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1. One Mr. T. P. Yeoman obtained a mining lease for coal of about 1300 acres located in the District of Sambalpur. valid for a period of thirty years with effect from October 1. 1917 from the Secretary of State for India in Council. This came to be known as the Ib. River Colliery. On 22-2-1920, Mr. Yeoman transferred a part of the lease-hold in favour of one Mr. M. H. Dutta and on June, 7. 1920 by an agreement between the Secretary of State for India in Council and Mr. Dutta the transfer was duly recognised. On August 21. 1931, the Hindu undivided family of Raisaheb Chandanmull Karnani carrying on business under the firm name and style of M/s. Chandanmull Indrakumar purchased the leasehold interest of Mr. Dutta in a court sale held by the High Court of Calcutta. On December 27. 1934, the Secretary of State for India in Council accepted M/s. Chandanmull Indrakumar as the transferee of the lease-hold interest (Annexure-C). Raisaheb Chandanmull Karnani died on February 2. 1943, but the joint family firm continued as before.

It is contended that the Company was a family concern of Raisahab Chandanmull Karnani and was brought about only to provide a convenient method of enjoying the properties of the family which remained undivided. Administration and management of the colliery was taken over by the company from January 30. 1950. The State Government and its officers started dealing with the petitioner-Company qua the colliery and accepted payment of rent, royalty and other dues from the Company. On April 22. 1957, sanction of renewal of the mining lease (Annexure-G) was made in the name of the Hindu undivided family firm and was directed to date back and commence from. October 1. 1947. A part of the lease-hold was being worked out but the major portion remained virgin. The Company continued to pay rents, royalties etc. Once in 1957 (Annexure-H) and again in April. 1963 (Annexure-L). notices were issued to the Company the first one by the Deputy Commissioner of Sambalpur and the second by the Deputy Secretary of the concerned Ministry of State Government to show cause as to why by operation of Rule 28-A of the Mineral Concession Rules of 1949 the renewal may not be taken to have become inoperative thus bringing about an end to the leasehold interest. The Company had showed cause and no further action had been taken. There was a criminal case against the Company and its officers for working the mines without a valid lease. That ended in adquittal. Thereafter rent, royalties etc. were accepted from the petitioner Company. On 6-2-70 the Secretary to Government in the Mining and Geology Department wrote to the Collector, Sambalpur saving.

The fact of having taken possession may be recorded in the standard register. The officers concerned may also record the facts in their respective tour diaries.
As regards the area in actual physical' possession of the party separate instructions will issue to recover possession later.
This may please be treated as present and action taken may be reported to the Department."

On 28-2-70 the Additional District Magistrate. Sambalpur is alleged to have taken over possession of the virgin portion of the colliery. He made the following record (Annexure-P).

Whereas the original lease having expired on 30th December. 1947, and there being no valid lease on 30th January. 1950 there was no question of any transfer of the area covered under the lease.
Now, therefore, you having no locus standi to work the mine are hereby required to vacate the colliery by 6th May. 1963 failing which legal action will be taken".

The petitioner explained that it had made the security deposits, paid the fees for surveying, for preparation of maps and Other expenses and there remained nothing more to be done by the petitioner-Company. It also indicated that it had been depositing rents and royalties from time to time which had been accepted by Government; Rule 28-A of the Mineral Concession Rules had no application to the present case as the renewal was deemed to be effective from 1-10-47 when the Rules were not in force and ultimately requested for withdrawal of the notice. In paragraph 26 of the writ petition it has been stated that the petitioner was prosecuted under Section 21 of the Mines and Minerals (Regulation and Development) Act of 1957 but the said prosecution ended in acquittal. This fact has not been denied. On 27-3-65 the Collector of Sambalpur called upon the Managing Director of the petitioner-Company to make payments of dead rent in respect of the colliery by crossed bank drafts through the State Bank of India, Sambalpur, payable to the Collector or the Officer in-charge, Mines, Sambalpur. Pursuant to the demand, payments were made.