2025 (3) TMI 950 - HC - Indian Laws

Massive illegal mining and sale of Beach Sand Minerals (BSM) by various private lessees/mining companies in the three southern districts of Tamil Nadu namely Thoothukudi Tirunelveli and Kanniyakumari during the period of 2000-2001 till 2016-2017 - PIL converted to suo moto case in view of environmental damages caused. Illegal Mining Storage Transportation and Exports of BSMs - Extent and Quantum of Illegal Beach Sand Mining - HELD THAT - The Respondents are trying to use the judicial process to wriggle away from the consequences arising out of their illegal actions. Committee after committee formed and re-agitating on the same point of issue will not pave any way to the ends to justice. In the eyes of this Court the Bedi Committee Sahoo Committee Reassessment Committee and the learned Amicus Curiae have carried out a fair and impartial task in inspecting and evaluating the extent and quantum of illegal beach sand mining carried out. An examination of the various committee reports and the Amicus Curiae reports prove the case of illegal beach sand mining. The methodology adopted by the committee on careful examination by this Court is free from bias and is not in transgression of natural justice principles. And the reports have been elaborately made after inspection. The Amicus Curiae appointed by this Court also based on a separate and detailed report has uncovered the presence of Monazite in the mined minerals which is prescribed substance under the Atomic Energy Act and the mining companies have no right to deal with the same - The committees have outlined various other illegalities and irregularities in transport storage and dealing of these illegally mined beach sand minerals thereby causing a grave danger to the environment. It is to be noted that there are a plethora of judgements on the issue of illegal sand mining guidelines to be followed measures to be taken enforcement mechanisms so on and so forth. But it would be an understatement to say that this has not been effectively adopted or followed by the implementing officials at the ground level. There are many ways prescribed by various agencies departments and the Government to curb illegal beach sand mining including legal frameworks such as the MMDR Act various other environmental legislations Sustainable Sand Mining Management Guidelines (SSMG) 2020 Enforcement and Monitoring Guidelines for Sand Mining (EMGSM) 2020. But the core question for consideration is why can t the illegal sand mining be stopped inspite of the humongous Government resources funds and time spent to draft these legislations measures and guidelines. The simple answer that can be deduced through the careful examination of the records and reports before us reveals the large scale corruption and collusion across departments officials and bureaucracy. A systemic implementation failure has paved way for the huge loss to the National and State exchequer which ought to be remedied at the earliest. Stringent and strict actions are the need of the hour to curb the illegalities and irregularities proliferating from illegal beach sand mining. Illegal transport - HELD THAT - The Amicus Curiae report on study of primary documents and records pertaining to transport permits clearly discerns the circumstances which constitute Unlawful transport . i. Transporting quantities in excess of approved quantities; ii. Transporting minerals not approved to be mined or transported for a specific lease and; iii. Transporting minerals during years/periods when there was no approved scheme of mining . Of the total quantum of 1 51 27 070 MTs of raw sand for which transport permits were obtained the total quantum unlawfully transported works out to 86 35 151 MTs in terms of the 62 mining leases owned by M/s.V.V.Mineral and M/s.Transworld Garnet India Private Limited. A shocking finding in the Amicus Curiae report is the total failure of the District Mines officials to check as to whether the transport permit that have been issued by them for years are according to the approved Mining plan/scheme and whether it is the approved quantities permitted to be transported. Another finding that is surprising is that the District collectors also failed to check on these mismatches in the transport permits when they prepared the annual reconciliation of royalty payments. These failures on the part of the officials paved way for a huge financial loss to the Government considering the enormous amount of BSMs unlawfully transported throughout several years. Illegal Exports - HELD THAT - The scale and magnitude of the lorries unlawfully transporting illegally mined raw sand and minerals across districts without any lawful obstruction in place to stop this crime is mind boggling and disheartening. Natural resources being exploited is one thing but when done beyond legally permissible limit to benefit a handful of people at the expense of the National economic interest and affecting the Country s overall growth and at the cost of people s livelihood has shaken the conscience of this Court. These are issues which need to be dealt with at the earliest and the way in which our Judicial process has been used to thwart the law from taking the right course of action is discernible from the endless litigations filed across different courts. Litigating and re-litigating on the same issues and trying to weave knot after knot till nobody knows how to unknot it. This modus seldom paves any benefit. It eventually itself becomes a point of accusation against the law breakers. Law can be bent. True. But it bends only for Justice. Our Nation is great in a way that Laws cannot be a mute spectator for long. Conscience and Spirit of our Courts cannot be doused easily and our Constitution keeps the heartbeat alive to ensure that People of this Country can never be wronged. The Amicus Curiae report highlighted illegal transport of minerals including discrepancies in transport permits and unauthorized exports. There are illegal transportation was rampant with significant quantities of BSMs exported without proper permits violating Section 4(1-A) of the MMDR Act. Presence of Monazite and Handling Licenses - HELD THAT - IMonazite being a prescribed substance under Atomic Energy Act and private parties are prohibited from mining processing selling or exporting the mineral there is no valid or justifiable reason to add the Monazite to the existing leases of the private parties. Moreover when the mineral Monazite is related to the issues concerning National security this cannot be viewed lightly. Such violations ought to be viewed seriously and the State Government by approving the proposals of the private parties to mine four atomic minerals including Monazite by adding these minerals to the pre-existing leases for mining Garnet Rutile and Ilmenite only has paved way for the illegality. This necessitates serious actions against the officials involved and a probe into the events leading to such grant of illegal approvals ought to be carried out to cull out any instances of corruption and collusion between the officials and the private mining lessees and appropriate legal action including criminal prosecution needs to be instituted against such Government officials and private mining parties involved. Royalty Settlement calculations and payments - HELD THAT - There is a wrongful application of Rule 64-B(2) for computing royalty on raw sand instead of ad valorem basis as per Rule 64-D. The royalty accounts as settled by the District Collectors of Tirunelveli Thoothukudi and Kanniyakumari computing the royalty for the quantum of raw sand transport by arbitrarily applying Rule 64-B(2) MCR in favour of M/s.V.V.Mineral (R8) M/s.Transworld Garnet India Private Limited (R9) and M/s.Industrial Mineral India Private limited (R13) is held legally invalid - The royalty accounts wrongfully settled by the District Collector of Tirunelveli Thoothukudi and Kanniyakumari by computing royalty for raw sand transported by wrongful application of Rule 64-B(2) of MCR 1960 in respect of M/s.V.V.Mineral (R8) M/s.Transworld Garnet India Private Limited (R9) and M/s.Industrial Mineral India Private Limited (R13) unsettled by the State Government is held valid. The computation of royalty on ad valorem basis for the actual quantum of minerals sold/ exported under the provisions of Section 9(2) read with Second Schedule of the MMDR Act and Rule 64-D of MCR 1960 in the light of third report of the Amicus is held legally valid. The State Government is directed to initiate all necessary actions to recover the cost of minerals and royalty as per the findings in the Amicus Report relating to post ban period which held the 1.5 crore MTs of BSMs found by Sahoo Committee in 2018 and the stock of 1.40 Crore MTs of BSM stocks found by the RR-2023 as illegally mined and processed and hence all legal consequence to that effect shall follow. Role of Officials and accountability - HELD THAT - Corruption in mining has become a norm and has been standardised by the officials involved. A pattern can be drawn from these illicit sand mining operations. The triangular link is undeniable here between the political executive and the mining lessees. It has become a systemic corruption. It is also undeniably established that Right from the grant of mining lease/approval/license to grant of transport permits to illegal inclusion of monazite in mining lease to lack of efficient monitoring to arbitrary and legally questionable royalty settlement proceedings to lack of initiation of appropriate action when required and complete shedding of accountability on the part of the officials concerned top to bottom across departments and executive spectrum there appears on the face of it a scheme of collusion corruption and connivance among political executive and the private mining lessees. The involvement of Government officials and illegalities perpetrated by them including political nexus in support of this scam should be investigated thoroughly. This is an imminent necessity to prevent corrosion of public trust in the system. The political nexus to the massive scam cannot be ruled out. Hence the the CBI is directed to investigate into the alleged political nexus and the role of the policy making authorities in conspiring with the private mining companies shall be investigated. Conclusion - This Court finds it a fit case to refer the matter to CBI. Hence based on the findings in the Committee reports and based on all other materials available on record the CBI is directed to register criminal cases and launch investigations. Also any pending cases relating to the issues discussed in this judgment registered by the Tamil Nadu Police is directed to be transferred to the CBI for enabling effective investigation. Petition disposed off.

Summary

1. ISSUES PRESENTED and CONSIDERED

The core legal issues considered in this judgment include:

(1) The validity of the constitution of the Expert Committee headed by Mr. Gagandeep Singh Bedi, I.A.S., and its findings on illegal mining of Beach Sand Minerals (BSMs).

(2) The methodology and findings of the Special Team headed by Mr. Satyabrata Sahoo, I.A.S., regarding illegal mining and storage of BSMs.

(3) The validity of the methodology and findings of the Amicus Curiae regarding illegal mining and transportation of BSMs, including the use of the reverse calculation method.

(4) The legality of the premature termination of BSM mining leases by invoking Sections 4A(1) and 4A(3) of the MMDR Act, 1957.

(5) The inclusion of Monazite and other atomic minerals in existing mining leases without prior approval from the Central Government.

(6) The legality of royalty calculations and settlements made by the District Collectors.

(7) The need for a comprehensive investigation into the role of officials and potential political nexus involved in the illegal mining activities.

2. ISSUE-WISE DETAILED ANALYSIS

(1) Illegal Mining, Storage, Transportation, and Exports of BSMs:

The judgment discusses the extent and quantum of illegal mining, highlighting the violation of mining plans and the unlawful extraction of minerals beyond permissible limits. It emphasizes the need for adherence to mining schemes, plans, and statutory requirements, as outlined by the Supreme Court in the Common Cause case.

The Court validated the findings of the Bedi and Sahoo Committees, which reported extensive illegal mining and transportation of BSMs across three districts, estimating over 1.01 crore MTs of raw sand illegally mined and transported.

The methodology adopted by the committees, including the triangulation method and reverse calculation, was upheld as fair and objective. The Amicus Curiae's reports, based on primary data analysis, were also deemed valid.

The judgment addressed the premature termination of mining leases, affirming the State's role as a public trustee of mineral resources and the necessity for premature termination in the interest of regulation and conservation.

(2) Illegal Processing:

The judgment examines violations of environmental laws, including the Coastal Regulation Zone (CRZ) Notification, and the failure to obtain necessary environmental clearances. It highlights the need for compliance with environmental regulations to prevent ecological damage.

(3) Illegal Transport:

The Court identified illegalities in the grant of transport permits, emphasizing the failure of officials to monitor and prevent unlawful transportation of BSMs. It noted the need for accountability and transparency in the issuance of transport permits.

(4) Monazite:

The judgment discusses the presence of Monazite, a prescribed substance under the Atomic Energy Act, in the stocks of mining companies. It highlights the illegal inclusion of Monazite in mining leases without Central Government approval and the need for a thorough investigation into the handling and potential export of Monazite.

(5) Royalty:

The Court analyzed the wrongful application of Rule 64-B for royalty settlement, emphasizing the requirement for ad valorem royalty calculation as per Rule 64-D and the Second Schedule of the MMDR Act. It noted the significant revenue loss to the State due to arbitrary royalty settlements.

(6) Role of Officials:

The judgment calls for a comprehensive investigation into the involvement of officials in the illegal mining activities, highlighting the need for accountability and transparency. It emphasizes the responsibility of District Collectors and other officials in preventing illegal mining and ensuring compliance with legal provisions.

3. SIGNIFICANT HOLDINGS

The Court upheld the findings of the Bedi and Sahoo Committees, as well as the reports of the Amicus Curiae, as valid and legally sustainable. It affirmed the premature termination of mining leases and directed the handover of all stocks to IREL India Limited. The judgment also validated the royalty calculations and directed the recovery of costs and royalties from the mining companies.

The Court emphasized the need for a thorough investigation by the CBI into the illegal mining activities, the role of officials, and potential political nexus. It directed the initiation of disciplinary proceedings against officials involved in the scam and stressed the importance of accountability and transparency in the mining sector.