2014 (12) TMI 1342 - SC - Indian Laws

Extraction/removal of any mineral vested in the State without lawful authority or without a lawful assignment by the State - Held that - The ordinary earth used for filling or levelling purposes in construction of embankments, roads, railways, buildings is deemed to be a minor mineral. It is not in dispute that in the present appeals excavation of ordinary earth had been undertaken by the Appellants either for laying foundation of buildings or for the purpose of widening of the channel to bring adequate quantity of sea water for the purpose of cooling the nuclear plant. The construction of buildings is in terms of a sanctioned development plan under the MRTP Act whereas the excavation/widening of the channel to bring sea water is in furtherance of the object of the grant of the land in favour of the Nuclear Power Corporation. The liability Under Section 48(7) for excavation of ordinary earth would, therefore, truly depend on a determination of the use/purpose for which the excavated earth had been put to. An excavation undertaken to lay the foundation of a building would not, ordinarily, carry the intention to use the excavated earth for the purpose of filling up or levelling. A blanket determination of liability merely because ordinary earth was dug up, therefore, would not be justified; what would be required is a more precise determination of the end use of the excavated earth; a finding on the correctness of the stand of the builders that the extracted earth was not used commercially but was redeployed in the building operations. If the determination was to return a finding in favour of the claim made by the builders, obviously, the Notification dated 3.2.2000 would have no application; the excavated earth would not be a specie of minor mineral Under Section 3(e) of the Act of 1957 read with the Notification dated 3.2.2000. Appeal allowed - decided in favor of appellant.

Issues Involved:

1. Applicability of Section 48(7) of the Maharashtra Land Revenue Code, 1966.
2. Definition and classification of "ordinary earth" as a minor mineral.
3. Requirement of mining license/permission under the Mines and Minerals (Development and Regulation) Act, 1957.
4. Commercial exploitation and use of excavated earth.
5. Constitutional validity of Section 48(7) of the Code.
6. Jurisdiction of the High Court to adjudicate without statutory remedy being exhausted.

Detailed Analysis:

1. Applicability of Section 48(7) of the Maharashtra Land Revenue Code, 1966:

The core issue revolves around whether the excavation activities undertaken by the appellants fall under the purview of Section 48(7) of the Code. This section penalizes unauthorized extraction of minerals. The appellants, comprising builders and the Nuclear Power Corporation, argued that their excavation activities were lawful and integral to their construction projects, sanctioned under the MRTP Act. The Supreme Court noted that the essence of Section 48(7) is the extraction/removal of any mineral vested in the State without lawful authority.

2. Definition and Classification of "Ordinary Earth" as a Minor Mineral:

The term "ordinary earth" was classified as a minor mineral by a notification dated 3.2.2000 under Section 3(e) of the Mines and Minerals (Development and Regulation) Act, 1957. The notification specified that ordinary earth used for filling or leveling purposes in construction activities is deemed a minor mineral. The Supreme Court emphasized that the use of the excavated earth is crucial in determining its classification. If the earth is used for purposes other than those specified in the notification, it would not be considered a minor mineral.

3. Requirement of Mining License/Permission under the Mines and Minerals (Development and Regulation) Act, 1957:

The appellants contended that their activities did not constitute mining operations requiring a license under the Act of 1957. The Supreme Court clarified that the necessity of a mining license depends on the purpose of excavation. If the excavated earth is used for filling or leveling as specified in the notification, a license would be required. However, if the excavation is solely for laying foundations without commercial use of the earth, it would not be classified as mining.

4. Commercial Exploitation and Use of Excavated Earth:

The builders argued that the excavated earth was redeployed in their construction activities and not commercially exploited. Similarly, the Nuclear Power Corporation claimed that the excavation was incidental to their project and not for commercial gain. The Supreme Court held that a precise determination of the end use of the excavated earth is necessary. If the earth is not used for commercial purposes, the notification dated 3.2.2000 would not apply, and the excavation would not attract penalties under Section 48(7) of the Code.

5. Constitutional Validity of Section 48(7) of the Code:

The appellants challenged the constitutional validity of Section 48(7), arguing that it conflicted with the central Act of 1957, which comprehensively covers mining activities. The Supreme Court did not delve into this issue, leaving it open for future adjudication in an appropriate case.

6. Jurisdiction of the High Court to Adjudicate without Statutory Remedy Being Exhausted:

The Nuclear Power Corporation's appeal was dismissed by the High Court on the grounds that they had not exhausted the statutory remedy under the Code. The Supreme Court found this dismissal unjustified, emphasizing that the Corporation's excavation activities were in line with the purpose of the land grant and did not involve commercial exploitation. The High Court should have adjudicated on the merits of the case.

Conclusion:

The Supreme Court allowed the appeals, directing the State to reassess the builders' cases based on the end use of the excavated earth. The appeal of the Nuclear Power Corporation was allowed, quashing the High Court's orders. The larger constitutional question regarding Section 48(7) was left unresolved for future consideration.

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