KANGRA VALLEY SLATE CO. LTD. v. STATE OF PUNJAB & ORS.

Citation: [1969] 3 S.C.R. 165; 1968 INSC 344

Court: Supreme Court of India

Bench: J.M. SHELAT , VISHISHTHA BHARGAVA, C.A. VAIDYIALINGAM

Judgment date: 1968-12-19

Case summary

1968 INSC 344. Supreme Court of India judgment dated 1968-12-19. KANGRA VALLEY SLATE CO. LTD. v. STATE OF PUNJAB & ORS. Read the judgment and case details...

Judgment text

- . A KANGRA VALLEY SLATE CO. LTD • v. STATE OF PUNJAB & ORS. December 19, 1968 B [J. M. SHELAT, V. BHARGAVA AND C. A. VAIDIALINGAM, JJ. J c D E F ·G H Mines & Mineral Regulations and Concession Rules, 1960 r. 28- Application for renewt. l of lease-Li111itation for-Scope of-Fixation of tinze by r. 28, whether n1andatory, and whether ultra vires the rule niaking power. Rule 28(1) of the Mines Concession Rules, 1960 (as it stood in 1961) provided that applications for renewal of a mining lease shall be made at least six months before expiry of the lease. The appellant whose mining lease was to expire on March 22, 1962 made an application for reney. :al of the lease. The application bore the date September 20, 1961 and was received by the Director of Industries on October 9, 1961. On the questions (i) whether r. 28 prescribed any time limit within wliich an application had to be made; (ii) even if it did, whethe'r it was only direc- tory and not mandatory; and (iii) whether r ..

28 laying down the period of limitation for renewal of application was ultra vires s. 13(2) of the Mines & Minerals (Regwlations & Development) Act, 1957 as the time limit prescribed in the rule did not fall under any of the matters set out in the sub~section. HELD : Rule 2d was valid, and was mandatory and the application was clearly beyond the time appointed under the rule. [173 CJ (i) The statement that the application was made on September 20, 1961 was verified by the·, Secretary of the appellant company, as true- to the best of his knowledge and belief. The Secretary ought to have personal knowledge whether the application was made on the alleged date or not. The Government did not admit that the application was sent on Septem~ er 20, 1961 and the company in the re. ioinder repeated that it \Vas sent on that date.

In spite of the date of sending the application being put in issue, no attempt was made by tht appellant to show from its despatch book or any other record or otherwise that it was actually despatched on the date alleged. No argument even was advanced in the High Court that as it was made on September 20, 1961 it was within time. The mere fact, therefore, that the application bore the date could not mean that it was made: on that date and was therefore within time. [I 70 B·C] (ii) Considering the scheme and the object of the Act and. the rules it could riot be held that r. 28 was not intended to be mandatory and was only directory. The rules laying down time limits for making applications, acknowledging their receipts and disposal thereof were intended to sec that the development of mines and exploitation of mine· rals took place both in a regulated manner and without any undue delay.

If the time limit of six months prescribed in rules 22 and 28 was not available to the State Government it would not be possible for it to decide within time and to, follow the procedure for granting a fresh lease to someone else. The result would be that mining _operations would be delayed in that particular land and to that extent the object of the Act and the duty imposed by s. 18 on the Central Government would be delayed or defeated. [172 B-D] 166 SUPREME COURT REPORTS [1969] 3 S. C. R. (iii) Rule 28 was not invalid by renson of its not falling under any one of the matters set out ills. 13(2) of the Act. Assuming that the time limit prescribed in the rule did not fall under any of the matters set out in that sub-section, Sub-. sec. l authorises the Central Government to make for regulating the grant of mining leases and the Cent'ral Govern- ment in pursuance of that power can make rules including the one laying down the time within which a renewal application should be made.

A grant of renewal of a lease is granting a mining lease, and therefore, fixing time within which an application for it should be made would be regulating the grant of a lease. The function of sub-sec. 2 was merely an illustrative one considering that the rule making power was conferred by sub-sec. 1 and the rules referred to in the opening ·sentence of sub-sec. 2 were the rules \\ 1 hich were authorised by and made under sub"'6ec. 1. Therefore, the provisions of sub-sec. 2 were not restrictive of sub--sec. 1 and that indeed was expiessly stated by the words "without prejudice to the generality of the power conferred by sub-sec. ! ". [172 E-Hl King-E1nperor v. Sihnath Banerjee, 72 I. A. 241 and State of Kera/a v. Shri M. Appukutty, [1963] Supp. I S. C. R. 563, followed. CIVIL APPELLATE JURISDICTION: Civil Appeal No. 1034 of 1966. Appeal by special leave from the judgment and order dated August 27, 1965 of the Punjab High Court in Letters Pat~t Appeal No. 233 of 1963. S. V. Gupte, B.

R. L. Iyengar, S. K. Mehta and K. L. Mehta, for the appellant. Niren De, Attorney-General and R. N. Sachthey. , for rcspon· dent Nos. 1 and 2. S. P. Nayar, for respondent No. 3. S. P. Sinha 'lljlld M. 1. Khowaja, for the intervener. The Judgment of the Court was delivered by Sbelat, J. The question arising in this appeal, is whether the appellant-company's application bearing the date September 20, 1961 for renewal of a mining lease was time barred and therefore not a valid application. The company is a public limited company having its regis- tered office in New Delhi and is engaged in quarrying slate and marketing the same. The company had secured a perpetual lease dated March 22, 1879 of certain lands in villages Majra and Manhatti in District Gurgaon. The Controller of Mining Leases under powers reserved under sec. 16 of the Mines & Minerals (Regulations & Development) Act, 67 of 1957 (here- inafter called the Act) read with r.

6 of the Mining Leases (Modification of Terms) Aniendmenr Rules, 1960 modified the said lease reducing its period so as to expire on March 22, 1962. In consequence of certain correspondence which took place bet- ween the company and the Director of Industries, Punjab, the company's secretary met that official on September 12, 1961 A B c D E F G , H KANGRA VALLEY SLATE v. PUNJAB (She/at, I. ) 167 A when he was advised that the company should apply for renewal of lease in Form J if it so desired. Consequently, it was said that the company made an application bearing the date Sep- tember 20, 1961 which was received by the Director of Indus- tries on October 9, 1961. The company thereafter applied for and obtained on November 10, 1961 a certificate of approval B under sec. 5 of the Act. The Director of Industries, however, rejected the said application on two grounds ( l) that it was beyond the time prescribed under r.

28 of the Mining Concession Rules, 1960, and (2) that it was not a valid application under Form I as it was not accompanied by a copy of the certificate of approval. The company thereupon filed a revision applica- C ti on under r. 54 of the said rules to the Central Government. The Central Government by . its order dated December 14, 1962 rejected it on the ground that it saw no valid ground for inter- fering with the decisi cction 2 of the Act. therefor. e, contains the requisite declaratiQn titat it was expedient in the public interest that the Union should take under its control the regulation of mines and the development ff of minerals to the extent provided in the Act. Sectiqn 18 of the Act expressly enacts that it shall be the duty of the Central Govern- ment to take all steps as may be necessary for the conservation· • A B c D E F G H KANGRA VALLEY SLATE V, PUNJAB (She/at, /,) 17 ~ and development of minerals and for that purpose make such rules as it thinks fit.

Since the development of mines and mine- rals was to be regulated and controlled by the Central Govern- ment, s. 4 lays down a ban against any one undertaking any prospecting or mining operations except under a licence or a lease. The anxiety of Patliament while enacting the Act was to see that conservation and development of mines and minerals should be in a proper and regulat manner. It is, therefore, that s. 5 provides that no prospecting licence. or mining lease should be granted by a State Government unless the applicant holds a certificate of approval from that Government. With the mandate which the Central Government received from the Act, the Central Gov- ernment made elaborate rules to ensure that development of mines and exploitation of minerals proceeded along regulated lines and there was no procrastination i nthe development. This is the trend expressed in cleat language throughout the rules. R. 15, for instance, .

provides that a deed granting a prospecting licence shall be executed within 90 days of the communication of the order of the State Government granting such a licence. If no such deed is executed within the aforesaid time due to the fault of the applicant the State Government is authorised to revoke it. R. 22 provides for an application for a mining lease and its renewal. For the latter, it provides that it shall be made at least six months (now extended to 12 months under the amended rule) before the expiry of the lease. R. 23 provides for the ack- nowledgment by the authority in the prescribed form of the . receipt of the application for grant or renewal of a lease. R. 24 provides time limit for disposal of the application made under r. 22. Cl. 3 of r. 24 provides that if an application is not dis- posed of within the prescribed time it shall be deemed to have been refused.

This provision was obviously made to ensure dis- posal within the time and to prevent an applicant having to wait indefinitely till his application was disposed of by the State Gov- ernment and to enable him to make a revision application under r. 54. It is cleat that the object of these rules laying down time limits for making applications, acknowledging their receipts and disposal thereof was to see that the development of mines and exploitation of minerals took place both in a regulated manner and without any undue delay. R. 28 with which we are imme- diately concerned not only lays down the time within which a renewal application is to be made but also provides that if it is not disposed of before the expiry of the lease the period of the lease shall be deemed to have been extended for a further period of six months or ending with the date of the receipt of the orders of the State Government thereon whichever is shorter. 172 SUPREME COURT REPORTS (1969] 3 S. C.

R The object of providing time limit for the renewal application was that sufficient time before the expiry of lease was available to the State Government to decide whether the renewal should be gra,nted or not, for, if the renewal was not gIJanted the land in question would be available for re-grant and the State Govern- ment would have to declare that the land was so available for re-grant, invite applications for the grant of the lease and follow the procedure laid down in the Act and the Rules therefor. It is obvious that if the time of six months prescribed in rules 22 and 28 was not available to the State Government it would not be possible for it to decide within time and to follow the proce- dure for granting a fresh lease to someone else. The result would be that mining operations would be delayed in that particular land and to that extent the object of the Act and the duty imposed by s. 18 on the Central Government would be delayed or defeated.

Considering the scheme and the object of the Act and the rules it is not possible· to agree with Mr. Gupte that r. 28 was not intended to be mandatory and is only direc- tory. Mr. Gupte next contended that r. 28 laying down the period of limitation for renewal application was ultra vires sec. 13 ( 2) of the Act, as the time limit prescribed in the rule does not fall under any of the matters set out in that sub-sectiqn, Assuming that it is so, sub-sec. 1 authorises the Central Government to make rules for regulating the grant of mining leases and the Central Government in pursuance of that power can make rules including the one laying down the time within which a renewal application should be made. A grant of renewal of a lease is granting a mining lease, and therefore, fixing time within which an application for it should be made would be regulating the grant of a lease. A similar contention was considered in King Emperor v. Sibnath Banerjee(') in connection with r.

25 of the Defence of India Rules made under s. 2 of the Defence of India Act, 1939, as amended in 1940, and the Privy Council held that though the rule did not fall under any of the matters enu- merated in sub-sec. 2 of sec. 2, the rule was competent as it would be one which could be made under the generality of powers contained in sub-sec. 1 of sec. 2. Their Lordships held that the function of sub-sec. 2 wa~ merely an i! lustrative Qnlo con- sidering that the rule making power was conferred by sub-sec. 1 and the rules referred to in the oμe·ning sentence of sub-sec. 2 were the rules which were authorised by and made under sub- sec. 1. Therefore, the provisions of sub-sec. 2 were not res- trictive of sub-sec. 1 and that indeed was expressly stated by the words ''without prejudice to the generality of the powers confer- (! ) 72 l. A. 241 at 258. A B c D E F G H A B c D E F G KANGRA VALLEY SLATE V. PUNJAB (She/at. J. ) 173 red by sub-sec. l". The general language of sub-sec.

l, there- fore, amply j. istified the terms of r. 26 and avoided the conten- tion that it was not justified under sub-sec. 2. These observa- tions were followed with approval in State of Kera/a v. Shri M. Appukutty (1) where the vires of r. 17 of the Madras General Sales Tax Rules made under s. 19 of the Madras General Sales Tax Act, 9 of 1939 were challenged and the challenge was re- jected. The argument, therefore, that r. 28 was invalid by reason of its not falling under any one of the matterr set out in s. 13 (2) is without substance. In the view that we take that r. 28 is a valid r• le and that it is mandatory, the application was clearly beyond the time appointed under the rule, the company having failee to establish that it was made, as it alleged, on September 20, 1961.

In that view it would not be necessary for us to go into the questions whether the order of the Central Government not being a speak- ing order was bad or whether the application by the company was not a valid one inasmuch as the company was not possess- ed a certificate of approval at the date when the application was made and its copy was not annexed thereto as required by Form J. Assuming that the application was a valid one and that the requirement of annexing the copy of the certificate of approval was not mandatory and assuming further that the order of the Central Government was not a valid one, the only thing that we could be asked to do would be to send back the matter to the Central Government directing it to pass a proper order. But in the view that we have taken of r. 28 and consequently of the application for renewal being time-barred, the Central Govern- ment can only reject once again the revision application adding in.

its order that the Director was right in rejecting the applica- tion as it was time-barred. Such an order of remand would serve no useful purpose so far as the appellant company is concerned. That being so, it is not worth our while to interfere under Art. 136 with the order of the Central Government and ask that Government to pass a fresh order. In the result the appeal must fail and is dismissed with costs. Y. P. Appeal dismissed. 0) [19631 Supp. I S. C. 11.. S63, S69, S10.

Source: Supreme Court eSCR. Dataset: Dattam Labs, CC BY 4.0. Text extracted automatically; compare with the source PDF for layout and accuracy.