLine Del 4000
referred to
Para 146
(2013) 7 SCC 522
referred to
Para 147
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CIVIL APPELLATE JURISDICTION : Special Leave Petition
(Civil) No. 32138 of 2015.
From the Judgment and Order dated 13.08.2014 of the High Court
of Judicature at Bombay, Panji Bench at Goa in WP No. 293 of 2014
WITH
SLP (C) No. 32699-32727 of 2015.
W. P. (C) Nos.711 and 720 of 2015.
Atmaram N.S. Nadkarni, ASG, Chander Uday Singh, Darius
Khambata, Mukul Rohtagi, Huzefa Ahmadi, Sr. Advs., Prashant Bhushan,
Pranav Sachdeva, O. Kuttan, Ms. Neha Rathi, Sanjay Parikh, Ms. Anitha
Shenoy, Ms. Mamta Saxena, Ms. Srishti Agnihotri, Pranav Sachdeva,
Ms. Neha Rathi, Rohit Kumar Singh, Merusagar Samantaray, Salvador
S. Rebello, Ms. Viddushi, Ms. Lhinghneviah, Ms. Sneha S. Prabhu
Tendulkar, Ms. Nivedita Nair, Abhishek Bhardwaj, Divya Prakash Pandey,
Devashish Bharuka, Ms. Rukmani Bobde, G.S. Makker, Pratap
Venugopal, Ms. Surekha Raman, Naval Aggarwal, Anuj Sarma,
Ms. Niharika, Aman Shukla, Ms. Kanika Kalaiyarasan (for M/S. K J
John And Co.), Sumit Goel, Tanuj Agarwal (for M/s. Parekh & Co.),
Yashraj Singh Deora, Ms. Swati Kamat, Ms. Parag Rao, Ms. Asmita
Singh, Ms. Sanjana Saddy, Ms. Ragya V. Singh, Ninad Laud, Ivo D'Costa,
Jayant Mohan, Abhijit Gosavi, Rohan Sharma, Karan Mathur, Anjuman
Tripathy, Sumit Goel, Tanuj Agarwal (for M/s. Parekh & Co.), Yashraj
Singh Deora, Ms. Swati Kamat, Ms. Asmita Singh, Ms. Sanjana Saddy,
Ms. Ragya V. Singh, Nikhil Vaze, Ms. Sujata Kurdukar, Rudresh Desai,
Jayant Mohan, P. Chaitanyashil, Advs. for the appearing parties.
The Judgment of the Court was delivered by
MADAN B. LOKUR, J. 1. Rapacious and rampant exploitation
of our natural resources is the hallmark of our iron ore mining sector -
coupled with a total lack of concern for the environment and the health
and well-being of the denizens in the vicinity of the mines. The sole
motive of mining lease holders seems to be to make profits (no matter
how) and the attitude seems to be that if the rule of law is required to be
put on the backburner, so be it. Unfortunately, the State is unable to
firmly stop violations of the law and other illegalities, perhaps with a
view to maximize revenue, but without appreciating the long term impact
of this indifference. Another excuse generally put forth by the State is
that of development, conveniently forgetting that development must be
sustainable and equitable development and not otherwise.
THE GOA FOUNDATION v. M/S SESA STERLITE LTD. & ORS.
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SUPREME COURT REPORTS
[2018] 2 S.C.R.
2. Effective implementation and in some instances circumvention
of the mining and environment related laws is a tragedy in itself. Laxity
and sheer apathy to the rule of law gives mining lease holders a field
day, being the primary beneficiaries, with the State being left with some
crumbs in the form of royalty. For the State to generate adequate revenue
through the mining sector and yet have sustainable and equitable
development, the implementation machinery needs a tremendous amount
of strengthening while the law enforcement machinery needs strict
vigilance. Unless the two marry, we will continue to be mute witnesses
to the plunder of our natural resources and left wondering how to retrieve
an irretrievable situation.
3. The Government of India appears to have received information
of large-scale illegal mining of iron ore and manganese ore in different
States in contravention of the provisions of the Mines and Minerals
(Development and Regulation) Act, 1957 (the MMDR Act), the Forest
(Conservation) Act, 1980, the Environment (Protection) Act, 1986 and
other rules and guidelines issued on the subject from time to time.
4. Acting on this information, the Government of India appointed
Justice M.B. Shah a former judge of this Court as a commission of
inquiry under Section 3 of the Commissions of Inquiry Act, 1952 by a
notification dated 22nd November, 2010. The terms of reference of the
Commission for the State of Goa were as follows:
2. The terms of reference of the Commission shall be -
(i) to inquire into and determine the nature and extent of mining
and trade and transportation, done illegally or without lawful
authority, of iron ore and manganese ore, and the losses
therefrom; and to identify, as far as possible, the persons, firms,
companies and others that are engaged in such mining, trade
and transportation of iron ore and manganese ore, done illegally
or without lawful authority;
(ii) to inquire into and determine the extent to which the
management, regulatory and monitoring systems have failed
to deter, prevent, detect and punish offences relating to mining,
storage, transportation, trade and export of such ore, done
illegally or without lawful authority, and the persons responsible
for the same;
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(iii) to inquire into the tampering of official records, including
records relating to land and boundaries, to facilitate illegal mining
and identify, as far as possible, the persons responsible for
such tampering; and
(iv) to inquire into the overall impact of such mining, trade,
transportation and export, done illegally or without lawful
authority, in terms of destruction of forest wealth, damage to
the environment, prejudice to the livelihood and other rights of
tribal people, forest dwellers and other persons in the mined
areas, and the financial losses caused to the Central and State
Governments.
3. The Commission shall also recommend remedial measures
to prevent such mining, trade, transportation and export done
illegally or without lawful authority."
5. Justice Shah visited Goa and after calling for and receiving
information from the concerned authorities as well as the mining lease
holders, he submitted a report on 15th March, 2012 and another on 25th
April, 2012 to the Ministry of Mines in the Government of India. The
reports were tabled in Parliament on 7th September, 2012 along with an
Action Taken Report and as a result, the Government of Goa passed an
order dated 10th September, 2012 suspending all mining operations in the
State with effect from 11th September, 2012. The Ministry of Environment
and Forests (MoEF) of the Government of India acted similarly and
kept in abeyance the environmental clearances granted to 139 mines
(actually 137 mines - there is some duplication) in the State of Goa by
an order dated 14th September, 2012.
6. Subsequent to the reports given by Justice Shah, a writ petition
was filed by Goa Foundation in this Court being WP (C) No. 435 of
2012. The writ petition was a public interest litigation praying, inter alia,
for directions to the Union of India and the State of Goa to take steps to
terminate the mining leases where mining was carried out in violation of
various statutes.
7. Similarly, several mining lease holders preferred writ petitions
in the Bombay High Court for a declaration that the reports given by
Justice Shah are illegal and also for quashing the orders dated 10th
September, 2012 and 14th September, 2012 whereby mining operations
were suspended and environmental clearances were kept in abeyance.
THE GOA FOUNDATION v. M/S SESA STERLITE LTD. & ORS.
[MADAN B. LOKUR, J.]
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The writ petitions filed in the High Court were transferred to this Court
for hearing along with WP (C) No. 435 of 2012.
8. This Court heard all these matters and rendered its decision in
Goa Foundation v. Union of India on 21st April 2014.1 Among other
conclusions arrived at, it was held by the Court that all the iron ore and
manganese ore leases had expired on 22nd November, 2007.
Consequently, any mining operation carried out by the mining lease holders
after that date was illegal. It was also held that all the mining lease
holders had enjoyed a first deemed renewal of the mining lease and for
a second renewal an express order was required to be passed in view of
and in terms of Section 8(3) of the MMDR Act. For a second renewal
of the mining lease, it was held that the State Government must apply its
mind and record reasons for renewal being in the interest of mineral
development and the necessity to renew the mining lease. Any decision
taken by the State Government should also be in conformity with the
constitutional provisions. The decision taken by the State of Goa to grant
a mining lease in a particular manner or to a particular party could be
examined by way of judicial review. It was also held that the orders
dated 10th September, 2012 and 14th September, 2012 are not liable to be
quashed and that they would continue till decisions are taken to grant
fresh leases and fresh environmental clearances for mining projects.
Goa Mineral Policy 2013
9. During the pendency of the proceedings before the Court, the
State of Goa announced the draft Goa Mineral Policy on 21st August,
2012. After suggestions etc. were received, the Mineral Policy was
finalized and gazetted on 28th September, 2013.
10.A few salient features of the Mineral Policy may be mentioned.
It is
stated in the Preamble to the Mineral Policy: "The Goan economy
is heavily dependent on the iron ore industry insofar as the major share
of the regional income from the mineral industry and its allied activities
like transport and trade is concerned."
"However, during the period from 2006-07 to 2011-12, due to
huge spurt in demand of low grade ore in international market
followed by illegalities and irregularities in the previous
regulatory regime, the State has witnessed the peak of chaotic
and unregulated mining without any concern for fragile ecology
1 (2014) 6 SCC 590
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and environment of the State or for the general well being of an
average Goan. It has resulted in massive export of unaccounted
ore from unidentified sources like dumps and tailings. The
reckless exploitation without any concern for sustainability
that the State has witnessed in last five years has serious
implications. Minerals are a finite and non-renewable natural
resource and must be exploited wisely in the larger interest of
the State.
It is high time that the new Government that has received an
unprecedented mandate from the people of Goa should take note
that dependence on mining presents extreme externalities and
the State has to tread cautiously promoting a sustainable
extraction regime to facilitate systematic, scientific and
planned utilization of mineral resources and to streamline
mineral based development of the State, keeping in view,
protection of environment, health and safety of the people in and
around the mining areas rather than race to bottom." [Emphasis
supplied by us].
11. Notwithstanding this serious indictment of the pre-existing
'policy' for mining natural resources in Goa, the Mineral Policy did not
address itself to the allocation or distribution of the natural resources in
any of its 20 paragraphs and many sub-paragraphs. The topics dealt
with in the Mineral Policy include objectives and parameters, sustainable
mining and mineral conservation, mineral administration, regulation of
mines and minerals, pollution and its social impact, and policy highlights.
Some of the other topics dealt with in the Mineral Policy include capping,
based on carrying capacity of public roads and to protect intergenerational equity, mines safety and rehabilitation of affected people,
stakeholder participation (including corporate social responsibility), welfare
and social responsibilities and establishment of the Goa Minerals
Development Fund etc.
12. However, what is of some significance is that paragraphs 1.4.4
and 1.4.5 of the Mineral Policy state that Goan iron ore is low grade,
that is having low iron (or Fe) content and that its extraction provides no
or minimal domestic value addition. Almost all the iron ore extracted in
Goa is exported and we were informed that only one mining lease holder
captively consumes Goan extracted iron ore. Paragraphs 1.4.4 and 1.4.5
of the Mineral Policy read as follows:
THE GOA FOUNDATION v. M/S SESA STERLITE LTD. & ORS.
[MADAN B. LOKUR, J.]
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"1.4.4 No Domestic Value Addition: The nature of Goan iron ore
is such that value addition opportunities in the domestic market
are minimal. The Chinese and Japanese use Goan iron ore for
blending purposes to bring down the average cost of iron ore,
whereas Indian steel producers have a wide range of high grade
fines to choose from. Despite the closure of mining
operations in the neighbouring State of Karnataka, Goan
iron ore is not used in Indian Steel Industry due to its low
Fe content.
1.4.5. Low Grade v/s High Grade: Goan iron ore has always
been of low grade Fe content in comparison with that of Odisha,
Jharkhand and Karnataka. The low grade of ore has been
competitive in global markets, because of the non reliance
on railways and close distances of mines to ports thereby
reducing the overall cost. The high silica presence in Goan
ore also is a favourable factor for preference for Goan ore over
Australian and Brazilian low grade ore." [Emphasis supplied by
us].
13.It appears from the above that the extraction of iron ore in
Goa is geared only towards export and not for domestic purposes because
of the low Fe content and high silica presence.
Vishwanath Anand Expert Appraisal Committee
14. During the pendency of the writ petition in the Court, the MoEF
constituted an Expert Appraisal Committee (EAC) on 21st March, 2013
with Shri Vishwanath Anand, former Secretary in the MoEF as the
Chairman to specifically look into issues related to illegal mining in the
State of Goa.