Allahabad High Court
Vipul Tyagi vs State Of U.P. And 6 Others on 11 January, 2021
Bench: Anjani Kumar Mishra, Prakash Padia
HIGH COURT OF JUDICATURE AT ALLAHABAD ?Reserved on 14.12.2020 Delivered on 11.01.2021 Court No. - 50 Case :- WRIT - C No. - 17258 of 2020 Petitioner :- Vipul Tyagi Respondent :- State Of U.P. And 6 Others Counsel for Petitioner :- Udayan Nandan,Sr. Advocate Counsel for Respondent :- C.S.C. and Case :- WRIT - C No. - 16799 of 2020 Petitioner :- Vipul Tyagi Respondent :- State Of U.P. And 4 Others Counsel for Petitioner :- Ravindra Singh Counsel for Respondent :- C.S.C. Hon'ble Anjani Kumar Mishra,J.
Hon'ble Prakash Padia,J.
Heard Shri Shashi Nandan, Senior Advocate for the petitioner and Shri Pradeep Kumar Tripathi, learned Standing Counsel on behalf of the State-respondents.
Writ Petition No. 17258 of 2020 seeks a writ of certiorari for quashing the order dated 21.03.2020 passed by the District Magistrate, the fourth respondent, whereby liability of Rs. 8,42,80,000/- has been imposed upon the petitioner as outstanding lease rental/royalty, a fine of Rs. 35,15,600/- has been imposed for illegal mining and a sum of Rs. 27,45,600/- has been held to be the liability of the petitioner, being TCS.
The order dated 28.03.2020 passed by the second respondent, whereby the revision directed against the order of the third respondent has been dismissed is also impugned.
A recovery certificate for recovery of the amount stated above has been issued on 14.01.2020. This RC is also sought to be quashed as is the attachment order dated 23.09.2020, passed consequent to the issuance of the recovery certificate.
The facts of the case as set out in the writ petition are that on 30.10.2018 a mining lease was granted in favour of the petitioner for a period of 5 years. The yearly royalty on the said lease was payable in quarterly installments. It is stated that on 05.12.2018, a notice was issued to the petitioner alleging that he was carrying out illegal mining. This notice was issued on the basis of an inspection alleged to have been carried out on 22.11.2018.
On 03.01.2019, a notice was issued to the petitioner calling upon him to deposit a sum of Rs. 2,64,00,000/- being the second installment of the royalty payable for the first year, which as noticed above was to be paid, quarterly.
On 21.01.2019 yet another notice alleging illegal mining being carried out by the petitioner was issued to him. Subsequently, on 22.01.2019, the petitioner was prohibited from carrying out mining operations.
On 13.06.2019, yet another notice was issued to the petitioner calling upon him to deposit the third installment of the quarterly payment required to be made by him. On 01.08.2019, a notice for payment of third and fourth quarterly installments was also issued.
It appears that the petitioner had filed an application for surrender of his lease. When no orders were passed on the said application, the petitioner filed Writ Petition No. 27353 of 2019 before this Court. This petition was disposed of, vide order dated 16.09.2019, directing that the petitioner's application for surrender of the mining lease be disposed of.
The application for surrender dated 26.09.2019 came to be rejected, vide order dated 21.10.2019.
Again, a writ petition was filed and the matter was remitted back for reconsideration of the surrender application of the petitioner.
The application for surrender of lease was again rejected on 14.01.2020. Thereafter, on 12.03.2020, yet another notice was issued to the petitioner calling upon him to deposit the third and fourth installments of the royalty payable by him.
Subsequently, the District Magistrate/District Officer on 21.03.2020 passed the order impugned while simultaneously blacklisting the petitioner. The liability of Rs. 8,44,80,000 specified in this order was for the arrears of royalty for the first year, the first and second installments for the royalty payable for the second year along with interest, thereon. A fine of Rs. 35,15,600/- was also imposed for the illegal mining carried out by the petitioner. The order passed by the District Magistrate/District Officer on 21.03.2020 has been affirmed upon dismissal of the revision filed by the petitioner vide order dated 29.09.2020.
Assailing the impugned orders, the contention of learned counsel for the petitioner is that in view of Rule 58 of the Uttar Pradesh Minor Mineral (Concession) Rules, 1963, any demand or recovery from the petitioner, beyond the second installment, he was required to deposit in pursuance of the notice dated 03.01.2019, is without jurisdiction. This is so because admittedly, the second installment was not paid in full, despite issuance of the notice to him. Under the circumstances, the respondents should have proceeded in accordance with Rule 58 and terminated the lease. This was not done. Neither has the petitioner carried out any mining operations, subsequently. It has been submitted that a categorical averment in this regard has been made in the writ petition, which has not been denied in the counter affidavit. It has been vehemently submitted that no liability can be imposed upon the petitioner beyond 30.06.2019, when the mining operations were ceased by the petitioner. To buttress this arguments reliance has been placed upon Section 15(3) of the Uttar Pradesh Mines and Minerals (Regulation and Development) Act, 1957.
The emphasis of Counsel for petitioner is upon the words "...minerals removal or consumed..."
The next submission of learned counsel is that no notice regarding the intention to blacklist was ever served upon the petitioner. The impugned orders insofar as they blacklist the petitioner are therefore, patently illegal. In any case, Rule 60(2) of the U.P. Minor Mineral (Concession) Rules, 1963, provides that an order for blacklisting can be for a maximum period of two years. Therefore, reasons are to be recorded as to the period for which a person is being blacklisted and as to why the blacklisting is for the maximum period provided. This again has not been done. The order of blacklisting is therefore, vitiated on this ground also.
In rebuttal, Shri Pradeep Kumar Tripathi, learned Standing Counsel has submitted that the argument that no liability beyond 30.06.2019 can be fastened upon the petitioner is, not correct. Mining operations were not stopped by the respondents but were stopped in view of terms contained in the environment clearance granted to the petitioner. For this purpose he has referred to Annexure 15 on page 183 of the paper book. He has also submitted that the impugned orders are perfectly justified because not only has the petitioner resorted to illegal mining, he has failed to deposit the royalty/lease rentals, which were his liability in view of the lease deed dated 30.10.2018. The petition is therefore, liable to be dismissed.
We have considered the submissions made by learned counsel for the parties and perused the record.
Rule 58 of the Uttar Pradesh Minor Mineral (Concession) Rules, 1963 relied upon by the petitioner reads as follows:-
"[58. Consequences of non-payment of royalty rent or other dues. - (1) The State Government or any officer authorised by it in this behalf may terminate the mining lease after serving a notice on the lessee to pay within thirty days of the receipt of the notice any amount due or dead rent under the lease including the royalty due to the State Government if it was not paid within fifteen days next after the date fixed for such payment. This right shall be in addition to and without prejudice to the right of the State Government to realise such dues from the lessee as arrears of land revenue.
(2) Without prejudice to the provisions of these rules, simple, interest at the rate of 18 per cent per annum may be charged on any rent, royalty, demarcation fee and any other dues under these rules, due to the State Government after the expiry of the period of notice under sub-rule (1)."
It is not disputed that the notice issued to the petitioner on 03.01.2019 was in terms of Rule 58. In case there was no compliance despite the said notice, the respondents should have terminated the lease and in failing to do so, they have failed to act in accordance with law. Instead of terminating the lease, notices for deposit of subsequent installments have been issued even though the first notice itself had not been complied with. The respondents should have proceeded in accordance with Section 58 and once they failed to do so, it was not open for them to keep issuing repeated notices. The subsequent notices, therefore, in our considered opinion, cannot be held to be justified. The liability imposed upon the petitioner by the impugned order passed by the District Magistrate also cannot be sustained in its entirety because it is the categorical case of the petitioner that he did not carry out any mining operations beyond 30.06.2019. This categorical averment in the writ petition has not been denied and, therefore, stands admitted.
Once the petitioner did not carry out any mining operations, which allegations as held above, stands admitted no royalty was liable to be recovered from him in view of Section 15(3) of the Act, which reads as follows:-
"[(3) The holder of a mining lease or any other mineral concession granted under any rule made under sub-section (1) shall pay ][royalty or dead rent, whichever is more], in respect of minor minerals removed or consumed by him or by his agent, manager, employee, contractor or sub-lessee at the rate prescribed for the time being in the rules framed by the State Government in respect of minor minerals:
Provided that the State Government shall not enhance the rate of [royalty or dead rent] in respect of any minor mineral for more than once during any period of [three years]."
Accordingly, we are in agreement with the submission of learned counsel for the petitioner that whatever was due form the petitioner till 30.06.2019 alone, could be recovered. No royalty payable as the third and fourth installments for the first year of the lease and for the first and second installments of the second year of the lease is liable to be recovered from the petitioner. The impugned orders, fastening also the liability of these installments, upon the petitioner, cannot be sustained.
Shri Pradeep Kumar Tripathi, learned Standing Counsel has not been able to show that the impugned order blacklisting the petitioner has been passed after notice. Power to blacklist is to be found in Rule 60(2) of the Uttar Pradesh Minor Mineral (concession) Rules, 1963 and reads as follows:-
"(2) If a lease is terminated under sub-rule (1) or Rule 58, the lessee may be blacklisted by the District Officer for such period, not exceeding two years, as he may consider proper which shall be uploaded on the website of the department and during the said period no mineral concession under these rules shall be granted to him. An entry in this regard shall be made in the remarks column of the registers of mining lease or the auction lease, as the case may be."
Although, this sub-rule 2 does not talk of any opportunity, however, the same has to be read in continuation with sub-rule 1, which is quoted below:-
"[60. Consequences of contravention of rules and conditions of lease generally. - (1) In case of any breach or contravention by a lessee of any of these rules or conditions and covenants contained or deemed to be contained in the lease except those relating to payment of royalty, rent or other sums due to the State Government, the State Government may, after giving the lessee a reasonable opportunity to state his case, terminate the lease. The right shall be in addition to and without prejudice to the provisions of Rule 59."
Under the circumstances, the impugned orders insofar as blacklist the petitioner without any show cause notice expressing the intent to blacklist the petitioner cannot be sustained, especially in view of the decision of the Apex Court in Gorkha Security Services Vs. Government (NCT of Delhi) and others (2014) 9 SCC 105, has held that it is incumbent on the part of the department to state in the show cause notice the intention to blacklist. The impugned orders are therefore, liable to be set aside on this ground also.
There is merit also in the submission of Shri Shashi Nandan that since the blacklisting can be for a maximum period of two years, reasons have to be recorded as to why the blacklisting is to be ordered for the maximum permissible period. We do not find any such reason in either the order passed by the District Magistrate or in the revisional order.
Accordingly and in view of what has been stated above, the writ petition is liable to be and is hereby allowed. The impugned orders dated 21.03.2020 as also revisional order dated 28.09.2020 are hereby quashed.
Since the recovery certificate dated 14.01.2020 has been issued consequent to the orders, which have been quashed above, the recovery is also vitiated as is the attachment order dated 23.09.2020. Even these orders are hereby, quashed.
Before parting with the case, it would be relevant to state that the liability impused upon the petitioner also includes fines for illegal mining. Any mining during the period for which lease rentals/royalty had not been paid by the petitioner, would not in our considered opinion, definitely amount to illegal mining and such fine along with interest imposable upon it, in accordance with the Uttar Pradesh Minor Mineral (concession) Rules, 1963 cannot be said to be unwarranted.
Accordingly, the writ petition is allowed. The impugned orders dated 21.03.2020 and 28.09.2020 as also the consequential recovery certificate dated 14.01.2020 and the attachment order dated 23.09.2020 are, hereby set aside. The matter is remanded back to the District Magistrate to determine the amount liable to be recovered from the petitioner up to 30.06.2019 in the light of what has been stated in the body of the judgment, above.
Insofar as Writ Petition No. 16799 of 2020 is concerned, it is admitted by learned counsel for the parties that the same has been rendered infructuous by subsequent developments. The Writ Petition No. 16799 of 2020, is dismissed as infructuous.
Order Date :- 11.1.2021 Mayank