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TMI Blog2024 (5) TMI 901X X X X Extracts X X X X X X X X Extracts X X X X ..... C' shall form a High Powered committee of not more than three members representing the interests of the three stakeholders to take a decision by a reasoned order with regard to the renewal of mining leases, viz. Kolha-Roida Iron and Manganese Ore Block For short, 'Kolha-Roida', Thakurani Iron & Manganese Ore Block For short, 'Thakurani' and Dalki Manganese Ore Block For short, 'Dalki', within three months. It is also directed that TGP Equity Management Private Ltd For short, 'TGP' will be heard. The decision will be submitted to the Company Court in the form of a report. 4. This judgment will also decide the appeal preferred by TGP challenging the judgment dated 09.03.2023 of the High Court of Orissa at Cuttack, whereby Writ Petition No. 1852 of 2010 filed by the State of Odisha has been allowed setting aside the order of the revisional authority dated 02.02.2009. This judgment relates to one of the mining leases, namely, Kolha-Roida. TGP has also impugned the order dated 13.10.2023 by which its application for the review of the order dated 09.03.2023 was dismissed on the grounds of delay, and on the grounds of review not being made out. 5. The case has a long and chequered histo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rtakings, vest under sub section (1), in a Government company that Government company shall, on and from the date of such vesting, be deemed to have become the owner in relation to such undertakings, and all the rights and liabilities of the Central Government in relation to such undertakings shall, on and from the date of such vesting, be deemed to have become the rights and liabilities, respectively, of that Government company." of the 1980 Act, the Central Government, on vesting of the said undertakings, had the right to vest the undertakings from the date specified in favour of a government company willing to comply with such terms and conditions that the Central Government would deem fit to impose. 11. Vide a gazette notification dated 25.10.1980, the Government of India, in the exercise of power under Section 7 of the 1980 Act, transferred the undertaking of Bird and Co., along with right, title and interest, on or from the said date, to Bharat Process & Mechanical Engineers Limited. For short, 'BPMEL.' 12. OMDC, as a subsidiary of Bird and Co., had continued with the winning and mining activities. On 26.08.1983, BPMEL executed a power of attorney in favour of OMDC to do th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ntial creditor in terms of Rules 154, 156 and 179 of the Company (Cal) Rules, 1959. 21. The Official Liquidator in September 2011 paid Rs.2,99,12,461/- to the TGP against the certified debt of Rs.1,92,12,957.92p and against the certified debt of Rs 4,08,26,270/-, both TGP and UCO Bank have recovered an amount of Rs 5,49,00,000 /- 22. Having dealt with the history of the case briefly, we now move on to the question central to the present appeal preferred against the impugned judgment dated 03.03.2020 passed by the High Court at Calcutta. 23. The issue that arises for consideration is the renewal of the three mining leases that were granted to Bird and Co., as noted above. The lease of Kolha-Roida came to an end on 14.08.1996, while that of Thakurani and Dalki ended on 30.09.2004 and 30.09.1994 respectively. 24. TGP contends that BPMEL had applied for renewal of Kolha-Roida lease on 14.07.1995 for 20 years. Vide order dated 16.11.2006, the application was rejected by the State of Odisha. BPMEL, which had already been directed to be wound up by the BIFR on 22.07.1996, did not file a revision. OMDC filed a revision application which was allowed by an order of remand passed by the r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rtially for the settlement of the company's outstanding debts. Additionally, the order emphasises that the Central Government cannot evade accountability for the claims of BPMEL's creditor. 28. The Union of India/ Central Government has taken a categoric stand that it does not want to renew the leases. The State of Odisha has the same stance. However, it is essential that we address the submissions made on behalf of TGP. 29. The arguments raised by TGP can be summarised as: * BPMEL, being a government company, is entitled to an automatic extension of leases under Rule 72 12 "(1) All mining leases for minerals granted to a Government company or corporation before the date of commencement of the Mines and Minerals (Development and Regulation) Amendment Act, 2015 (IO of 2015), namely, the 12th January, 2015, shall be deemed to have been granted for a period of fifty years. (2) The State Government, upon an application made to it in this behalf by the Government company or corporation at least three months prior to the expiry of the mining lease, shall, extend the period of the mining lease for further periods of twenty years at a time: Provided that the State government ma ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... shall not be possible for the holder of the lease to undertake production and dispatch or to continue such production and dispatch for reasons beyond his control, make an order, within a period of three months from the date of receipt of such application, to extend the period of two years by a further period not exceeding one year and such extension shall not be granted for more than once during the entire period of lease: Provided further that such lease shall lapse on failure to undertake production and dispatch or having commenced the production and dispatch fails to continue the same before the end of such extended period." of the Mines and Minerals (Development and Regulation), Act 1957, as there is no express order by the State Government declaring that the subject leases have lapsed. For the same, reliance is placed on the judgment of this Court in Common Cause v. Union of India (2016) 11 SCC 455. Thus, the submission is that, though the leases have been non-operational for nearly three decades, they have not lapsed. * Rule 23 of the 2016 Rules permits the transfer of a mining lease or composite licence. The conditions of the said lease are satisfied as OMDC and BPMEL had ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ut. The undertakings with respect to the mining leases were vested with BPMEL, which had executed a power of attorney in favour of OMDC to continue the mining activities. BPMEL itself never undertook any winning or mining activities from the three mines. On liquidation of the holding company, BPMEL, the power of attorney stood terminated, per Section 201 "201. Termination of agency.- An agency is terminated by the principal revoking his authority, or by the agent renouncing the business of the agency; or by the business of the agency being completed; or by either the principal or agent dying or becoming of unsound mind; or by the principal being adjudicated an insolvent under the provisions of any Act for the time being in force for the relief of insolvent debtors." of the Indian Contract Act, 1872. Moreover, OMDC, a subsidiary of BPMEL, is a separate juristic entity. The plea that the juristic entity should be ignored has not been raised or argued. 32. It is also an accepted and admitted position that pursuant to several decisions of this Court, penalties of approximately Rs.800,00,00,000/- (Rs. 800 crores) has been levied on OMDC in respect of the mines. OMDC's straitened circum ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erit an order of the nature as sought by TGP. The workers will be paid in terms of the Companies Act, 1956. 37. Having considered all aspects of the matter, it is evident to us that entertaining any notion of lease renewal would be an exercise in futility, devoid of any practical or tangible benefit. The sheer magnitude of the liabilities involved renders the prospect of renewal implausible. Besides, the proposition advanced doesn't have any discernible plan or vision for the requisite financial, technical, and managerial support. BPMEL went into liquidation in 1996 and has been defunct for nearly three decades. OMDC is also barely operational. As such, it cannot be considered a viable option to undertake mining activities. In light of these facts, it is imperative to bring this dispute to an end. Prolonging it any further, sans a feasible resolution in sight, would be otiose. 38. Thus, we allow the appeal filed by the State of Odisha and set aside the judgment dated 03.03.2020 passed by the High Court at Calcutta upholding the order of the Company Judge. The direction to constitute a High Powered Committee is set aside. The question of renewal of lease, would not be examined by ..... X X X X Extracts X X X X X X X X Extracts X X X X
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