MMDR Act | Mining Lessee Can't Claim Deemed Extension Without Complying With Terms Of Lease: Allahabad High Court

The Allahabad High Court has held that the benefit of deemed extension of a mining lease under Section 8A(6) of the Mines and Minerals (Development and Regulation) (Amendment) Act, 2015 is available to a lessee only where the application for renewal was a valid application and all the terms and conditions of the lease have been complied with. It held that a lessee who continued mining after the expiry of the lease without a valid mining plan and environment clearance had not complied with the conditions of the lease and could not claim the benefit of deemed extension.Section 8A(6) of the Mines and Minerals (Development and Regulation) (Amendment) Act, 2015 provides that a mining lease granted before the commencement of the Amendment Act, 2015, where the mineral is used for other than captive purpose, shall be deemed to have been extended up to 31 March 2020, or for a period of fifty years from the date of grant, whichever is later. The extension is made “subject to the condition that all the terms and conditions of the lease have been complied with”.Interpreting that condition and relying on Supreme Court's decision in Common Cause v. Union of India, the bench of Justice Saral Srivastava and Justice Sudhanshu Chauhan held,“In a situation where lease deed has expired and an application had been submitted for renewal of lease deed, and there is no lease deed in existence, but the petitioner continued to carry out mining operation without any lease, in such situation, the Court is supposed to lift the veil and find out the true intention of the legislature in incorporating the words “all the terms and conditions of the lease deed have been complied with”.”The Court held,“In our opinion, the above mentioned words in Section 8A(6) have been incorporated with an intention that where renewal application has been submitted and an order is yet to be passed, the mining operation should be carried out after complying with all the relevant provisions of the Act and Rules, and if there is non-compliance of any rule or provision of the Act, it implies that all the terms and conditions of the lease deed have not been complied with.”A mining lease for Silica Sand over 47.06 hectare in Village Janwa, Tehsil Bara, District Allahabad had originally been granted in 1979 to the proprietor of M/s Bhulli Maharaj & Sons for ten years. It was renewed once under Section 8(2) of the Mines and Minerals (Development and Regulation) Act, 1957 for a further ten years, the renewed term expiring on 15.06.1999. On 12.06.1998, the petitioner applied for a second renewal for twenty years.Mining was stopped in 2011 for want of an Environment Clearance Certificate. Petitioner's mining plan was approved on 16.07.2015 and the Environment Clearance Certificate was granted on 6.01.2016. In the meantime, Section 8A had been inserted into the Act, 1957 by the Amendment Act, 2015 with effect from 12.01.2015, and Silica Sand had been notified as a minor mineral in February 2015.When his renewal application remained undecided, petitioner had earlier approached the High Court, and a Coordinate Bench had held that he was entitled to the benefit of Section 8A(6) subject to the condition that all the terms and conditions of the lease had been complied with. Petitioner's subsequent representation for extension of the lease was rejected by the Additional Chief Secretary by the order impugned.Petitioner argued that after the insertion of Section 8A the State Government's power to renew a lease had been done away with, and his lease stood extended for fifty years by operation of law. It was argued that the rejection of his application was illegal. He further argued that the Coordinate Bench's earlier finding in his favour had attained finality and was binding on the parties.The State argued that the benefit of Section 8A(6) was conditional on compliance with the terms and conditions of the lease, which the petitioner had not met. It was argued that petitioner's renewal application was itself defective as it had not been accompanied by a mining plan. It was also submitted that the deemed extension under Rule 24A(6) of the Mineral Concession Rules, 1960 applied only to a first renewal and not to a second renewal.Relying on Supreme Court's decision in Common Cause v. Union of India, the Court held that the benefit of Section 8A(6) could be extended only where the application for renewal was a valid application, that is, one conforming to all the requirements of law.Examining the petitioner's application in Form-J, the Court found that it had not been accompanied by the mining plan or the No Dues Certificate. These were furnished after Section 8A had come into force. The application was therefore not a valid application in law and could not attract the benefit of deemed extension, held the Court. The Court further held that the petitioner had continued mining after the expiry of his lease in 1999 without a valid mining plan, in violation of law, and had therefore...

MMDR Act | Mining Lessee Can't Claim Deemed Extension Without Complying With Terms Of Lease: Allahabad High Court

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MMDR Act | Mining Lessee Can't Claim Deemed Extension Without Complying With Terms Of Lease: Allahabad High Court

Upasna Agrawal

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