State Of Karnataka & Ors vs Janthakal Enterprises & Anr

Reportable IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NOS.3293-3294 OF 2011 [Arising out of SLP(C) Nos.33773-33774/2009]

State of Karnataka & Ors. .....Appellants

Versu s

Janthakal Enterprises & ....Respondents Anr.

O R D E R

Leave granted. Heard.

2. The first respondent was the holder of a mining

lease (No.593/993) for the period 6.7.1965 to

5.7.1985 under registered lease dated 6.7.1965 in

respect of an area of 80.94 hectares in Survey No.

35(Part) of Tanigehalli and Survey No.107(Part) of

Hirekandawadi villages, Holalkere Taluk, Chitradurga

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District, Karnataka. The first respondent filed an

application for renewing the mining lease, on

22.6.1984, without seeking clearance under Section 2

of the Forest (Conservation) Act, 1980. The

application for renewal was rejected on 30.9.1996.

However subsequently by two notifications dated

23.8.2007, the State Government accorded sanction for

the first renewal of the mining lease retrospectively

for a period of twenty years (from 5.7.1985 to

4.7.2005) and for the second renewal for another

period of twenty years (from 5.7.2005 to 4.7.2025)

subject to clearance under Section 2 of the Forest

(Conservation) Act, 1980 and environment clearance

under Environment Protection Act, 1986. But the said

renewals have not been granted as the first

respondent did not obtain the required clearances. In

fact, the proposals submitted by the first

respondent, for obtaining forest clearance were

returned several times for not submitting a complete

proposal. In view of it, the first respondent alleges

that mining activity has been carried on by the first

respondent in the mining lease area, after 5.7.1985.

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3. The first respondent produced before the

Director, Mines & Geology, State of Karnataka, an

alleged permission letter dated 14.2.2008 purportedly

issued by the Ministry of Environment and Forest,

(for short `MoEF') Government of India, addressed to

the Principal Chief Conservator of Forests, Karnataka

according permission to the first respondent for

lifting upto one lakh Tonnes of old waste dumped in

the leased area, made up of natural soil erosions and

waste thrown by neighbouring mining lessees. On

routine verification about the genuineness of the

said communication, the MoEF informed the Secretary

(Forests), Government of Karnataka, that the said

letter dated 14.2.2008 was a fake letter and directed

the state government to initiate criminal action

against the first respondent and others responsible

for the same. The first respondent subsequently

admitted that the letter dated 14.2.2008 was not

genuine. According to the first respondent, one Irfan

Shaikh representing himself to be a clerk working at

MoEF, had represented to the first respondent that he

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would be able to get any clearance from MoEF; that

the first respondent explained its case to him; that

the said Irfan Shaikh thereafter provided the said

letter dated 14.2.2008 authorising lifting the old

waste dumps; and that believing the said letter to be

a genuine letter issued by MoEF, the first respondent

had furnished it to the Director, Department of Mines

and Geology, State of Karnataka. The first respondent

submitted that once it came to know that the letter

was a fake, it neither relied on it nor used it.

4. The first respondent filed IA Nos.2419 and 2420

of 2008 in WP (C) No.202 of 1995 (T N Godavaraman

Thirumulpad vs. Union of India) in this Court,

seeking permission to intervene and seeking direction

for grant of approval of its proposal for diversion

of 80.94 Hectares of forest land, for non-forest

mining activity under the Forests (Conservation) Act

and permission to lift 75000 MT of iron ore and 25000

MT of Manganese ore which had been previously mined

and lying in the dump area of the mine. In the said

applications, the petitioner averred as under : 5

"That in the mine in question, around 75000 MT of iron ore and 25000 MT of manganese which were previously mined and stored in the dump area are lying there (material mined before 1980). The appellant prays that it may be permitted to lift the same from the dump and sell it.

The first respondent also offered to pay the NPV for

the said forest area of 80.94 Hectare, as also the

amount to be paid for carrying out compensatory

afforestation. The said applications were however

dismissed by this court, as withdrawn, on 20.3.2009.

5. The first respondent thereafter filed a writ

petition on 30.3.2009 before the Karnataka High Court

(WP No.8094/2009) seeking the following relief:

"Issue a writ of mandamus directing the respondents to permit the petitioner to lift the dumped material lying in the mining yard of ML 593/993 at Hirekandawadi & Thanigehalli village of Holalkere Taluk, Chitradurga District, by collecting the requisite fee and royalty."

The State of Karnataka, Director of Mines and Geology

(Karnataka), Secretary, Ministry of Environment and

Forests, (Government of India), Principal Chief

Conservator of Forests, Karnataka and the Conservator

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of Forests, Chitradurga Division were arrayed as

respondents 1 to 5 in the said writ petition. The

first respondent alleged as follows in support of the

said prayer in the writ petition :

(a) The leased area under ML No.593/993

had been declared as reserved forest area

wherein mining or other non-forest activities

were prohibited without obtaining necessary

clearance.

(b) When the mining activities were carried

on by the first respondent between 1965 and

1980, there was no value for iron ore of

grades less than 62% or 63% and the excavated

material of lesser grades were dumped as waste

in the mining area. There were nine such old

dumps containing 1,17,800 metric tonnes of

waste material, in the leased area, consisting

of material extracted prior to 1985 when the

mining lease was validly in force.

(c) In view of the gradual appreciation in

value of iron ore, the said dumped material

became valuable and the first respondent

decided to dispose of the said waste. But in

spite of repeated requests, necessary

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clearances/transportation permits, were not

issued to the first respondent who was the

owner thereof, even though there was no legal

impediment for grant of such

clearances/permits.

6. The said writ petition came up for consideration

before a division bench of the High Court on

24.4.2009 for preliminary hearing. The High Court

directed issue of notice to the respondents and also

issued an ex parte interim direction to the forest

department, to furnish the following details to the

court :

(i) What was the actual quantity of dumped material available in the mining yard?

(ii) What would be the royalty, EPF, NPV which the writ petitioner was otherwise liable to pay?

(iii) What was the damage they had caused to the flora and fauna? And

(iv) What was the extent of afforestation, if the writ petitioner was liable to make it?

7. When the matter came up for preliminary hearing

on 2.7.2009, the Government Advocate handed over to

the court, a copy of the report dated 18.6.2009

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submitted by the Deputy Conservator of Forests,

Chitradurga Division to the Principal Chief

Conservator of Forests, prepared in compliance with

the order dated 24.4.2009. The said report furnished

the following information:

Q: What is the actual quantity of the available

material:

A: There are 9 old dumps in the above ML area. The

quantity of the material assessed by the Dept. of

Mines & Geology is 1,17,800 M.T.

Q: Since when it is dumped and the damages caused

thereto due to that dumping:

A: As per this office records in the above ML no

mining activities were carried out in the area since

1985. Due to dumping of the material, forest growth

and vegetation in the area and surrounding streams

are disturbed.

Q: What is the royalty, damages has to be paid by the

petitioner?

A: The royalty is to be collected by the Dept. of

Mines & Geology. Hence, the information is to be

provided by the Dept. of Mines & Geology. The

surrounding area about 12.00 Ha was damaged. As per

the Hon'ble Supreme Court of India order dated

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28/03/2008 in I.A. NO.826 in 566 with related I.As in

Writ Petition (Civil) No.202/1995 the value of the

damaged forest land is estimated at the rate of

Rs.8.03 lakhs per Ha. Hence, for 1200 Ha. the

damages in mandatory terms amounts to Rs.96.36 lakhs

(Rupees Ninety six lakhs thirty six thousand only).

Q: The amount of Net Present Value, EPF to be paid by

the petitioner

A: As per the Hon'ble Supreme Court of India

order dated 28/03/2008 in I.A. NO.826 in 566 with

related IAs in Writ Petition (Civil) No.202/1995 the

Net Present Value is to be paid by the petitioner is

as follows:

Sl. Particulars Density Extent Rate of Amount NPV (Rs.

No. (in ha) (Rs in In lakhs) lakhs)

1 Eco-Class III Dense 80.94 8.03 649.9482

The Compensatory afforestation charges at the rate of

Rs.84,000/- per ha for 80.94 ha. amounting to

Rs.67,98,960/- (Rupees Sixty seven lakhs ninety eight

thousand nine hundred and sixty only) if the user

agency take action to transfer and mutate the 80.94

ha non-forest land in favour of the Forest

Department.

If the compensatory afforestation land is not

available and the petitioner fails to identify and

transfer non-forest land in favour of the forest

department, double the amount i.e. Rs.67,98,960 x 2

10

times = Rs.1,35,97,920/- (Rupees One crore Thirty

five lakhs Ninety seven thousand Nine hundred and

twenty only) is to be paid by the petitioner to raise

the compensatory afforestation in the forest land.

Environmental loss may be assessed by the

Environmental Department, Government of Karnataka."

8. At the said hearing on 2.7.2009, when the matter

came up for further orders, the Government advocate

appeared for respondents 1, 2, 4 and 5. There was no

representation on behalf of the third respondent

(MoEF, Government of India). As only a short time had

elapsed after service of notice, the State and its

forest and mining departments could not file their

statement of objections. The Forest department claims

that it could not even appoint a Litigation

Conducting Officer nor furnish its parawise remarks

to the counsel for preparing the counter-affidavit,

for want of time. The High Court however allowed the

writ petition by the impugned order dated 2.7.2009,

with the following directions :

"The petitioner is permitted to remove the dumped Iron ore quantified at 1,17,800 Metric Tonnes

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lying in the mining yard (M.L.No.593/1993) situate at Hirekandawadi and Tanigehalli Villages of Holalkere taluk, Chitradurga District, subject to the following conditions :

(i) The iron ore which has already been extracted and quantified at 1,17,800 Metric Tonnes lying staked as on date, can be lifted by the petitioner upon proper notice to the Mining Authorities.

(ii) On getting such notice, the Mining Authorities shall depute a competent officer, who shall remain present at the time of such lifting.

(iii) Such lifting will take place in accordance with law and upon payment of required royalty to the State.

(iv) The lifting operation must be completed within a period of six weeks from the date of receipt of this order or production of the certified copy of the order, whichever is earlier.

(v) Petitioner shall make payment of the following amounts before lifting the dumped Iron ore:

a) Royalty : Rs. 11,04,375/-

b) Damage of forest land in monetary terms : Rs.96,36,000/-

c) Net present value, EPF for the entire area : Rs.6,49,94,820/-

d) Compensatory Afforestation charges. : Rs. 67,98,960/-

OR

Penalty on compensatory afforestation charges if the land is not available & if the petitioner fails to identify and transfer the

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non-forest land. :Rs.1,35,97,920/-

e) Any other statutory dues

vi) It is made clear that it is for the forest authorities to decide, whether Net present value as directed to be paid, is adjustable towards the approval under section 2 of the Forest (Conservation) Act."

9. The first respondent thereafter filed an

application seeking modifications in the order dated

2.7.2009. The said application was allowed on

27.8.2009, without giving opportunity to the State or

Central Government to file their objections.

Direction (iii) and onwards in the operative portion

of the order dated 2.7.2009 were recast as follows :

"(iii) Such lifting will take place in accordance with law and upon payment of required royalty and amount ordered to be deposited by this court, necessary permission for transport for lifting the iron ore shall be issued within thirty days of depositing the royalty and amount ordered to be deposited by the petitioner by this order.

(iv) The lifting operation must be completed within a period of six months from the date of receipt of this order or production of the certified copy of the order, whichever is earlier.

(v) Petitioner shall make payment of the following amounts before lifting the dumped Iron ore:-

a) Royalty : 11,04,375/-

13 b) Net present value, EPF for the entire area : 4,69,45,200/-

c) Compenatory Afforestation charges : 67,98,960/-

OR

Penalty on compensatory Afforestation charges if the Land is not available and if the petitioner fails to identify and transfer the non-forest land : 1,35,97,920/-

d) Any other statutory dues.

vi) The petitioner shall be entitled to adjust the present amount to be paid as per the order towards amount payable as EPF for the purpose of granting permission under section 2 of the Forest (Conservation) Act".

10. The said orders dated 2.7.2009 and 27.8.2009 are

challenged by the State Government and its

authorities in these appeals by special leave. The

appellants contended that the following incorrect

factual assumptions were made by the High Court,

while disposing of the writ petition, which are not

borne out by the record :

(a) That the material on record showed that first

respondent was not carrying on any mining activities

in Mining Lease Area No.593/993, after coming into

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force of Forest (Conservation) Act, 1980 in the

mining area;

(b) That the nine dumps of iron ore found in the

mining lease area quantified at 1,17,800 metric

tonnes had been validly extracted by the first

respondent when the mining lease was valid and was in

force (that is prior to 5.7.1985);

(c) That the respondents in the writ petition

(appellants herein) did not dispute the claim of the

first respondent that it had stopped the mining

operations and only wanted to shift the dumped iron

ore excavated prior to 1980. Therefore, the writ

petitioner (first respondent herein) was entitled to

permission to remove the 1,17,800 metric tones of

dumped iron ore from the mining lease area.

(d) The state Government and the central Government

conceded the claim of the first respondent.

11. We find considerable force in the contentions of

the appellants. Neither the State Government nor the

Central Government filed any counter nor did they

have sufficient opportunity to file any counter. Nor

did they concede any claim of the first respondent.

Apparently, the entire order was passed on the basis

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of the report dated 18.6.2009 submitted by the Dy.

Conservator of Forests, by assuming it to be an

admission on behalf of the state government. But the

report dated 18.6.2009 is only a report submitted by

the Deputy Conservator of Forests to the Principal

Chief Conservator of Forests in pursuance of an ex-

parte interim order of the High Court. Even the said

report does not state that the ore in the nine dumps

was mined prior to the Forest (Conservation) Act came

into force, but only states that there was no mining

activity in the area since 1985. The said report

does not say when the said ore was mined. In fact

that information was not sought by the High Court.

Significantly, apart from the said report of the

Deputy Conservator of Forests, there is no other

material to conclude that the material was mined

legally prior to 1980, when the lease was in force or

that the said quantity of dumped ore belongs to the

first respondent or that the first respondent is

entitled to remove or sell the said material. The

first respondent had not placed any material to show

that the said quantities of ore had been mined before

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the lease expired or that the said quantifies of ore

were lying at the site prior to 1980. No report was

also called for from the Director of Mines & Geology

which is the concerned department, or from the

central government. The four questions in the order

dated 24.4.2009, significantly do not refer to the

following important aspects :

(i) When was the said material mined/excavated?

(ii) What is the grade (percentage of ore content) in the dumped ore?

(iii) Whether the first respondent was the owner of the dumped material?

(iv) Whether there was any impediment for removing the dumped material or transporting them?

The above questions can be answered only by the

Department of Mines and Geology and not by the forest

department. Be that as it may.

12. The correctness and reliability of the report

dated 18.6.2009 of the Dy. Conservator of Forests is

itself doubtful and far from satisfactory. The

inspection and verification was not done by the Dy.

Conservator of Forests who had furnished the report.

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The Principal Chief Conservator of Forests informed

the Dy. Conservator of Forests, about the ex- parte

interim direction of the High Court, by letter dated

30.5.2009. In turn, the Deputy Conservator directed

the Assistant Conservator of Forests to give a

report. The Assistant Conservator of Forests gave a

report dated 16.6.2009 to the Dy. Conservator of

Forests which was incorporated in his report dated

18.6.2009. There was not even an affidavit supporting

or verifying the said report. The report appears to

have been prepared rather casually and in a hurry. Be

that as it may.

13. There was unexplained delay and laches in filing

the writ petition. The lease period came to an end

on 6.7.1985. The writ petition was filed twenty four

years later that is in the year 2009, seeking a

direction to the State Government and Central

Government to permit lifting of the ore by collecting

necessary fee/royalty. Except stating that the dumped

material had earlier no value, there was no

explanation why for 24 years, no action was taken by

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the first respondent either to claim ownership in

respect of the said "material" or remove the same.

There was no material to show that the said material

was of a grade of 62% to 63% or less. There was no

material to show that the first respondent had

informed the Mining Authorities or Forest authorities

or the state government about the existence of mined

ore in the mining area in nine dumps, either by way

of returns, reports or otherwise. The first

respondent had earlier produced a fake document dated

14.2.2008 wherein it was stated that the waste dumps

(of one lakh tones) was not mined material but

consisted of natural eroded soil and wastage thrown

from neighbouring mines. Though first respondent

subsequently admitted that the said letter dated

14.2.2008 was a fake, it did not aver that the

contents of the document were false and concocted.

Thus at one stage before filing the writ petition,

the first respondent claimed that what was sought to

be removed was not mined mineral, but eroded soil and

waste thrown from neighbouring mines. But in the writ

petition, the first respondent claimed that the

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material in question was low grade ore mined by it

when the lease was in force. The contradictory

stands raise doubts about the claim of the first

respondent.

14. The courts should share the legislative concern

to conserve the forests and the mineral wealth of the

country. Courts should be vigilant in issuing final

or interim orders in forest/mining/Environment

matters so that unscrupulous operators do not abuse

the process of courts to indulge in large scale

violations or rob the country of its mineral wealth

or secure orders by misrepresentation to circumvent

the procedural safeguards under the relevant

statutes. The court should also realise that Central

Government and the State Government are huge and

complex organizations and many a time require

considerable time to secure information and provide

them to court, in matters requiring enquiry,

investigation or probe. Where writ petitions

involving disputed questions of fact in regard to

forest/mining/environment matters, come up for

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consideration, courts should give sufficient time and

latitude to the concerned ministries/departments to

file their objections/counters after thoroughly

verifying the facts. If there is undue hurry, the

concerned ministries/departments will not be able to

make proper or thorough verifications and place the

correct facts. Instances are not wanting where the

public interest will be sabotaged, by the officers of

the state/central government who are supposed to

safeguard the public interest, by colluding with the

unscrupulous operators. A wrong decision in such

matters may lead to disastrous results - in regard to

public interest - financially and ecologically.

Therefore, writ petitions involving mineral wealth,

forest conservation or environmental protection

should not be disposed of without giving due

opportunity to the concerned departments to verify

the facts and file their counters/objections in

writing.

15. This case is a typical example where a writ

petition requiring decision of disputed and

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unascertained factual allegations filed on 30.3.2009

has been disposed of on 2.7.2009 without giving due

opportunity to the mining and forest departments of

the State Governments and the MoEF, to file their

counter-affidavits. When there was delay of nearly a

quarter century on the part of the writ petitioner in

approaching the court, the writ petition ought not to

have been disposed of in hardly three months, without

counter-affidavits from the concerned respondents.

Even though there were no counter affidavits, nor any

opportunity to the respondents in the writ petition

to file counter-affidavits, the High court assumed

that the State and the Central Governments had

conceded the claims of the first respondent in the

writ petition and allowed the writ petition on

2.7.2009. Again, the High Court without calling for

objections from MoEF or the state government, on an

application by the writ petitioner, amended the final

order and reduced the Net Present Value (NPV) from

Rs.6,49,94,820/- to Rs.4,69,45,200/-. Anxiety to

render speedy justice should not result in sacrifice

of the public interest.

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16. We are of the considered view that the High Court

committed a serious error in hurriedly deciding

seriously disputed questions of fact without calling

for a counter and without there being any proper

verification of the claim of the first respondent by

the authorities concerned. The order of the High

Court cannot be sustained.

17. We, accordingly, allow these appeals and set

aside the order of the High Court and dismiss the

writ petition filed before the High Court. We impose

costs of Rs.50,000/- upon the first respondent

payable to the state government.

18. The learned counsel for first respondent

submitted that this order should not come in the way

of the first respondent seeking appropriate remedy in

accordance with law. If the first respondent has any

remedy in law or cause of action for seeking any

remedy, this order will not come in the way of first

respondent seeking such remedy in accordance with

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law.

......................J. ( R.V. RAVEENDRAN )

New Delhi; ......................J. April 15, 2011. ( A.K. PATNAIK )