Orissa High Court
Afr M/S. Sgs Mines And Industries vs State Of Odisha & Ors. ..... Opp. Parties on 21 September, 2022
Author: B.R.Sarangi
Bench: B.R.Sarangi
ORISSA HIGH COURT: CUTTACK
W.P(C) NO. 4504 OF 2017
In the matter of an application under Articles 226 and
227 of the Constitution of India.
---------------
AFR M/s. SGS Mines and Industries
Pvt. Ltd, Jharkhand & Anr. ..... Petitioners
-Versus-
State of Odisha & Ors. ..... Opp. Parties
For Petitioners : M/s. S. Nanda, A. Mahanta and
K. Ray, Advocates
For Opp. Parties : Mr. P.P. Mohanty,
Addl. Govt. Advocate
[O.Ps.No.1-2]
Mr. P.K. Parhi, ASGI
[O.P. No. 3]
P R E S E N T:
THE HONOURABLE DR. JUSTICE B.R.SARANGI AND THE HONOURABLE MR JUSTICE G. SATAPATHY Date of hearing: 08.09.2022 :: Date of Judgment : 21.09.2022 DR. B.R. SARANGI,J. This is a writ petition, by means of which, a direction has been sought to the opposite parties to grant prospecting license to the petitioner-company for // 2 // decorative stone (granite) over an area 19.90 Hectare in village-Gunthapada in the district of Ganjam, by declaring Rule-4(12) of the Odisha Minor Mineral Concession Rules, 2016 (OMMC Rules, 2016) as ultra vires to the provisions of Mines & Minerals (Development & Regulation) Act, 1957 (MMDR Act, 1957) and Article 19(1)(g) of the Constitution of India, so far as it relates to grant of prospecting license for Granite field under the provisions of Odisha Minor Mineral Concession Rules, 2004 read with Granite Conservation and Development Rules, 1999 (GCD Rules, 1999), and by further declaring Rule 4(4) of the OMMC Rules, 2016 as inconsistent with and repugnant to Rule-4 of the GCD Rules, 1999, so far as it prescribes reconnaissance permit prior to grant of prospecting license and Rule-4(12) renders applications for prospecting license prior to commencement of the Rules as ineligible, being ultra vires to Articles-14, 19(1)(g) and 21 of the Constitution of India.
2. To succinctly put, the factual matrix of the case, is that petitioner no.1 is a company incorporated under the Companies Act, 1956 and is engaged in the // 3 // business of production of granite. Petitioner no.2 is Director of the petitioner-company and representing it in this writ petition. The petitioner-company filed an application for grant of prospecting license for granite over an area 19.90 Hectare in village-Gunthapada of district-Ganjam in prescribed Form 'A' under Rule-9 of the OMMC Rules, 2004 before the Director of Mines- Opposite Party No.2, along with application fees of Rs.1000/-, as stipulated in the OMMC Rules, 2004, which was also duly received by the department and receipt of acknowledgement was issued in prescribed Form 'C'. On receipt of the said application, the Mining Officer, Ganjam Circle, Berhampur, on 20.04.2016, requested to the Tahasildar, Aska and Divisional Forest Officer, Ghumusara, Bhanjanagar to submit their report with regard to nature of land involved. Whereafter, the Tahasildar, Aska and DFO, Ghumusara in turn directed their subordinates, namely, Revenue Inspector and Range Officer respectively to furnish the details of the land. On 12.08.2016, the Range Officer furnished a report to its superior and in turn the same was // 4 // forwarded to the Mining Officer for further action. On 22.08.2016, the Revenue Inspector and Range Officer furnished the details of the land. The DFO, Ghumusara, South Division, vide letter dated 28.09.2016, submitted his report in respect of the subject land. Although the Revenue and Forest authorities furnished their respective reports, from revenue point of view and forest point of view, the law requires that if upon directions to submit report the same are not received within a period of two months, it shall be deemed that the concerned authorities do not have any objection. Therefore, despite lapse of two months, even though the concerned authorities did not furnish their reports, but still the petitioner-company's application was not forwarded for further action, it is deemed that the said authorities did not have any objection.
2.1 It appears that the entire exercise has been taken up by the Department in active consideration of the application of the petitioner-company under the provisions of OMMC Rules, 2004 and had the application been processed strictly in accordance with // 5 // the time frame prescribed under the OMMC Rules, 2004, the petitioner could have been granted the lease much prior to commencement of the OMMC Rules, 2016. When the application dated 08.04.2016 of the petitioner- company for grant of prospecting license was under
active consideration, the State of Odisha in the Department of Steel and Mines, in exercise of powers conferred under Section 15 of the MMDR Act, 1957 and in supersession of the provisions contained under the OMMC Rules, 2004, issued a Gazette Notification dated 14.12.2016 bringing into force the OMMC Rules, 2016.
2.2 Under Sub-rules (4) and (12) of Rule 4 of OMMC Rules, 2016, there is a restriction with regard to grant of prospecting license-cum-mining lease or mining lease or quarry lease or quarry permit, which requires that no prospecting license-cum-mining lease shall be granted for a specified minor mineral over any area unless it is satisfied that the reconnaissance survey (G4 level) has been carried out over the area applied for to establish availability of mineral therein or evidence of mineral in the area has been established otherwise, // 6 // provided that this provision shall not be applicable for areas in which mining has been carried out in the past under a mining lease and all applications for prospecting license and mining lease for specified minor minerals received prior to the date of commencement of these rules shall become ineligible. Hence, this writ petition.
3. Mr. S. Nanda, learned counsel appearing for the petitioners contended that a declaration be issued that a right has been accrued in favour of the petitioner-
company in view of statutory fiction/deeming provision and even otherwise in view of inaction/delay on the part of the State Government in disposing of its application for grant of prospecting license prior to the coming into effect of OMMC Rules, 2016 on 14.12.2016. As a consequence thereof, if a right has been accrued in favour of the petitioner-company, in view of provisions contained in Section 6 of the General Clauses Act, 1897, the prospecting license stands granted in favour of the petitioner-company considering the processing of the application and/or Sub-rule (12) of Rule-4 of OMMC Rules, 2016 introducing disqualification clause is in the // 7 // teeth of Article 13 of the Constitution of India, as the same is arbitrary and ultra vires to Articles-14, 19(1)(g) and 21 of the Constitution of India and repugnant to Clause (i) of Sub-section (2) of the Section 18 of the MMDR Act,1957 and inconsistent with GCD Rules, 1999. An alternative submission is also made that in view of ambiguity and vagueness in Sub-rule (12) of Rule-4 of OMMC Rules, 2016 regarding disqualification of prospecting license/ mining lease application, the same may be read down to exclude the prospecting license application of the petitioner from being declared "ineligible" as the prospecting license having been acted upon and, in the instant case, the prospecting license is deemed to have been granted in terms of 2nd proviso to Sub-rule (1) of Rule-10 of the OMMC Rules, 2004 and/or in view of the accrued right in terms of Section-6 of the General Clauses Act, 1897 prior to the coming into force of OMMC Rules, 2016 on 14.12.2016.
To substantiate his contentions, learned counsel for the petitioners has relied upon the judgments in New Okhla Industrial Development // 8 // Authority (Noida) v. Yunus., AIR 2022 SC 847; S.L. Srinivasa Jute Twine Mills Private Ltd. V. Union of India, (2006) 2 SCC 740; Sangam Spinners v. Regional Provident Fund Commissioner-I, AIR 2008 SC 739; Chintaman Rao v. State of Madhya Pradesh, AIR 1951 SC 118; Index Medical College, Hospital and Research Centre v. State of Madhya Pradesh, AIR 2021 SC 3090 and Indian Social Action Forum v. Union of India (UOI), AIR 2020 SC 1363.
4. Mr. P.P. Mohanty, learned Additional Government Advocate appearing for the State-opposite parties, vehemently contended that the petitioner- company's application for grant of prospecting license for granite, which was made on 06.04.2016, i.e., prior to commencement of OMMC Rules, 2016 on 14.12.2016, having remained pending and not been granted so far, has become ineligible in terms of Rule 4(12) of the OMMC Rules, 2016. As the petitioner-company has not been granted with prospecting license, no vested right has been created in its favour.
// 9 // 4.1 It is further contended that the provisions of OMMC Rules, 2016 are the policy decision of the State Government, which, inter alia, seeks to bring transparency in the allocation of mineral concessions by providing that the mineral concessions for granite and all other minor minerals shall henceforth be granted only through auction. Prior to the said policy decision, prospecting license and mining lease for granite were being granted under the provisions of the OMMC Rules, 2004 without competitive bidding through auction. Therefore, in the OMMC Rules, 2016, it has been provided for auction of Prospecting License-cum-Mining Lease and Mining Lease for granite and all other minor minerals which is in public interest, as it seeks to bring transparency in the grant of minor mineral concessions. But OMMC Rules, 2016 contain provisions for protecting of vested rights of the applicants who have been granted prospecting license and mining lease prior to commencement of these Rules, as provided in Rule 4(13).
// 10 // 4.2 It is also contended that exceptions provided in Rule 4(13) are similar to the provisions of Section 10 A (2) of the MMDR Act, 1957 and all applications for major mineral concessions received prior to date of commencement of the MMDR Amendment Act, 2015 (i.e.12.01.2015) have been declared as having become ineligible subject to the exceptions provided under Section 10 A (2) thereof. In view of such position, since the petitioner-company was not granted prospecting license and its application was pending, in view of Rule- 4(12) of the OMMC Rules, 2016, the application has become ineligible. Therefore, no illegality or irregularity has been committed by the authority by declaring so. Consequently, the question of declaration of such Rules as ultra vires does not arise, in view of fact that the same has been issued in consonance with the provisions contained under Section-10 A (2) of the MMDR Act, 1957. As such, OMMC Rules, 2016 has been framed under the rule making power of MMDR Act, 1957. Therefore, making pari materia provisions in the Rules cannot be said to be ultra vires and as such, it has been // 11 // done within the competency of the authority concerned. Consequentially, it is contended that the writ petition merits no consideration and the same should be dismissed.
5. Mr. P.K. Parhi, learned Assistant Solicitor General of India appearing for opposite party no.3 contended that there is no violation of any provisions, as alleged, and, as such, no vested right can be accrued in favour of the petitioner-company, when his application for prospecting license is pending for consideration. In the meantime, by operation of law if the application has been declared ineligible, in that case the application so submitted by the petitioner-company can also be declared as ineligible i.e. in consonance with the provisions of law and, as such, it cannot be construed that it is ultra vires of any provision, as alleged. 5.1 He further contended that the GCD Rules, 1999 have been framed by the Central Government under Section 18 of the MMDR Act, 1957, whereas OMMC Rules, 2016 have been framed by the State // 12 // Government under Section 15 of the MMDR Act, 1957 and both are different. Meaning thereby, OMMC Rules, 2016 are framed for regulating grant of mineral concession in respect of minor minerals, whereas GCD Rules, 1999 are framed regarding conservation and systematic development of granite. Therefore, these two Rules have been framed under two separate provisions for two separate purposes, therefore, it cannot be said that Sub-rules (4) and (12) of Rule-4 of the OMMC Rules, 2016 are inconsistent to the GCD Rules, 1999. Thereby, it is contended that learned counsel appearing for the petitioners has misconstrued the provisions of law and, as such, the contention raised by learned counsel for the petitioners, that provisions contained in Sub-rules (4) and (12) of Rule-4 of the OMMC Rules, 2016 are ultra vires to GCD Rules, 1999 and also Articles-14, 19 (1)(g) and 21 of the Constitution of India, is absolutely misconceived one. Therefore, the writ petition merits no consideration and is liable to be dismissed.
6. This Court heard Mr. S. Nanda, learned counsel for the petitioner; Mr. P.P. Mohanty, learned // 13 // Additional Government Advocate appearing for the State- opposite parties no.1 & 2; and Mr. P.K. Parhi, learned Assistant Solicitor General of India appearing for opposite party no.3, in virtual mode. Pleadings having been exchanged between the parties, with the consent of learned counsel for the parties the writ petition is being disposed of finally at the stage of admission.
7. At the outset, it is apt to mention that Part-XI of the Constitution of India deals with relations between the Union and the States. Chapter-1 thereof states about Legislative relations. Articles-245 & 246 of the Constitution of India, which come under Chapter-1, read as follows:
"245. Extent of laws made by Parliament and by the Legislatures of States-(1) Subject to the provisions of this Constitution, Parliament may make laws for the whole or any part of the territory of India, and the Legislature of a State may make laws for the whole or any part of the State. (2) No law made by Parliament shall be deemed to be invalid on the ground that it would have extra-
territorial operation.
xxx xxx xxx
246. Subject-matter of laws made by Parliament and by the Legislatures of States.-(1) Notwithstanding anything in clauses (2) and (3), Parliament has exclusive power to make laws with respect to any of the matters enumerated in List I in // 14 // the Seventh Schedule (in this Constitution referred to as the "Union List").
(2) Notwithstanding anything in clause (3), Parliament and , subject to clause (1), the Legislature of any State [***], have power to make laws with respect to any of the matters enumerated in List III in the Seventh Schedule (in this Constitution referred to as the "Concurrent List").
(3) Subject to clauses (1) and (2), the Legislature of any State [***] has exclusive power to make laws for such State or any part thereof with respect to any of the matters enumerated in List II in the Seventh Schedule (in this Constitution referred to as the 'State List').
(4) Parliament has power to make laws with respect to any matter for any part of the territory of India not included [in a State] notwithstanding that such matter is a matter enumerated in the State List".
8. Thus, Article 245 sets out the limits of the legislative powers of the Union and the States from the geographical or territorial angle. In other words, Article 245 of the Indian Constitution talks about the extent of laws made by Parliament and by the Legislatures of States. Article 246 of the Constitution deals with the subject-matter of laws made by the Parliament and the Legislatures of States. In other words, Article 246 of the Constitution deals with the division of power between the Union and the States. It demarcates the powers of the Union and the State by classifying their powers into 3 lists. They are the Union List, the State List and the // 15 // Concurrent List. Article-254 of the Constitution of India postulates that in case there is inconsistency in the law made by the Parliament and the law of the State Legislature, the Central Legislation has to prevail.
9. As per Entry 54 of List-1 of the Seventh Schedule (Article 246) of the Constitution of India, the Parliament enacted the MMDR Act, 1957 and the Rules framed thereunder. Entry 54 of List-1 reads as follows:
"Regulation of mines and mineral development to the extent to which such regulation and development under the control of the Union is declared by Parliament by law to be expedient in the pubic interest".
10. Entry 23 under List-II of the Seventh Schedule of the Constitution of India empowers the State to frame laws in the "State List" which reads as follows:
"Regulation of mines and mineral development subject to the provisions of List I with respect to regulation and development under the control of the Union".
11. At this juncture, it is of relevance to note some of the relevant provisions of the MMDR Act, 1957.
// 16 // Section-3 of the MMDR Act, 1957 deals with definitions. Sub-sections-(e), (g) & (h) of Section-3, being relevant for the purpose of the case, are extracted hereunder:-
"(e) "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 a minor mineral;
xxx xxx xxx
(g) "prospecting license" means a license granted for the purpose of undertaking prospecting operations;
(h) "prospecting operation" means any operations undertaken for the purpose of exploring, locating or proving mineral deposits;
xxx xxx xxx"
Section-4 of MMDR Act, 1957 states prospecting or mining operations to be under license or lease, whereas Section-5 deals with restrictions on the grant of prospecting licenses or mining leases. Section-6 states about the maximum area for which a prospecting license or mining lease may be granted, whereas Section-7 deals with the period for which prospecting licenses may be granted or renewed. Section-8 deals with the period for which the mining leases may be granted or renewed, // 17 // Section-9 envisages with regard to royalties in respect of mining leases, Section-9(A) deals with dead rent to be paid by the lessee, Section-9(B) deals with District Mineral Foundation, whereas Section-9(C) deals with National Mineral Exploration Trust. Under the procedure for obtaining prospecting license or mining lease in respect of the land in which the mineral is vested with the government, Section-10 deals with application for prospecting licenses or mining leases and Section10-A envisages the rights of existing concession holders and applicants, whereas 10-B deals with grant of mining lease in respect of notified minerals through auction.
Section-14 of the MMDR Act, 1957 reads as follows:
"14. [Sections 5 to 13] not to apply to minor minerals- The provisions of [sections 5 to 13] (inclusive) shall not apply to [quarry leases, mining leases or other mineral concessions] in respect of minor minerals".
In view of the aforesaid provisions, it is made clear that Sections 5 to 13 are meant for grant of major mineral concession and they do not apply to minor minerals.
// 18 // Section-15 states about power of State Governments to make rules in respect of minor minerals. Section-18 deals with mineral development. Sub-section (1) of Section-18 postulates the duty of the Central Government to take all such steps as may be necessary for the conservation and systematic development of minerals in India and for the protection of environment by preventing or controlling any pollution which may be caused by prospecting or mining operations and for such purposes the Central Government may, by notification in the Official Gazette, make such rules as it thinks fit. Sub-section-2(i) of Section 18 states about the regulation of prospecting operations. Thereby, the Central Government and State Government, by two different sections, have been vested with the power to frame their rules in their respective fields.
12. In exercise of powers conferred by Sub-section (1) of Section 15 of the MMDR Act, 1957, the State Government made rules for regulating the grant of mineral concessions in respect of minerals and for the purposes connected therewith, called "Orissa Minor // 19 // Minerals Concession Rules, 2004". Sub-rule (l) of Rule-2 defines "Granite" which reads as follows:
(l) "Granite" means dolerites, granite gneisses, migmatites, gabbros, anorthosites, rhyolites, syenites, leptynites, charnockites and other igneous and orthometamorphic rock types which are-
(i) amenable to be recovered as dimensional stone;
(ii) capable of taking polish; and
(iii) commercially exploitable".
Sub-rule (q) of Rule-2 reads as follows:
"(q) "prospecting license" means a license granted for the purpose of undertaking any operation for the purpose of exploring, locating or proving the deposits of decorative stones over a compact area;"
Rule-3 deals with restriction on prospecting/ mining/ quarrying operation. Rule-4 deals with restrictions on grant of prospecting licenses or mining/quarry leases or its renewal.
13. Chapter-II of OMMC Rules, 2004 deals with grant of prospecting license for decorative stone. Rule-9 thereof states about application for prospecting license and Rule 9(1) states an application for prospecting license shall be made to the Director in Form-A in triplicate through the Deputy Director or the Mining // 20 // Officer having jurisdiction and shall be accompanied with the documents prescribed under Rule-9(1) (i) to (xi). Under Sub-rule (2) of Rule-9, every application received by the Deputy Director/Mining Officer shall be entered in the register of application for prospecting license in Form-B and also acknowledgement receipt shall be provided in Form-C as per sub-rule (3)(b) of Rule-9.
14. Rule-10 deals with disposal of the application. Sub-rule (1) of Rule-10 reads as follows:
"(1) No application shall be granted unless the applicant submits the income-tax clearance certificate and sales-tax clearance certificates or non-assessment certificates in original and no objection of the concerned Tahasildar on revenue point of view and the concerned Gram Panchayat for grant of prospecting license:
Provided that the Mining Officer/Deputy Director of the respective jurisdiction shall seek a report from concerned Tahasildar on revenue point of view, Divisional Forest Officer on forest point of view and in case of Scheduled Area, from the concerned Gram Panchayat in the interest of tribal development of the area before forwarding the application to the Director for his consideration:
Provided further that in case the views of the Tahasildar and the concerned Gram Panchayat is not received within a period of two months of receipt of intimation, it would be deemed that the Tahasildar/Gram Panchayat has no objection for grant of prospecting license".
// 21 // As per second proviso, it is made clear that in case the views of the Tahasildar and the concerned Gram Panchayat are not received within a period of two months of receipt of intimation, it would be deemed that the Tahasildar/Gram Panchayat has no objection for grant of prospecting license. Therefore, the provision is very clear to the extent that if no views are received from the Tahasildar or the concerned Gram Panchayat within a period of two months on receipt of the intimation, then only it would be deemed that the Tahasildar/Gram Panchayat has no objection for grant of prospecting license. There is no provision emphasizing the fact that the prospecting license has already been granted.
15. "No objection" for grant of prospecting license stands altogether on a different footing than that of "deemed grant of prospecting license" in favour of the applicant and thereby the petitioner has misconstrued the provision of deemed grant of prospecting license in his favour due to non-receipt of any objection from the Tahasildar/Gram Panchayat within a period of two months. Therefore, the argument to that extent advanced // 22 // by learned counsel for the petitioners cannot have any justification so as to enlarge the scope of the provision, which is very clear and unambiguous. On plain reading of the provision of the statute, it conveys the language implies that if no views are received from the Tahasildar/Gram Panchayat within a period of two months of receipt of the intimation, it would be deemed that the Tahasildar/Gram Panchayat has no objection for grant of prospecting license. Therefore, the language is very plain and simple and there is no ambiguity and it should be applicable in the manner as has been placed in the Statute.
16. Rule-11 of OMMC Rules, 2004 deals with refusal of application for a prospecting license and Sub- rule (1) whereof states that the Director may, after giving an opportunity of being heard and for reasons to be recorded in writing and communicated to the applicant, refuse to grant or renew a prospecting license over the whole or part of the area applied for. In the present case, that stage has not yet come. Admittedly, the application submitted by the petitioner-company for grant of // 23 // prospecting license was received in prescribed Form-A and the same was entered in the Register of application for prospecting license in Form-B. Accordingly, acknowledgement was granted in Form-C in view of Rule-9(2) of the OMMC Rules, 2004. At best it can be said that the application for grant of prospecting license is pending. At no stretch of imagination, it can be said that there is deemed grant of prospecting license in favour of the petitioner-company. Therefore, all other arguments which have been advanced by learned counsel for the petitioners cannot have legs to stand when such application is pending for consideration.
17. Rule-80 of the Rules, 2004 deals with repeal and savings. By commencement of OMMC Rules, 2004, the earlier Rules, i.e. OMMC Rules, 1990 were repealed. Sub-rule (2) of Rule-80 states that notwithstanding such repeal anything done, any action taken or order passed under the rules so repealed shall be deemed to have been done, taken or passed under the corresponding provisions of these rules, and shall be brought into conformity with the provisions of these rules within three // 24 // months from such commencement or such further time as the Government may specify in this behalf. Thereby, any order or any step taken under the OMMC Rules, 1990 has been protected under Sub-rule (2) of Rule-80 even after commencement of OMMC Rules, 2004.
18. In exercise of powers conferred by Sub-section (1) of Section 15 of the Mines and Minerals (Development and Regulation) Act, 1957 and in supersession of the provisions contained in the Odisha Minor Mineral Concession Rules, 2004, except as respects things done or omitted to be done before such supersession, the State Government framed rules for regulating the grant of mineral concessions in respect of minor minerals and for the purposes connected therewith, called "Odisha Minor Mineral Concession Rules, 2016" (for short ' OMMC Rules, 2016'), which commenced from 14.12.2016.
19. The expressions 'decorative stone', 'granite' and 'prospecting license-cum-mining lease', as have been defined under Rule-2 (h),(n) and (t) are quoted below:-
// 25 // "(h) "Decorative stone", means all types of granites as defined in the Granite Conservation and Development Rules, 1999 and any other rock suitable for decorative or export purpose including dimension stone.
xxx xxx xxx
(n) "Granite" means dolerites, granite gneisses, migmatites, gabbros, anorthosites, rhyolites, syenites, leptynites, charnockites and other igneous and orthometamorphic rock types which are-
(i) amenable to be recovered as dimensional stone.
(ii) capable of talking polish, and
(iii) commercially exploitable.
xxx xxx xxx
(t) "Prospecting license-cum-mining lease"
means a two stage concession granted for the purpose of undertaking prospecting operation in respect of specified minor minerals followed by mining operation over a compact area."
20. Rule-4 of OMMC Rules, 2016, deals with restriction on grant of prospecting license-cum-mining lease or mining lease or quarry lease or quarry permit. Rule-4 (4), (12) and (13), being relevant, are extracted hereunder:-
xxx xxx xxx "(4) No prospecting license-cum-mining lease shall be granted for a specified minor mineral over any area unless it is satisfied that the reconnaissance survey (G4 level) has been carried out over the area applied for to establish availability of mineral therein or evidence of // 26 // mineral in the area has been established otherwise:
Provided that this provision shall not be applicable for areas in which mining has been carried out in the past under a mining lease.
xxx xxx xxx (12) All applications for prospecting license and mining lease for specified minor minerals received prior to the date of commencement of these rules shall become ineligible.
(13) Notwithstanding anything contained in sub-
rule (12), the following applications shall remain eligible for grant of mining lease under these rules:
(a) Where before the commencement of these rules, a prospecting licensee has been granted in respect of any land for any specified minor mineral, the licensee shall have the right to obtain mining lease in respect of that mineral in that land, if the State Government is satisfied that the licensee,
(i) has undertaken prospecting operations to establish the existence of mineral contents in such land in accordance with the provisions applicable during the period of license.
(ii) has not committed any breach of the terms and conditions of the license,
(iii) has not become ineligible for grant of mining lease,
(iv) has not failed to apply for grant of mining lease within a period of three months after the expiry of prospecting license or such further period as may be extended by the State Government.
(b) Where the State Government has communicated order (terms and conditions) to grant a mining lease before commencement of these rules, the mining lease shall be granted // 27 // subject to fulfillment of terms and conditions of the grant order within the time stipulated in the grant order or such further time, not exceeding two years, as may be extended by the State Government".
In view of aforesaid provisions, it is made clear that no prospecting license-cum-mining lease shall be granted for a specified minor mineral over any area unless it is satisfied that the reconnaissance survey (G4 level) has been carried out over the area applied for to establish availability of mineral therein, whereas Sub-rule (12) contends that all applications for prospecting license and mining lease for specified minor minerals received prior to the date of commencement of these rules shall become 'ineligible' and Sub-rule (13) gives a rider to Sub-rule (12) contending that notwithstanding anything contained in Sub-rule (12), the applications shall remain eligible for grant of mining lease. Admittedly, the application for prospecting license and mining lease for 'granite' was submitted by the petitioner-company on 08.04.2016, i.e., prior to commencement of OMMC Rules, 2016 w.e.f. 14.12.2016. Thereby, such application has become 'ineligible' but if the conditions stipulated in Sub-rule (a) // 28 // of Rule-13 (i) to (iv) is adhered to, then that cannot be construed to be ineligible, rather that is eligible for grant of mining lease. As such, none of the conditions mentioned therein specified so far as the application of petitioner-company is concerned. Thereby, invoking Rule-4(12) of OMMC Rules, 2016, the application for prospecting license received on 08.04.2016 prior to commencement of OMMC Rules, 2016, became ineligible. Rule-4(12) is no way inconsistent with any of the provisions rather it is in consistent with Section-10 A (2) of the MMDR Act, 1957.
21. Rule-66 of OMMC Rules, 2016 deals with transitory provisions, which reads as follows:
"66. Transitory provisions:- (1) Notwithstanding anything contained in these rules, the existing lessees of such of the specified minor minerals which were major minerals on the date of coming into force of the Mines and Minerals (Development and Regulaton) Amendment Act, 2015 (11 of 2015) shall be eligible for extension of the validity period of lease for such period and subject to such conditions as provided in Section 8A of the Mines and Minerals (Development and Regulation) Act, 1957.
(2) Notwithstanding anything to the contrary contained in these rules, the applicants for mineral concessions in respect of such of the specified minor minerals, which were major minerals on the date of coming into force of the Mines and Minerals (Development and Regulation) Amendment Act, 2015 (11 of 2015), and whose applications have remained eligible under the provisions of the sub-section (2) of // 29 // Section 10A of the Act, shall remain eligible for grant of mineral concession for such period as prescribed under rule 8 of these rules subject to satisfaction of conditions prescribed in sub-rule (13) of rule 4 of these rules".
Under Sub-rule (2) of Rule-66, it is made clear that the applicants for mineral concessions in respect of such of the specified minor minerals, which were major minerals on the date of coming into force of the Mines and Minerals (Development and Regulation) Amendment Act, 2015 w.e.f. 12.01.2015 and whose applications have remained eligible under the provisions of the Sub-section (2) of Section 10A of the Act, shall remain eligible for grant of mineral concession.
22. Initially, 'granite' was coming under the major minerals, but after commencement of MMDR Amendment Act, 2015, 'granite" has been considered as minor mineral. Thereby, the application filed has to be protected by virtue of such provision and this benefit is made available to the petitioner. As such, considering 'granite' as minor mineral, the petitioner-company submitted application under Rule-9 of OMMC Rules, 2004 and its application was duly acknowledged by // 30 // taking follow up action. But in the meantime, since OMMC Rules, 2016 came into force w.e.f. 14.12.2016, in view of the provisions contained under Rule-4(12) of the said Rules, the application of the petitioner-company became ineligible. Thereby, no illegality or irregularity has been committed by the authority and, as such, there is no violation of any provisions of law so as to declare the provisions contained in Sub-rule (12) of Rule-4 of OMMC Rules, 2016 as ultra vires. Much argument has been advanced by learned counsel for the petitioners before this Court that because of pendency of application for grant of prospecting license, a vested right has been accrued in favour of the petitioner, that itself is misconceived one.
23. So far as challenge to Sub-rule (12) of Rule-4 of OMMC Rules, 2016 is concerned, it is contended that it carries with manifest arbitrariness, unreasonableness, discriminatory and also violates fundamental rights and, therefore, the same is in teeth of Article 13 of the Constitution of India.
// 31 // Looking at the provisions of Article-13 of the Constitution of India, it would appear that the main object of Article-13 is to secure the primacy of the Constitution in regard to the fundamental rights. The first clause relates to the laws already existing in force and declares that pre-Constitution laws are void to the extent to which they are inconsistent with the fundamental rights. The second clause relates to post- Constitution laws and prohibits the State from making a law which either takes away totally or abrogates in part a fundamental right. The expression "the State" is to be construed in conformity with Article 12 as judicially interpreted. It is further contended that the said sub- rule (12) of Rule-4 of OMMC Rules, 2016 has to be declared as ultra vires to Articles 14, 19(1)(g) and 21 of the Constitution of India in view of deeming provision and also accrued rights. As has been discussed above, the petitioner has been misconstrued the deeming provision contained in proviso to Rule-10 of OMMC Rules, 2004 and as such, no right has been accrued in favour of the petitioner-company, because no // 32 // prospecting license has been granted to the petitioner- company. Rather, the provision is very clear that in case the views of the Tahasildar and the concerned Gram Panchayat are not received within a period of two months of receipt of intimation, it would be deemed that the Tahasildar/Gram Panchayat has no objection for grant of prospecting license. That does not mean, prospecting license has been granted to the petitioner- company. Mere expression of no objection for grant of prospecting license by the Tahasildar/Gram Panchayat, cannot be construed to be granting prospecting license in favour of the petitioner-company. Under misconception and misconstruction of the provisions, the petitioner-company cannot take advantage contending that a right has been accrued in its favour in view of deeming provision.
24. More so, the contention raised, that delay/inaction on the part of the State cannot take away the vested right of the petitioner-company, has no force at all. When no right has yet been vested with the petitioner-company by granting prospecting license, in // 33 // that case question of delay/ inaction on the part of the State cannot be taken into consideration. More so, the application for prospecting license was filed only on 08.04.2016 by following due process. The same was scrutinized by two different authorities, namely, revenue and forest authorities and when the same was pending for consideration for grant of prospecting license, the other follow up action as per the rules were taken. In the meantime, the OMMC Rules 2016 came into force with effect from 14.12.2016. Thereby, by operation of law, the application filed by the petitioner-company for grant of prospecting license became ineligible. Therefore, the entire argument advanced by learned counsel for the petitioner with regard to 'vested right', 'accrued right' and 'deeming provision' are absolutely misconceived one and more so reference made with regard to transitory provision and saving clause, the benefit of which cannot be admissible to the petitioner-company so as to raise such contention before this Court. Thereby, the argument so advanced by learned counsel for the petitioner cannot sustain in the eye of law.
// 34 //
25. It was further contended by learned counsel for the petitioners that Rule-4(4) of the OMMC Rules, 2016 is repugnant to Rule-4 of the GCD Rules, 1999 and ultra vires to the MMDR Act, 1957. Rule-4 of the GCD Rules, 1999 reads as follows:
"4. Prospecting to precede mining operations.- No lease shall be granted by the State Government unless it is satisfied that there is evidence to show that the area for which the lease is applied for has been prospected earlier for granite or the existence of granite therein has been established otherwise".
On perusal of the aforesaid provision, it appears that there is no contradiction between the provision of Rule-4 of the GCD Rules, 1999 and Rule-4(4) of the OMMC Rules, 2016. Rule-4 of the GCD Rules, 1999 provides that the existence of granite should be evident in the area for grant of mining lease. Similarly, Rule-4(4) of the OMMC Rules, 2016 provides that reconnaissance survey (G4 level) should be carried out over the area applied or to establish availability of mineral therein or evidence of mineral in the area should be established otherwise in the area for grant of prospecting license-cum-mining lease in the area. The State Governments are empowered to make rules for regulation of the grant of mineral // 35 // concession in respect of minor minerals under Section 15 read with Section 14 of the MMDR Act, 1957. Thereby, neither the provision of the MMDR Act, 1957 nor the GCD Rules, 1999 is a bar to the State Government from inserting any mandatory provision in respect of minor minerals for regulating the grant of quarry leases or mining leases and for the purposes connected therewith. As such, there exists legislative competency to frame such rules. Therefore, it cannot be declared as ultra vires to any provisions of the Statute or the Constitution. The matters relating to regulation of grant of concessions for minor minerals, as explained, comes under the legislative and administrative jurisdiction of the State. As a consequence thereof, the contention of the petitioner-company cannot sustain in the eye of law and accordingly, the same cannot be accepted.
26. Considering the same from another angle, it is made clear that the provisions contained in OMMC Rules, 2016 are the policy decision of the State Government, which, inter alia, seek to bring // 36 // transparency in the allocation of mineral concessions by providing that the mineral concessions for granite and all other minor minerals, shall be granted only through auction. Prior to this Policy decision, prospecting license and mining lease for granite were being granted under the provisions of the OMMC Rules, 2004 without competitive bidding through auction. In the OMMC Rules, 2016, it has been provided for auction of prospecting license-cum-mining lease and mining lease for granite and all other minor minerals which is in public interest as it seeks to bring transparency in the grant of minor mineral concessions. But, OMMC Rules, 2016 contain provisions for protecting of vested rights of the applicants who have been granted prospecting license and mining lease prior to commencement of these rules as provided under Rule 4(13). The exceptions provided in Rule 4(13) are similar to the provisions of Section 10A(2) of the MMDR Act, 1957 and all applications for major mineral concessions received prior to date of commencement of the MMDR Amendment Act, 2015 have been declared as having become ineligible // 37 // subject to the exceptions provided under Section 10A(2) thereof. Similarly, all applications received prior to commencement of OMMC Rules, 2016, i.e. 14.12.2016, have become ineligible subject to exception provided under Sub-rule (13) of Rule-4 OMMC Rules 2016 and the petitioner does not fall within the exception clause of Rule-4(13) so as to claim the benefit and, as such, the application submitted by the petitioner-company for grant of prospecting license, being pending, it comes under the fold of Rule-4(12). Thereby, it has become ineligible, reason being the OMMC Rules, 2016, providing among other things, auction as the only method of settlement/grant of prospecting license and mining lease of minor mineral is the outcome of judicial dictum and to achieve the above said objective.
27. Rule-52 of the GCD Rules, 1999 provides that the provisions of the Minor Mineral Concession Rules or any other rules framed by the State Government under Section 15 of the MMDR Act, 1957 shall be applicable to granite quarry leases to the extent they are not repugnant to or inconsistent with the GCD Rules, 1999.
// 38 // There is no such provision in the GCD Rules, 1999 that prohibits the State Government from taking policy decision to grant the license or leases through competitive bidding and from prescribing the procedure for grant of prospecting license. Therefore, the OMMC Rules, 2016 cannot be considered to be repugnant to the provisions of the GCD Rules, 1999 insofar as the same provides for auction of prospecting license-cum-mining lease/mining lease for granite and declaration of pending prospecting license applications as ineligible. Furthermore, due procedure has been followed in framing the OMMC Rules, 2016 and that the requirement of Section-28 of MMDR Act, 1957 has also been complied with, as the said rules have been laid before the State Legislative Assembly. Thereby, no illegality or irregularity has been committed in framing OMMC Rules, 2016 and, as such, the prayer made to declare the same as ultra vires cannot sustain in the eye of law.
28. In C.C.S.U. v. Min., (1984) 3 AII ER 935, it has been held that it is not for the Courts to determine // 39 // whether a particular policy or particular decision taken in fulfillment of that policy are fair. They are concerned only with the manner in which those decisions have been taken, if that manner is unfair, the decision will be tainted with what LORD DIPLOCK labels as 'procedural impropriety'.
29. In Sangwan v. Union of India, (1980) Supp. SCC 559 : AIR 1981 SC 1545, the apex Court held that though in the absence of any statutory fetter, the Government, in the exercise of its executive power, is competent to change its policy, even then a change in policy must be made fairly and should not give the impression that it was so done arbitrarily or by any arbitrary criteria.
If the Government, as a matter of principle, decided to go for auction in the public interest and declare the pending applications are ineligible in consonance with the provisions contained in Rule-4(12) that cannot be construed as arbitrary, unreasonable and contrary to the provision of Articles-14 and 19(1)(g) of // 40 // the Constitution of India. More so, in regard to relative merits of different economic policies, the Court cannot examine the same and it cannot strike down one policy on the ground that another policy would be fairer and better. In the case of policies, as a matter of good governance and administration, wherever policy decision are taken, it is desirable that there should be wide range of consultation including considering the representation, but law do not require that there should be a hearing before a decision taken. It has held that such hearing is also impossible in public interest and also impracticable.
30. In New Okhla Industrial Development Authority (supra), the apex Court held that when a legal fiction is employed by the legislature, it becomes a duty of the Court to interpret it and to give it meaning. In gleaning its meaning, the Court is duty bound to ascertain the purpose of this legislative device. It is further held that it is the bounden duty of the Court to ascertain for what purpose the legal fiction has been created. It is also the duty of the Court to imagine the fiction with all real consequences and instances unless // 41 // prohibited from doing so. The use of the term "deemed" has to be read in its context and further the fullest logical purpose and import are to be understood. It is because in modern legislation, the term "deemed" has been used for manifold purposes.
In view of the discussion made above, this judgment has no application to the petitioners, rather it supports the case of the opposite parties.
31. In S.L. Srinivasa Jute Twine Mills P. Ltd. (supra), the apex Court, considering the effect of repeal and taking into consideration Section 6 of the General Clauses Act, 1897, held that unless a different intention appears, the repeal shall not affect any right, privilege, obligation or liability acquired, accrued or incurred under any enactment so repealed. The effect of commencement of OMMC Rules, 2016 is the same. As such, the said judgment is not applicable to the petitioners. There is no vested right accrued in favour of the petitioner-company merely filing an application for grant of prospecting license pending for consideration.
// 42 //
32. In Sangam Spinners (supra), interpretation of Section-6 of the General Clauses Act, 1897 also taken into consideration so far as effect of repeal is concerned in Chintaman Rao (supra), wherein the provision is declared to be ultra vires has been considered and the question for decision is whether the statute under the guise of protecting public interests arbitrarily interferes with private business and imposes unreasonable and unnecessarily restrictive regulations upon lawful occupation; in other words, whether the total prohibition of carrying on the business of manufacture of bidis within the agricultural season amounts to a reasonable restriction on the fundamental rights mentioned in Article-19(1)(g) of the Constitution. While considering the meaning of 'reasonable restriction', the apex Court held that the orders issued by the Deputy Commissioner are void, inoperative and ineffective. As such, the said judgment has been considered all together on a different context on the factual matrix of the said case. Thereby, the same cannot have any application to the present case.
// 43 //
33. In Index Medical College, Hospital and Research Centre (supra), the apex Court held that regarding admission of medical students, where prescribing medical institutions from filling up seats which fall vacant due to candidates in mop-up round not taking admission or submitting resignation after taking admission amounts to unreasonable restriction. But the factual matrix of the said case is completely different from the present case.
34. In P.R. Aiyar, Advanced Law Lexicon, Vol.4 (2005) 4796 and Encyclopedic Law Lexicon, Vol. 4 (2009) 4838-4839 the expression "ultra vires" has been defined to mean beyond power or authority or lack of power. An act may be said to be "ultra vires" when it has been done by a person or a body of persons which is beyond his, its or their power, authority or jurisdiction.
35. Wade & Forsyth, Administrative Law (2009) states "ultra vires" relates to capacity, authority or power of a person to do an act. It is not necessary that an act to be ultra vires must also be illegal. The act may // 44 // or may not be illegal. The essence of the doctrine of ultra vires is that an act has been done in excess of power possessed by a person.
36. D.D. Basu, Administrative Law (1993) 94 states that whenever any person or body of persons, exercising statutory authority, acts beyond the powers conferred upon him or them by statute, such act becomes ultra vires and, accordingly, void. In other words, substantive ultra vires means the delegated legislation goes beyond the scope of the authority conferred on it by the parent statute. Therefore, it is a fundamental principle of law that a public authority cannot act outside the powers, i.e. ultra vires, and it has been rightly described as "the central principle" and "foundation of large part of administrative law". Thereby, an act which is for any reason in excess of power is ultra vires.
37. Schwartz Administrative Law (1984) states as follows:
"If an agency acts within the statutory limits (intra vires), the action is valid; if it acts outside (ultra // 45 // vires), it is invalid. No statute is needed to establish this; it is inherent in the constitutional position of agencies and courts".
Power delegated by statute is limited by its terms and subordinate to its objects. The delegate must act in good faith, reasonably, intra vires the power granted and on relevant consideration of material facts. All his decisions must be in harmony with the Constitution and other laws of the land.
38. In Daymond v. S.W. Water Authority, (1976) 1 All E.R. 1039 (H.L.), it is held that in order to determine whether the subordinate legislation exceeds the power granted by the Legislature, the Court has to interpret the enabling statue.
The above view has also been taken in Hotel Industry Board v. Automobile Ltd. (1969) 2 All E.R. 582 H.L. and McEldowney v. Forde, (1969) 2 All E.R. 1039.
39. In Durga Prasad v. Suptd., AIR 1966 S.C. 1209, the apex Court held that where the authority to make a Rule is conferred for exercising a particular // 46 // power, the Court would not construe the Rule in such manner as to include a separate and independent power.
40. In U.S. v. Eaton, (1892) 144 U.S. 677, it is held that subordinate law-making body cannot go beyond the policy laid down in the statue, so as to alter or amend the law.
The same view has also been taken in U.S. v. Grimand, (1911) 220 U.S. 506.
41. In U.S. v. Two Hundred Barrels of Whiskey, (1877) 95 U.S. 571, it is held that the purpose of subordinate legislation is to carry into effect the existing law and not to change it.
The same view has also been taken by the apex Court in Venkateswara v. Govt. of A.A., AIR 1966 SC 629.
42. There is always a presumption in favour of constitutionality, and a law will not be declared unconstitutional unless the case is so clear as to be free from doubt; "to doubt the constitutionality of a law is to resolve it in favour of its validity". Where validity of a // 47 // statute is questioned and there are two interpretations, one of which will make the law valid and the other void, the former must be preferred and the validity of the law upheld.
43. In Karnataka Bank Ltd. v. State of A.P., (2008) 2 SCC 254, the apex Court held in pronouncing on the constitutional validity of a statute, the Court is not concerned with the wisdom or un-wisdom, the justice or injustice of the law. If that which is passed into law is within the scope of the power conferred on a Legislature and violates no restrictions on that power, the law must be upheld whatever a Court may think of it. The parent act may be unconstitutional on several grounds, i.e. (i) excessive delegation; or (ii) breach of a Fundamental Right; or (iii) on any other ground such as, distribution of powers between the Centre and the State.
44. In Hinsa Virodhak Sangh v. Mirzapur Moti Kuresh Jamat, (2008) 5 SCC 33, the apex Court held that there is presumption in favour of constitutionality of statutes as well as delegated legislation and it is only // 48 // when there is clear violation of constitutional provision (or of a parent statute, in the case of delegated legislation) beyond reasonable doubt that the Court should declare it to be unconstitutional.
45. In Indian Express Newspapers v. Union of India, (1985) 1 SCC641 : AIR 1986 SC 515, the apex Court held as follows:
"A piece of subordinate legislation does not carry the same degree of immunity which is enjoyed by a statute passed by a competent legislature. Subordinate legislation may be questioned on any of the grounds on which plenary legislation is questioned. In addition it may also be questioned on the ground that it does not conform to the statute under which it is made. It may further be questioned on the ground that it is contrary to some other statute. That is because subordinate legislation must yield to plenary legislation. It may also be questioned on the ground that it is unreasonable, unreasonable not in the sense of not being reasonable, but in the sense that it is manifestly arbitrary".
46. In J.K. Industries Limited v. Union of India, (2007) 13 SCC 673, relying upon the aforesaid judgment in the case of Indian Express Newspaper (supra), the apex Court held that, any inquiry into its vires must be confined to the grounds on which plenary legislation may be questioned, to the grounds that it is // 49 // contrary to the statute under which it is made, to the grounds that it is contrary to other statutory provisions or on the ground that it is so patently arbitrary that it cannot be said to be inconformity with the statute. It can also be challenged on the ground that it violates Article 14 of the Constitution. The apex Court also further held that a subordinate legislation may be struck down as arbitrary or contrary to the statute if it fails to take into account the vital facts which expressly or by necessary implication are required to be taken into account by the statute or the Constitution. This can be done on the ground that the subordinate legislation does not conform to the statutory or constitutional requirements or that it offends Article 14 or Article 19 of the Constitution.
It is also further clarified in the said judgment that where the validity of subordinate legislation is challenged, the question to be asked is whether the power given to the rule making authority is exercised for the purpose for which it is given. Before reaching the conclusion that the Rule is intra vires, the court has to examine the nature, object and the scheme of the // 50 // legislation as a whole and in that context, the Court has to consider, what is the area over which powers are given by the section under which the Rule Making Authority is to act. However, the Court has to start with the presumption that the impugned Rule is intra vires. This approach means that, the Rule has to be read down only to save it from being declared ultra vires if the court finds in a given case that the above presumption stands rebutted. The basic test is to determine and consider the source of power, which is relatable to the rule. Similarly, rule must be in accordance with the parent statute as it cannot travel beyond.
47. In State of Uttar Pradesh v. Renusagar, AIR 1988 SC 1737: (1988) 4 SCC 59, the apex Court held that if the exercise of power is in the nature of subordinate legislation, the exercise must conform to the provisions of the statute. All the conditions of the statute must be fulfilled.
48. The doctrine of "ultra vires" has two aspects, (1) substantive ultra vires and (2) procedural ultra vires.
// 51 // In view of law laid down by the apex Court in Indian Express Newspapers (supra), it becomes clear that a delegated legislation may be challenged on the ground of substantive ultra vires in the following circumstances:
"1.Where parent Act is unconstitutional;
2.Where parent Act delegates essential legislative functions;
3. Where delegated legislation is inconsistent with parent Act;
4. Where delegated legislation is inconsistent with general law;
5. Where delegated legislation is unconstitutional is unconstitutional;
6. Where delegated legislation is arbitrary;
7. Where delegated legislation is unreasonable;
8. Where delegated legislation is mala fide;
9. Where delegate further delegates (sub- delegation);
10. Where delegated legislation excludes judicial review; and
11. Where delegated legislation operates retrospectively".
49. In Indian Council of Legal Aid and Advice v. Bar Council of India, AIR 1995 SC 691: (1995) 1 SCC 732, the apex Court held that to apply the doctrine of substantive ultra vires, the Court first interprets the relevant statutory provisions to determine the scope of delegation of power and then interprets the impugned delegated legislation and finally adjudge whether the // 52 // same is within, or without, the statutory power conferred.
50. In Lohia Machines Ltd. v. Union of India, AIR 1985 SC 421: (1985) 2 SCC 197, the apex Court held that declaring delegated legislation ultra vires also becomes difficult because of judicial attitude. The judicial policy generally is to interpret the delegating provision rather broadly.
51. In Om Prakash v. State of U.P., (2004) 3 SCC 402 : AIR 2004 SC 1896, basing reliance on H.C. Suman v. Rehabilitation Ministry Employees' Cooperative Housing Building Society Ltd. (1991) 4 SCC 485 : AIR 1991 SC 2160, the apex Court held that Courts should be slow to interfere with byelaws made by public representative bodies unless they were manifestly partial and unequal in operation or unjust, mala fide or effect unjustified interference with liberty.
52. In Kunj Behari Lal Butail v. State of Himachal Pradesh, AIR 2000 SC 1069 : (2000) 3 SCC 40, the apex Court held that often the rule-making power // 53 // is conferred without specifying the purposes as such, but generally "for carrying out the purposes of the Act." This is a general delegation without laying down any guidelines. This power cannot be so exercised in such a way as to bring into existence substantive rights or obligations or disabilities not contemplated by the parent Act itself.
53. In Laghu Udhyog Bharati v. Union of India (1999) 6 SCC 418, it was held by the apex Court that when the Act confers rule making power for carrying out purposes of the Act, rules cannot be so framed as not to carry out the purpose of the Act or be in conflict with the same. Legal effect of the formula is to confer a plenary power on the delegate to make rules subject to the overall requirement that the rules made ought to have a nexus with the purpose of the Act.
54. In Kerala Samsthana Chethu Thozhilali Union v. State of Kerala, (2006) 4 SCC 327 : AIR 2006 SC 3480, the apex Court considered the Court's power and held when such a power is given, the Court seeks to // 54 // ascertain the purpose of the enactment and then to ascertain whether the rules framed further that purpose. A rule may be held as ultra vires if it has no nexus with the purpose of the parent Act or if it scuttles the same.
55. The efficacy of judicial control of delegated legislation is very much dependant on how broad is the statutory formula conferring power of delegated legislation on the delegate. Usually, the application of the ultra vires rule becomes very difficult in practice because of three main reasons;
(1) Powers are usually delegated in broad language;
(2) Generally speaking, the courts interpret the enabling provision rather broadly;
(3) The courts adopt a deferential, rather than a critical, attitude towards delegated legislation and, thus, lean towards upholding the same.
56. In Goodricke Group Ltd. V. State of West Bengal, 1995 Supp (1) SCC 707, the apex Court held that "entries in the Seventh Schedule to the Constitution are legislative heads or fields of legislation. The legislature derives its power from Article 246 of the // 55 // Constitution and not from the respective entries. The language of the respective entries, therefore, should be given widest meaning. It is well-recognized that where there are three lists containing a large number of entries, there is bound to be some overlapping among them. In such a situation, the rule of "pith and substance" has to be applied to determine the competence of the legislature. Each general word should be held to extend to all ancillary or subsidiary matters which can fairly and reasonably be comprehended in it".
57. In Jilubhai Nanbhai v. State of Gujarat, 1995 Supp (1) SCC 596: AIR 1995 SC 142, the apex Court held as follows:
"It must be remembered that we are interpreting the Constitution and when the Court is called upon to interpret the Constitution, it must not be construed in any narrow or pedantic sense and adopt such construction which must be beneficial to the amplitude of legislative powers. The broad and liberal spirit should inspire those whose duty is to interpret the Constitution to find whether the impugned Act is relatable to any entry in the relevant list".
(emphasis supplied)
58. Taking into consideration the aforementioned principles, the provisions of Rule 4(4) and (12) of OMMC // 56 // Rules, 2016 cannot be declared as ultra vires either to the GCD Rules, 1999 or to Articles 14, 19 (1)(g) and 21 of the Constitution of India, rather the said provisions are intra vires. As a consequence thereof, the application filed by the petitioner on 08.04.2016 for grant of prospecting license under the OMMC Rules, 2004 becomes ineligible, in view of commencement of Rule 4(12) of the OMMC Rules, 2016 w.e.f 14.12.2016. There is thus no illegality or irregularity committed by the authority nor is there violation of any of provisions of law, so as to cause interference of this Court.
59. The writ petition thus merits no consideration and the same is hereby dismissed. There shall be no order as to costs.
(DR. B.R. SARANGI) JUDGE G. SATAPATHY, J. I agree.
(G. SATAPATHY) JUDGE Orissa High Court, Cuttack The 21st September, 2022, Alok/Arun