Madhya Pradesh High Court
Rccpl Private Limited vs The State Of Madhya Pradesh on 9 April, 2026
Author: Vivek Rusia
Bench: Vivek Rusia
NEUTRAL CITATION NO. 2026:MPHC-JBP:28287
1 WP-10517-2026
IN THE HIGH COURT OF MADHYA PRADESH
AT JABALPUR
BEFORE
HON'BLE SHRI JUSTICE VIVEK RUSIA
&
HON'BLE SHRI JUSTICE PRADEEP MITTAL
ON THE 09th OF APRIL, 2026
WRIT PETITION No. 10517 of 2026
RCCPL PRIVATE LIMITED
Versus
THE STATE OF MADHYA PRADESH AND OTHERS
Appearance:
Shri Kishore Shrivastava, learned Senior Advocate with Shri Kunal
Thakre & Ms.Aditi Shrivastava, Advocates for the petitioner.
Shri Abhijeet Awasthi, learned Deputy Advocate General for the
respondent/State.
Reserved on : 25.3.2026
Pronounced on :09.4.2026
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ORDER
Per: Justice Vivek Rusia The petitioner in this writ petition has sought quashing of communication dated 17.3.2026 (Annexure-P/34) and prayed for direction to arrest continuation of any proceeding against the petitioner for recovery of royalty on minerals that have been removed or consumed in terms of section 9 of MMDR Act, 1957.
Facts of the case, in short, are as under :-
2. The petitioner was granted the prospecting licence on 03.3.2008 Signature Not Verified Signed by: RAJESH MAMTANI Signing time: 10-04-2026 12:03:13 NEUTRAL CITATION NO. 2026:MPHC-JBP:28287 2 WP-10517-2026 for limestone over an area of 1306.945 hectares situated in village Itoura, Chakbandi and other adjoining area of Tahsil Raghurajnagar, District Satna.
Thereafter, the petitioner applied for grant of mining lease over an area measuring 795.942 hectares in the aforesaid region. The respondent No.1 granted an approval for mining lease in favour of petitioner for a period of 50 years on 03.1.2018 under section 6(1)(c) of the MMDR Act subject to submission of mining plan. The petitioner applied for environmental clearance before the Ministry of Environment, Forest & Climate Change (MOEF) on 06.12.2018. The petitioner was granted the mining lease by the State of Madhya Pradesh on 25.9.2020 subject to the condition that the petitioner shall obtain all consents, approvals, permissions, licences under the applicable laws prior to commencement of mining operations under the Mineral Concession Rules, 2016. In pursuant to the aforesaid grant of mining lease the petitioner submitted a performance security for Rs.9,62,55,597/- by way of the Bank Guarantee. The Mining Lease deed was executed on 12.11.2020 and the same was registered on 27.11.2020. The petitioner submitted an application under Rule 20(3) of the Minerals (Other than Atomic & Hydro Carbons Energy Minerals) Concession Rules, 2016 seeking extension of time for commencement of production on the ground of obtaining environmental clearance. Finally, the environmental clearance was granted on 30.6.2023. Thereafter, the petitioner started the mining operations. In view of sub-clause (i) of Clause 1.0 of Chapter-I of Mining Plan & Progressive Mine Closure Plan of Itoura Limestone Deposit was approved by letter dated 27.11.2019, it was anticipated that one to two years Signature Not Verified Signed by: RAJESH MAMTANI Signing time: 10-04-2026 12:03:13 NEUTRAL CITATION NO. 2026:MPHC-JBP:28287 3 WP-10517-2026 will be taken for obtaining environmental clearance, CTO and permissions to enter upon the land. Therefore, the petitioner was aware well in advance that one or two years relaxation period will be granted to it to obtain the clearance etc. before starting the mining activities.
3. The petitioner was served with a demand notice dated 04.10.2024 by the Collector, District Satna stating that as per MDPA agreement and Mining Schemes the petitioner has not deposited total royalty amounting to Rs.3,65,31,040/-, therefore, why the performance security amount be not forfeited. It was alleged that petitioner has failed to achieve the production of 30% of the Mining Scheme in the financial year 2022-23. The petitioner has neither achieved the 40% production for the financial year 2023-24 nor deposited the royalty amount. On the ground of breach of MPDA the petitioner was called upon to deposit the alleged royalty amount of Rs.1,09,31,040/- for financial year 2022-23 and Rs.2,56,00,000/- for financial year 2023-24 within seven days, due to failure to achieve minimum production requirement prescribed under the mining Plan. As per notice there was no demand for years 2020-21 and 2021-22. When the petitioner deposited aforesaid amount, another notice dated 24.2.2026 was issued to show-cause as to why performance security be not confiscated in favour of Government of Madhya Pradesh under clauses 4.3.3 and 8.3 of the MPDA for not discharging the liability of paying Rs.5,30,41,305/-. The petitioner submitted a reply challenging the jurisdiction of the respondent No.2.
4. The contention of Shri Shrivastava, learned senior counsel is not Signature Not Verified Signed by: RAJESH MAMTANI Signing time: 10-04-2026 12:03:13 NEUTRAL CITATION NO. 2026:MPHC-JBP:28287 4 WP-10517-2026 liable to be accepted that the petitioner could not perform the mining operations for want of environmental clearance and mining activities could not be commenced. For obtaining such clearance and completing other formalities, the petitioner was already granted two years relaxation in achieving the minimum target. As per Schedule-D which pertains to Minimum Production Requirement the petitioner was required to make minimum production in following manner:-
Year Minimum Value of
Production Performance
(Since Requirement (% Security to 1st Equivalent
Commencement of yearly be year to 0.50%
of Mining production as per 0% of
Lease) mining Plan) appropriated
the value of
estimated
2nd year 0% resources. =
Total IBM
notified
3rd 30% Security =
Year Total
4th Year 40% Resources*
Average
5th year 50% Performance
Security
6th Year 50% sell price *
onwards 0.50%
5. From perusal of aforesaid schedule it is reflected that in first year and second year there is 0% yearly of the production as per mining plan to achieve the minimum production requirement. Thereafter, for the 3rd year it was 30% and in 4th year 40%, for 5th year 50% and from 6th year onwards 50% production. The petitioner with an open eye had signed the agreement to achieve this minimum production. Now, the petitioner cannot be permitted Signature Not Verified Signed by: RAJESH MAMTANI Signing time: 10-04-2026 12:03:13 NEUTRAL CITATION NO. 2026:MPHC-JBP:28287 5 WP-10517-2026 to take the plea that it is a violation of contract and provision of section 52 of the Contract Act and further that the mining could not be started due to want of environmental clearance.
6. In this regard Clause 2 of Chapter-II of Mining Plan & Progressive Mine Closure Plan of Itoura Limestone Deposit is worth referable which also provides that in 1st year no working will be done during the year and statutory approvals will be taken alongwith the land acquisition. Therefore, one year was granted to the petitioner, which was sufficient to obtain all the clearance as per Rule 30(10) of Mineral Concession Rules.
7. Similar issue arose before this Court in the cases of grant of charge of dead rent due to non starting mining activities. In the said bunch of cases, same plea was taken that due to delay in grant of environmental clearance and permission to enter into the mining areas, the production could not be started. The aforesaid plea was negatived by this Court in the case of M.P.Bricks Company Vs. State of M.P. & others, [W.P.No.3601/2021 decided on 28/1/2026] and other similar matters.
8. Therefore, in our view the respondents are right in issuing the demand notice to the petitioner, failing which the Bank Guarantee/Performance Guarantee is liable to be encashed.
9. In the result, the writ petition stands dismissed.
Signature Not Verified Signed by: RAJESH MAMTANI Signing time: 10-04-2026 12:03:13 NEUTRAL CITATION NO. 2026:MPHC-JBP:28287 6 WP-10517-2026 (VIVEK RUSIA) (PRADEEP MITTAL) JUDGE JUDGE RM Signature Not Verified Signed by: RAJESH MAMTANI Signing time: 10-04-2026 12:03:13