L. Venkateswara Rao And Ors. vs Singareni Collieries Company Ltd., ... on 25 June, 1993
6. In substance, a person carrying on quarrying operations etc., in contravention of the rules shall be liable to pay penalty, which should be such a seigniorage fee together with assessment as may be imposed by the officer. The Director of Mines and Geology is empowered to impose such a penalty. In no case such penalty shall exceed 10 times the normal seigniorage fee. For ascertaining the position of payment of mineral revenue, the person authorised viz., Director of Mines and Geology shall be entitled to enter and inspect the premises, survey and take measurements, weigh, measure etc., examine the document, book etc., and then order the production of any such document, book, register, record as is referred in Sub-clause (d). If no such documentary proof is produced in token of having paid the mineral revenue due to the Government by any person, then, such authority is empowered to impose the penalty which is five times of the normal seigniorage fee as penalty in addition to normal seigniorage fee leviable under the rules. The vires of the provision etc., has already been tested and accepted by a Full Bench of this court in L. Venkateswara Rao v. Singareni Collieries Company Ltd., in addition to the other principles therein which are not relevant for the purpose of this case. But when the vires is upheld, it is also implied that such a power of the vires should be exercised within the implication of the provisions or otherwise, it may become the ultra vires exercise of the power vested in the authority. The very fact that such a levy is penalty based on seigniorage as a civil conseqence shows that the person affected has a right to be given an opportunity. Moreover, Rule 26(3)(i)(e) emphatically imposes obligation on the authority to order the production of any such document, book, register, record as is referred to in Clause (d) meaning thereby that the affected person will be given opportunity to produce such material which are described in the provision (possibly any other material which may be sufficient to satisfy the authority that the condition to pay the Government Revenue is satisfied). The consequence of non-production of such material as is described under Rule 26(3)(i) and non-compliance of the orders under Sub-clause (e) results in the imposition of the penalty under Rule 26(3)(ii). The expression that if no documentary proof is produced in token of having paid the mineral revenue due to the Government means that failure or non-compliance of the order under Sub-clause (e) or in other words, failure to avail the opportunity afforded by issuing such an order or by receipt of such an order. In other words, a person is entitled to be given an opportunity and to be treated with principles of natural justice. Having availed such an opportunity, if he fails to comply with, he is bound to the consequences of suffering the imposition of penalty. Such a person cannot complain later that he cannot be mulcted to pay the penalty. It is apparent under the circumstances and also in the light of the provisions stated above that it is mandatory for the authority to comply with the provisions inasmuch as to strengthen it by expending the application of the principles of natural justice without which the order will be vitiated. Therefore, the question in each case would be whether such compliance has been adhered to by the authority and such a non-compliance has been established against the person who has to be put under the sufferance for payment of penalty.