Andhra HC (Pre-Telangana)
Exotic Granite Exports Rep. By Its ... vs The Government Of Andhra Pradesh Rep. By ... on 26 March, 2008
Equivalent citations: AIR 2008 (NOC) 2109 (A.P.), 2008 (3) AJHAR (NOC) 935 (A. P.)
ORDER P.S. Narayana, J.
1. Heard Sri S. Venkat Reddy, the learned Senior Counsel representing the writ petitioner, the learned Government Pleader for Industries and Commerce, the learned Government Pleader for Forests, the learned Assistant Solicitor General and also Sri S.R. Ashok, the learned senior Counsel, representing the respective respondents.
2. The writ petitioner M/s.Exotic Granite Exports, filed the present Writ Petition praying for quashing the proceedings of 1st respondent in Memo No. 1220/M.II(1)/07, dated 16-3-2007 (P1) by issuing an appropriate writ, order or direction, more particularly one in the name of Writ of Mandamus declaring that the same is arbitrary, unreasonable, unjust, violative of the principles of natural justice and financial rights guaranteed to the petitioner under Articles 14 and 19(1)(g) of the Constitution of India and also the provisions of Section 2 of the Forest (Conservation) Act and the Rules made under Section 4(1) of the Act and issue a consequential direction to the 4th respondent to grant mining lease in favour of the petitioner in respect of 4.916 Hectares of forest land in Compartment No. 1148 of Ingurthy East R.F. Mahaboobabad Range, Warangal South Division, Warangal District and to pass such other suitable orders.
3. W.P.M.P. No. 34520/07 is an application praying for amendment of the prayer in the Writ Petition and the same reads as hereunder:
It is therefore prayed that this Hon'ble Court may be pleased to quash the proceedings of the 1st respondent herein in Memo No. 1220/M.II(1)/07 dated 16-3- 2007 and the proceedings of the 2nd respondent in G.O.Ms. No. 135, EFS & T Department, dated 4-12-2007 by issuing an appropriate writ, order or direction, more particularly one in the nature of Writ of Mandamus declaring that the same are arbitrary, unreasonable, unjust, abuse of process of Court, gross contempt of Court, violative of principles of natural justice and the financial rights guaranteed to the petitioner under Articles 14 and 19(1)(g) of the Constitution of India and also the provisions of Section 2 of the Forest (Conservation) Act and the Rules made under Section 4(1) of the Act and issue a consequential direction to the 4th respondent to grant mining lease in favour of the petitioner in respect of 4.916 Hectares of forest land in Compartment No. 1148 of Ingurthy East R.F. Mahaboobabad Range, Warangal South Division, Warangal District and pass such other order or orders as are deemed fit and proper in the circumstances of the case.
4. The Counsel representing the respective parties made elaborate submissions - Sri Venkat Reddy, learned senior Counsel representing the writ petitioner stating that in the facts and circumstances, the amendment application to be allowed and on the contrary the respective Counsel representing the respondents opposing the same on the ground that it is totally a different cause of action and hence amendment application cannot be allowed.
5. It is averred in para-3 of the affidavit filed in support of the amendment application that notice was ordered in the Writ Petition on 12-4-2007. The 2nd respondent did not file any counter so far in the Writ Petition and in the Stay Petition. All of a sudden, on 7-12-2007, the Government Pleader for the 2nd respondent in the High Court served a copy of G.O.Ms. No. 135, dated 4-12- 2007 on the petitioner's Counsel. The 2nd respondent also refused to make available the records of the 2nd respondent for perusal of the Counsel for the petitioner, despite the letter dated 2-12-2007 addressed to the Government Pleader for respondent No. 2 under the Writ Rules. It is further stated in para- 4 that by and under the G.O.Ms. No. 135, dated 4-12-2007 the 2nd respondent cancelled its orders issued in G.O.Ms. No. 8, EFS & T Department, dated 11-1-2007 in favour of the petitioner and directed the 3rd respondent to submit the proposal of M/s. APMDC Limited., the 6th respondent, under the Forest Conversation Act for diversion of the said area for extraction of black granite. The said action was taken pursuant to the request made by the Industries and Commerce Department of Government of A.P., the 1st respondent herein, vide U.O. No. 1220/M.II(1)/2007-2 dated 5-5-2007, referred to in the said G.O. which is reproduced hereunder:
4. In the U.O. 6th read above, the I&C Department has also requested the EFS & T Department., to cancel the G.O.Ms. No. 8, EFS & T Department, dated 11-1-2007 where Forest clearance was given to M/s.Exotic Granites which does not have Quarry lease and grant NOC for Forest Clearance to APMDC, a State Government Public Sector Undertaking (PSU) which has been given the Quarry lease in Govt.Memo No. 1220/M.II(1)/2007 dt.16-3-2007 on the following grounds.
It is further stated that the action of the 1st and 2nd respondents taken pending the disposal of the above Writ Petition and the said WPMP after receiving the notice in the same and the 2nd respondent without filing any counter to the same, amounts to abuse of process of Court and renders the 1st and 2nd respondents guilty of gross contempt of Court. Besides the same, the petitioner was not heard before passing the said G.O. and as such the same is violative of principles of natural justice and the same is liable to be set aside on that ground alone. The action is designed to defeat the ultimate relief that is likely to be granted to the petitioner. The action also makes the WPMP infructuous. It is also further stated in para-5 that in the aforementioned circumstances, the petitioner is constrained to file the present application seeking stay of all further proceedings pursuant to G.O.Ms. No. 135, EFS & T Department, dated 4-12-2007, pending disposal of the above Writ Petition and also seeking an additional prayer in the Writ Petition for a declaration that G.O.Ms. No. 135, EFS & T Department, dated 4-12-2007 is issued in utter violation of the principles of natural justice, abuse of process of Court and gross contempt of this Court. The affidavit filed in support of the above Writ Petition may be read as a part of this affidavit.
6. In the light of the facts and circumstances, in stead of driving the writ petitioner to yet another Writ Petition, inasmuch as in the light of the close nexus between the factual matrix and this being a subsequent event and a consequential proceeding, in a way, this Court is not inclined to drive the writ petitioner to yet another litigation and accordingly the amendment application W.P.M.P. No. 34520/2007 is hereby ordered.
7. The prayer in the Writ Petition initially and the prayer which had been prayed for by virtue of the amendment application already had been specified above.
8. Sri S.Venkat Reddy, the learned senior Counsel representing the writ petitioner had taken this Court through the relevant provisions of the Forest Conservation Act and also the relevant provisions of the Mines & Minerals (Development & Regulation) Act, 1957 and the Rules and would maintain that this is a case of overlooking the priority without any reason whatsoever. The learned senior Counsel pointed out to relevant material papers filed along with the Writ Petition and also the additional material papers as well and had taken this Court through the impugned actions, the impugned action questioned in the Writ Petition originally and also the further impugned action further questioned by way of an application praying for amendment and would maintain that this is a case where respondents 5 and 6 were manned by the same person at the relevant point of time and having granted stage-1 and stage-2 approvals and having handed over possession, overlooking the priority and going back on the proposals would amount to depriving the writ petitioner of the valuable rights accrued to the writ petitioner to be considered on priority basis in accordance with Law. In the light of the facts and circumstances, it is clear that the writ petitioner would legitimately expect the further finalisation and in fact the petitioner had entered upon the work and had spent huge amount and at this stage, making such an order on the ground of giving preference to the 6th respondent, definitely cannot be sustained. The learned senior Counsel also would maintain that it cannot be said that this is only a preliminary order and further it cannot be contended that the petitioner can approach the Director of Mines & Geology again and the Director of Mines & Geology would reconsider the same, these contentions are unsustainable contentions. The learned Counsel in elaboration had taken this Court through the different provisions of the Forest Conservation Act and also pointed out to the relevant portions of the affidavit filed in support of the Writ Petition and also the respective counter affidavits and ultimately would conclude that inasmuch as substantial justice to be done, the impugned actions to be quashed.
9. The learned Government Pleader for Industries representing the respondents 1 and 5 would maintain that this is only a preliminary order and at the appropriate stage, the same can be challenged. Even otherwise, this discretion had been exercised by virtue of the proviso to Rule 12(5)(b) of the A.P. Minor Mineral Concession Rules, 1966, referred to as "Rules" hereinafter for the purpose of convenience. The learned Government Pleader for Industries also had taken this Court through Section 11 of the A.P. Mines & Minerals (Development & Regulation) Act, 1957, in short referred to as "Act" for the purpose of convenience. The learned Government Pleader for Industries would maintain that the second application was taken on priority basis. No decision had been taken till today by the Director of Mines & Geology. The State Government had not granted mining lease in favour of the 6th respondent. The learned Government Pleader for Industries also would maintain that the Forest Conservation Act or the Rules made thereunder or the permissions, if any granted, they do not govern the grant of mining lease at all. The learned Government Pleader for Industries also had referred to G.O.Ms. No. 181, the guidelines while granting exemption in forest area and ultimately the Government Pleader for Industries would maintain that at the best, it is only a right to be considered and at this stage, the question of issuing notice before making the order would not arise. It is only an approval by the State Government to dispense with the priority and no grant is made till today and hence the Writ Petition is premature. The learned Government Pleader placed strong reliance on certain decisions as well.
10. The learned Government Pleader for Forests had taken this Court through the relevant provisions of the Forest Conservation Act and also pointed out to the last para of G.O.Ms. No. 135 and also pointed out to G.O.Ms. No. 8 and the relevant clauses. The learned Government Pleader for Forests asserted that possession had not been given. The learned Government Pleader also explained under what circumstances the application of the 6th respondent is being forwarded. It is only a mere permission and there is no legal right as such of the petitioner which had been infringed to approach the writ Court.
11. The learned Assistant Solicitor General had taken this Court through the relevant provisions of the Forest Conservation Act and also the Act and the relevant Rules and would explain the scope and ambit of these Enactments.
12. Sri S.R. Ashok, the learned senior Counsel representing the 6th respondent would maintain that the said Raja Gopal was not impleaded as eo nominee party and hence personal allegations cannot be made as against the said Raja Gopal as though he is otherwise interested having manned both respondents 5 and 6 at the relevant point of time. It may be true that stage-1 and stage-2 approvals had been obtained, but however the Memo dated 1-9-2005 is of considerable importance. The Memo is dated 1-9-2005, whereas the first approval was on 27-6-2006. The Memo is prior to the first approval. Even otherwise the Forest clearance would not confer any right whatsoever relating to grant of mining lease. There cannot be any doubt or controversy relating to the expertise or technical qualifications of the 6th respondent to carry on the mining operations and these aspects would not be considered while considering the approvals, if any under the Forest Conservation Act. The learned senior Counsel also had referred to Section 11(5) of the Act and the Counsel also would maintain that there is no fundamental right, no vested right, no statutory right at least. At the best it is a case to be considered. The allocation to the 6th respondent would be beneficial to the public exchequer. The Corporation is having the special expertise and knowledge. The Government in exercise of power under Rule 12(5)(b) of the Rules passed the order since the reason being benefit to the public exchequer and hence the discretion exercised in this regard cannot be found fault. Even otherwise, the writ Court to be slow in interfering with such decisions. The Corporations constitute a separate class by themselves. The learned Counsel also in elaboration explained the relevant G.Os. and Article 162 of the Constitution of India. The learned senior Counsel also would maintain that the Memo is not contrary to any Legislation. The mistake initially done had been rectified and in the light of the Memo, orders had been recalled, the question of promissory estoppel or legitimate expectation cannot be made the grounds of attack. At the best, it is an intermediate order subject to further consideration. The 5th respondent had not filed counter affidavit but the 5th respondent is taking the same stand as that of the 6th respondent. Absolutely no mala fides had been attributed to the said Raja Gopal. When an officer is acting bona fide for protecting the public exchequer, such officer cannot be attacked on untenable grounds. The question of issuance of prior notice would be an empty formality since the result would be the same. In such cases, the question of violation of principles of natural justice also cannot be complained of. The order made in the Writ Appeal also had been explained. The learned senior Counsel placed strong reliance on several decisions in this regard.
13. Heard the Counsel.
14. On 2-12-2002, the petitioner made an application to the Assistant Director of Mines & Geology, Warangal for grant of quarry lease to quarry granite useful for cutting and polishing over an extent of 10 Hectares of forest land in Compartment No. 1148 of Ingurthi Reserve Forest, under the provisions of Rule 12(5)(a)(iii) of the A.P. Minor Mineral Concession Rules, 1966. The Assistant Director of Mines and Geology, Warangal by his letter dated 2-12-2002 forwarded the application of the petitioner to the Divisional Forest Officer, Warangal South, Warangal to process the said application under Section 2 of the Forest (Conservation) Act, 1980. By and under the same proceedings, the Assistant Director requested the Divisional Forest Officer to depute the concerned officer for joint survey on 16-12-2002 in respect of the land applied for by the petitioner. After the joint survey, the petitioner submitted a revised application on 25-3-2003 to the Assistant Director of Mines and Geology, Warangal for grant of quarry lease in Compartment No. 1148 of Ingurthy Forest Range and the same was forwarded to the Divisional Forest Officer, Warangal for processing of the proposals. On 4-11-2003, the petitioner submitted fresh proposals to the Principal Chief Conservator of Forests, Hyderabad, the 3rd respondent under Rule 6(1) of the forest (Conservation) Rules 2003 issued under Section 4 of the Act. The office of the 3rd respondent registered the proposals of the petitioner on 20-11-2003 at Sl. No. 159 and forwarded the same to the Divisional Forest Officer, Warangal for site inspection and furnishing necessary information. The Assistant Director of Mines & Geology, Warangal by his letter No. 1087/Q/2003 dated 9-3-2005 issued a certificate to the petitioner describing the quality and quantity of the granite available in the area applied for by the petitioner. The said letter had been issued pursuant to the instructions given by the 5th respondent as is clear from the said letter. It is further stated that by the letter dated 27-6-2005, the Government of A.P. recommended the proposals of the petitioner to the 4th respondent seeking prior approval in accordance with Section 2 of the Act. Thereafter the 4th respondent accorded Stage-I approval to the project of the petitioner by and under proceedings dated 27-6-2006. Pursuant to the same, the Divisional Forest Officer, Warangal South Division by letter dated 31-7-2006 called upon the petitioner to deposit a sum of Rs. 44,60,974/- towards the cost of afforestation, regeneration of safety zone area and net present value of the forest area measuring 4.916 Hectares and deliver the originals of mutation certificates, adangals and sale deeds relating to the identified non-forest land transferring and mutating the same in favour of the Government of A.P., Forest Department. In compliance with the same, the petitioner deposited the said sum of Rs. 44,60,974/- by way of 6 demand drafts as specified in the letter dated 31- 7-2006 addressed by the petitioner to the Divisional Forest Officer, Warangal and the same was acknowledged by the Divisional Forest Officer, Warangal. That apart, the petitioner purchased an extent of 1.64 Hectares of land in Nagaram village and 4.31 Hectares of land in Katrapalli village of Warangal District incurring an expenditure of Rs. 8,64,885/- towards land cost, stamp duty and registration fees and thereafter registered the said lands in favour of the Forest Department under registered sale deeds dated 2-8-2006 bearing document Nos. 1016 and 1017 of 2006. It is further stated that the petitioner also complied with the other requirements of the letter dated 31-7-2006 of the Divisional Forest Officer and intimated the same to the Divisional Forest Officer by a letter dated 18-10-2006. Along with the said letter, the documents in proof of compliance of the requirements of the said letter were also handed over to the Divisional Forest Officer. It is further stated that to comply with all the requirements of the letter dated 31-7-2006, in addition to deposit of Rs. 44,60,974/- deposited by way of 6 demand drafts, the petitioner incurred a further expenditure of Rs. 8,09,000/- towards land cost and Rs. 1,32,930/- towards stamp duty and registration fees. Thereafter on 30-11-2006, the 3rd respondent submitted compliance report to the 2nd respondent based on the report submitted by the Divisional Forest Officer, Warangal South Division and requested for onward transmission to the Government of India for Stage-II approval. Thereafter the 4th respondent by proceedings dated 22-12-2006 accorded Stage-II approval for the project of the petitioner for a period of 10 years subject to certain conditions specified therein. It is further stated that on 11-1-2007 the 2nd respondent issued G.O.Ms. No. 8 according permission to the 3rd respondent for diversion of 4.916 Hectares of forest land in Ingurthy East R.F., Mahaboobabad Range, Warangal South Division, Warangal District for extraction of black granite in favour of the petitioner for a period of 10 years subject to the conditions specified therein. After receipt of the said G.O., the petitioner addressed a letter to the 5th respondent for grant of quarry lease in its favour in terms of G.O.Ms. No. 8 dated 11-1-2007. On 31-1-2007 the petitioner submitted a letter to the 1st respondent requesting for grant of quarry lease in terms of G.O.Ms. No. 8 dated 11-1-2007. It is also further stated that on 1-2-2007, the office of the Chief Minister issued proceedings No. 1119/CMP/2007 to the Secretary, Industries (Mines) Department, instructing that the representation made by the petitioner to grant quarry lease for an extent of 4.916 Hectares in Compartment No. 1148, Ingurthy East Reserve Block of Mahaboobabad Range, Warangal District as it got clearance from the Forest Department, may be examined and necessary action be taken. On 13-2-2007, the project land of 4.916 Hectares was handed over to the petitioner pursuant to G.O.Ms. No. 8 and proceedings of the Divisional Forest Officer, Warangal dated 9-2-2007. It is also further stated that the 6th respondent also made an application on 5-8-2003 for grant of quarry lease over an extent of 5 Hectares in Compartment No. 1148, Ingurthy Forest Range. On 3-6-2004, the proposals submitted by the 6th respondent for grant of mining lease in Ingurthy Forest Range were returned for compliance of certain objections. To the best of the knowledge of the petitioner, the 6th respondent had not so far submitted proposals complying with the objections raised in the letter dated 3-6-2004. The same is also borne out by the counter affidavit filed by the 2nd respondent in W.P. No. 17918/2005 which was filed by M/s.Madhu Industries, one of the applicants for grant of mining lease in the same area. In paragraph-4 of the said counter affidavit, it is stated:
4. It is also submitted that two more cases of APMDC Hyderabad and M/s. Reliance Granites Private Limited were also registered at Serial No. 18 & Serial No. 178. Applications of these parties were forwarded to D.F.O., Warangal (South) for processing. However these two applicants are not fulfilling the required formalities as required under F(C) Act.
It is also further stated that while matters stood thus, the petitioner came to know that the 1st respondent issued instructions to the 5th respondent to overlook the claims of the petitioner and grant mining lease in favour of the 6th respondent. It is stated that the petitioner has to be granted the mining lease in view of the No Objection Certificate granted in favour of the petitioner by the Government of India as already stated above. The 1st respondent unjustly, unreasonably and contrary to the Act and the Rules and the law laid down by this Court directed the 5th respondent to take steps to grant lease in favour of the 6th respondent. The proceedings of the 1st respondent giving the aforesaid directions to the 5th respondent to favour the 6th respondent is not communicated to the petitioner. The petitioner therefore made an application dated 23-3-2007 invoking its right under the Right to Information Act, 2005 to the Joint Director of Mines & Geology and State Public Information Officer, requesting to furnish a copy of the proceedings of the 1st respondent wherein the 1st respondent directed the 5th respondent to overlook the priority of the petitioner and take steps to grant mining lease in favour of the 6th respondent. Pursuant to the said request, the Joint Director of Mines & Geology and State Public Information Officer furnished a copy of the said proceedings No. 1220/M.II(1)/07 dated 16-3-2007. A perusal of the copy of the said Memo clearly indicates that though by the said proceedings the 1st respondent negatived the right of the petitioner for grant of the mining lease, it had not even marked a copy of the same to the petitioner. The petitioner was also not given any notice before the 1st respondent took the said action detrimental to the interests of the petitioner. The said order of the 1st respondent is therefore violative of principles of natural justice which is read into Article 14 of the Constitution of India and the said proceedings are liable to be set aside on that ground alone. A ready of the said proceeding makes it clear that the same was made on a report submitted by the Vice Chairman and Managing Director of the 6th respondent to the 1st respondent to direct the 5th respondent to grant lease in its favour in view of the facts and circumstances set out in the report. The 5th respondent also supported the said report. It is stated that such a recommendation is made because the Director of Mines & Geology, the 5th respondent and the Vice Chairman and Managing Director of the 6th respondent happens to be the same person Sri V.D. Raja Gopal, otherwise, the Director of Mines & Geology could not have recommended for grant of lease in a forest area to a body which had not obtained an order of diversion from the Government of India. It is further stated that it is unimaginable as to how such a report could be made by the 6th respondent and as to how the same could be supported by the 5th respondent. To the knowledge of the 5th respondent, the 6th respondent made an application dated 5-8-2003 and the same was returned on 3-6-2004 which is also affirmed in the counter affidavit filed by the 2nd respondent in W.P. No. 17918/2005 as aforesaid. In view of the aforementioned circumstances, no reasonable person can make such a request to overlook the priority of the petitioner and direct the 5th respondent to grant lease in favour of the 6th respondent and the 5th respondent should not have recommended such a request. In the report submitted to the Government it is stated that the 6th respondent had filed proforma and other information for getting No Objection Certificate from the Forest Department and No Objection Certificate is awaited. To the best of the knowledge of the petitioner, after application filed by the 6th respondent is returned by the Forest Department with objections, no steps had been taken by the 6th respondent so far. It is also further stated that once the Forest Department had granted a No Objection Certificate to the petitioner, the question of Forest Department granting a No Objection Certificate in favour of the 6th respondent does not arise. The Forest Department cannot entertain an application for grant of a No Objection Certificate in the same area which is granted to the petitioner. The said application is totally misconceived. It is also seen from the said proceeding that the 5th respondent reported that the No Objection Certificate obtained by the petitioner has to be reviewed by the Forest Department as the Forest Department did not follow the instructions issued in their Memo No. 5624/For.I(1)/05-2, dated 1-9-2005. It is also further stated that No Objection Certificate in favour of the petitioner is granted as per law in existence at the time the petitioner made the application. The proceedings dated 1-9-2005 are only executive instructions and the same do not have retrospective effect and therefore the Forest Department has no authority in law to review its proceedings granting No Objection in favour of the petitioner on that ground. That when once the No Objection Certificate is granted in favour of one person, there is no question of the Forest Department considering and granting No Objection Certificate in favour of another for the same area or part of it. The instructions contained in Memo dated 1-9-2005 are executive instructions and they don't have retrospective effect, is now well settled by a Judgment dated 3-2-2006 of a Division Bench of this Court in W.A. No. 115/2006. By and under the said Judgment, the Division Bench confirmed the order of a single Judge in the Writ Petition which had taken the same view. The Division Bench had also taken the view that when once a No Objection Certificate is issued in favour of a person in respect of an area, it is impermissible to entertain an application for grant of No Objection Certificate for the same area or part of the same. The impugned proceedings dated 16-3-2007 are not only vitiated for violation of principles of natural justice, but also for the 1st respondent accepting the biased recommendation of the 5th respondent recommending the report of the 6th respondent whose Director and the Vice Chairman and Managing Director happen to be the same person Sri V.D. Raja Gopal ignoring the legal position well settled by a Division Bench Judgment of this Court aforesaid. The assumption that if the lease is given to the 6th respondent, the 6th respondent makes a minimum profit of Rs. 11 crores, assuming the same to be correct, is not a relevant ground. The 1st respondent cannot violate the law on the ground that the State owned Corporation makes some profit out of it and the same would go to the State exchequer. Having regard to all the facts and circumstances aforesaid, the petitioner has legitimate expectation that the mining lease for mining black granite in 4.916 Hectares of forest land in Compartment No. 1148 of Ingurthy East R.F. Mahaboobabad Range, Warangal South Division, Warangal District would be granted in its favour. The said legitimate expectation is given a deathblow by the 1st respondent even without hearing the petitioner. The said order is liable to be set aside for that reason also. Therefore the impugned order is violative of fundamental right guaranteed to the petitioner under Articles 14 and 19(1)(g) of the Constitution of India and therefore liable to be quashed by this Court by issuing an appropriate writ, order or direction. In such circumstances, the writ petitioner approached this Court praying for appropriate relief and in the light of the subsequent events, the amended prayer which had been permitted had been prayed for as specified supra.
15. In the counter affidavit filed by the 1st respondent, sworn to by the Deputy Secretary to Government, working in the office of the 1st respondent, it is averred that along with the petitioner, the 6th respondent also applied for grant of quarry lease. The 6th respondent is a Public Sector Undertaking formed in the year 1962 and works for the benefit of the State. The purpose of constituting the 6th respondent is wherever minerals of assured profit are available, the same shall be exploited by it for the benefit in the form of revenue to the State exchequer out of mining. The 6th respondent is one of the profit earning Public Sector Undertakings of the State and for the last three years it is earning a profit in the range of Rs. 20 crores, 18 crores and 32 crores p.a. respectively. In the present case, the 6th respondent had applied for grant of quarry lease on 4-8-2003 and also submitted proposals for Forest Clearance under Section 2 of Forest (Conservation) Act 1980. The Divisional Forest Officer had returned the proposals with a request to obtain alternate land. Accordingly the 6th respondent had obtained an extent of 70 ha. From the District Collector, Anantapur so as to provide alternate land in lieu of the forest land to be granted for the purpose of quarrying and the said fresh proposals were submitted to Principal Chief Conservator of Forest, Hyderabad on 18-3-2005, but the 3rd respondent ignoring the said proposals of P.S.U. had processed the proposals of the petitioner. In fact when similar situations had arisen the same was brought to the notice of the Principal Secretary, Forest and Environment Department by the Industries & Commerce Department vide D.O.Letter No. 12087/Mines.Ii(1)/2005-1 dated 27-6-2005. Considering the request, the Principal Secretary, Forest & Environment Department, Government of A.P. issued instructions to all the Officers of the Forest Department giving guidelines on how to accept the applications for diversion of forest land for mining purpose in Memo No. 5624/Foest-1(1)/05-2 dated 1-9-2005. In the said letter it is clearly stated "After consideration of the issue Government hereby direct the Principal Chief Conservator of Forest, Hyderabad to process the Mining Leases/Quarry Leases applications for clearance under Forest (Conservation) Act 1980 after receiving the applications with technical observations through the Mines & Geology Department. However, mere forwarding of any mining lease application by the Mines & Geology Department does not confer any right to the applicant for grant of mining lease/quarry leases as the process involves statutory procedure prescribed under F(C) Act, 1980". Thus it is clear that in order to divert the forest land for mining purpose, the granting authority shall inform its intention of grant of mining lease to the said applicant and only then the forest Department should consider and process the request for diversion of forest land. The grant of leases are governed by the Rules and according to the said Rules, whenever more than one application is received for the area, the Director of Mines & Geology for the reasons to be recorded in writing may consider the applications received subsequently by overlooking the priority with prior approval of the Government. The Director of Mines & Geology for the reason that the application of the 6th respondent belongs to a State Public Sector Undertaking and the State exchequer will derive a benefit of Rs. 11 crore profit due to exploitation of granite in this area proposed for grant of lease in favour of the 6th respondent by overlooking the priority. Considering these factors, the 1st respondent issued the Memo accepting the said proposals. Basing on these proposals, now the Director of Mines & Geology will have to take a decision for grant of lease after obtaining forest clearance in favour of the 6th respondent. Since the forest clearance is already given in favour of the petitioner, the respondent had requested the Government to cancel the said clearance given in favour of the petitioner and allot the same to the Public Sector Undertaking and the said request is pending before the Government. Therefore, as no decision is taken by the Director of Mines & Geology, the present Writ Petition is a pre-mature petition. The act of the 3rd respondent in ignoring the State Public Sector Undertaking and considering the application of the petitioner without properly following the instruction of the State is not proper and the same needs to be re-examined afresh as per memo dated 1-9-2005. It is also further stated that for grant of a licence for mining, there are separate set of rules and regulations and according to those rules, leases are granted. Since the applied land is falling in the forest land, the Forest (Conservation) Act 1980 applies and any minding shall be only after getting the clearance under the said Act. The Forest (Conservation) Act 1980 does not contemplate to allocate the surface rights to those who are not otherwise entitled to get the mining lease under the relevant provisions of the law. Therefore, considering these aspects the 2nd respondent had issued comprehensive guidelines in Memo No. 5624/For.I(1)/05-02 dated 1-9-2005. Therefore, these guidelines form fact of processing applications for diversion of forest land which are to be followed scrupulously. Whereas in case these guidelines are ignored by the 3rd respondent, any further proceedings by way of allocation of forest land ignoring the guidelines issued by the 2nd respondent vitiates the said proceedings and therefore the 6th respondent had requested the 1st respondent to advise the 2nd respondent to cancel the said clearances given to in favour of the petitioner and accord clearance in favour of the 6th respondent and it is under process and hence it is pre-mature to file the instant Writ Petition. It is also stated that the 6th respondent shall also have to comply with the instructions of the Forest Department. It is further stated that the orders said to be issued are nothing but forwarding representation submitted to the Hon'ble Chief Minister by the petitioner for necessary action. There is no specific decision given for grant in favour of the petitioner. Any representation submitted to the Hon'ble Chief Minister will be forwarded to the concerned Departments for necessary action. The Memo No. 11709(M.II-2) 2004-3, IND & COM.(M.II) Department dated 7-3-2005 is entirely irrelevant. The 1st respondent passed on order on a revision filed by M/s.Exotica Granites Pvt. Ltd., over the lease holders for the are in question earlier when the renewal application was rejected by the Department on the ground that the applicant M/s. Reliance Granites (P) Limited did not attend for Survey & Inspection of the applied area. The 1st respondent issued such orders dismissing the said revision petition and therefore the same are not relevant. The petitioner's contentions that the 6th respondent had not submitted proposals in full shape to the Forest Department pursuant to the objections dated 3-6-2006 is totally incorrect. The 6th respondent had submitted in full shape the proposals for forest clearance by its letter dated 14-8-2003. It is further stated that the processing of applications for grant of leases are governed by the provisions of the Rules which were framed under the powers delegated to the State under Section 15 of the Act. It is further stated that as per Rule 12(5)(b) of the Rules, the Director of Mines & Geology is the competent authority to grant leases particularly in this case and is at liberty to overlook the priority of any application by taking prior approval of the Government and accordingly he had moved a proposal to the Government for permission to overlook the priority for specified reasons. The said specified reasons are clearly spelt out in the orders issued by the Government. The specified reasons quoted by the Director of Mines & Geology in para-9 of the order are that A.P.Mineral Development Corporation is a State Government Public Sector Undertaking and keeping in view the additional revenue to the Corporation and the Government, existence of local industries and due to filing of statutory clearance applications by the Corporation, recommended the case of Public Sector Undertaking. The 5th respondent also moved a proposal to Government for considering its application stating that the area consists of about 37,000 CBM of black granite deposits even assuming a minimum profit it will get Rs. 11 crores and the entire amount will go to State exchequer and hence requested to consider the application of State Public Sector Undertaking by overlooking priority. These grounds are valid grounds for invoking the overlooking priority in the interest of additional revenue to the State exchequer. Mining is not a fundamental right as held by the Hon'ble High Court of Orissa in Indian Charge Chrome Limited v. Union Of India AIR 2002 Ori. 45 (DB). Even according to Section 17-A (2) of the Act, the State Government can reserve any area for exclusive exploitation by Public Sector Undertakings. The policy of reservation had been upheld by the Courts number of times. Very recently when Galaxy Granite areas had been reserved in favour of A.P. Mineral Development Corporation, the Division Bench in W.A. No. 1000/2002 and Batch upheld the said reservation and even the Apex Court in SLP(C) No. 15690-15695 of 2004 filed by M/s. Pallava Granite Industries (India) Pvt.Ltd., challenging the said orders of the Division Bench confirmed the orders of the Division Bench. All these indicate that the law provides for such special treatment for Public Sector Undertakings in the interest of accrual of more revenue to the State exchequer. The State exchequer has multiple responsibilities towards its public and runs on taxation and it is one way of getting revenue to the State exchequer and hence in the interest of revenue to the State exchequer which primarily acts for the welfare of the its people, the sustenance of Public Sector needs to be encouraged. It is also further stated that it is a fact that the Director of Mines & Geology is holding additional charge of VC & MD, A.P. Mineral Development Corporation. As explained in the previous paras, the Public Sector Undertakings are constituted only for the benefit of the public and hence the Director of Mines & Geology of the A.P. Mineral Development Corporation suggested for consideration of its application as VC & MD is not at all against the concept of encouraging the Public Sector Undertakings. More so, in the present case, as of Director and Mines & Geology, he had sought for the approval of the 1st respondent to overlook the priority. When such approvals are sought for which there is a mandatory provision under the Rules, the approving authority cannot be construed as acting blindly in accepting the proposals of the Director of Mines & Geology. Even the 1st respondent is also presently acting as Chair Person of A.P. Mineral Development Corporation and it does not mean that the defendant taken by the Government is contrary to the Law since Law itself provides special provisions to the Public Sector Undertakings in the matter of reservation of areas. As explained earlier, the Public Sector Undertakings have to be given the special status since they act for the benefit of the public and any revenue earned by it goes to the State exchequer which in turn spends for the benefit and welfare of the public in the State. It is also further stated that the issue involved is grant of quarry lease for exploitation of Granite. The Rules governing such grants are the Rules aforesaid which were made under Section 15 of the Act. The Rule pertains to obtaining of clearance from Forest Department in case the area falls in Reserve Forest. Only on obtaining a clearance from the Forest Department, one cannot demand for a right of mining under the provisions of the Rules as the said provisions clearly indicate on how the leases can be granted and how the priorities can be assumed. As aforesaid, in this case, the Forest Department did not follow the guidelines issued by the 2nd respondent and considered the application of the petitioner overlooking the application of State Public Sector Undertaking. Therefore, the 6th respondent is seeking reconsideration of the act of the 3rd respondent in the light of guidelines dated 1-9-2005 since the orders are passed due to ignorance under mistake of fact. It is totally a mistake of fact to state that only first clearance can be considered by overlooking recommendations of the Department who are granting leases for exploitation of minerals. Further it is stated that the filing of Writ Petition is quite pre-mature and when the Government is examining the pros and cons on issue of no objection certificate to the petitioner, the petitioner cannot seek directions from this Court prematurely. The request of the 6th respondent to reconsider the issue of clearance in favour of the petitioner ignoring the claims of the 6th respondent deserves to be considered by the 2nd respondent and when the 2nd respondent is about to examine these issues, the present Writ Petition and the consequential orders may influence the independent decision being taken by the 2nd respondent. The petitioner admitted that the instructions dated 1-9-2005 issued do not have retrospective effect, but in this case, as the petitioner was given final clearance only on 11-1-2007, the instructions dated 1-9-2005 issued by the 2nd respondent are applicable in this case and therefore the decision of the Division Bench in W.A. No. 115/2006 is not applicable. The No Objection Certificate issued in this case is contrary to the instructions dated 1-9-2005 and hence such no objection certificate is not valid and needs to be reviewed. It is further stated that the special privilege given to the State Public Sector Undertaking in the matter of grant of leases are well established by way of reservation of internal deposits for exclusive exploitation under Public Sector Undertakings under Section 17 and 17A of the Act. The processing of application of private entrepreneurs are made by same authority who are competent to make reservations. Therefore, the question of bias does not arise. Always, the authorities are expected to work for the interest of the Government and if the State exchequer gets more benefits in awarding license for exploitation of any mineral, they are bound to do so since they have to act in favour of State exchequer. Further, the mining lease is not a fundamental right as held by the Courts. Hence, the fundamental rights of the petitioner are not affected. In the State of A.P., in fact, number of coal mine leaseholds are held by private entrepreneurs which were nationalized by bringing out Nationalisation of Coal Mine Act. The Writ Petition is quite premature since the application is not yet disposed of and when the statutory authority is in the process of exercising its right, the petitioner is interfering in discharging the statutory duty by the statutory authority and the present Writ Petition is misconceived. As explained earlier, mining is not a fundamental right and where the statutory provisions are made for grant of licenses, special provisions to State/Central Public Sector Undertakings in the matter of grant of leases are also made. Further it is stated that providing reservation of the areas for the exclusive exploitation of public sector undertaking itself indicates that the Government chose to grant leases to private entrepreneurs only when the Government is not interested to exploit such deposits by itself, whereas in this case the Government chose to exploit these deposits through its Public Sector Undertaking and therefore the petitioner cannot claim the area. The no objection certificate issued by the 2nd respondent is due to mistake of fact ignoring guidelines issued by the 2nd respondent itself on 1-9-2005. Probably these facts were not brought to the notice in the file by the appropriate authorities. Therefore the 6th respondent sought to re-examine the issue in the light of non-consideration of its application. Further, the 2nd respondent had also not issued any notice and the principles of natural justice require issuance of notice before issuing no objection certificate in favour of the petitioner when the 6th respondent is also claiming for no objection certificate and therefore on this ground alone the Writ Petition is liable to be dismissed besides it being a pre-mature Writ Petition and seeks interference in discharge of duties by the authorities as per the provisions.
16. In the counter affidavit filed on behalf of respondents 2 and 3, sworn to by S.B.L. Misra, Additional Principal Chief Conservator of Forests (FCA), it is stated that the Government in Memo No. 1220/M.II(1)/2007, I&C (M.II) Department, dated 16-3-2007 had issued orders permitting the Director of Mines & Geology to overlook the prior applications and granted quarry lease for black granite in Compt. No. 1148 of Ingurthy Forest Range, Kesamudram Mandal, Warangal District in favour of M/s. Andhra Pradesh Mineral Development Corporation Limited, the State Government Public Sector undertaking by exercising powers conferred under Rule 12(5)(b) of the Rules. It is further stated that the I&CD Department in an urgent note (From Ind. & Commr. Department, U.O. No. 1220/M.II(1)/2007-2 dated 5-5-2007 had also requested the EFS & T Department to cancel G.O.Ms. No. 8, EFS & T Department dated 9-1-2007 where forest clearance was given to M/s. Exotic Granites which does not have quarry lease and grant NOC for Forest Clearance to A.P. Mineral Development Corporation, a State Government Public Sector Undertaking which had been given the quarry lease in Government Memo No. 1220/M.II(1)/2007 dated 16-3-2007 on the following grounds:
(a) The APMDC Limited had taken care of supplying raw material to local industries at the rate of 20% of the production. Thus, by all means, from the development angle, it is desirable to grant leases to APMDC only wherever it had applied for QL/ML under Rule 12(5)(b) of the Rules and it is a fit case to overlook priority since the State P.S.U. is involved.
(b) The annual estimated production is 1800 cubit meters. In case it is given to State Public Sector Undertaking, besides seigniorage fee, it will get additional revenue of about Rs. 11.00 crores since the area contains 37,000 cum of recoverable deposit as per geological estimates.
(c) Not only in respect of this project but in respect of Beach Sand, Iron Ore and other Projects the State if presently contemplating to consider the application of APMDC overlooking the priority of Private firms/individuals, keeping in view the overall development of the State by way of value addition since the Government is having discretion to consider the applications overlooking priorities both in respect of major and minor minerals.
(d) In case the Government does not take the same stand in this case, it may become a bad precedent in respect of other minerals also and ultimately all the Projects contemplated like beach sand with Russian collaboration, Iron ore etc., will get affected.
(e) The Public Sector Undertakings need to be given preference while considering QL/ML applications for grant in the interest of APMDC Limited and also Government from Revenue point of view. Therefore, the Government after careful examination of the whole issue and also keeping in view the request made by Industries & Commerce Department had cancelled the orders issued in G.O.Ms. No. 8, EFS&T Department dated 11-1-2007 permitting the Principal Chief Conservator of Forests for diversion of 4.916 ha. Of the Forest land in Compartment No. 1148 of Ingurthy Beat of Mahaboobabad Range, Warangal (South) Division for extraction of black granite in favour of M/s.Exotic Granite and issued directions to submit the proposal under Forest (Conservation) Act 1980 for rediversion of the above said area for extraction of black granite in favour of M/s.APMDC Limited., Hyderabad which is a State Government undertaking. In view of the orders issued by the Government in G.O.Ms. No. 135 dated 4-12-2007, M/s. Exotic Granites will not have any claim over the said land.
17. In the counter affidavit filed by the 4th respondent, it is averred that the State Environment, Forests, Science & Technology Department vide their letter dated 29-1-2005 had initially forwarded a proposal for diversion of 5 Hectares of forest land in Compt. No. 1148 of Ingurthy beat, Warangal District for grant of mining lease for extraction of black granite in favour of M/s.Madhu Industries. Subsequently, the State Government by their letter dated 27-6-2005 had forwarded another proposal for diversion of 4.96 Hectares of forest land in Compt. No. 1148 of Ingurthy beat of Warangal South Division, Warangal District for grant of mining lease for extraction of black granite in favour of M/s.Exotic Granite Exports duly withdrawing the earlier proposal made in favour of M/s.Madhu Industries. Aggrieved by the decision of the State Government, M/s.Madhu Industries had filed a Writ Petition, W.P. No. 17918/2005 before this Court and this Court by order dated 3-11-2005 in W.P. No. 22798/2005 and W.V.M.P. Nos. 2812 & 2524/2005 in W.P. No. 17918/2005 directed the 4th respondent to consider both the proposals made by the Government of A.P. within 8 weeks without in any manner being influenced by any observation made in the Judgment. As per the said directions, both the above proposals were considered based on the representations received from the appellants as well as the reports of the State Government and it was decided to approve the proposal of M/s.Exotic Granite Exports. Accordingly, the proposal of M/s.Exotic Granite Exports was approved by the 4th respondent by letter dated 22-12-2006. The prior approval of the Central Government under Forest (Conservation) Act, 1980 is a prerequisite for use of forest land for non-forestry purposes. The other formalities for undertaking the mining operations viz., obtaining a valid mining lease under the Act, the execution of lease deed etc., are to be taken care of by the concerned Department of the State Government. The 4th respondent is concerned only with the granting of permission for use of forest land for non- forestry purposes.
18. In the counter affidavit filed by the 6th respondent it is averred that the Memo dated 16-3-2007 issued by the 1st respondent is not a final order vesting or divesting of rights of any of the parties and as such it is not open for attack. The order of the Government dated 16-3-2007 is more in the nature of intermediate order granting permission to the Director of Mines to overlook priority specified in the statute. In consequence of the said order, the Director of Mines has to take final and ultimate decision with regard to grant of lease to either of the competing parties. As the Director is yet to take final decision with regard to grant of lease, there is no cause of action for the writ petitioner to approach this Court especially when the impugned order cannot be said to be contrary to the provisions of the Forest (Conservation) Act muchless violative of Constitutional rights of the writ petitioner and hence the Writ Petition is liable to be dismissed at the threshold on the said ground alone as being pre-mature. Further it is averred that the action of the Government in so far as recommending the proposal of the petitioner to the 4th respondent, in the context of seeking prior approval in accordance with Section 2 of the Act is not a relevant circumstance inasmuch as mere forwarding of the proposal to the 4th respondent does not confer any right in favour of the applicant for securing lease under the Rules. The same is inherent in the scheme of the Act. Merely because the Forest Department granted clearance, the same cannot be construed as conferring a vested right in favour of the applicant to secure mining lease. It is only when the Director of Mines who is the statutory authority under the Rules considers relevant applications and determines the issue as to the entitlement of the applicant on the basis of various relevant factors including availability of infrastructure, experience in the field, potentiality of the applicants etc., the petitioner gets leasehold right. Therefore, grant of stage-I approval by the 4th respondent to the project of the petitioner by 27-6-2006 is neither here nor there. At any rate, the 4th respondent also would not have considered any of the aforesaid aspects which are relevant for grant of mining lease at the threshold stage of State-I approval nor is he obligated to do so since they are not within his realm to consider. So also the mere circumstance of payment of Rs. 44.60 lakhs towards the cost of the aforesaid project, re-generation of safety zone area etc., does not per se confer any right in the petitioner to secure mining lease. The petitioner has no choice except to undertake all the consequential actions like purchase of land for being made over to Forest Department and making deposits in terms of statutory rules, if he wishes to pursue his application for grant of mining lease, as the same are conditions precedent for considering the application of the petitioner by the competent authority i.e., the Director of Mines. But at the same time, the mere preparedness on the part of the petitioner does not secure any right in his favour for being considered on priority basis. The submissions made by the 6th respondent in this behalf would hold good even if Stage-II approval is granted by the Government of India. Thus, the petitioner cannot claim any preferential right in its favour merely because Stage-I and II approvals were granted by the Government of India. This inherent legal position had only been taken note of by the Government of A.P. in its Memo dated 1-9-2005. Further it is stated that the Memo dated 1-9-2005 does not bring about any change in the pre-existing legal position but it only sought to clarify the methodology of consideration of rival applications keeping in view the provisions of the Forest Conservation Act vis--vis the Rules. So also is the case with regard to G.O.Ms. No. 8 dated 11-1-2007 whereby the Forest Department is alleged to have issued "diversion order" to an extent of 4.916 hectares. The said permission granted by the Forest Department for such alienation of 4.916 hectares of forest land is subject to ultimate decision by the Director of Mines with regard to grant of lease. In so far as the note dated 1-2-2007 issued by the Hon'ble Chief Minister's office, it is stated that the same is nothing but a covering note forwarded by the Chief Minister's office along with the representation allegedly submitted by the petitioner. It is normal practice in Government to forward such representations along with a note and such communication cannot be taken as decision of the Government directing the appropriate authority to consider the petitioner's request for grant of mining lease dehors the statutory provision. At any rate, there is nothing in the said communication suggesting any such course nor is it possible for any authority to do so and the Hon'ble Chief Minister would not have issued any communication contra to the Government's Memo dated 1-9-2005 and also the statutory provisions in the Forest (Conservation) Act and the Rules nor the same is legally permissible for him. It is also further stated that the subject land is situate in the forest area and it is absolutely essential to the entrepreneur to ensure ecological balance in the interest of larger public good. In such cases, it would be advisable to consider the applications of public sector Corporations like the 6th respondent to take care of the ecological balance while exploiting the mine on a better scale than a private entrepreneur. Viewed from the said angle also, the 6th respondent is entitled to be considered on priority basis in preference to the writ petitioner. It is further stated that the 6th respondent is advised that inasmuch as the 4th respondent did not consider vital aspect before granting forest clearance in favour of the writ petitioner, the clearance granted by it is illegal and as such the order dated 27-6-2006 issued by the 4th respondent is unsustainable in law. The 6th respondent is further advised to state that though the "first come first serve" is the principle underlying behind grant of lease with regard to virgin land, it is not an absolute principle universally applicable and the same is subject to exceptions as set out in the very statutory scheme. It is not mandatory for the Director of Mines to consider only the case of the 1st applicant, but on the other hand, it is open to him to consider the cases of all eligible applicants and grant in favour of any one applicant who is found to be better placed from the view point of proper mining and larger public good, of course, from after securing prior approval from the Government of A.P. It is further stated that it is taking all the aforesaid factors into consideration, the Vice-Chairman and the Managing Director of the 6th respondent Corporation requested the Government of A.P. to relax the rigour of rule and permit the Director to consider the case of the 6th respondent in relation to the subject land and for varied reasons set out in the said note submitted by the 6th respondent-Corporation, the Government by its communication dated 16-3-2007, granted permission to the Director to consider the application of the 6th respondent. The reasons that weighed with the Government for granting such permission to the Director, so as to enable him to consider the application of the 6th respondent, cannot be said to be illegal or arbitrary muchless without jurisdiction. As per the settled legal position, the Government Corporations are always considered category by themselves and as such they are entitled to preferential treatment vis--vis a private citizen in the matter of distribution of public largesse and the said principle received approval from the Apex Court in very many cases and it is too late in the day to question the same. It is also further stated that it had been found that the subject mine is a resourceful one and capable of yielding a positive gain of as much as Rs. 11 crores on estimate basis. Apart from the fact that the petitioner is a public sector Corporation, its multifarious experience, availability of infrastructure and resourcefulness would enable it to carry on mining on sound and effective lines with minimal overheads which ultimately would result in hiking its revenue further. The grant of lease in favour of 6th respondent- Corporation would advance the cause of larger public good as whatever dividend that may be secured by the Corporation would be passed on to be public exchequer ultimately and this is the prime reason, if not the exclusive reason, for the Government to consider relaxation of priority rule in terms of proviso to Rule 12(5) of the Rules. It is also further stated that the conduct of the writ petitioner against the order of the Government dated 16-3-2007 in para-8 of the affidavit is devoid of force inasmuch as the said order does not divest any rights of the parties but only relaxes the rule so as to enable the Director to consider all eligible applicants also. The order cannot be considered as one of vesting or divesting of rights of the parties. In that sense, there is no requirement to issue any prior notice to the petitioner before exercise of such power by the Government. Even now, it is open to the writ petitioner to represent to the Director of Mines as to how the writ petitioner would be better entitled to secure the mining lease in its favour in preference to the 6th respondent. In reply to para-9 of the affidavit, it is stated that the Director of Mines Mr. V.D. Rajgopal was appointed as Vice-Chairman and Managing Director of the 6th respondent-Corporation on 24-6-2004 and later he was appointed as Director of Mines on and from 1-8-2005 and the same person holding two offices and considering the same issue in different capacities is nothing new or alien to the administrative functioning. At any rate, the said functioning of the Director has no effect on the lease because any authority is bound to consider the issue on an objective basis in the larger interest of public good and without being impaired by any irrelevant considerations. Merely because the deponent happens to be the Vice-Chairman and Managing Director of the 6th respondent-Corporation, it does not mean that he would take decisions in an unfair and unreasonable manner sitting in the office of the Director of Mines. Since any gain made by a public sector Corporation like 6th respondent would ultimately go to the State's exchequer, the said aspect does not deserve any consideration. Even otherwise, a person holding the office of Director of Mines is competent to consider the proposal of the 6th respondent-Corporation and offer its views in a dispassionate manner. It is really surprising that the petitioner should express surprise over the said method of functioning. The 6th respondent, as a public Corporation, is within its legitimate right to express its views claiming exclusivity in its favour in the matter of grant of lease. Incidentally as the 5th respondent is holding the office of the Chief Executive of the Corporation, he had to inevitably sign the said representation addressed to the Government as per the protocol required to be observed and merely because Vice-Chairman and the Managing Director who happen to be 5th respondent had signed the report of the 6th respondent, the report cannot be termed as that of the Director. It is still a representation made by the 6th respondent- Corporation. Further, when the 5th respondent considers such a report of the 6th respondent, the former is entitled to express his views on the matter in an objective basis uninfluenced by irrelevant considerations. As long as the contents in the report of the 6th respondent and forwarding note of the 5th respondent are not misrepresenting the situation, they cannot be found fault with. It is not the case of the petitioner that the respondents 5 and 6 had presented any distorted position before the Government and secured the clearance of the Government on the basis of such a report. It is further stated that the comment in para-10 that no reasonable person could have made a request to overlook the priority of the petitioner in the face of returning of the application dated 5-8-2003 (should read as 14-8-2003) cannot be appreciated. Though the application of the 6th respondent was returned on 3-5-2004, the application was since represented by the 6th respondent on 18-3-2005. It is also further stated that the 6th respondent understands and believes it to be true that the Director of Mines had forwarded a proposal for waiving priority only on 22-1-2007 by which date the application of the 6th respondent was very much alive on the file of the Director of Mines. The assertions of the petitioner that the 6th respondent had not taken any action after return of the application by the Forest Department is also not true and correct. It is stated that to set the record straight, the 6th respondent had resubmitted the application to the Forest Department on 18-3-2005 duly curing the deficiencies pointed out by the said Department. The views of the Director with reference to the application of the 6th respondent were made on an objective basis and uninfluenced by the fact that he was incidentally functioning as Vice-Chairman and Managing Director of the 6th respondent-Corporation and therefore no adverse comment could be made against such an action. It is further stated that the contention in para-11 that the question of granting "NOC" to the 6th respondent does not arise in view of prior granting of "NOC" to the petitioner is too wide a statement to be accepted. It is not as if the petitioner is able to trace such a position with reference to any statutory provisions. Further it is stated that the Forest Department does not become functus officio the moment "NOC' is granted to any one of the aspirants. There is nothing in the scheme of the Act which forbids the Forest Department from entertaining any application in respect of the same land and granting N.O.C. There is an inherent feature in the very grant itself to indicate that the grant is not final and the same is subject to subsequent events. The theory of executive instructions not having retrospective effect developed by the petitioner has no relevance in the context and at any rate the same is based on misconception of legal position. The instructions given by the Government of A.P. in its communication dated 1-9-2005 is not a newly made rule much less is it intended to amend the existing rule. It is also further stated that it is not in dispute that the application seeking mining lease has got to be submitted to the Mines Department and not to the Forest Department. It is only in the course of such scrutiny by the Mines Department, the application is normally referred to the Forest Department for obtaining its N.O.C. Therefore it is obligatory for the Mines Department to first consider the feasibility of grant of mining lease in favour of the aspirant before forwarding the same to the Forest Department and it had been the legal position throughout. At any rate it is not amending in nature of any prior statutory provision and therefore the theory of prospectivity and retrospectivity have no relevance. The contra contention developed in para-12 is liable to be rejected as being devoid of substance. The comment of the 5th respondent if any as regards validity of the N.O.C. issued by the Forest Department has to be understood in the light of this legal position. It is further stated that the Forest Department has no authority in law to review its proceedings in granting N.O.C. to the petitioner is equally unsustainable. The said contention is contrary to the very condition setout in the communication issued by the Forest Department. At any rate, mere grant of N.O.C. from the Forest Department in favour of the petitioner does not entitle the petitioner to carry out mining activity in the said land. On the contrary, the petitioner gets a right to carry on mining activity only in the eventuality of Director of Mines granting mining lease in his favour. In the eventuality of non-accord of lease in favour of the petitioner, the Forest Department would be entitled to resume the land. Therefore the contra contention urged in para-12 by the petitioner is unsustainable. It is further stated that the contention developed on the basis of Judgment delivered in W.A. No. 115/2006 has no legs to stand. The facts set out in W.A. No. 115/2006 would clearly demonstrate that the facts there in are totally at variance with the facts arising in the instant case and hence the said Judgment is distinguishable on facts. At any rate, in view of the order of the Government exercising its power under proviso to Rule 12(5) of the Rules, the said Judgment has no application. It would be open to the Mining Department to consider the applications of both the writ petitioner and the 6th respondent from point of view: (i) feasibility, (ii) profitability and (iii) public interest and forward the proposals to the Forest Department for grant of N.O.C. depending on the exigencies. In such eventuality, it is for the Forest Department to grant N.O.C. to the relevant person chosen by Mining Department. At any rate, there is no injunction against the Forest Department from granting the N.O.C. in favour of such an applicant after due process by the Mining Department. Further the contention that the public exchequer might be in advantageous position in the event of grant of lease to public Corporation is definitely a relevant circumstance for the 1st respondent to consider exercising of power under proviso to Rule 12(5) of the Rules. The Legislature in its wisdom had not set out any conditions or circumstances in the context of relaxing the priority. Therefore it is open for the Government to relax the rule relating to priority for appropriate and relevant reasons. The discretion of the Government has to be exercised fairly and reasonably and not for irrelevant considerations. Larger public good in preference to individual good is an accepted theory. The public sector Corporations making a gain of crores of rupees and the circumstance that such a gain would got to the State exchequer for being used for larger public good is not only a relevant circumstance but also a preferable law and the Government should be appreciated or preferring such a view. It is unfortunate that the petitioner should choose to decry such a bona fide decision taken by the Government. It is further stated that the contention in para-20 of the writ affidavit is based on the theory of legitimate expectation which is equally baseless. It is not the case of the petitioner that the Director of Mines who is the competent authority to grant lease under the scheme of the Rules had ever assured the petitioner that he would be granted lease in respect of the subject land. In the absence of any such representation from the competent authority i.e., the Director of Mines, the question of the petitioner putting forward the theory of legitimate expectation does not arise. It is not open to the petitioner to invoke the said theory of legitimate expectation merely because the Forest Department gave N.O.C. Even the Forest Department had not assured the petitioner that the Director of Mines would be granting lease in favour of the petitioner the moment N.O.C. is cleared by the Forest Department. The order dated 16-3-2007 issued by the 1st respondent is legal and valid apart from being fair and reasonable and it cannot be said that the action is arbitrary and unreasonable much less unjust. The rights of the petitioner including the legal representatives guaranteed under the Constitution of India had never been ever violated by the impugned order of the 1st respondent. The Writ Petition is devoid of merit and hence it is liable to be dismissed.
19. A reply affidavit in detail had been filed to the counter affidavit filed by the 1st respondent again reiterating the same stand. It is averred in para-4 that the material allegations made in paras 2 and 3 of the counter affidavit are not true and correct. The legal contentions raised therein are totally unsound and untenable. The said contentions are based on a total misunderstanding of the scope, effect and interpretation of Memo No. 5624/Forest- I(1)/05-2 dated 1-9-2005 and the interpretation given to the said memo is wholly unsound and unwarranted. The Memo is not capable of such an interpretation. Unless and until prior approval is given by the Government of India, no State Government or other authority is empowered to divert a forest land for non- forest purpose. The same is very clear from Section 2 of the Forest (Conservation) Act 1980. The Forest (Conservation) Rules 2003, particularly Rule 6 and the Forms framed thereunder, provide as to how an application for obtaining the prior approval of the Central Government for diversion of the forest land for non-forest purposes should be made. The entire field is occupied by the law made by the Parliament. The same cannot be modified or controlled by any law made by the State Legislature. It is unthinkable that the same could be controlled or processed or guided by Memo dated 1-9-2005 issued by the 2nd respondent. The Rules also will not have any impact on the provisions of the Act and the Rules made thereunder. The Rules do not provide for giving any priority or preference to a State Public Sector undertaking. The contention that the Director of Mines & Geology for the reason that the application of the 6th respondent belongs to a State Public Sector Undertaking and the State exchequer will derive a benefit of Rs. 11 crore due to exploitation of the granite in the area proposed for grant of lease in favour of the 6th respondent by overlooking the priority of the petitioner is based on a total misapprehension of the rights of a share holder vis--vis a Company registered under the Companies Act. It is admitted that the forest clearance is already given in favour of the petitioner. It is further stated that it is pertinent to note that as per the Rules, the Forest Department sought for the prior approval of the Government of India under the Act and the Government granted prior approval in two stages, stage-1 and stage-2. Stage-2 approval was given after all the conditions imposed under stage-1 approval were complied with. Pursuant to the same, the 2nd respondent issued orders in G.O.Ms. No. 8 dated 11-1-2007 diverting the land of an extent of 4.916 hectares in Ingurthy East Reserve Forest, Mahaboobabad Range, Warangal South Division, Warangal District in favour of the petitioner. There is no question of the 6th respondent's application for clearance of the said land in favour of the 6th respondent would arise. The Division Bench of this Court in W.A. No. 115/2006 dated 3-2-2006 clearly and categorically held that when clearance is granted in favour of a particular individual, the same land or part of the said land cannot be considered for clearance in favour of another person. The said decision is arrived at on an interpretation of the provisions of the Act and the Rules. The clearance granted in the case of the petitioner cannot therefore be reexamined afresh as per the memo dated 1-9-2005. The said contention is based on a misreading and misunderstanding of the scope and ambit and misinterpretation of the said Memo dated 1-9-2005. It was further held that the said Memo, assuming without admitting can be invoked, the same can be invoked only in case of the applications filed after the said Memo came into force and the same cannot be invoked in the case where clearance is already given, as the Memo has no retrospective effect. Further it is averred in para-5 of the reply affidavit that the allegations made in para-4 of the counter affidavit are not true and correct and are based on the misunderstanding of the scope of the Act and the Rules made thereunder and the scope of the Memo dated 1-9-2005 and there is no question of application of the Memo dated 1-9-2005 to the instant case. There is no question of scrupulously following the said procedure in processing the application of the 6th respondent for diversion of the forest land. The 2nd respondent has no jurisdiction to review its earlier orders and therefore there is no question of the 2nd respondent now processing the applications of the 6th respondent for grant of prior approval and diversion of forest land in its favour. The contention that the Writ Petition is premature is unsound and untenable and baseless into bargain. The rest of the allegations in the said para need not be controverted because the same are also based on a misunderstanding of the contentions raised in the affidavit filed in support of the Writ Petition in paras 4 and 5. It is averred in para-6 that the allegations made in para-7 of the counter affidavit are unsound and untenable. The application made by the 6th respondent does not satisfy the requirements of the Rules is very clear from para-4 of the counter affidavit filed by the 2nd respondent herein in W.P. No. 17918/2005 and the contentions raised by the 1st respondent herein therefore merits no consideration. It is clear from the prayer in the said application for vacating the interim orders granted in W.P. No. 17918/2005 on 12-8-2005 and the Writ Petition be dismissed with costs, that the counter affidavit is filed subsequent to 12-8-2005. In view of the ratio of the Division Bench Judgment in W.A. No. 115/2006 dated 3-2-2006, the application of the 6th respondent cannot be considered at all. Further in relation to the material allegations made in para-8 of the counter affidavit it is stated that the same are not true and correct and the legal contentions raised therein are based on the reports submitted by the respondents 5 and 6. The Director of the 5th respondent and the Vice Chairman & Managing Director of the 6th respondent is one and the same, namely Sri V.D. Rajagopal. Allegations of bias are made against him but the said Sri V.D. Rajagopal either in his capacity as the Director of the 5th respondent or in his capacity as Vice Chairman & Managing Director of the 6th respondent had not filed a counter affidavit so far. No counter is also filed on behalf of either the 5th respondent or 6th respondent. The Law does not provide for any special treatment for Public Sector Undertakings. The decisions quoted are out of context and they have absolutely no application whatsoever to the facts and circumstances of the case. The allegations made in paras 10 and 11 of the counter affidavit also had been denied. Further in paras 9 and 10 of the reply affidavit it had been averred that the material allegations made in paras 12, 13, 14 and 15 of the counter affidavit are not true and correct and the legal contentions raised therein are totally unsound and untenable. The contention that the Writ Petition is premature and that the statutory authority is in the process of exercising its right and the State exchequer is in the process of exercising its right and the State exchequer is making profit and there is natural fundamental right in the petitioner to carry on business are unsound and untenable. The petitioner has a fundamental right not to be treated arbitrarily and has a fundamental right to carry on his business complying with all the provisions of the Act and the Rules made therein. Further, the allegations made in paras-16 and 17 are unsound and untenable. The accusation leveled against the 2nd respondent that it had not given any notice to the 6th respondent before giving clearance to the petitioner's application violates principles of natural justice is absurd. It is unthinkable as to how the 2nd respondent can initiate proceedings to review the proceedings issued by it without giving notice to the petitioner. The application filed by the petitioner is in accordance with the Act and the Rules and the Government of India gave prior approval to the project of the petitioner and the 2nd respondent did what is incumbent upon it according to Law. The 2nd respondent has no authority in law to review its decision.
20. In the reply affidavit filed to the counter affidavit of the 6th respondent it is averred that the material allegations made in the counter affidavit of the 6th respondent are not true and correct and the legal contentions raised therein are unsound, unsustainable and untenable. In reply to para-12 of the counter affidavit, with regard to submission of the application by the 6th respondent and the returning and resubmission thereof, it is stated that in the counter affidavit filed on behalf of the Environment, Forests, Science & Technology (For.I) Department in W.P. No. 17918/2005 sometime after 12-8-2005, it is stated that the proposal submitted by the 6th respondent herein is not fulfilling the required formalities under the Forest (Conservation) Act 1980. In the said counter affidavit, the Forest Department prayed that in view of the averments made in the said counter affidavit, this Court may be pleased to vacate the interim orders granted on 12-8-2005. It is categorically averred that if the 6th respondent had resubmitted its application duly curing the deficiencies, the Forest Department would not have stated so in the said counter affidavit. The petitioner wanted to file its reply after verifying the exact situation as to when exactly the 6th respondent resubmitted its application and therefore the petitioner through its Counsel issued a notice under Rule 15 of the Writ Proceedings Rules, 1977 seeking inspection of the records of the Forest Department. The Government Pleader for Forests informed the Counsel for petitioner that the Forest Department had declined to grant permission for inspection of the records. It was also informed to the Counsel for petitioner that the Forest Department issued G.O.Ms. No. 135 dated 4-12-2007 cancelling the earlier G.O.Ms. No. 8 dated 11-1-2007 issued by the said Department in favour of the petitioner and supplied a copy of the same to the petitioner's Counsel. The petitioner reserves its right to question the same by filing a separate application in the Writ Petition as the said G.O. had been issued at the instance of the Industries and Commerce Department with a mala fide intention of defeating the rights of the petitioner. The action of the Industries and Commerce Department to request the Forest Department to cancel G.O.Ms. No. 8 dated 11-1-2007 issued by the said Department in favour of the petitioner when the Writ Petition is pending and the Forest Department canceling the same after obtaining time for filing counter, would amount to abuse of the process of Court and the said Departments are consequently guilty of Contempt of Court. It is averred that it is absurd to state that the impugned memo issued by the 1st respondent dated 16-3-2007 is not final order vesting or divesting rights of any of the parties and as such it is not open for attack. It is equally absurd to state that the order dated 16-3-2007 is more in the nature of an intermediate order granting permission to the Director of Mines to overlook priorities specified in the statute and that the Director of Mines as a consequence has to take final and ultimate decision with regard to grant of lease to either of the competing parties. A reading of the recommendation submitted by the Director of Mines, the 5th respondent, to the Government and the memo dated 16-3-2007 passed by the Government pursuant to the said recommendation makes it very clear that it is not in the nature of a preliminary order. No reasonable and unbiased person can either interpret or understand the said Memo in that manner. In fact, in G.O.Ms. No. 135, dated 4-12- 2007, in paragraph-4, the Forest Department stated as hereunder:
In the U.O. 6th read above, the I&C Department has also requested the EFS & T Department dated 9-1-2007 to cancel the G.O.Ms. No. 8, EFS & T Department dated 9- 1-2007 where Forest clearance was given to M/s.Exotic Granites which does not have quarry lease and grant NOC for Forest Clearance to APMDC, a State Government Public Sector Undertaking (P.S.U.) which has been given the Quarry lease in Govt. Memo No. 1220/M.II(1)/2007 dated 16-3-2007 on the following grounds.
It is further averred that paragraph-10 of the impugned Memo dated 16-3-2007 clearly and categorically states that the Government hereby permit the Director of Mines and Geology to overlook the prior applications and grant quarry lease for black granite in Compartment No. 1148 of Ingurthy Forest Range, Kesamudram Mandal, Warangal District in favour of M/s.A.P.M.D.C. Limited., the State Public Sector undertaking, by exercising power conferred under Rule 12(5)(b) of the Rules. The very first sentence of the impugned Memo reads as hereunder:
The Director of Mines and Geology vide his reference 1st cited has requested the Government to grant quarry lease in favour of M/s.Andhra Pradesh Mineral Development Corporation Limited., under Rule 12(5)(b) of A.P. Minor Mineral Concession Rules, 1966.
From the impugned memo it is seen that there are four applications for grant of lease for quarrying black granite for the area in question. The applications of two of them, namely M/s. Reliance Granites (P) Limited and M/s. Madhu Industries Limited are already rejected. There are only two applications, the application of the petitioner and that of the 6th respondent. It is further stated in the said Memo that the G.O. issued by the Forest Department did not follow the instructions issued by the Government in Memo No. 5624/FOR-I(1)/05-2 dated 1- 9-2005 and the same therefore requires to be reviewed. The Government as well as the Director of Mines and Geology are under the erroneous impression that the Forest Department is empowered to review its orders at any point of time they would like to do or directed to do. The Forest Department has no inherent jurisdiction to review its orders. The Department is a creature of the statute namely, the Forest (Conservation) Act and the Rules made thereunder and the said enactment and the Rules made thereunder do not cloth the Forest Department to review the orders passed by it basing on the prior approval of the Government of India contemplated under the Act. It is stated that the material allegations in para-3 of the counter affidavit of the 6th respondent are misleading. The various applications referred to in paragraph-3 of the affidavit filed in support of the Writ Petition are to the full knowledge of the Director of Mines & Geology and the same is clear from the report sent by him to the Government of A.P. The Director of Mines & Geology who had sent report is none other than Sri V.D. Rajagopal, the deponent of the counter affidavit under reply. In such circumstances, there is no grace in to the 6th respondent submitting to this Court that he is unable to answer them for sheer lack of information. Further, Sri V.D. Rajagopal stated in para-3 of the counter affidavit:
I reserve my right to file detailed counter with regard to these aspects at the time of final hearing of the Writ Petition.
Further, in the last paragraph he stated:
For the reasons stated above, it is prayed that the Hon'ble Court may be pleased to dismiss the Writ Petition and pass such other order or orders as the Hon'ble Court may deem fit and proper in the circumstances of the case.
The same reflects his anxiety to get the Writ Petition dismissed even before he filed his final counter in the Writ Petition and the same is listed for final hearing. It is further averred that the material allegations made in paragraphs 4 and 5 of the counter affidavit of the 6th respondent are not true and correct and the legal contentions raised therein are wholly unsound, unsustainable and untenable. The same are based on the fertile understanding of the deponent to the counter affidavit regarding the respective powers of the Government of India, the Forest Department of A.P. and the powers of the Director of Mines & Geology under the provisions of the Act and the Rules made thereunder and the Rules that lead to the passing of the orders in Memo No. 5624/FOR-I(1)/05-2, dated 1-9-2005 issued by the Industries and Commerce Department. The contentions raised in the said paragraphs that an applicant desirous for grant of a mining lease in the Forest area must necessarily send his application to the Forest Department through the Director of Mines & Geology with the clearance of the said authority and if the application is not mooted through the Department of Mines & Geology it would be of no avail for the reason that the Director of Mines & Geology need not necessarily grant a mining lease to such an applicant, is wholly based on the misunderstanding of the law applicable and consequently unsound and untenable. The view that the powers of the Director of Mines & Geology under the Rules are of paramount importance in the matter of grant of quarry leases even in forest area is equally unsound and untenable. To say the least, the understanding of the deponent regarding respective powers of the authorities under the provisions of the concerned enactments is most unfortunate. The application of the 6th respondent for grant of quarry lease cannot be considered at all, as the 6th respondent had not obtained the prior approval of the Government of India. The Government in Industries and Commerce Department, erred in accepting the recommendation of the respondents 5 and 6, both of which are manned by the deponent of the counter affidavit of the 6th respondent. It is further averred that the contentions raised in paragraph 6 of the counter affidavit are unsound and untenable. They are again based on the erroneous understanding of the deponent of the various statutory provisions involved and also the powers of the Chief Minister in the administration of the State. Further, the material allegations made in paragraph-7 of the counter affidavit are not true and correct. The Forest (Conservation) Act itself was enacted to ensure ecological balance in the larger interests of the public good and the Act therefore confers the power to grant prior approval on a high powered authority like the Government of India. The State Forest Department which is empowered to process such application and recommend the matter to the Government of India also would certainly take care of the ecological balance in the interests of the larger public good and there is no warrant for the Department to assume that the Government of India did not consider the vital aspect of ecological balance before granting "clearance in favour of the writ petitioner". The contention that the clearance granted by the Government of India "is illegal and as such the order dated 27-6-2006 issued by the 4th respondent is unsustainable in law", to say the least is not only absurd but it is perverse. The deponent seems to think that he is all powerful and he can overrule the decision of the Government of India also without questioning it in a Court of law. This attitude on the part of Head of the Department who is given the authority to man a State owned Corporation and the office of the Director of Mines & Geology is not only unbecoming, but most unfortunate. Further it is averred that the material contentions raised in paragraph-8 of the counter affidavit are once again based on the misunderstanding of the Forest (Conservation) Act, the Rules made thereunder and the A.P. Minor Mineral Concession Rules and the powers of the Director of Mines & Geology. It is admitted by the 6th respondent in paragraph-8 that "It is taking these factors into account, the Vice-Chairman and Managing Director of this Corporation requested the Government of A.P. to relax the rigour of rule and permit the Director to consider the case of the 6th respondent in relation to subject land. For varied reasons set out in the said note submitted by this Corporation, the Government by its communication dated 16-3-2007, granted permission to the Director to consider the application of this respondent". Despite the fact that the recommendations of the 6th respondent in Single File System No. APMDC/BG/ING- FC/2003 dated 23-1-2007, formed the very foundation of the impugned Memo dated 16-3-2007, the same has not been supplied to the writ petitioner though he specifically requested for the same. While replying to paragraph-9 of the counter affidavit it is averred that the material contentions raised therein are wholly unsound and untenable. The consideration that mainly weighed with the 1st respondent to relax the priority Rule in terms of proviso to Rule 12(5) of the Rules is not a relevant issue. In directing the 5th respondent to grant mining lease to quarry granite in the area reserved for the petitioner, the 1st respondent acted in utter violation of the law applicable to the case. The credit of misleading the Government to resort to such an action wholly goes to the 6th respondent. The 1st respondent totally surrendered its Judgment to the respondents 5 and 6 in issuing the impugned Memo dated 16-3-2007. It totally ignored the overriding nature of the provisions of the Forest (Conservation) Act, the Rules made thereunder and the same prevailing over the other laws in force in a State. It is further averred while replying to paragraph-10 of the counter affidavit that the material allegations made in therein are unsound and untenable. It is absurd to say that the impugned order dated 16-3-2007 does not divest any rights of the parties, but only relaxes the Rule so as to enable the Director to consider all eligible applicants also. The said contention ignores the fact that there are no other eligible applicants for the grant of mining lease in the reserve forest area excepting the writ petitioner and the 6th respondent. By and under the impugned order dated 16-3-2007, the 1st respondent without giving any opportunity to the petitioner, deprived the petitioner of its right to obtain a mining lease in the area reserved for it, on considerations not germane to the provisions of the Forest (Conservation) Act and the Rules made thereunder. Further, while replying to paragraphs 11 and 12 of the counter affidavit, it is stated that the material allegations made therein are not true and correct and t legal contentions raised are unsound and untenable. The recommendations made by the 6th respondent and the Director of Mines, the 5th respondent, are both vitiated, as both of them are based on the misunderstanding of the law involved in the case and consideration which are not relevant for the exercise of the power under the Act and the Rules made thereunder and the powers of the Director and the Government of A.P. under the Rules. The recommendations made by the 6th respondent would not have been blindly accepted by the 5th respondent, if both the offices are not being manned by the same person who badly misunderstood the provisions of the enactments involved in the matter and the respective powers of the Central Government, the State Government and the Director of Mines & Geology. It is further averred that it is highly doubtful whether the 6th respondent resubmitted its application on 18-3-2005 duly curing the deficiencies pointed out by the Forest Department. As already pointed out supra, the counter affidavit filed by the Forest Department in W.P. No. 17918/2005 after 12-8-2005 makes it clear that the application was not submitted before that date. Whether the application is submitted or not is not relevant at this stage, because the application of the 6th respondent cannot be recommended again by the Forest Department to the Government of India for grant of prior approval for diversion of forest area for mining in favour of the 6th respondent because the application for the said area of the writ petitioner was already recommended and the Government of India, the 4th respondent, accepted the recommendations and granted Stage-1 and Stage-2 approvals and the Forest Department pursuant to the same, issued G.O. for diversion of the land and handed over the land to the 5th respondent pursuant to the orders passed by the authorities concerned in accordance with Law. As per the judgment of a Division Bench of this Court in W.A. No. 115/2006 dated 3-2-2006, when once the application of the petitioner is cleared by the Forest Department, the Forest Department cannot consider the application of another applicant, in the instant case the 6th respondent, for recommending the grant of prior approval by the Government of India. The 1st respondent issued the impugned Memo even without giving any opportunity to the petitioner. The action of the 1st respondent in issuing the impugned Memo if therefore wholly illegal, arbitrary, unreasonable and unjust. The said action is also vitiated as the 1st respondent without application of mind, accepted the erroneous and untenable recommendations of the respondents 5 and 6. It is further averred that the material allegations made in paragraphs 13, 14, 15 and 16 of the counter affidavit are not true and correct and the legal contentions raised therein are based on the misunderstanding of the provisions of law involved in the matter. The same are mere repetition of the allegations and the contentions made in the earlier paragraphs and therefore do not require any detailed reply. The same run contrary to the decision of a Division Bench of this Court in W.A. No. 115/2006. The contention that the Judgment of this Court in W.A. No. 115/2006 is not applicable to the facts of the case is wholly unsound and untenable and must be rejected off-hand. The judgment of this Court constitutes the law for the State of Andhra Pradesh. The contention that the Memo dated 1-9-2005 merely sets out the law which is in force all along and the law is expressly stated in the said Memo is unsound, unsustainable and untenable. The application of the petitioner for quarrying granite in forest area and for getting clearance from the Government of India is processed in accordance with the existing law. The same is very clear from the following passage in the recommendation of the 5th respondent the 1st respondent:
Further, M/s. Exotic Granite Exports dt.1.3.05 have requested the Director of Mines & Geology to give the letter to Divisional Forest Officer, Warangal South stating that the particular colour and composition of Granite is available in the said R.F. area and not available in any non Forest Lands, Government Lands, Patta Lands. The same was referred to the Assistant Director of Mines & Geology, Warangal for issuing Certificate. The Assistant Director of Mines and Geology, Warangal vide Letter No. 1087/Q/03, dated 9-3-2005 have issued a Certificate to M/s. Exotic Granite Exports and submitted a copy of the same to us.
It is further averred that if ultimately no lease for mining granite is going to be granted in favour of the petitioner, despite the clearance from the Government of India, there is really no purpose in the Department of Mines granting certificate in favour of the to the effect referred to supra. It is also further averred that the departmental instructions will not have the effect of overriding the law of the land i.e., the Forest (Conservation) Act and the Rules made thereunder, the laws prevailing in the State, namely, the Rules, and also cannot override the provisions of the Central Act and the Rules made thereunder. As already submitted, the administrative instructions issued in Memo dated 1-9-2005 are only prospective and not retrospective as laid down by this Court in W.A. No. 115/2006. They are not applicable the applications for grant of quarry lease filed anterior to the said date, the processing of which was also commenced much earlier to the said date.
21. These are the respective stands taken by the parties.
22. It may be appropriate to have a glance at the contents of Memo No. 5624/FOR.I(1)/2005-2 dated 1-9-2005, at this juncture:
GOVERNMENT OF ANDHRA PRADESH ENVIRONMENT, FORESTS, SCIENCE AND TECHNOLOGY DEPARTMENT Memo No. 5624/FOR.I(1)/2005-2 dated 1-9-2005 Sub: Fod - Mines and Minerals - Applications for grant of Q.L./Mining lease in forest areas - Processing of applications for grant of mining lease through Mines & Geology Department - Instructions - issued.
Ref: From Industries & Commerce Department, D.O.letter No. 12087/Mines II(1)/2005-1, dated 27-6-2005.
As per the guidelines of the Government of India the nodal officer of the Forest Department receives applications from the user agencies for diversion of forest lands for various purposes including mining operations. In this context the Industries and Commerce Department has reported that entertaining statutory proforma applications direct from the User Agency by the Forest Department may lead to complicating the process of QL/PI/Mining lease and prolong the purpose of disposal. This may also create legal complications for both the Departments including Government of India. They have further stated that on the top of this, securing forest clearance does not confer any right to claim for grant of QL/Mining Lease etc., as the applications are to be examined taking into consideration the experience, financial capacity, technical knowledge and also priorities of Public Sector Undertakings if any. To avoid such complications, the Industries and Commerce Department, have requested the EFS & T Department to issue necessary instructions in the matter.
After consideration of the issue Government hereby direct the Principal Chief Conservator of Forests, Hyderabad to process the Mining leasts/QL applications for clearance under Forest (Conservation) Act, 1980 after receiving the applications with technical observations through the Mines & Geology Department. However, mere forwarding of any mining lease application by the Mines & Geology Department does not confer any right to the applicant for grant of mining lease/QL as the process involves statutory procedure prescribed under F(C) Act, 1980.
The Principal Chief Conservator of Forests, Hyderabad is requested to follow the above instructions and communicate the above orders to all concerned Conservators of Forests/Deputy Conservators of Forests.
T. CHATTERJEE PRINCIPAL SECRETARY TO GOVERNMENT
23. The relevant portion of the Judgment in W.A. No. 115/2006 reads as hereunder:
In our opinion, there is no merit in either of the contentions of the learned Counsel. It is true that the scheme of the Rules does not envisage giving of priority to an application made prior in point of time, but the absence of such provision cannot made a ground for nullifying the decision of the Forest Department not to entertain the application of the appellant. In our view, once the Department accepts the proposal made by one party for carrying out the mining operations in the reserve forest, another application made for undertaking mining operation in a part of the same area cannot be entertained.
The facts brought on record of the case show that the first application made by the appellant on 26-5-2003 was not in conformity with the rules, which require the making of application to the nodal authority in the prescribed form. The application dated 26-5-2003 was submitted by the appellant to the Assistant Director of Mines & Geology and not to the Nodal Officer. That apart, the same was not in the prescribed form. For the first time, application in the prescribed form was made to the competent authority on 5-11-2003 i.e., after more than two months of the application made by respondent No. 7. Therefore, the action of the concerned authorities of the Forest Department in processing the application of respondent No. 7 and making recommendation for grant of permission for mining operation cannot be dubbed as arbitrary.
The argument of the learned Counsel that the application of respondent No. 7 should not have been entertained because the same was not routed through the Mines & Geology Department is liable to be rejected because the policy, which is in the nature of executive instructions, cannot be applied with retrospective effect and the disposal of the applications made prior to 1-9-2005 cannot be regulated by that policy.
There is another reason for our disinclination to entertain the aforementioned argument of the learned Counsel. In the Writ Petition filed by it, the appellant did not question the entertaining of the application of respondent No. 7 on the ground that the same had not been filed through the Mines & Geology Department. Not only this, no such argument is shown to have raised before the learned single Judge. Therefore, at this belated stage, we are unable to entertain the argument of the learned Counsel that the application filed by the respondent No. 7 was not maintainable.
No other point has been argued.
For the reasons mentioned above, the appeal is dismissed.
24. The handing over of the land to the writ petitioner is no doubt put into controversy. The proceeding of handing over by the Forest Range Officer, Mahabubabad on 13-2-2007 and taking over by the Managing Partner of the M/s.Exotic Granite Exports had been laid emphasis by the learned senior Counsel representing the writ petitioner in this regard. The proceeding, "Diversion of forest land to M/s.Exotic Granite Exports, Hyderabad", reads as hereunder: "As per G.O.Ms. No. 8/EFS&T (For-I) Dept., dated 11-1-2007 and Divisional Forest Officer Warangal South Rc. No. 10244/2004/DM, dated 9-2-2007, an area of 4.916 Hectares of Forest land in Ingurthy East Reserve Forest Block (Section and Beat Ingurthy) is handed over to M/s. Exotic Granite Exports, Hyderabad for period of (10) years for extraction of black granite in the above said area. The following (8) conditions are applicable:
1. The legal status of the forest land shall remain unchanged.
2. The compensatory afforestation shall be raised over an extent of 4.916 H of identified non-forest land at Sy. No. 302/1, 302/3 of Katrapally (V) and Sy. No. 259 & 260/A of Nagaram Village at the cost of user Agency.
3. The Forest area shall be used for the purpose of mining, storage of minerals and OB dumps only.
4. The mining shall be done as per the approved mining plan.
5. Reclamation of work in the mining area will be taken up at the cost of user agency.
6. No other structure shall be taken up in the leased area.
7. Soil conservation measures shall be taken up at the cost of user agency.
8. The total forest area utilized for the project shall not exceed 4.916 Ha in case the land is not used for the stipulated purpose, then the area will be resumed by the Forest Department. The above land an area of 4.916 Hectares handed-over to M/s.Exotic Granite Exports, Hyderabad on 13-2-2007.
"Handed over"
Sd/- 13-2-2007 Sd/- Forest Section Officer,
Forest Range Officer, Ingurthy.
Mahabubabad
"Taken over"
For Exotic Granite Exports
Sd/- Managing Partner
M/s. Exotic Granite Exports,
Hyderabad.
25. The right to be considered in accordance with Law on priority basis also is a valuable right. May be that it may not be a fundamental right. Certain submissions were made to the effect that it is not a statutory right even. The element of discretion, scope and ambit thereof in the realm of consideration and the parameters and limitations in exercise of the same vis-- vis the power of judicial review may be the principal question to be decided in the present Writ Petition.
26. Elaborate submissions were made in relation to Rule 12(5)(b) of the Rules. Rule 12 deals with Grant of lease and the said Rule 12(5)(b) reads as hereunder:
The application for grant of P.L. or Q.L. for granite and marble shall be disposed off by the Director in the order of their receipt. Whenever, more than one application is received on the same day, the Director shall grant licence or lease to the deserving applicant on merits to be recorded in writing:
Provided that the Director may grant a P.L. or Q.L. to an applicant whose application is received later, in preference to earlier application with the prior approval of the Government for any special reasons to be recorded in writing:
Provided further that where a prospecting licence has been granted in respect of any land the Licensee shall have preferential right for obtaining a quarry lease in respect of that land over any other person in case he has undertaken prospecting operations to establish mineral resources and submitted a prospecting report in respect of such land and submitted quarry lease application within three months after expiry of the prospecting licence period and such right can be exercised only once over the entire prospected area.
It is true that when an authority is conferred with discretion to consider, in the realm of consideration some margin always to be given and it should have to be presumed that the discretion had been exercised properly unless the facts and circumstances of a given case reflect the illegality, arbitrariness, unreasonableness or unjustness in the exercise of the power.
27. Respondent Nos. 5 and 6, the self same Director, manned by the same person at the relevant point of time in dual capacity, appears to have played active role in the decision making process. In the said backdrop, can it be said that the discretion exercised by the authorities is just, proper, reasonable or arbitrary or capricious in the facts of the given case ?
28. The Act, Act 67/57, is an Act to provide for development and regulation of mines and minerals under the control of the Union. Section 3 of the Act deals with Definitions. Section 3(c) defines "mining lease" as:
mining lease means a lease granted for the purpose of undertaking mining operations, and includes a sub-lease granted for such purpose;
3(e) defines "minor minerals" as:
minor minerals means building stones, gravel, ordinary clay, ordinary sand other than sand used for prescribed purposes, and any other mineral which the Central Government may, by notification in the Official Gazette, declare to be minor mineral Section 11 of the Act dealing with Preferential right of certain persons reads as hereunder:
(1) Where a reconnaissance permit or prospecting licence has been granted in respect of any land, the permit holder or the licensee shall have a preferential right for obtaining a prospecting licence or mining lease, as the case may be, in respect of that land over any other person.
Provided that the State Government is satisfied that the permit holder or the licensee, as the case may be, -
(a) has undertaken reconnaissance operations or prospecting operations, as the case may be, to establish mineral resources in such land;
(b) has not committed any breach of the terms and conditions of the reconnaissance permit or the prospecting licence;
(c) has not become ineligible under the provisions of this Act; and
(d) has not failed to apply for grant of prospecting licence or mining lease, as the case may be, within three months after the expiry of reconnaissance permit or prospecting licence, as the case may be, or within such further period, as may be extended by the said government.
(2) Subject to the provisions of Sub-section (1), where the State Government has not notified in the official Gazette the area for grant of reconnaissance permit or prospecting licence or mining lease, as the case may be, and two or more persons have applied for a reconnaissance permit, prospecting licence or a mining lease in respect of any land in such area, the applicant whose application was received earlier, shall have the preferential right to be considered for grant of reconnaissance permit, prospecting licence or mining lease, as the case may be, over the applicant whose application was received later:
Provided that where an area is available for grant of reconnaissance permit, prospecting licence or mining lease, as the case may be, and the State Government has invited applications by notification in the Official Gazette for grant of such permit, licence or lease, all the applications received during the period specified in such notification and the applications which had been received prior to the publication of such notification in respect of the lands within such area and had not been disposed of, shall be deemed to have been received on the same day for the purposes of assigning priority under this sub-section:
Provided further that where any such applications are received on the same day, the State Government, after taking into consideration the matter specified in Sub-section (3), may grant the reconnaissance permit, prospecting licence or mining lease, as the case may be, to such one of the applicants as it may deem fit.
(3) The matters referred to in Sub-section (2) are the following:
(a) any special knowledge of, or experience in, reconnaissance operations, prospecting operations or mining operations, as the case may be, possessed by the applicant;
(b) the financial resources of the applicant;
(c) the nature and quality of the technical staff employed or to be employed by the applicant;
(d) the investment which the applicant proposes to make in the mines and in the industry based on the minerals;
(e) such other matters as may be prescribed.
(4) Subject to the provisions of Sub-section (1), where the State Government notifies in the Official Gazette an area for grant of reconnaissance permit, prospecting licence or mining lease, as the case may be, all the applications received during the period as specified in such notification, which shall not be less than thirty days, shall be considered simultaneously as if all such applications have been received on the same day and the State Government, after taking into consideration the matters specified in Sub-section (3), may grant the reconnaissance permit, prospecting licence or mining lease as the case may be, to such one of the applicants as it may deem fit.
(5) Notwithstanding anything contained in Sub-section (2), but subject to the provisions of Sub-section (1), the State Government may, for any special reasons to be recorded, grant a reconnaissance permit prospecting licence or mining lease, as the case may be, to an applicant whose application was received later in preference to an application whose application was received earlier.
Provided that in respect of minerals specified in the First Schedule, prior approval of the State Government shall be obtained before passing any order under this Sub-section.
Emphasis was laid on Sub-section (5) of Section 11 of the Act. Section 14 of the Act dealing with Sections 5 to 13 not to apply to minor minerals reads as hereunder:
The provisions of Section 5 to 13 (inclusive) shall not apply to quarry leases, mining leases or other mineral concessions in respect of minor minerals.
It is needless to say that in the present case, Sub-section (5) of Section 11 of the Act cannot be invoked.
29. Strong reliance was placed on Samatha Hyderabad Abrasives and Minerals Private Limited v. State of Andhra Pradesh , Satyendra Kumar Tripathi v. State of U.P. , Surya Industries, Cuddappa v. Secretary, Ministry of Mines, Government of India, New Delhi , Milan Minerals Private Limited v. Union of India AIR 2002 Kar. 242, Andhra Cement Limited v. Government of A.P. . Further, strong emphasis had been laid on the decision of the Orissa High Court in Indian Charge Chrome Limited v. Union of India (referred AIR 2002 Ori. 45 (DB) supra) as well. Further strong emphasis had been laid on the first proviso of Rule 12(5)(b) of the said Rules which had been specified supra. Further strong reliance was placed on Choise Enterprises Chittoor v. Director of Mines & Geology, Government of A.P. 1997(1) A.L.D. 468, Pradeep Minerals and Granites (P) Limited v. State of A.P. 1998(3) ALT 519, Sona Exports v. Director of Mines & Geology and A.P. Minerals Development Corporation Limited v. R.L.P. Granite (P) Limited , Hampi Enterprises v. Director of Mines & Geology .
30. Section 17-A of the Act dealing with Reservation of area for purposes of conservation, reads as hereunder:
(1) The Central Government, with a view to conserving any mineral and after consultation with the State Government may reserve any area not already held under any prospecting licence of mining lease and, where it proposes to do so, it shall, by notification in the Official Gazette, specify the boundaries of such area and the mineral or minerals in respect of which such area will be reserved.
(1A) The Central Government may, in consultation with the State Government, reserve any area not already held under any prospecting licence or mining lease, for undertaking prospecting or mining operations through a Government company or corporation owned or controlled by it, and where it proposes to do so, it shall, by notification in the Official Gazette, specify the boundaries of such area and the mineral or minerals in respect of which such area will be reserved.
(2) The State Government may, with the approval of the Central Government, reserve any area not already held under any prospecting licence or mining lease, for undertaking prospecting or mining operations through a Government company or Corporation owned or controlled by and where it proposes to do so, it shall by notification in the Official Gazette, specify the boundaries of such area and the mineral or minerals in respect of which such areas will be reserved.
(3) Where in exercise of the powers conferred by Sub-section (1A) or Sub-section (2) the Central Government or the State Government, as the case may be undertakes prospecting or mining operations in any area in which the minerals vest in a private person, it shall be liable to pay prospecting fee, royalty, surface rent or dead rent, as the case may be, from time to time at the same rate at which it would have been payable under this Act if such prospecting or mining operations had been undertaken by a private person under prospecting licence or mining lease.
Strong reliance was placed on Ishwar Industries Limited v. Union of India , Government of A.P. represented by its Secretary, Industries and Commerce Department v. Pallava Granite Industries India Private Limited and Bhupath Rai Magan Lal Joshi v. Union of India .
31. The Forest (Conservation) Act 1980 is an Act to provide for conservation of forests and for matters connected therewith or incidental thereto. Section 2 of the said Act dealing with Restriction on the dereservation of forests or use of forest land for non-forest purpose, reads:
Notwithstanding anything contained in any other law for the time being in force in a State, no State Government or other authority shall made, except with the prior approval of the Central Government, any order directing-
(i) that any reserved forest (within the meaning of the expression "reserved forest", in any law for the time being in force in that State) or any portion thereof, shall cease to be reserved;
(ii) that any forest land or any portion thereof may be used for any non-forest purpose.
(iii) that any forest-land or any portion thereof may be assigned by way of lease or otherwise to any private person or to any authority, corporation, agency or any other organization not owned, managed or controlled by government;
(iv) that any forest land or any portion thereof may be cleared of trees which have grown naturally in that land or portion, for the purpose of using it for reafforestation. Explanation: For the purpose of this Section "non-forest purpose" means the breaking up or clearing of any forest-land or portion thereof for
(a) the cultivation of tea, coffee, spices, rubber, palms, oil bearing plants, horticultural crops or medicinal plants;
(b) any purpose other than reafforestation, but does not include any work relating or ancillary to conservation, development and management of forests and wild life, namely, the establishment of check posts, fire lines, wireless communications and construction of fensing, bridges and culverts, dams, waterholes, trench marks, boundary marks, pipelines or other like purposes.
Strong reliance was placed on State of Rajasthan v. B.K. Meena , Hyderabad Abrasives and Minerals v. Government of A.P. , Anupama Minerals v. Union of India , Rural Litigation and Entitlement Kendra v. State of U.P. , Ambica Quarry Works v. State of Gujarat and State of Bihar v. Banshi Ram Modi .
32. Certain submissions were made in relation to certain of the Amending Acts as well. Section 4 of the said Act deals with Power to make rules. Rules 6 and 7 of the Forest (Conservation) Rules 2003, read as hereunder:
Rule 6: Submission of proposals seeking approval of the Central Government under Section 2 of the Act:
(1) Every User Agency who want to use any forest land for non-forestry purposes, shall make its proposal in the relevant form appended to these rules i.e., Form A for proposals seeking first time approval under the Act and Form B for proposals seeking renewal of leases, where approval of the Central Government under the Act had already been obtained, to the Nodal Officer of the concerned State Government or the Union Territory Administration, as the case may be, along with requisite information and documents, complete in all respects.
(2) The User Agency shall endorse a copy of the proposal, along with a copy of the receipt obtained from the office of the Nodal Officer, to the concerned Divisional Forest Officer or the Conservator of Forest, Regional Office, as well as the Monitoring Cell of the Forest Conservation Division of the Ministry of Environment and Forests, Paryavaran Bhawan, CGO Complex, New Delhi-110003.
(3) (a) After having received the proposal, the State Government or the Union Territory Administration, as the case may be, shall process and forward it to the Central Government within a period of two hundred and ten days of the receipt of the proposal including the transit period.
(b) The Nodal Officer of the State Government or as the case may be, the Union Territory Administration, after having received the proposal under Sub-rule (1) and on being satisfied that the proposal is complete in all respects and requires prior approval under Section 2 of the Act, shall send the proposal to the concerned Divisional Forest Officer within a period of ten days of the receipt of the proposal:
Provided that on the determination regarding completeness of the proposal or the expiry of ten days, whichever is earlier, the question of completeness or otherwise of the proposal shall not be raised.
(c) If the Nodal Officer of the State Government or the Union Territory Administration, as the case may be, finds that the proposal is incomplete, he shall return it within the period of ten days as specified under Clause (b), to the User Agency and this time period shall not be counted for any future reference.
(d) The Divisional Forest Officer or the Conservator of Forests shall examine the factual details and feasibility of the proposal, certify the maps, carry out site-inspection and enumeration of the trees and forward his findings in the format specified in this regard to the Nodal Officer within a period of ninety days of the receipt of such proposal from him.
(e)(i) The Nodal officer, through the Principal Chief Conservator of Forests, shall forward the proposal to State Government or the Union Territory Administration, as the case may be, along with his recommendations, within a period of thirty days of the receipt of such proposal from the Divisional Forest officer or the Conservator of Forests.
(ii) The State Government or the Union Territory Administration, as the case may be, shall forward the complete proposal, along with its recommendations, to the Regional Office or the Ministry of Environment and Forests, Paryavaran Bhawan, CGO Complex, New Delhi-110003, as the case may be, in the specified Forms within a period of sixty days of receipt of the proposal from the Nodal Officer:
Provided that all proposals involving clearing of naturally grown trees on the forest land or a portion thereof for the purpose of using it for reforestation shall be sent in the form of Working Plan or Management Plan:
Provided further that the concerned State Government or as the case may be, the Union Territory Administration, shall simultaneously send the intimation to the User Agency about forwarding of the proposal, along with its recommendations, to the Regional Office or the Ministry of Environment and Forests, as the case may be.
(f) If the proposal, along with the recommendations, is not received from the concerned State Government or the Union Territory Administration, as the case may be, till fifteen days of the expiry of time limit as specified under Clause (a), it shall be construed that the concerned State Government or as the case may be, the Union Territory Administration, has rejected the proposal and the concerned State Government or the Union Territory Administration shall inform the User Agency accordingly:
Provided that in case the State Government or the Union Territory Administration, as the case may be, subsequently forward the proposal, along with its recommendations, to the Regional office or the Ministry of Environment and Forests, as the case may be, the proposal shall not be considered by the Central Government unless an explanation for the delay to the satisfaction of the Central Government is furnished, together with action taken against any individual held to be responsible for the delay.
(4) The proposal referred to in Clause (e)(ii) of Sub-rule (3), involving forest land up to forty hectares shall be forwarded by the concerned State Government or as the case may be, the Union Territory Administration, along with its recommendations, to the Chief Conservator of Forests or the Conservator of Forests of the concerned Regional office of the Ministry of Environment and Forests, Government of India, who shall, within a period of forty-five days of the receipt of the proposal from the concerned State Government or the Union Territory Administration, as the case may be (a) decide the diversion proposal up to five hectares other than the proposal relating to mining and encroachments, and (b) process, scrutinize and forward diversion proposal of more than five hectares and up to forty hectares including all proposals relating to mining and encroachments up to forty hectares along with the recommendations, if any, to the Ministry of Environment and Forests, Paryavaran Bhawan, CGO Complex, New Delhi-110003, for obtaining the decision of the Central Government and inform the State Government or the Union Territory Administration, as the case may be, and the User Agency concerned.
(5) The Regional Empowered Committee shall decide the proposal involving diversion of forest land up to forty hectares other than the proposal relating to mining and encroachments, within forty-five days of the receipt of such proposal from the State Government or the Union Territory Administration, as the case may be:
Provided that the Central Government may, if consider it necessary, enhance or reduce the limit of the area of the forest land.
(6) The proposal referred to in Clause (e)(ii) of Sub-rule (3), involving forest land of more than forty hectares shall be forwarded by the concerned State Government or as the case may be, the Union Territory Administration, along with its recommendations, to the Ministry of Environment and Forests, Paryavaran Bhawan, CGO Complex, new Delhi-110003.
Rule 7: Committee for advise on proposals received by the Central Government:
(1) The Central Government shall refer every proposal, complete in all respects, received by it under Sub-rule (6) of Rule 61 including the inspection report, wherever required, to the Committee for its advice thereon.
[1-A] These proposals shall be processed and put up before the Committee and the recommendations of the Committee shall be placed within a period of ninety days of the receipt of such proposals from the State Government or the Union Territory Administration, as the case may be, before the Central Government for its decision.
(2) The Committee shall have due regard to all or any of the following matters while tendering its advice on the proposals referred to it under Sub-rule (1), namely:
(a) Whether the forests land proposed to be used for non-forest purpose forms part of a nature reserve, national park, wildlife sanctuary, biosphere reserve or forms part of the habitat or any endangered or threatened species of flora and fauna or of an area lying in severely eroded catchment;
(b) Whether the use of any forest land is for agricultural purposes or for the rehabilitation of persons displaced from their residences by reason of any river valley or hydro-electric project;
(c) Whether the State Government or the Union Territory Administration, as the case may be has certified that it has considered all other alternatives and that no other alternatives in the circumstances are feasible and that the required area is the minimum needed for the purpose; and
(d) Whether the State Government or the Union Territory Administration, as the case may be undertakes to provide at its cost for the acquisition of land of an equivalent area and aforestation thereof.
(3) While tendering the advice, the Committee may also suggest any conditions or restrictions on the use of any forest land for any non-forest purpose, which in its opinion, would minimize adverse environmental impact.
Further, strong reliance was placed on Ananda Behera and Anr. v. State of Orissa and Anr. . In Indian Metals & ferro Alloys Limited v. Union of India the Apex Court observed at paras 16, 17, 26 and 36 as hereunder:
Is Section 11(2) Conclusive -
Now, to turn to the contentions urged before us: Dr.Singhvi, who appeared for ORIND, vehemently contended that the rejection of the application of ORIND for a mining lease was contrary to the statutory mandate in Section 11(2); that, subject only to the provision contained in Section 11(1) which had no application here, the earliest applicant was entitled to have a preferential right for the grant of a lease; and that a consideration of the comparative merits of other applicants can arise only in a case where applications have been received on the same day. It is no doubt true that Section 11(2) of the Act read in isolation gives such an impression which, in reality, is a misleading one. We think that the sooner such an impression is corrected by a statutory amendment the better it would be for all concerned. On a reading of Section 11 as a whole, one will realize that the provisions of Sub-section (4) completely override those of Sub-section (2). This sub-section preserves to the S.G. a right to grant a lease to an applicant out the turn subject to two conditions:
(a) recording of special reasons and (b) previous approval of the C.G. It is manifest, therefore, that the S.G. is not bound to dispose of applications only on a "first come, first served" basis. It will be easily appreciated that this should indeed be so for the interests of national mineral development clearly require in the case of major minerals, that the mining lease should be given to that applicant who can exploit it most efficiently. A grant of ML, in order of time, will not achieve this result.
In the context of his submission pleading for priority on the basis of the time sequence, Dr.Singhvi referred to certain observations in the decisions reported as Ferro Alloys Corporation of India v. Union of India ILR (1977) 1 Delhi 189 at p.196 and as Mysore Cements Limited v. Union of India AIR 1972 Mys.149 at p. 151. We do not think these decisions help him. In the former case, an application by FACOR for a lease was rejected on the ground that an earlier application was being accepted. FACOR contended this was wrong, that the S.G. could not have refused to look into its application merely because another applicant had a preferential right under Section 11(2) and that its application as well as that of the earlier applicant should have been considered together. It is in the situation that the Court observed that Rule 11 primarily embodies the general principle of "first come, first served" and an out-of-turn consideration under Section 11(4) was an exception for which a strong case had to be made out. The petitioner could not have a grievance if the general principle was followed. So also, in the latter case, an earlier application having been accepted and a lease granted, the consideration of a later application was held to be uncalled for. These decisions cannot be treated as authorities for the proposition that the S.G. is bound to grant an earlier application as soon as it is received and cannot wait for other applications and consider them all together and grant a later one if the circumstances set out in Rule 1194) are fulfilled. That apart, it has to be remembered that the S.G. did reject ORIND's application by an order dated 23-10-1973. This order was set aside in the C.G. on 20-2-1977 and the S.G. directed to consider it afresh. The S.G. did not comply with this order and so a Writ Petition was filed by ORIND which was pending when this Writ Petition was filed. Subsequently, the High Court on 9-2-89, directed the S.G. to consider and dispose of ORIND's application on merits. The S.G. on 7-4-89 dismissed ORIND's application on the ground that the issue is before us and hence the S.L.P. against the order of rejection of the S.G. Even assuming that we accept the S.L.P. filed by ORIND, that will only entitle ORIND to have its application reconsidered for grant along with such other applications as may be pending as on the date of such reconsideration. In the context of the scheme of the Act and the importance of a lease being granted to one or more of the better qualified candidates where there a number of them, it would not be correct to say that, as the S.G.'s order of 29-10-1973 has been set aside, ORIND's application should be restored for reconsideration on the basis of the situation that prevailed as on 29-10-1973 and that, therefore, it has to be straightaway granted as there was no other application pending on that date before the S.G. In matters like this, subsequent applications cannot be ignored and a rule of thumb applied. We are unable to accept the submission of Dr.Singhvi that the application of ORIND, being the earliest in point of time, should have been accepted and that we should direct accordingly. As to how far the requirements of Section 11(4) are fulfilled in the present case, that is an aspect which will be considered later.
...
Our conclusion that the areas in question before us were all duly reserved for public sector exploitation does not, however, mean that private parties cannot be granted any lease at all in respect of these areas for, as pointed out earlier, it is open to the C.G. to relax the reservation for recorded reasons. Nor does this mean, as contended for by OMC and IDCOL, that they should get the leases asked for by them. This is so for two reasons. In the first place, the reservation is of a general nature and does not directly confer any rights on OMC or IDCOL. This reservation is of two types. Under Section 17A(1), inserted in 1986, the C.G. may after consulting the S.G. just reserve any area - not covered by a PL or a ML - with a view to conserving any mineral. Apparently, the idea of such reservation is that the minerals in this area will not be exploited at all, neither by private parties nor in the public sector. It is not necessary to consider whether any area so reserved can be exploited in the public sector as we are not here concerned with the scope of such reservation, there having been no notification under Section 17A(1) after 1986 and after consultation with the S.G. The second type of reservation was provided for in Rule 58 of the Rules which have already been extracted earlier in this judgment. This reservation could have been made by the S.G. (without any necessity for approval by the C.G.) and was intended to reserve areas for exploitation, broadly speaking, in the public sector. The notification itself might specify the Government, Corporation or Company that was to exploit the areas or may be just general, on the lines of the rule itself. Under Rule 59(1), once a notification under Rule 58 is made, the area so reserved shall not be available for grant unless the two requirements of Sub-rule (e) are satisfied: viz., an entry in a register and a Gazette notification that the area is available for grant. It is not quite clear whether the notification of 5-3-74 complied with these requirements but it is perhaps unnecessary to go into this question because the reservation of the areas was again notified in 1977. These notifications are general. They only say that the areas are reserved for exploitation in the public sector. Whether such areas are to be leased out to OMC or IDCOL or some other public sector Corporation or a Government Company or are to be exploited by the Government itself is for the Government to determine de hors the statute and the rules. There is nothing in either of the them which gives a right to OMC or IDCOL to insist that the leases should be given only to them and to no one else in the public sector. If, therefore, the claim of reservation in 1977 in favour of the public sector is upheld absolutely, and if we do not agree with the findings of Rao that neither OMC nor IDCOL deserve any grant, all that we can do is to leave it to the S.G. to consider whether any portion of the land thus reserved should be given by it to these two corporations. Here, of course, there are no competitive applications from organizations in the public sector controlled either by the S.G. or the C.G., but even if there were, it would be open to the S.G. to decide how far the lands or any portion of them should be exploited by each of such Corporations or by the C.G. or S.G. Both the Corporations are admittedly instrumentalities of the S.G. and the decision of the S.G. is binding on them. We are of the view that, if the S.G. decides not to grant a lease in respect of the reserved area to an instrumentality of the S.G., that instrumentality has no right to insist that a M.L. should be granted to it. It is open to the S.G. to exercise at any time, a choice of the State or any one of the instrumentalities specified in the rule. It is true that if, eventually, the S.G. decides to grant a lease to one or other of them in respect of such land, the instrumentality whose application is rejected may be aggrieved by the choice of another for the lease. In particular, where there is competition between an instrumentality of the C.G. and one of the S.G. or between instrumentalities of the C.G. inter se or between the instrumentalities of the S.G. inter se, a question may well arise how far an unsuccessful instrumentality can challenge the choice made by the S.G. But we need not enter into these controversies here. The question we are concerned with here is whether OMC or IDCOL can object to the grant to any of the private parties on the ground that a reservation has been made in favour of the public sector. We think the answer just be in the negative in view of the statutory provisions. For the S.G. could always denotify the reservation and make the area available for grant to private parties. Or, short of actually deserving a notified area, persuade the C.G. to relax the restrictions of R.59(1) in any particular case. It is, therefore, open to the S.G. to grant private leases even in respect of areas covered by a notification of the S.G. and this cannot be challenged by any instrumentality in the public sector.
...
We have briefly summarized the claims of ORIND & COL. It is unnecessary to discuss these contentions at length as we cannot but help feeling that the claims of OCL and ORIND have been rejected summarily by Rao without an advertence to the various considerations urged by them. In our opinion, this part of Rao's decision has to be set aside as being too cryptic and unsustainable. Pursuant to this conclusion, it is open to us to direct these claims to be considered afresh by the C.G. We, however, think it more expedient that the claims of the OCL and ORIND should be restored, for detailed consideration in all their several aspects, before the S.G., as the S.G. has had no opportunity to consider the various aspects pointed out and as this course will also provide one opportunity to the claimants to approach the C.G. again, if dissatisfied with the S.G's decision to consider whether, despite the reservation, some relaxation can be made also in favour of these two companies. The learned Advocate General for Orissa criticized the conclusion of Rao conceding the right of industries set up in the State, even of FACOR and IMFA, to captive mines for meeting their requirements. We are inclined to think he is right in saying that merely because an industry is allowed to be set up in the State by grant of an industrial licence and/or certain other concessions, it does not follow that it becomes entitled to a captive mine to cater to its needs. We, however, express no concluded opinion on this issue which does not arise for our consideration. The S.G. has to take into account various factors and aspects (some of which have also been referred to in the interim order of this Court dated 27-9-84) before granting a M.L. to an individual concern carving out an exception to its reservation policy. This it has done in respect of IMFA and FACOR for certain special reasons which have been elaborated upon earlier. Whether it would do so also in favour of OCL and ORIND is for the State to consider. We express no opinion on these claims and leave it for the consideration of the S.G. and C.G. It would have been noticed that the applications of these two companies have not been considered in this light earlier. We, therefore, restore the applications of OCL and ORIND for the consideration of the S.G.
33. In A. Kotaiah v. State of A.P. it was held at paras 6 to 10 as hereunder:
In support of the first contention, it is argued that Article 73 of the Constitution defines and delimits the executive powers of the Union, and that power is limited to the execution of laws enacted by parliament, and in the present case as there is no law empowering the State to reserve lands for the public sector, the resolution passed by the Government of India and the notification issued by the Governor of Andhra Pradesh pursuant thereto, are unconstitutional.
In my opinion this argument proceeds on a misconception of the content of the executive power of the Union and ignores the provisions of Article 298 of the Constitution. Article 73 indicates the extent of the executive power of the Union while Article 162 deals with the executive power of a State; and Article 298 further extends the scope of the executive power of the Union and of each State and is in the following terms:
The executive power of the Union and of each State shall extend to the carrying on of any trade or business and to the acquisition, holding and disposing of property and the making of contracts for any purpose". Article 297 lays down that all lands, minerals and other things of value underlying the ocean within the territorial waters of India, shall vest in the Union and be held for the purposes of the Union.
The impugned notification in the present case was issued in pursuance of the Industrial Policy Resolution of the Government of India and with their prior approval, and therefore there is no Constitutional inhibition in regard to the action taken by the State Government.
In Ram Jawaya Kapur v. State of Punjab where by a series of executive orders, the Punjab Government had implemented their policy of nationalization of text-books, the Supreme Court had to consider the scope and extent of the executive power of the Union and of the States, and their Lordships repelled the contention that the State Government had no power to engage in an trade or business activity without the sanction of the Legislature. Dealing with that contention, Mukherjee, C.J., observed as follows:
Neither of these Articles (Article 73 and Article 162) contain any definition as to what the executive function is and what activities would legitimately come within its scope. They are concerned primarily with the distribution of the executive power between the Union on the one hand and the States on the other. They do not mean, as Mr.Pathak seems to suggest, that it is only when the Parliament or the State Legislature has legislated on certain items appertaining to their respective lists, that the Union or the State Executive, as the case may be, can proceed to function in respect to them. On the other hand, the language of Article 162 clearly indicates that the powers of the State Executive do extend to matters upon which the State Legislature is competent to legislate and are not confined to matters over which legislation has been passed already. The same principle underlies under Article 73 of the Constitution of India.
The learned Judge went on to observe:
It may not be possible to frame an exhaustive definition of what executive function means and implies. Ordinarily the executive power connotes the residue of governmental functions that remain after legislative and judicial functions are taken away....
...
The executive power, however, can never go against the provisions of the Constitution or of any law. This is clear from the provisions of Article 154 of the Constitution but, as we have already stated, it does not follow from this that in order to enable the executive to function, there must be a law already in existence and that the powers of the executive are limited merely to the carrying out of these laws.
In another portion of the judgment, the learned Judge observed:
The executive function compromises both the determination of the policy as well as carrying it into execution. This evidently includes the initiation of legislation, the maintenance of order, the promotion of social and economic welfare, the direction of the foreign policy, in fact the carrying on or supervision of the general administration of the State". To this list may be added the power to carry on trade or business as prescribed by the Article 298, which was amended in its present form by the Constitution (Seventh Amendment) Act, 1956.
There is thus no force in the contention of the learned advocate for the petitioner that the resolution passed by the Government of India, which was given effect to by the State Government, is bad for want of legislative sanction.
The second contention advanced by the learned advocate for the petitioner that the Mineral Concession Rules, 1949, do not authorize the State to undertake the exploitation of mineral resources is also devoid of substance. Section 5 of the Mines and Minerals (Regulation and Development) Act empowers the Central Government to make rules for regulating the grant of mining leases or for prohibiting the grant of such leases in respect of any mineral or in any area. Rule 13 of the Mineral Concession Rules prohibits the grant of a prospecting licence in respect of any mineral as the Central Government may, by order communicated to the State Government concerned, specify either throughout, or in such part of the State, as may be specified in the order.
Rule 17 gives the State Government an absolute discretion in the matter of granting or refusing prospecting licences. It follows that the petitioner has no right, fundamental or other, to a prospecting licence; he cannot therefore, question the right of the Central and State Governments to deal with mineral resources in the State in the manner they deem fit in the public interest; and Article 298 of the Constitution clothes the Union and State Governments with the power to carry on any trade or business.
34. In Dharambir Singh v. Union of India and Ors. , the Apex Court observed at paras 3 and 4:
Sub-section (1) of Section 11 envisages grant of a prospecting licence in respect of a land and a prospecting licensee has a preferential right for obtaining a mining lease in respect of the land over any other person; provided, however, that the conditions enumerated in Clauses (a) to (c) in proviso thereto are satisfied. Further, Sub-section (2) states that subject to the provisions of Sub-section (1), where two or more persons have applied for a prospecting licence or a mining lease in respect of the same land, the applicant whose application was received earlier, shall have a preferential right for the grant of the licence or lease, as the case may be, over an applicant whose application was received later. It is also, again, subject to the conditions enumerated in the proviso. Sub-section (3) is not material for the purposes of this case. Sub-section (4) further provides that notwithstanding anything contained in Sub-section (2), but subject to the provisions of Sub-section (1), the State Government, may for any special reasons to be recorded and with the previous approval of the Central Government grant a prospecting licence or a mining lease to an applicant whose application was received later in preference to an applicant whose application was received earlier.
Thus it would be seen that while granting a prospecting licence or mining lease, the area of discretion has been circumscribed by several factors enumerated in Section 11. In grant of mining lease of a property of the State, the State Government has a discretion to grant or refuse to grant any prospective licence or licence to any applicant. No applicant has a right, much less vested right, to the grant of mining lease for mining operations in any place within the State. But the State Government is required to exercise its discretion, subject to the requirements of the law. Therefore, the Tribunal of the Central Government has rightly held that it being in the area of discretion of the State Government, merely because the applicant had applied for, the State Government was not enjoined to grant the mining lease. The petitioner had taken the plea that since he alone had discovered the mines, he has got a preferential right over any other person. The Tribunal of the Central Government and the High Court rightly rejected that contention of the petitioner; that contention has not been pressed before us. We find no illegality in the order of the Tribunal refusing to grant mining lease to the petitioner nor is there any illegality in the order of the High Court.
35. In Government of A.P. and Ors. v. Pallava Granite Industries (India) Private Limited and Ors. it was observed at paras 37 and 40 as hereunder:
In State of Tamilnadu v. Hind Stone , the Supreme Court observed that "the public interest which induced Parliament to make the declaration contained in Section 2 of the Mines and Minerals (Regulation and Development) Act, 1957, "has naturally to be the paramount consideration in all matters concerning the regulation of mines and the development of minerals. Parliament's policy is clearly discernible from the provisions of the Act. It is the conservation and the prudent and discriminating exploitation of minerals, with a view to secure maximum benefit to the community. There are clear sign posts to lead and guide the subordinate legislating authority in the matter of the making of rules.
...
The impugned decision of the Central Government is self-explanatory. It had referred to the letters addressed by the State Government from time to time in which it is inter alia stated that the APMDC is a profit making body and is equipped with necessary expertise and machinery to undertake mining of granite in a systematic and scientific manner, to the best advantage of the State Government. I had also understood that the mineral granite in the said land is Black in colour and suitable for polishing. The mineral is rare and unique deposit in the world because of its colour mixed with yellow crystals, it is known as "Galaxy Granite" and it has good demand in the foreign market. The proposals to set a granite park for creating a Granite Park, a much profitable one had also been taken into consideration. The impugned memo itself reveals that the Central Government had considered the proposals made by the State Government and was in agreement with the recommendations of the State Government. That all relevant factors have been taken into consideration.
On the aspect of distribution of State largesse in the realm of awarding of Government contracts, the Apex Court in Master Marine Services (P) Limited. v. Metcalfe & Hodgkinson (P) Limited observed at paras 11, 12 and 15 as hereunder:
The principles which have to be applied in judicial review of administrative decisions, especially those relating to acceptance of tender and award of contract, have been considered in great detail by a three-Judge Bench in Tata Cellular v. Union of India . It was observed that the principles of judicial review would apply to the exercise of contractual powers by government bodies in order to prevent arbitrariness or favouritism. However, it must be clearly stated that there are inherent limitations in exercise of that power of judicial review. Government is the guardian of the finances of the State. It is expected to protect the financial interest of the State. The right to refuse the lowest or any other tender is always available to the Government. But, the principles laid down in Article 14 of the Constitution have to be kept in view while accepting or refusing a tender. There can be no question of infringement of Article 14 if the Government tries to get the best person or the best quotation. The right to choose cannot be considered to be an arbitrary power. Of course, if the said power is exercised for any collateral purpose the exercise of that power will be struck down.
After an exhaustive consideration of a large number of decisions and standard books on administrative law, the Court enunciated the principle that the modern trend points to judicial restraint in administrative action. The Court does not sit as a 'Court of appeal' but merely reviews the manner in which the decision was made. The Court does not have the expertise to correct the administrative decision. If a review of the administrative decision is permitted it will be substituting its own decision, without the necessary expertise, which itself may be fallible. The Government must have freedom of contract. In other words, fair play in the joints is a necessary concomitant for an administrative body functioning in an administrative sphere or quasi- administrative sphere. However, the decision must not only be tested by the application of Wednesbury principles of reasonableness but also must be free from arbitrariness not affected by bias or actuated by mala fides. It was also pointed out that quashing decisions may impose heavy administrative burden on the administration and lead to increased and unbudgeted expenditure.
...
The law relating to award of contract by the State and public sector corporations was reviewed in Air India Limited. v. Cochin International Airport Limited and it was held that the award of a contract, whether by a private party or by a State, is essentially a commercial transaction. It can choose its own method to arrive at a decision and it is free to grant any relaxation for bona fide reasons, if the tender conditions permit such a relaxation. It was further held that the State, its corporations, instrumentalities and agencies have the public duty to be fair to all concerned. Even when some defect is found in the decision making process, the court must exercise its discretionary powers under Article 226 with great caution and should exercise it only in furtherance of public interest and not merely on the making out of a legal point. The Court should always keep the larger public interest in mind in order to decide whether its intervention is called for or not. Only when it comes to a conclusion that overwhelming public interest requires interference, the court should interfere.
36. Elaborate submissions were made in relation to non-coordination of the Departments in the public administration and also the scope and ambit and the operation of both the Acts referred to supra had been explained in the light of the relevant statutory provisions and the Rules governing the field. Contentions at length had been advanced that the mere fact that at a particular point of time some approval had been granted by the Forest Department by itself will not confer any right whatsoever on the writ petitioner to claim that the application of the writ petitioner to be considered on priority basis since the grant of mining lease is totally a different affair unconcerned with the approval or otherwise under the provisions of the Forest (Conservation) Act.
37. Here is a case where a contention is put forward that reasonable discretion had been exercised by virtue of the power under Rule 12(5)(b) first proviso of the Rules specified above. Further, yet another contention had been advanced that it is only an intermediate order and when final order is made, may be the writ petitioner can question the same at appropriate stage. On a careful reading of both the G.Os., this Court is satisfied that in the decision making process, whatever the nomenclature that may be adopted, virtually a decision had been taken to disregard the concept of priority despite the fact that after an application had been made by the writ petitioner much water had flown especially in the light of the approvals granted which had been specified above. Though certain submissions had been made that possession also had not been handed over, some material had been placed before the Court to show that possession in fact had been handed over by the Forest Department. In substance the writ petitioner in a way had acted upon it and had done something further in furtherance thereof. This is the area wherein both the doctrine of promissory estoppel and the doctrine of legitimate expectation would come into operation. Here is an applicant, the writ petitioner, who approached the competent authority by making an application with the fond hope that on priority basis, his application would be considered. It may be one thing that if such discretion had been exercised at a particular point of time when no further proceedings as such had taken place. The correspondence would go to show that having granted approval, at the instance of one Department, again the other Department had gone back by issuing subsequent G.O. which also is being called in question, no doubt by filing an application praying for amendment of the prayer which had been allowed by this Court.
38. Non-coordination of the Departments in Public Administration should not cause prejudice or result in undue hardship to an ordinary citizen. It is true that always it cannot by itself be a ground to quash the proceedings. The same may have to be judged in the backdrop of the series of events and conduct of the parties as well. Having delivered possession, no doubt the same is put into controversy but some acceptable material had been placed before this Court to establish the same, the writ petitioner proceeded further and the subsequent events go to show that there had been change of opinion by the concerned Director who appears to have acted in dual capacity. It is no doubt true that the said party is not impleaded as eo nominee party. When the conduct of the parties clearly had reflected the invocation of promissory estoppel and legitimate expectation, while exercising discretion, the authorities are bound to be careful and cautious, in default, the resultant action may be arbitrary.
39. The respective stands taken by the parties already had been dealt with in elaboration supra and the details need not be repeated again. When in the decision making process, even if it is to be taken as just an intermediate order, when on a careful reading of the G.O. it reflects that the principal issue had been pleaded, it cannot be said that the compliance of principles of natural justice would be an useless formality and hence the same need not be complied with. No doubt, strong reliance was placed on the concept of useless formality whether in the realm of principles of natural justice on the decision in Aligarh Muslim University and Ors. v. Mansoor Ali Khan No doubt certain submissions were made that it is just in the realm of administrative law and hence the question of violation of principles of natural justice would not arise. This is a case where exercise of discretion by virtue of the first proviso to Rule 12(5)(b) of the Rules had been putforth as a ground by way of defence. It is needless to say that the proviso is an exception to the general rule. The subsequent withdrawal of the approval is impliedly suggestive of the fact of pre-judging the consideration of the application on priority basis and dispensing with thereof under the guise of the proviso specified above. If discretion had been exercised at the earliest point of time when the petitioner is not put to any serious prejudice and when the action impugned does not culminate in any serious civil consequences and may be even if the writ petitioner is put on notice nothing further can be explained, dispensing with giving of opportunity or dispensing with the principles of natural justice may be taken as defence. In the light of the series of events, since the alleged discretion had been exercised only as an exception to the general rule and though it is contended that no final decision as such had been taken, since the pre-judging of the principal issue in a way already had been completed, both the impugned proceedings of the respondents 1 and 2 in the Writ Petition, do suffer from the vice of non-compliance of principles of natural justice. This Court is not inclined to express any further opinion relating to the other merits and demerits of the matter for the reason that this Court is inclined to set aside the said proceedings giving liberty to the respective competent authorities to put the writ petitioner on notice calling upon him to raise all the appropriate objections and take appropriate decision in relation to both the aspects. This Court is left with no other option except to take such opinion especially in the light of the series of events, the way in which the whole decision making process as such is vitiated on a careful analysis of the correspondence placed before this Court and the several proceedings which had been referred to above.
40. Accordingly, the proceedings of the 1st respondent herein in Memo No. 1220/M.II(1)/07 dated 16-3-2007 and the proceedings of the 2nd respondent in G.O.Ms. No. 135, EFS & T Department, dated 4-12-2007 are hereby quashed and the matter is remitted to the concerned competent authorities to put the writ petitioner on notice, call for objections, if any on the side of the writ petitioner and pass appropriate orders in this regard in accordance with Law. The Writ Petition is allowed to the extent indicated above. No order as to costs.