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TMI Blog2025 (3) TMI 950X X X X Extracts X X X X X X X X Extracts X X X X ..... 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 transpor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or 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 t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing 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 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y, M/s.Balamurugan Company, M/s.Indian Ocean Garnet Sands Co. Pvt. Ltd, M/s.Earth Mineral Resources Pvt. Ltd, S.Vaikundarajan, Thiru.Gagandeep Singh Bedi, I.A.S. Secretary to Government, M/s.Southern Enterprises, rep. by Mr.Dhaya Devadas, M/s.Indian Garnet Sand Company, Private Limited and rep. by Mr.Dhaya Devadas, M/s Grace Minerals, rep. by Mr.Dhaya Devadas, Commissioner of Customs and Central Excise, Regional Commissioner of Customs and Central Excise Chennai, Chairman, V O Chidambaranar Port Trust, The Member Secretary Tamil Nadu, Principal Secretary, Government of Tamil Nadu, M/s.Indian Rare Earths Limited, Tamil Nadu Minerals Limited, Southern Region Mines and Mineral Based Workers Welfare Association, M/s.V.V.Mineral Skilled Employees Association, Rep. by its Secretary, Honourable Mr. Justice S.M.Subramaniam And Honourable Mr. Justice M.Jothiraman For the Petitioners : Dr.V.Suresh Amicus Curiae And Mr.P.M.Subramanian Senior Counsel For Mrs.N.K.Kanthimathi For the Respondents R2 & R4 : Mr.R.Rajesh Vivekanandhan Deputy Solicitor General of India For the R3 : Mr.K.Gunasekar Senior Panel Counsel For the R5 to R7, R23 & R31 : Mr.Aravind P.Datar Senior Counsel Assisted ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... el changes, mineral rock formations, drift of eroded material through ocean currents and subsequent deposit of minerals on shores. The processes resulting in the deposits of these rare minerals along the shore, stretch over several thousands of years and are continuously driven by sea/ocean erosion of rock formations in other parts of the world. The ocean currents transport the rare minerals from their origin to the shores here. The transportation is dependent upon the physical properties of the minerals themselves i.e., density, mass, etc. 4. In so far as the State of Tamil Nadu is concerned BSMs are peculiar to the three coastal districts of Tamil Nadu namely Thoothukudi, Tirunelveli and Kanniyakumari alone. Beach sand is rich in seven heavy minerals - ilmenite, leucoxene (brown ilmenite), rutile, zircon, sillimanite, garnet and monazite. They are processed to derive rare earth elements and titanium that are used in a variety of industries, including paints and cosmetics. 5. In Beach Sand Minerals (BSMs) ore, there occurs Monazite, a prescribed substance as per Atomic Energy Act, 1962. Monazite contains Thorium, Uranium and Rare Earth (RE) elements. Thorium is a central compone ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ransportation and other alleged activities". This order was challenged before the Hon'ble Supreme Court of India in S.L.P.No.10498 of 2019, which was disposed of on 04.07.2019 with a direction to this Court to dispose of various petitions, including this PIL, expeditiously. 12. It is also to be clarified that the argument put forth by mining companies that the PIL itself has become infructuous owing to the amendments brought about to the Mines and Minerals (Development and Regulation) Act, 1957 [hereinafter after referred to as 'MMDR Act'] and introduction of the Atomic Concession Rules, 2016, does not stand accepted, since this Suo Motu PIL is related to the issue of Illegal mining, transportation and sale of raw sand and BSMs during the period 2000-2001 till end of 2016 and related issues and irregularities committed during the said period, which ought to be decided. The illegalities / irregularities alleged during 2000-2001 till 2016 ought to be examined and cannot be brushed aside owing to the advent of amendments, which is post 2016 and shall have no bearing on the validity of this PIL. V. Significance of This PIL: 13. The negative environmental impacts due to i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oastal poramboke lands in the three coastal districts of Tirunelveli, Thoothukudi and Kanniyakumari under the provisions of Mines and Minerals (Development and Regulation) Act, 1957 and Mineral Concession Rules, 1960. The details are as follows: Sl.No. District No. of Mining Leases Granted to Private Lessees 1. Tirunelveli 52 2. Thoothukudi 6 3. Kanniyakumari 6 Total 64 17. Three Mining leases have been granted to M/s.IREL India Limited, for mining Garnet, Ilmenite, Rutile, Zircon, Sillimanite, Leucoxene and Monazite in patta and coastal poramboke lands in Kanniyakumari District. TAMIN have been granted with one mining lease for mining Garnet in Tirunelveli District. Sl.No. District No. of Mining Leases Granted to Government Undertakings 1. Tirunelveli 1 2. Kanniyakumari 3 Total 4 18. Mining leases granted to private lessees in the three districts are as follows: Sl.No. Name of the Lessee No. of Leases Granted 1. V.V.Mineral 34 2. Transworld Garnet India Pvt. Ltd. 16 3. Beach Minerals Sands Company and Beach Minerals Company Pvt. Ltd. 10 4. K.Thangaraj 1 5. M.Ramesh 1 6. Indian Ocean Garnet Sand Company Pvt. Ltd. 1 7. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ning Companies: 24. Based on the report of the District Collector, the Government of Tamil Nadu formed a Special team headed by Mr. Gagandeep Singh Bedi, IAS, Secretary, Revenue department vide G.O.Ms.No.156, Industries (MMD1) Department dated 08.08.2013 to inspect and verify in terms of Section 24 of MMDR Act, 1957, whether there is illicit mining by the six lessees of minerals - Garnet, illmenite and Rutile in Thoothukudi district. This team also consisted of officers from the departments of Revenue, Environment and Forest and Geology and Mining. 25. The Special Team headed by Mr. Gagandeep Singh Bedi, IAS, evolved a comprehensive methodology to conduct the field study through a process of triangulation so as to ensure objectivity and avoidance of bias. 26. The Enquiry Team under Mr.Bedi was divided into various teams who inspected the mining leasehold areas. The Reports of these teams were then randomly allotted to another team for super-checking and boththese reports submitted were verified by the Core Team. The field visits apart, a team of officials headed by JD (Mines) Mr.Palanivel and other officials inspected the Mineral Separation Units of the lessees on 19th, 20th, 29 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ction of the Committee under section 24 of the MMDR Act, the District Collectors of the aforementioned districts passed orders to stop the mining operations and transport permits to private lessees from the month September, 2013. But this ban also paved way for more allegations to crop up that the mining companies were illicitly allowed to carry on their mining operations even when the ban was in force. Litigations Began Cropping Up on the Issue of Illegal Beach Sand Mining: 32. Soon thereafter a number of cases including Writ Petitions and PIL came to be filed by different parties including the present Respondents making charges, claims and counter claims. The Division Bench of this Court came to consider the various writ petitions filed and delivered a common order dated 12.12.2013 in W.P.(MD).No.1233 of 2012, etc., and Batch. The critical observations of the Division Bench of this Court in its Order dated 12.12.2013 is as reproduced below: "32. We have also taken note of the fact that the Government of Tamil Nadu has passed G.O.(Ms) No.173, Industries (MMD. 1) Department, dated 17.9.2013, to inspect and to find out as to whether illicit mining of such major minerals are taki ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y. There is no doubt that the governments concerned have to be vigilant in taking appropriate steps to strike a fine balance between proper utilisation of the available resources and the preservation of such resources for posterity. We are also clear that such a balance can necessary scientific data provided by persons, who are experts in be achieved only on the basis of the their respective fields. 34. In such circumstances, in view of the fact that a committee of experts, under the Chairmanship of Mr. Gangandeep Singh Bedi, Secretary, Revenue Department, has been constituted by the State Government to examine, investigate and to file a report, after physical verification of the mining sites in question, we find it appropriate to permit the petitioner in the writ petitions, including those who are wanting to implead themselves in the writ petitions, to submit their representations to Mr.Gagandeep Singh Bedi, the Chairman of the Committee, along with the necessary documents, if any, within fifteen days from today. It is also made clear that it would also be open to the private Respondents, who are parties herein, to submit their representations to the Chairman of the Committee, w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... old areas. The Court held the G.O's to be valid to all other quarries except the Petitioner's. 34. This Order by the learned Single Judge has come up for challenge vide Writ Appeals in W.A.Nos.1168 and 1169 of 2015 filed by the State Government and W.A.Nos. 1220 and 1221 of 2015 by Respondents 24 to 26, in the present case. These above mentioned Writ Appeals are connected with this Suo Motu PIL and is heard together before this Bench. Events Leading to the Initiation of Suo Motu PIL: 35. Meanwhile, based on the news item published in the Economic Times in the month of February 2015, a Joint Inspection was carried out by the Director, Regional Office, Ministry of Environment Forest and Climate Change of India along with Assistant Conservator of Forests, Department of Environment, Assistant Directors of Geology and Mining of Tirunelveli, Thoothukudi and Kanniyakumari Districts and Officials from the Tamil Nadu Pollution Control Board in the coastal districts from 24.04.2015 to 27.04.2015. A Joint Inspection Report dated 27.04.2015 was signed by the Director, Ministry of Environment Forest and Climate Change of India and other Officials, who accompanied in the Joint Inspect ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... od from 2008-2009 to 2012-2013. Transport permits issued to the lessees for beach sand minerals for the period from 2000-2001 to 2013- 2014 were compared with the quantum of such minerals permitted for production in the approved mining plan / scheme of mining and it was found that a huge quantum of beach sand minerals unlawfully transported by the private lessees. 41. As the entire quantum of beach sand minerals kept with the private lessees, both processed and unprocessed were arrived as illegal storage. It was resolved by the District Committee to request the Assistant Commissioner, Customs, Thoothukudi to produce certificate of legally mined minerals obtained from the District Collector concerned before allowing export of minerals and to insist on transport permits along with bulk permit. The Chairman, Port Trust of Cochin, Vizagapattinam and new Mangalore were addressed by the District Collector, Tirunelveli vide letter dated 19.12.2016 informing that private lessees from the State of Tamil Nadu were making their attempt for export of beach sand minerals from the Ports outside the State of Tamil Nadu and no export of beach sand minerals can be allowed in the absence of valid t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed by Mr.Satyabrata Sahoo, I.A.S., vide G.O.Ms.No.41, Industries (MMD.1) Department dated 07.04.2017. Inspections were carried out at all processing plants, godowns and other storage areas of the mining lessees in the 3 districts. All stocks of the mining companies were sealed in godowns, stockyards, factories and premises of the companies with effect from April, 2018. 46. A comprehensive report of the special team was submitted to the Government on 18.04.2018 and the same was filed before this Court on 24.04.2018. It consists of main report and several volumes of data from the AMD/AERB of Government of India and various inspection teams. The Monazite content in various stocks as found by Atomic Minerals Directorate (AMD) has also been analysed. The actual stock of BSMs kept with the private plant owners in the 3 districts, as estimated by Sahoo's Committee was to the tune of 1.50 Crore Metric Tonnes. Key Findings of Sahoo Report: 47. The total quantum of beach sand minerals stored by the Plant owners / Lease holders at various places in Tirunelveli, Thoothukudi and Kanniyakumari Districts as assessed by the Special Team are furnished as follows: Sl.No. Districts Quantum ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g on the National Security, if the products fall into wrong hands. Reassessment Report: 54. Based on the request made by the District Collectors of Tirunelveli and Thoothukudi and based on the recommendations of the Commissioner of Geology and Mining, orders have been issued vide G.O.Ms.No.246, Industries (MMD.1) Department, dated 20.09.2021 authorising the District Collectors of Tirunelveli, Thoothukudi and Kanniyakumari under MMDR Act, 1957 to re-assess the beach sand minerals stored and sealed at various places by the Special Team Headed by Thiru Satyabrata Sahoo, I.A.S. The BSM stocks were ascertained and sealed at the conclusion of the inspections conducted in 2018 on the directions of this Court, by Joint- Inspection teams of Central and State agencies headed by Mr.Satyabrata Sahoo, I.A.S. 55. The "Reassessment Report on Beach Sand Minerals" filed by the Secretary, Natural Resources Department, Government of Tamil Nadu presents the findings of inspection done in 2021-2022 by Joint Teams of officials from the Revenue, Geology and Mining, Survey and other departments of the Government of Tamil Nadu. Included in the Inspection Teams were also officials of the Atomic Minerals ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... State Government has very clearly and emphatically accepted the findings of fact in the Amicus report on scale of illegal mining, transportation and export, as also the Royalty Report filed before this Court. Regarding Allegation of Bias and Prejudice Raised against Amicus Curiae: 59. The Amicus Curiae was appointed by the Court on 28.01.2016, after the Court converted the original Writ Petition into a Suo Motu PIL in view of the serious allegations of massive illegal mining of beach sand minerals in three coastal districts of Kanniyakumari, Thoothukudi and Tirunelveli Districts. 60. It is to be noted that the objections are filed by the 22nd respondent Mr.S.Vaikundarajan on 19.12.2024 during final arguments of the present Suo Motu PIL petition and connected proceedings. The respondents 8 and 9 also raised similar accusations. The 8th respondent in his Memo of Objections to the report of Amicus Curiae imputed "Conflict of Interest" on the part of this Amicus. However, the 8th respondent suppressed the order of this Court dated 15.03.2016, wherein the very same accusations were rejected by this Court. 61. On 28.01.2016, when this Court appointed this Amicus, he was not present ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a call on the same." "We have perused the Memo; we see no reason why the Learned Amicus cannot continue in this matter, merely because he happened to be the Secretary of an Association and Editor of a Bulletin, in which the author published a report, where there was general reference to the illegal sand mining in Tamil Nadu in four lines." 64. Apart from these two occasions when Respondents 8, 9 and 22 accused Amicus of bias, the same parties, viz., R8 - M/s.V.V.Mineral and R9 - M/s.Transworld Garnet India Private Limited filed W.M.P.No.24173 of 2017 and W.M.P.No.24174 of 2017 making the very same allegations, which was dismissed as withdrawn on 03.10.2017 itself. 65. While so, despite knowing that the same allegations were considered and rejected by this court on three occasions - viz., 15.03.2016, 20.09.2016 and on 03.10.2017, the parties have repeated the same allegations in: (a) the Memo of Objections' dated 20.01.2024 filed by R8 - M/s.V.V.Mineral; and (b) in the Note titled 'Brief Facts about the Writ Appeal and the Motive behind the litigations' served on the Amicus Curiae and circulated by counsel for R22 Mr.S.Vaikundarajan in Court during final argumen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... #39;Royalty Settlement Proceedings' approved by the District Collectors of Thoothukudi, Tirunelveli and Kanniyakumari districts in respect of royalty collected and due to be paid by different mining companies for each annual year from 200-2001 till 2015-2016 were studied. Fourth Report of Amicus Curiae: 71. The fourth report of Amicus curiae summarises the key findings from the reassessment report filed on 27.11.2023 by the 6th Respondent. It reports about large scale illegal removal of 16.04 Lakhs MT of beach sand minerals by different mining companies during 2018-2022. This report of Amicus Curiae dealt with the study of two key issues: (1) The high quantum of illegal mining and transportation of BSMs by various mining companies. (2)High presence of Radio Active Monazite in the semi-processed and processed BSMs stocks kept by various mining companies / Plant owners. Show Cause Notice Issued: 72. The State Government accepted the findings pertaining to illegal mining, transportation, export and royalty payments on all four reports since the findings of Bedi report, Sahoo's report, Reassessment report and Amicus Curiae report were on the same lines and the findings ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Water Act. 76. It was contended that the Amicus Curiae did not highlight any violations of the India Rare Earths Limited (IREL), but instead pointed out imaginary violations against the 8th Respondent's mining lease. The 8th Respondent further leveled allegations of serious mining violations against IREL. It was further contented that the Amicus Curiae did not apply the reverse calculation method for the IREL and that he did not prepare chart citing violations by IREL. 77. It was contented that the Amicus failed to act impartially and that though Amicus discussed about the Bedi report in his volume of charts, Amicus did not point out that Bedi committee did not inspect Trichy and Madurai Districts. 78. It was further contended that principles of Natural Justice was violated only for the 8th Respondent. Inspections of leases belonging to the 24th, 25th and 8th Respondents were conducted based on directions of the High Court. However Natural Justice Principles were violated only with respect to the 8th Respondent. Further, the 8th Respondent alleges that the Amicus failed to point out the illegalities and violations committed by the 24th and 25th Respondents. The 8th Respondent fu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... me, the mining plan and the mining lease as well as the statutes such as the EPA, the FCA, the Water (Prevention and Control of Pollution) Act, 1974 and the Air (Prevention and Control of Pollution) Act, 1981. If any mining operation is conducted in violation of any of these requirements, then that mining operation is illegal or unlawful. Any extraction of a mineral through an illegal or unlawful mining operation would become illegally or unlawfully extracted mineral." On relying in this paragraph, the 8th Respondent averred that they have necessary approvals and clearances as under the Act and Rules. 84. It was further contended that the 8th Respondent has not engaged in illegal mining. And that with respect to Bedi Committee, the 8th Respondent claims it to be not statutorily valid. It was further averred that there is no excess stock with respect to 8th Respondent as per Sahoo Committee report. 85. It was averred by the 8th Respondent that with respect to monazite, there are no possibilities for export of monazite as there are no countries where thorium is used for any purpose. And that the allegation of export of monazite by M/s.V.V. Mineral is wrong. 86. It was also submit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... about mining plan has no basis. 91. The 8th Respondent averred that none of the Act and Rules for payment of royalty or mining operation has been violated by the 8th respondent. It was submitted that the entire 3rd report of the Amicus is without any statutory violation and that this report regarding royalty and his enclosures 15A and 15B has no legal value. 92. Regarding Monazite the 8th Respondent contends that the percentage of occurrence of monazite in BSMs is a natural phenomenon and claims that they have requisite handling license and that they are permitted to store the monazite tailings. Based on the aforementioned grounds the 8th and 22nd respondent sought for dismissal of this PIL. Key Contentions of 16th, 17th, 18th, and 19th Respondents: 93. It was mainly submitted that Monazite is a radioactive material and cannot be clandestinely smuggled across National/International borders. Every atomic mineral have traces of radioactive mineral, which cannot be separated and that National and International regulators have fixed permissible threshold. It was submitted that checkpoints at Airports and Harbours are installed with radioactive detectable scanners as per Internation ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... id down in Common cause judgment (Supra) which deals about static miserable reserve does not apply to the case of BSMs. It was further submitted that the MMDR Act is not a control Act but a development oriented Act. 99. It was averred that the repeated criticism of mining of BSM would cause environmental issue is a gross generalization without any regard to factual aspects. BSM are unique and they are the only mineral which are replenishable in nature. The replenishment was also recognised by the learned Amicus in his report. The Nagar Committee assigned by Department of Atomic Energy also has recognized fact of replenishment. 100. With regard to royalty it was contented that whatever amount calculated in whatever means either in the form of royalty towards ROM has to be treated as advance royalty. Therefore the entire quantities of mineral exported by the respondents are royalty stuffed. And excess royalty amount collected in the Department of Geology and Mining is still with the Government. Key Contentions of 24th, 25th and 26th Respondents: 101. It was submitted that except one mining lease in favour of Indian Garnet Sand Company Private Limited all other mining leases in fa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d for excess quantities of mineral that can only be extracted with proper prior approvals. The modifications also for the remaining period of the approved mining plan/scheme of mining. The lessee cannot extract the mineral as per the whims and fancies and later approach the Indian Bureau of Mines extending the approval of mining plan/scheme of mining from the date of approval i.e. Prospective not retrospective. Submissions on Behalf of the 2nd Respondent: 105. The 2nd Respondent submitted that Monazite, which is (greenish yellow) phosphate mineral containing rare earth metals, is an important source of thorium, lanthanum and cerium. Thorium has been recognised as (another) radioactive nuclear material for producing energy indigenously and that India is now progressing steadily towards a Thorium based nuclear program. Thorium based program has the potential to support energy security in long term. Monazite is a principal source of Thorium and Indian Rare Earths Limited (IREL) is a leading supplier of Monazite in the country. It was stated that none other than IREL is allowed to process Monazite. 106. It was submitted that India's nuclear development plans are crucially depen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ndent) report of the second respondent and furnished the percentage of monazite content with respect to each of their mine numbering 34 specifically given in the tabular format (Page Nos.9 to 13 of their letter dated 04.12.2016). Further in page number 14, they have furnished the total ROM (Run of Mine) collected from each of their mine numbering 34 (Page Nos.14 to 16). 111. Based on the above data furnished by the respondents 8 and 22, approximate quantity of monazite computed and furnished in a tabular format. Based on the data furnished by the Respondents, it is seen that the data on grade of monazite in the mining lease areas with reference to AMD's reports vis-à-vis the monazite resources is computed as 5876 M.T. covering 34 mining lease areas of the respondents 8 and 22, whereas the total quantity of monazite computed based on the data submitted by the Respondents 8 and 22 regarding quantity of tailings from 2007 to 2016 is 23, 461M.T. Hence, there is a mismatch as seen from the above regarding computed monazite resource. 112. It was submitted that as regards, excessive mining carried out by private lessees, which are found to be higher than the quantity approved ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gs need to be eventually handed over to DAE. 113. It was submitted that during processing of the raw sand, monazite, which is radioactive in nature, gets distributed and progressively concentrated in various process streams and becomes potential source of radiation exposure. Therefore, for radiological safety considerations, AERB issued guidelines for safe management of monazite tailings under Atomic Energy (Radiation Protection) Rules, 2004 in order to avoid any undue radiation exposure to workers and general public. Accordingly, the facilities were either required to store the monazite tailings in pits within premises under their institutional control topped with non-radioactive silica sand or were required to backfill the mined-out sites after mixing with silica sand such that radiation level remained comparable to natural background radiation of the region. Nevertheless, besides being radioactive substance, monazite contains thorium and uranium which is notified as prescribed substance under the Act, control of which solely rests with the Department of Atomic Energy. DAE has all the enabling powers to acquire prescribed substance under the Act. Submissions on Behalf of the 1s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... required. 118. It was submitted that the issue of illegal mining is the subject matter of State Government. State Governments are in charge of law and order. State Governments have been empowered under section 23-C of MMDR Act, 1957 to curb illegal mining by framing Rules for preventing illegal mining, transportation and storage of minerals. The revisionary jurisdiction of the Central Government is also banned in respect of orders passed by State Governments under section 23-C. 119. It was further submitted that the Central Government also took cognizance of the emerging situation, a need was felt to look into the matter holistically in the interest of regulation of mineral development and for conservation of mineral resources of strategic significance. 120. Pursuant thereto, the entire export of BSM has been now canalised through Indian Rare Earth Limited since 21.08.2018 for which monazite test certification from Atomic Mineral Directorate [AMD] has been made mandatory. Furthermore, Central Government revised the threshold value of BSM from 0.75% to 0.00% [zero percent] Monazite content in Total Heavy Mineral vide G.S.R.No.134(E) dated 20.02.2019. That pursuant to the notific ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , 01, 14, 239 MT of raw sand (1.01 Crore MT) had been illegally mined and transported over an extent of 234.55.0 Hectares of non leased out areas in three districts. 123. Further, with regard to the Amicus Curiae's report it was submitted that the Learned Amicus Curiae's report is based on the data collected from the District Collector of Tirunelveli, Thoothukudi and Kanniyakumari on the quantum of Beach Sand minerals permitted to be transported by the district officials of Department of Geology and Mining in Tirunelveli, Thoothukudi and Kanniyakumari districts for the period from 2000-01 to 2013-14 (pre-ban period).The report submitted by learned Amicus curiae is based on the details of mining plans and scheme of mining approved by Indian Bureau of Mines with reference to non-atomic minerals namely Garnet and Sillimanite. 124. It was averred that the minerals not permitted for production in the approved mining plan/scheme of mining were treated as unlawfully mined and transported one. Further none of the private respondents had submitted scheme of mining for approval of the Atomic Minerals Directorate in respect of Ilmenite, Rutile, Zircon and Leucoxene. 125. It was submitt ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g is correct or not? (ii) Reverse calculation of calculating quantum of ROM required to produce 80, 725.05 MT of Monazite-rich tailings is correct or not? (5) Whether the methodology adopted by the Amicus in calculating the Cost of minerals and Royalty on ad valorem basis for the quantum of minerals unlawfully/illegally mined and transported/exported during pre-ban period and post-ban period is valid in law? (6) Whether the reports and findings submitted by the Learned Amicus Curiae is valid in law? (7) Whether the findings of the Reassessment Report is valid in law? (8) Whether the premature termination of BSMs mining leases by invoking Sections 4A(1) and 4A(3) of MMDR Act, 1957 in terms of the directives dated 01.03.2019 issued by the Ministry of Mines, Government of India is valid? (9) Whether the findings of the Committees and Amicus on processed stocks with high quantum and concentration of Monazite illegally held by the private respondents is valid? (10) Whether there has been an illegal inclusion of Monazite and other atomic minerals to existing mining leases without prior approval of Government of India? (11) Whether the request of the Government for handing ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ittee 88 1.6 Allegations of Bias against Mr.Gagandeep Singh Bedi I.A.S 89 1.7 Powers of Inspection Under Section 24 of MMRD ACT 93 1.8 Methodology Adopted by the Committees to Inspect and Verify the Extent and Quantum of Illegal Mining 95 1.9 Extent and Quantum of Illegal BSMs in Three Districts - Pre-Ban Period 103 1.10 Extent of Illegal Mining of Garnet 105 1.11 Post Ban Period - Illicit Beach Sand Mining 106 1.12 Difference in the Stocks Kept in the Three Districts 108 1.13 Action Under Section 4 of MMDR Act 111 1.14 Premature Termination of Mining Lease 111 (2) Illegal Processing 116 2.1 Environmental Laws on Mineral Processing 117 2.2 Coastal Regulation Zone (CRZ) 117 2.3 Violations of Conditions of EC and CRZ Clearances 119 2.4 Sand Dunes 121 2.5 Role of Tamil Nadu Pollution Control Boa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of India 174 (C) Royalty 179 (1) Royalty Settlement 179 1.1 Royalty - Legal Position 180 1.2 Rule 64-D - Manner of Payment of Royalty on Minerals on Ad Valorem Basis 185 1.3 Purpose of Rule 64-D 186 1.4 Distinction Between Rules 64-B and 64-D 191 (2) Illogical and Wrongful Application of Law in Royalty Settlement Proceedings 195 2.1 Low Royalty Fixation by IBM 197 2.2 Misleading Data in Royalty Settlement Proceedings 199 2.3 False Declaration made by the 8th Respondent 199 2.4 Improbability of export of only 5 MTs of Ilmenite during the 3 year period from 2005- 06 to 2007-08 201 (3) Royalty Calculations and Payments 202 3.1 Post Ban Period - Royalty Calculations 203 (D) Role of Officials 205 (1) Contradictory Reports 208 (2) Stages of Neglect/In-Action/Corruption of Officials 212 2.1 Role of Of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hat is permissible under the mining plan or under the EC, undoubtedly attracts the provision of sec. 21(5) of the Act, being extraction without lawful authority. ....... It will also attract section 21(1) of the MMDR Act, 1957. Section 21(5) of the Act is certainly attracted and is not limited to a violation committed by a person only outside the mining lease area - it includes a violation committed even within the mining lease area". 134. The Hon'ble Supreme Court in the same ruling explained about the scope of recovery of cost by pointing out that if there was illegal mining, the defaulting lessee must bear the consequences of the illegality and not be benefited by pocketing 70% of the illegally mined ore. The Hon'ble Supreme Court clarified that in the case of mineral unlawfully mined and transported; "...there can be no compromise on the quantum of compensation that should be recovered from any defaulting lessee - it should be 100 %". (para 154). It must be pointed out, that apart, from the cost of mineral, the State Government can also recover royalty on the quantum of mineral unlawfully transported as provided in Section 21(5) of the Act itself. Also Section 23(C) of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . Rule 22A(2) states that once the mine is in operation, the modification of the mining plan requires prior approval. Rule 9(1) of the MCDR, 1988 also stipulates that the mining operations can commence only in accordance with a mining plan approved under Section 5(2)(b) of the Act. Rule 13(1) of the MCDR also prescribes that mining operations shall be carried out in accordance with the approved mining plans with such conditions as may be prescribed or as per the scheme approved under Rule 12 of the MCDR, 1988. Rule 13(2) importantly provides that, if the Regional Controller or authorized officer finds that the mining plan is not being complied with, they may order suspension of all or any of the mining operations and permit continuance only once operations are in accordance of the mining plan. 1.4 Operations Carried Out in Violation of Mining Plans: 141. Section 4(1) of the MMDR Act, 1957 makes explicit that "No person" shall undertake any mining operation in any area except under and in accordance with the terms and conditions of the mining lease. The strict law further provides in Section 4(1-A) that no person shall transport or store or cause to be transported or stored any mi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed 08.08.2013 and G.O.Ms.No.173, Industries (MMD.1) Department dated 17.09.2013 with respect to M/s.V.V.Mineral and M/s.Transworld Garnet India Private Limited alone and further directed the subsequent appointment of a committee under a Retired Judge of this High Court to inquire into the allegations and this Order of the learned Single Judge was challenged before the Division Bench of this Court by the State Government through W.A.Nos.1168, 1169 of 2015 and by Mr.Dhaya Devadas in W.A.Nos.1220 and 1221 of 2015. These Writ Appeals were connected along with Suo Motu PIL and heard together. The validity of the G.Os under challenge and formation of the Committee has been elaborately dealt with in the writ appeals. 1.6 Allegations of Bias against Mr.Gagandeep Singh Bedi, I.A.S: 145. One of the issues raised by the private Respondents is, whether Mr.Gangandeep Singh Bedi, I.A.S., the Chairman of the Special Committee appointed by the State Government, is biased in conducting inspections under Section 24 of MMDR Act, as ordered by the Government in G.O.Ms.No.156, Industries Department dated 08.08.2013 and G.O.Ms.No.173, Industries Department dated 17.09.2013. 146. The natural justice p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bstantial reasoning cannot be a valid argument. There must be an actual bias or reasonable likelihood of bias. To sustain a plea of bias, there must be cogent, uncontroversial and undisputed material, and the court cannot go by vague, whimsical and capricious suspicion. 151. Moreover the test of 'real likelihood of bias' ought to be applied in the instant case and this test can be applied in tandem with "fair-minded and informed observer" standard test. This can be elaborated further by the following explanation; To disqualify a person from adjudicating on the ground of interest in the subject matter of lis, the test of real likelihood of the bias is to be applied. In other words, one has to enquire as to whether there is real danger of bias on the part of the person against whom such apprehension is expressed in the sense that he might favour or disfavour a party. In each case, the Court has to consider whether a fair minded and informed person, having considered all the facts would reasonably apprehend that the Judge would not act impartially. 152. Both the above tests have been applied effectively across various decisions rendered by the Hon'ble Supreme Court. As d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , book, register or record; (e) order the production of any such document, book, register, record, as is referred to in clause (d); and (f) examine any person having the control of, or connected with, any mine. 155. So the section explicitly lays down the power of entry and inspection in the mines. Nowhere does it specify the need for prior notice to inspect. In the absence of provision to issue notice, the contention raised by the Respondents mining companies that prior notice must be issued finds no merit. Moreover an inspection cannot be termed as 'surprise inspection' if prior notice is issued. That would defeat the very definition of 'surprise inspection'. Therefore when the Act is clear in its terms, no new meaning/procedures can be accorded to it. 156. Hence, the vires of the G.O.Ms.No.156, Industries (MMD.1) Department dated 08.08.2013 and G.O.Ms.No.173, Industries (MMD.1) Department dated 17.09.2013 stands undefeated and ought to considered valid in the eyes of the law, thereby making the appointment of Bedi Committee legally sustainable. 157. It is pertinent to note that the Special team under Mr.Bedi was entrusted with the task of inspecting and verifying the alle ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... action of illegal mining. The two points of contention on their side has always been that the Committees are biased and in terms of Sahoo Committee and Amicus reports, they have questioned the reverse calculation method. But this Court finds no merit in both these contentions. The random bias allegations against a committee not only comprising of Mr. Bedi but around 230 officials who are involved in this process, cannot be termed to operate as a single man committee. 162. Moreover, what makes the Committee reports stand good is the fact that all the Four Committee Report findings in one way or the other concur with each other. Even the Respondent mining company are not disputing the fact of illegal mining having taken place. Instead the contentions of Respondent companies are only in the lines of the calculation method adopted. In terms of reverse calculation method adopted, the difference in the raw sand quantum is so enormous that it is hard to throw away this calculation method. It is a form of logical deduction and the DAE has also accepted the finding of the Amicus Curiae to this effect. They have accepted the specific finding in the AC report that the leftover monazite is i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... with the data about Mining/Transportation and Sales given by the private Mining Companies to Government agencies. The entire data was compiled, analysed and thereafter provided in the form of consolidated charts which showed the compiled information in the following ways: (a) Mining Lease (ML) wise. (each of the total of 64 MLs have been listed district wise). (b) Year wise and (c) Raw Sand (ROM) and BSM wise for each private respondent mining company. 168. As all the charts in Volume 4 of Amicus report show, each Mining lease - chart also shows the approval given by (a) IBM for mining of raw sand and BSMs in the case of Garnet and Sillimanite and (b) AMD in the case of Atomic minerals like Ilmenite, Rutile, Leucoxene and Zircon for each mining period of 5 years for each of the 64 mining leases in the three districts. Full details of the proceedings are also provided by way of proceedings number, date etc. 169. The collected data and its analysis were presented in a single chart as available in Volume 4, which the Government Departments as well private mining companies could easily cross-check and verify the data presented in each chart year-wise from 2000-2001 to 2015-2016 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pany wise data on illegal transportation of raw sand and minerals is available in the Comprehensive First Report filed by the Amicus. 1.9 Extent and Quantum of Illegal BSMs in Three Districts - Pre-Ban Period: 175. The Key findings in the Bedi Committee Report pertaining to illicit mining in the three districts are as follows: SUMMARY OF ILLICIT MINING IN TIRUNELVELI DISTRICT Village No. of Leases No. of Mining Coc. No of Leases Where Illicit Mining Extent of Illicit Mining (Acres) Quantity of Illicit Mining (MTs) 1 Kuttam 9 All 9 leases belong to Beach Sand Minerals Company 8 65.43 24, 73, 575 2 Karaisuthu Uvari 17 Trans World Garnet - 14 & V.V.Mineral - 3 15 111.79 23, 56, 552 3 Karaisuthy Pudur 9 V.V.Mineral - 7, K.Thangaraj - 1 & M.Ramesh - 1 6 194.13 28, 52, 855 4 Levinjipuram 4 All 4 leases belong to V.V.Mineral 4 0.6 6, 31, 408 5 Irukkanthurai 3 All 3 leases belong to V.V.Mineral NIL NIL NIL 6 Koodankulam 1 V.V.Mineral NIL NIL NIL 7 Chettikulam 2 Both belong to V.V.Mineral 2 1.12 12, 000 8 Vijayapathi 3 All 3 belong to V.V.Mineral 1 0.05 1, 000 9 Thiruvambalap uram 3 All 3 belong to V.V.Miner ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... duce the garnet. 1.11 Post Ban Period - Illicit Beach Sand Mining: 179. It is to be noted on perusal of the findings in Sahoo Committee and Amicus Curiae reports, which reveal that there was widespread illegal mining and transportation of BSM even after the imposition of the ban in August-September, 2013. It appears that despite the ban on mining of beach sand minerals and transport of the same post September, 2013, the separation or processing for which the primary material is the raw beach sand were continuing to function uninterrupted in the districts of Thoothukudi and Tirunelveli. 180. The Sahoo Committee had reported the following quantum of ROM/Semi-processed and Processed found with various lessees of which the major stocks is as follows: M/s.V.V.Mineral, R8/22 - 38.77 Lakh Tonnes; M/s.Transworld Garnet, R9 - 16.31 Lakh Tonnes; BMC, R10/17, 64.40 Lakh Tonnes, IMC, R15 - 25.58 Lakh Tonnes and IOGS, R20 - 4.20 Lakh tonnes. Also the total quantum of BSM stored by Plant owners/lease holders at various places in Tirunelveli, Thoothukudi and Kanniyakumari as assessed by the Special Team is to the extent of 1, 55, 48, 680 MT. Whereas the total quantum of BSM declared as stocks ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... report states that monazite to the tune of 6, 448.362 MT in the semi-processed stocks of 4, 83, 198.255 kept by plant owners in three districts is a matter of serious concern. 184. The Respondent mining companies in their counter affidavit to the findings of the reports primarily failed to provide satisfactory answers. T he 8t h Respondent predominantly attacks the formation of the Committees or raises allegations against the officers involved in the process but ultimately inspite of four different and elaborate reports submitted by the teams comprising of top most officials in the State Government, the Respondents failed to reply to the findings on the massive scale of illegal mining. The contention of the Respondents 8/22 does not address the veracity of the findings nor could they disprove the evidence backed findings, rather they are trying to question the very act of ordering the inspection of the mining sites. 185. However, this argument cannot be accepted as when allegations of illegal mining are levelled time and again over a period of time on particular lease sites, it is the duty of the State Government to appoint committees to inspect and verify the truth of these alle ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rsuanct to the directions issued by the Central Government, show cause notices were issued by the Government to the private respondents and after providing reasonable opportunities of hearing, orders have been passed by the Government by pre-maturely terminating the mining leases granted in favour of the private respondents. Writ Petitions have been instituted challenging the premature termination of mining leases granted in Tirunelveli, Thoothukudi and Kanniyakumari Districts. 190. It is to be pointed out that none of the private respondents chose to challenge the directives of the Central Government to prematurely terminate the mining leases vide its order dated 01.03.2019. The Writ Petitioners have challenged the consequential show cause notices and termination orders issued by the State Government without challenging the fundamental order of the Central Government directive for premature termination of leases. Thus, the Writ Petitions are not maintainable without there being a challenge to the Central Government directives. 191. The Nine Judges Constitution Bench of the Hon'be Supreme Court of India in the case of Mineral Area Development Authority and Another vs. Steel A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... operations; (iii) the provisions of the statute reflect the priority of the State to regulate mining and related activities to ensure sustainable mineral development; (iv) prospecting and mining operations may be carried out by both the government as well as private lessees bearing in mind the public interest; and (v) the Government has to ensure that mineral concessions are granted in a fair and transparent manner. .... 142. The word "regulate" is of wide import and the breadth of its meaning depends on the context in which it is used. This Court has construed the power to regulate to include the power to: (i) grant or revoke a permission or licence including incidental or supplemental powers (State of T.N. v. Hind Stone, (1981) 2 SCC 205, para 10; State of U.P. v. Dharmander Prasad Singh, (1989) 2 SCC 505, para 52); (ii) prohibit depending upon the context and circumstance (Talcher Municipality v. Talcher Regulated Market Committee, (2004) 6 SCC 178, para 14; Union of India v. Asian Food Industries Ltd., (2006) 13 SCC 542, para 43); (iii) control or adjust by rule or to subject to governing principles (U.P. Coop. Cane Unions Federations v. West U.P. Sugar Mills As ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s which are influenced by tidal action (on the landward side) upto 500m from the High Tide Line (HTL) and the land between the Low Tide Line (LTL) and the HTL". The Notification imposes restrictions on activities within the CRZ. The entire coast is categorized into Zone I, II, III and IV with Zone I being the most ecologically sensitive where all development activities are prohibited. All inter - tidal Zones are categorized as Zone I and hence no mining can be permitted in the inter tidal Zone. One of the conditions of the CRZ clearance is that no mining takes place in the inter tidal zone. 197. Where replenishment of reserves is of such high volumes, there is a sharp increase in the permitted quantity of raw sand to be mined as also the quantum of minerals permitted to be mined during that specific period. This is identified in the AC report, in cases of 19 approvals of mining leases in which official agencies, viz., AMD and IBM have approved claims by mining companies. The AC report also quoted the Nagar committee report over replenishment of beach sand occurring in the backdrop of allegations that mining companies have been using the excuse of mining replenishments to cover up ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... natural mouth of river Nambiyar in S.F.No. 23 between Thiruvambalapuram and Karaichuthu Pudur villages, thereby affecting the fragile backwater eco-system (coming under CRZ-I). It has also affected the natural tidal water influence on the river body. Mining has also been noticed right up to the river banks. These are environmental violations of serious nature. 203. In Tirunelveli District, 24 out of 52 leases, the lessees have not obtained necessary environmental clearance from the Ministry of Environment and Forest, Government of India, which they should have otherwise obtained, as all the lease areas are falling under CRZ. 204. In all leases the following common environmental violations were noticed: (1) No Green belt developed. (2) No dust suppression system installed. (3) Depth criterion not followed (4) Sand tailings not refilled. (5) Mining in Inter Tidal zone has been noticed (in the leased area, without necessary clearance from Ministry of Environment and Forests, Government of India). (6) Illicit mining reported in CRZ-1 and Inter Tidal Zone. (7) Temporary and Permanent structures, Bore wells, Open wells, Cement pipelines (to draw sea water), desalination p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tee of minerals, regulates prospecting and mining operations in public interest (State of Rajasthan vs. Gotan Lime Stone Khanji Udyog (P) Ltd., (2016 4 SCC 469 [29]; Orissa Mining Corporation Ltd. vs. Ministry of Environment & Forests, (2013 6 SCC 476 [58]). 209. The regulatory regime under the MMDR Act recognises the important role of the State in regulating mines and mineral development. This emerges from the stand point of the following perspectives: (i) the State is a public trustee of natural resources, including minerals. (ii) pursuant to its role as a public trustee, the State has been empowered to regulate prospecting and mining operations. (iii) the provisions of the statute reflect the priority of the state to regulate mining and related activities to ensure sustainable mineral development. (iv) prospecting and mining operations may be carried out by both the Government as well as private lessees bearing in mind the public interest; and (v) the Government has to ensure that mineral concessions are granted in a fair and transparent manner (Mineral Area Development Authority (Supra)). 210. When the State holds a resource that is freely available for the use of public, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... stage of the grant of EC but at subsequent stages with respect to illegal sand mining, NGT, in an Order dated 5-4-2019 in National Green Tribunal Bar Assn. v.Virender Singh (National Green Tribunal Bar Assn. v. Virender Singh, 2019 SCC OnLine NGT 1488) and connected matters, directed the MoEFCC and the State Governments to review extant monitoring mechanisms and consider revision of the 2016 Sand Mining Guidelines. Consequently, the MoEFCC issued the 2020 Sand Mining Guidelines. 17. The damage caused to the environment due to rampant unscientific illegal mining needs no reiteration. Unabated illegal mining has resulted in the emergence of sand mafia who have been conducting illegal mining in the manner of organised criminal activities and have been involved in brutal attacks against members of local communities, enforcement officials, reporters and social activists for objecting to unlawful sand excavation. The statistics provided by the State Government highlight the magnitude of the problem as about 2411 FIRs have been registered in relation to illegal mining in the State of Rajasthan, between 16-11-2017 and 30-1-2020. When this Court has restrained 82 mining lease/quarry hold ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... its earlier orders, on scale of compensation to be recovered for violation of norms for mining on "polluter pays" principle. Additionally, Para 9.2 of the 2020 Sand Mining Guidelines provides as follows: "The environmental damages incurred or resulting due to illegal mining shall be assessed by a committee constituted by District Administration having expertise from relevant fields, and also having independent representation of locals and State Pollution Control Board. Guidelines for assessment of ecological damages prescribed by the State Government or Pollution Control Boards concerned or any other authority shall be applicable and compensation as fixed shall be paid by the project proponent, in light of the Hon'ble National Green Tribunal orders." 21. Section 21(5) of the MMDR Act empowers the State Government to recover the price of the illegally mined mineral, in addition to recovery of rent, royalty or tax. The penalty recommended by CEC for illegal sand mining is in addition to the penalty that can be imposed by the State Government in terms of Section 21(5) of the Act. However, the basis for imposition of exemplary penalty of Rs 10 lakhs per vehicle and Rs 5 lakhs p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sbelieve that the officials did not know about the illegal mining and transportation happening right under their nose. 216. In the Memo filed by the Amicus dated 21st November, 2016, information was placed before this court which showed that there was widespread illegal mining and transportation of BSM even after the imposition of the Ban in August-September, 2013. The key element of the Memo pertaining to illegal transport is extracted below: "Stopping of Transport Permits: 217. It is to be noted that both G.O.Ms.No.156, Industries (MMD.I) Department dated 08.08.2013 and G.O.Ms.No.173, Industries (MMD.I) Department dated 17.09.2013 effectively required all private mining lessees to immediately stop mining operations pending completion of inspection by the Special Team and all Assistant Directors (Mines) in the concerned districts to immediately stop issuance of transport permits of major minerals like Garnet, Ilmenite, Rutile etc. So effectively as of 17.9.2013, all lessees ceased to operate their mines and to transport minerals or raw sand". 218. As per the contentions of the 6th Respondent, in the month of May 2016, the 9th Respondent had declared that 6, 98, 887 MT of Garne ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Monazite, which being a radioactive substance and constitutes a high risk, the stocks which are in the custody of the State Government ought to be handed over to the M/s.IREL India Ltd. which is a Government of India undertaking exclusively entitled to handle Monazite under the Atomic Energy (Working of Mines, Minerals and Handling of Prescribed substances) Act, 1984. 3.2 Illegal Transportation Left Unchecked: 223. The Reassessment report filed by the District Collectors also reveal the huge scale of unlawful transportation of raw sand and BSMs taking place. The District Collector, Thoothukudi vide letter dated 28.01.2022 reported that the officials of the Department of Geology and Mining, Revenue and Police have inspected the BMC godown located at Survey No.651/3 of Mullakadu - II Village on 08.01.2022 at 7.00 P.M. and noticed that a Taurus lorry with Registration No.TN-58 AK 3313, a JCB vehicle, a Fork Lift and two motor bikes were found in the godown. After enquiry, it was confirmed that the BMC godown was trespassed and 35 M.T of Garnet were to be smuggled in the Taurus lorry. Therefore all the vehicles used for causing illegal transport of Garnet stored in the Mullakadu - II ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s of minerals exported by different companies. One of the key findings in the Sahoo report is that many stocks of processed minerals belonging to different mining companies, has been found to have considerable amount of Monazite concentration beyond the threshold value of >0.25% Monazite equivalent and a significant quantity of Monazite can be extracted from these stocks. It is a matter of concern that these processed minerals which were ready for sale/export contains such high concentration of Monazite. Therefore there are clear findings by the committee on the presence of Monazite among the minerals exported. The quantum of such Monazite exported and the Countries to which this radioactive substance was exported, the modus adopted by these companies and the role of the Customs officials who had failed to prevent such export must be probed extensively to ensure that our National security is not compromised. 228. Though the Respondent companies are dismissing this contention as unfounded and speculative, the fact that the component Thorium is derived from Monazite and is considered as a crucial element and deemed as the nuclear fuel of the future needs to be considered. Though int ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s a recovery of 61.37% of total heavy minerals. 232. This high recovery percentage of total heavy minerals is neither supported by the available literature nor supported by the approved mining plan / scheme of mining pertaining to the mining lease hold areas of the 8th Respondent in the three districts. Even after this high recovery of total heavy minerals extracted and sold from 2000-2001 to 2016-2017, the balance stock available with the 8th Respondent could be waste only and could not be treated either as raw sand (ROM) or semi processed sand or processed minerals. Whereas, the report filed by the Special Team headed by Mr.Satyabrata Sahoo, I.A.S., on 18.04.2018 revealed that 38, 77, 391M.T of raw sand, semi processed sand and processed minerals are kept with them as stock. Therefore, the entire quantity of 38, 77, 391 M.T of stock available with the 8th Respondent as assessed by the Sahoo Committee is illegally mined, transported and stored contravening the provisions of Section 4(1) and 4(1A) of the MMDR Act, 1957 and it will attract the penal provisions of Section 21 of MMDR Act, 1957. 233. Further, the 8th Respondent has not provided the actual quantum of Garnet, Ilmenite, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by the Division Bench on 03.09.2018. The Special Leave Petition filed by M/s.V.V.Mineral in S.L.P.(C).No.2775 of 2019 as been dismissed by the Hon'ble Supreme Court of India as withdrawn on 20.02.2020. Thus, the Division Bench judgment of Kerala High Court attained finality. Therefore, no further adjudication needs to be undertaken in respect of the issues in connection with the Public Notice No.50 of 2016 issued by the Commissioner of Customs. (B) Monazite: (1) Presence of Monazite in the Coastal Beaches of Tamil Nadu: 237. The Amicus Curiae report carries a study about Heavy Minerals in the Beach and coastal red sands (Teri) of Tamil Nadu by The Atomic Minerals Directorate for Exploration and Research, and The Department of Atomic Energy (AMD-ER & DAE). The essential portions are extracted below: "High concentrations of industrially important heavy minerals in the beach and dune sands of Tamil Nadu in the southeastern part of India have been known since the early part of the 20th century. Indeed, the chance discovery of monazite in the beach sands of Manavalakurichi near Kanyakumari in Tamil Nadu by Herr Schomberg in 1908, heralded the beginning of exploration for the p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tset, it must be noted that as a policy decision, DAE is not allowing any private players to process Monazite. Also it further clarified that, the AMD has not approved any such mining plan for monazite in favour of the 8th Respondent i.e. M/s.V.V.Mineral. The 2nd Respondent, DAE has also submitted that, as per the records available with AMD, 10 (9 from M/s.V.V.Mineral and one from M/s.Indian Garnet Supply Company) numbers of approved mining plans have been transferred to 15th Respondent i.e., M/s.Industrial Minerals Company. It is clarified by the 2nd Respondent that these mining plans do not include Monazite mining. The AMD has not approved any mining plan in Tamil Nadu in favour of 9th Respondent M/s.Transworld Garnet India Private Limited. 243. However, under the guidelines framed by the Atomic Energy Regulatory Board (AERB) individual processors of beach sand have to separate and safely keep the monazite content of such sand. No individual or entity is permitted to process monazite in any manner without a licence from DAE. Monazite is important for our Country's nuclear requirements and due to the said reasons only, private players are not allowed to process Monazite. 244 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s so as to prevent both accidental radiation to animals and human beings and contamination of local sites, sand and water as well as prevent it from getting into wrong hands. 2.1 Handling Licences Mandatory for Handling Monazite Tailings: 249. The majority of BSMs are categorised as Atomic Minerals under the MMDR Act (after the 2016 amendment, all BSMs are classified as Atomic minerals). Leucoxene, Rutile, Ilmenite, Zircon and Monazite were also classified as prescribed substances under the Atomic Energy Act though after 01.01.2007, only Monazite remained a prescribed substance with Rutile, Leucoxene, Ilmenite and Zircon denotified as prescribed substances. 250. Till 1998, on the introduction of the Policy on 'Exploitation of Beach Sand Minerals to private players', it was mandatory for all the private players to hand over the monazite tailing's (and also remaining heavy minerals containing other prescribed substances like Ilmenite, Zircon, Rutile etc.) to IREL, a Government of India Undertaking under the administrative control of DAE. After the said Policy, all private players were allowed to mine and win the prescribed substances except Monazite. The Monazite taili ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e presently being stored does not qualify, as "Wastes" and hence, no authorization under the Atomic Energy (Safe Disposal of Radioactive Waste) Rules, 1987 were issued. 2.2 Presence of Monazite Enriched Tailings in the Leased Out Mines: 256. Based on the Orders of this Hon'ble Court dated 02.11.2017, Joint Inspection was carried out by the officials of Atomic Minerals Directorate, Hyderabad and Indian Bureau of Mines, Chennai in the presence of officials of Atomic Energy Regulatory Board(AERB), Mumbai and Second level Team Heads for assessment of Monazite enriched tailings said to be stored. 257. The report submitted by AMD reveals that the Thiruvembalapuram site of M/s.V.V.Mineral contains 23, 608 MT of Monazite at an average grade of 17.47%. The report reveals that Kuttam site of M/s.Beach Minerals Sands Company is having 0.6% Monazite equivalent. The report reveals that Arasoor site of M/s.Beach Minerals Sand Company is having 0.46% Monazite equivalent and reveals that the Mappillaioorani site of M/s.Miracle Sands and Chemicals has Monazite tailings at two places, having 7.8% monazite equivalent. This trench has 75 MT material, which translates to 5.85 MT Monazite. The ot ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... huge discrepancy between factual records of transportation, declarations made by the company as to the extent of raw sand (ROM) mined and the actual fact as disclosed from monazite tailings. 263. Adding complexity to this is the fact that the report of the Special Team indicates that a quantity of 671.89 MTs of Monazite can be extracted from the processed minerals kept packed in bags in Thoothukudi with Monazite content between 0.7% to 4.8%. Using the reverse calculation method, a much higher proportion of raw sand (ROM) would be required to produce 667.4 MTs of pure Monazite. Using the same calculation, about 13lakh tonnes of raw sand would be required to produce 671 MTs of monazite. 2.5 Reverse Calculation Method: 264. The 2nd Respondent / DAE reported "Gross Mismatch" between Total Quantum of raw sand purportedly transported by 8th Respondent/ M/s.V.V.Mineral between 2001-2016 and raw sand required to produce 80, 725.05 Mts of Monazite rich tailings. A unique method - reverse calculation was used by the Amicus to determine Quantity of raw sand (ROM) required to produce Quantum of Monazite tailings declared by 8th Respondent/ M/s.V.V.Mineral. 265. To conduct further study a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aw Sand requirement (APP) Note: If we consider the production plants (Pre-concentration plant and Mineral Separation Plant) are operating with recoveries as defined in Case - 2 then, a ROM (Raw sand) quantity of 4.787 crores tonnes with 0.05% of Monazite grade is required for the generation of 80, 725 Mts of Monazite tailings with 29% Monazite grade constituting 23, 461 Mts. Case 3 and 4 represents 2 other possibilities and are presented to have a rough estimation of the amount of raw sand required amounting to 4.88 crores and 4.93 crores of raw sand each. 268. The above calculation is an attempt to approximately calculate the total quantity of raw sand required based on the specifications given by R-2. The calculations are made on the assumption that some amount of monazite will be lost in the preliminary washing and pre-concentration stage and during mineral separation stage. 269. The above calculation indicates that approximately 4.69 Crores to 4.93 Crore MTs of raw sand will be required to produce the 23, 461 MTs of Monazite or 80, 725.06 MTs of monazite enriched tailings. 270. It requires to be noted that the total quantity of ROM transported as shown by the data provided ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y with respect to the quantity of monazite assessed by Special Team. The difference indicates that, a larger quantity of raw sand has been processed than what was declared. 275. The DAE further submits that, even if a higher grade of monazite is considered, say 0.1% (2 times) in raw sand mined, taking into account the possible enrichment process by beach washings, about 3.50 to 4 crore tonnes of raw sand is required for the collection of 38, 608 tonnes of monazite as against the 98, 88, 100 tonnes raw sand declared by Respondents 8 and 22. In view of the above, the possibility of excessive mining of raw sand against the declared quantities and grades cannot be ruled out. Hence there can be an effective conclusion drawn from the Sahoo committee report, Amicus Curiae report and the submissions of DAE that there has been illegal mining of raw sand over and above the permissible limits. 276. The Sahoo Committee report and the Amicus Curiae report reveal similar contradictions in the quantity of raw sand mined as declared by the private mining companies namely Respondents herein and the actual raw sand mined as disclosed from monazite tailings. Though the Respondent mining companies o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... MTs of Monazite, a further quantity of 15, 000 MTs of monazite that can be extracted from all the stocks of the company is added, a total figure of 38, 608 MTs of Monazite merges. As explained before, this, in turn, would require a ROM quantity of over 6 to 7 crore tonnes of raw sand (ROM). 280. Similarly with regard to the Respondent 10/Respondent 17, the Sahoo committee report indicates that the company gave a declaration to the committee of having stocks of 9441 MT, whereas, the Committee estimated amount to 64, 40, 028.93 MT. Hence, there is a huge discrepancy between quantity declared and quantity found. 281. The Report of the Special Team in respect of stocks of raw sand and minerals processed by M/s.Transworld Garnet has reported that as against a declared quantity of 17, 75, 761 MT of stock, the quantity estimated by the Second Level Teams is 16, 30, 724.5 MTs. It is necessary to point out that Transworld Garnet India Pvt. Ltd. has been granted 14 mining leases for mining garnet in Tirunelveli district and 2 mining leases for mining garnet in Thoothukudi district. They do not have any mining lease for mining Ilmenite and other BSMs. 282. While so, one of the samples rela ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mpanies' site in Kuttam, which was found to have 0.6% Monazite Equivalent. The monazite tailings had been stored in trench like structures. In the other site at Arasoor Village, 11 bags of 2 tonnes each of monazite tailings had been stored in a well like structure. Samples taken from that site indicated the stock of tailings to have a monazite equivalent reading of 0.46%. The tail amount of monazite amounted to about 0.10 MT. 288. Using the same formula adopted for calculating the total amount of ROM necessary for producing 23, 462 MT of Monazite in the case of M/s.V.V. Mineral, it is found that a total quantity of 63, 61, 952 MT of raw sand (ROM) will be required to produce the said 3, 780 MTs of Monazite that can be extracted from stocks presently available with the Company. As can be inferred from the above discussion, the company viz., Beach Mineral Sand Company, must have had to illegally mine a huge quantity of raw sand to produce the stocks Processed / Semi-processed minerals that they now possess. 2.8 Mismatch in Figures of Monozite Tailings Submitted by the Respondent Companies: 289. Very importantly, the Report by the Special Team concludes on the issue of monazite ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ld have actually been dispatched, if the Special Team's Inspection and sealing of godowns and stockyards had not been carried out in mid-2017, a major issue of concern that arises is as to how much of previous stocks of processed minerals sold also had similar high concentration of monazite as part of the stocks sold. 294. In other words, could exports of processed minerals by different companies have contained significant quantities of monazite tailings mixed up as part of the stocks sold, is an issue that requires to be investigated by agencies competent, since it requires a multi disciplinary probe. This is a matter not just of commercial transactions but also involving National and International security. (3) Whether State Government is Empowered to Add Monazite and Other Atomic Minerals to the Existing Mining Leases Without Prior Approval of the Central Government? 295. This question is of utmost significance in the present matter. It is an undisputed fact that Monazite is a prescribed substance under the Atomic Energy Act and it is clear that private parties are prohibited from mining, processing, selling or exporting the mineral. So the pertinent question that arises ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... inspite of large scale reports available on monazite being dealt with by private players. Why did the monitoring mechanism remain silent and ineffective when the illegalities where perpetrating? Hence this Court feels that the role of DAE officials must also be enquired into by the appropriate agencies to identify if there is any collusion of officials in this major scam. 3.1 Is Approval Required for Grant of Mining Lease Pertaining to Other Atomic Minerals? 298. Proviso to Section 5(1) of the MMDR Act clearly states that: "5. Restrictions on the grant of mineral concession.- (1) A State Government shall not grant a mineral concession to any person unless such person- (a) is an Indian national, or company as defined in 10[clause (20) of section 2 of the Companies Act, 2013 (18 of 2013)]; and (b) satisfies such conditions as may be prescribed: Provided that in respect of any mineral specified in Part A and Part B of the First Schedule, no reconnaissance permit, prospecting licence or mining lease shall be granted except with the previous approval of the Central Government. Provided further that the previous approval of the Central Government shall not be required for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ding the atomic minerals in the lease and the State Government after obtaining such permission from the Central Government shall include the said atomic mineral(s) in the lease. Hence it is mandatory under the Act and Rules for the State Government and the lessee to obtain the permission from the Central Government before granting mining lease to the lessee for mining atomic minerals. 3.2 Illegal Inclusion of Monazite and Other Heavy Minerals in Existing Mining Leases Without Prior Approval of the Government of India: 302. It is pertinent to note that the contentions of the DAE had listed out the formalities to be followed prior to grant of licence to mine atomic minerals. It is shocking that the State Government had not obtained the prior permission from the Central Government/DAE as required under the Act. 303. Though the titanium ores and its concentrates (Ilmenite, Rutile, Leucoxene and Zirconium, its alloys including zircon) were removed from the list of prescribed substances under the Atomic Energy Act, 1962 with effect from 01.01.2007, it still continued to be atomic minerals under the MMDR Act. Hence with effect from 01.01.2007, the State Government ought to obtain permi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nclusion of Monazite to the existing mining lease of the 8th Respondent arises and the State Government failed to provide any satisfactory answer. Further, The Commissioner of Geology and Mining too acted upon this direction and passed a consequential order of inclusion of Monazite to the lease thereby committing a grave illegality. This entire process of inclusion of such a prescribed substance without the sanction of the Central Government ought to be viewed seriously and the level in which the State Government had bent its machinery and the laws of the land to grant such an unlawful lease to the 8th Respondent must be examined to unearth the presence of any political nexus, if any, and the connivance of the officials and the lessees must be probed in detail. 306. Since the policy decision of Central Government /DAE is to not allow private players to process monazite due to National Security reasons, only handling licence is granted for storing them separately in accordance with directives issued by AERB while granting handling licence under the Atomic Energy (Radiation Protection) Rules, 2004. 307. Therefore, when Monazite is listed as a prescribed substance and there is a cle ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd the private mining lessees and appropriate legal action including criminal prosecution needs to be instituted against such Government officials and private mining parties involved. (C) Royalty: (1) Royalty Settlement: 309. Royalty is a consideration paid by a mining lessee to the lessor for enjoyment of mineral rights and to compensate for the loss of value of minerals suffered by the owner of the minerals. It is the payment of tax to the Government for the (owner) mineral right for the privilege granted by him for mining and producing/dispatching of minerals. 310. As held in Mineral Development Authority case cited supra, the essential characteristics of royalty are that: (i) it is a consideration or payment made to the proprietor of minerals, either the Government or a private person; (ii) it flows from a statutory agreement (a mining lease) between the lessor and the lessee; (iii) it represents a return for the grant of a privilege (to the lessee) of removing or consuming the minerals; and (iv) it is generally determined on the basis of the quantity of the minerals removed. 1.1 Royalty- Legal Position: 311. Royalty was initially collected based on a fixed rate f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g either within or outside the leased area. Royalty for minerals processed within the leased area: Scenario: When the run-of-mine (ROM) mineral (the mineral extracted during mining in its primary state is called run-of-mine (ROM), [which may or may not be useable in its primary state depending on the minerals and its grade] is processed within the leased area itself (i.e., processing happens at the mine site). Royalty Calculation: Royalty is charged on the processed mineral that is removed from the leased area. This means that after processing, the final product (Such as concentrates, refined minerals, or any other processed form) is subject to royalty, which is determined based on the processed mineral quantity and its value. Example: If a mine processes iron ore into concentrated iron within the lease area, the royalty will be calculated on the concentrated iron ore when it is removed from the site. Royalty for minerals processed outside the leased area: Scenario: When the run-of-mine mineral is removed from the leased area and taken to a processing plant outside the leased area for further processing. Royalty Calculation: (1) Royalty is charged on the unprocessed run-of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... for different minerals as published by IBM shall be the sale price for computation of royalty. 1.2 Rule 64-D - Manner of Payment of Royalty on Minerals on Ad Valorem Basis: 317. Rule 64-D(i) (I) is as extracted below, "(1) Every mine owner, his agent, manager, employee, contractor or sub-lessee shall compute the amount of royalty on minerals where such royalty is charged on ad valorem basis as follows: (i) - 'for all non-atomic and non fuel minerals sold in the domestic market or consumed in captive plants or exported by the mine owners (other than bauxite and laterite despatched for use in alumina and metallurgical industries, copper, lead, zinc, tin, nickel, gold, silver and minerals specified under Atomic Energy Act), the State-wise sale prices for different minerals as published by Indian Bureau of Mines shall be the sale price for computation of royalty in respect of any mineral produced any time during a month in any mine in that State, and the royalty shall be computed as per the formula given below: Royalty = Sale price of mineral (grade wise and State-wise) published by IBM X Rate of royalty (in percentage) X Total quantity of mineral grade produced/ dispatched: ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mineral and consignment and quantum of mineral sold. This system is crucial for the mineral industry, as it helps align the interests of mine operators and the Government, contributing to the sustainable and equitable extraction of minerals. 320. In 2014, the royalty rate for BSM in the Second schedule was changed, whereby royalty rate for Garnet was changed from 3% sale price to 4% average sale price and rate of royalty for all other BSM were unchanged. In 2016, few major changes were brought about to the MMDR Act. A new item was added to Part B- 'Atomic Minerals' of the First schedule of the MMDR Act, 1957 which reads as follows: "12. Beach Sand Minerals i.e., Economic Heavy Minerals found in the teri or Beach Sand, which include ilmenite, rutile, leucoxene, garnet, monazite, zircon and sillimanite." 321. Around the same time, the MCR, 1960 was repealed and substituted with two new Rules, these are - (1) The Minerals (Other than Atomic and Hydro carbons Energy Minerals) Concession Rules, 2016 (w.e.f 04.03.2016). (2) The Atomic Minerals Concession Rules, 2016 (w.e.f 11.07.2016) (AMCR) It is to be pointed out that the provisions of Rule 23 (2) of the AMCR, 2016 provided fo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e of royalty for "Raw Sand". 1.4 Distinction Between Rules 64-B and 64-D: 327. The key distinction between Rule 64-B and Rule 64-D is that, in the case of Rule 64-B, it is based on processing of minerals within or outside the leased area, whereas Rule 64-D deals with royalty calculation on sale price or metal content of minerals. In simpler terms, with respect to Rule 64-B, the focus is on the processing stage (processed or unprocessed), whereas Rule-64 D focusses on value of the minerals through sale price or metal content. 328. When the primary intent behind the grant of a mining lease is to extract minerals and either sell them locally or export them, it is naturally understood that the fixation of royalty should be based on the value of the minerals alone. It would be unfair to fix the royalty on ROM (raw sand) based on the ground that, as per Rule 64-B(2), since the ROM mineral is removed from the lease area and taken to a processing plant located outside the leased area, royalty should be fixed on the unprocessed ROM. This is a complete wrong application of the Rule. The royalty should be affixed to the value of the minerals removed. More so, when Section 9 read with Secon ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... his ad valorem shall be calculated based on the sale price of each mineral. Hence, it is implicitly clear that Section 9(2) of MMDR Act and Second Schedule to the Act and Rule 64-D of MCR should be read together for computation of royalty on ad valorem basis for the minerals. Hence, it becomes crystal clear that the royalty rate for each of the six BSMs is fixed on an ad valorem basis. This fixation ranges from 2 to 4% of the sale price of each mineral. 333. It is also to be noted that the Department itself has computed royalty on ad valorem basis on all mining companies, including 8th Respondent/ M/s.V.V. Minerals, under Rule 64-D until the period 2007 - 2008. However, in 2012, when District Officials of Tirunelveli District were computing the Royalty Payment for the period 2008-09, 2009-10, 2010-11 and 2011-12, they have selectively chosen to apply Rule 64-B and charged royalty on a flat rate of Rs.20 to 45 per MT of raw sand only in respect of 8th R espondent/ M/s.V.V. Minerals, 9th Respondent/ M/s.Transworld Garnet India Pvt Ltd and 13th Respondent/Industrial Minerals India Private Ltd, all of whom were sister concerns of 8th Respondent/ M/s.V.V. Minerals at the relevant point ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in a huge loss of revenue to the State by way of very low royalty collections, when in fact, the company has sold huge quantities of BSMs through export during these years and thereby earned huge income in those periods. 2.1 Low Royalty Fixation by IBM: 337. It has been observed by the Bedi committee that the Domestic sale price of Tamil Nadu as published by IBM, is at much lower rate as compared to other States. 338. For Example, in August 2013, as per data published in the IBM, the sale price of Garnet was Rs.377 per MT for Tamil Nadu, but Rs.8, 833 per MT for Andhra Pradesh and Rs.5, 500 per MT for Odisha. But it is to be noted that the export price of Garnet is Rs.15, 000-Rs.18, 000 per MT and hence the lessees have benefited a lot due to this shocking undervaluation. When the issue of undervaluation was raised, the sale price was refixed in January 2014 at Rs. 5, 600 MT for Tamil Nadu. But the Government of Tamil Nadu has lost a chunk of its revenue due to this undervaluation. 339. Due to the low fixation of the sale price for royalty, the total royalty earnings for Garnet in Tamil Nadu were Rs.5.47 Crore in 2013-2014. Further, the total royalty earnings from various beac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... MT. This data provided by M/s. V.V. Mineral at the time of Royalty Settlement of 1, 765 MT of BSM exported is shown to be as incorrect by their own declaration made to the Taluk Level Committee of Tirunelveli in June, 2016, in which they claim to have exported 8, 83, 865 MT of BSMs during the same period. Even if it may be argued that this figure includes exports from all the three districts, considering that 27 out of 34 mines of M/s. V.V. Mineral are located in Tirunelveli District, it can safely be assumed that a substantial proportion of the 8, 83, 865 MT of BSM exported in the three years came from Tirunelveli District. 344. What stands out in stark contrast, is that as against the claim of M/s.V.V. Mineral of having sold 2, 74, 835.91 MT of BSMs locally for the 3 years period 2005-06 to 2007-08, the comparative figure of local sales of BSMs for the same period as declared before the Taluk Level Committee in 2016 is 28, 885.66 MT only. 345. This comparison echoes huge difference in declaration made by the companies before two different authorities. It can be inferred clearly that the company attained undue monetary benefit, due to these false declaration and would amount to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... -14 (upto September, 2013) and the post-ban period covering the years 2014, 2015 and 2016. Consolidated summary of Royalty and Cost of mineral due to be recovered from lessees: SI.NO Name of th Lessee/Plant owner Royalty and Cost of mineral due to be recovered for unlawful/Illegal transport of BSM (in Rs.) 1 M/s.V.V.Mineral (R8, R22) 35, 81, 11, 76, 202 2 M/s.Transworld Garnet India (P) Ltd., (R9) 4, 78, 34, 94, 227 3 M/s.Industrial Mineral India (P) Ltd., (R13) 82, 51, 69, 343 4 M/s.Beach Mineral Sands Company and their sister companies & M/s.Beach Mineral Company (P) Ltd., (R10, R16, R18, R19), (R17) 9, 21, 69, 81, 216 5 IOGS Group (M.Ramesh (R11) and K.Thangaraj (R12) 4, 92, 67, 36, 512 6 M/s.Industrial Mineral Company (R15) 2, 76, 08, 66, 333 Total 58, 32, 44, 23, 835 (Rupees Five Thousand Eight Hundred and Thirty Two Crores Forty Four Lakhs Twenty Three Thousand Eight Hundred and Thirty Five only). 3.1 Post Ban Period - Royalty Calculations: 352. It is the claim of all the various mining companies that the entire stock of BSMs comprising of processed and semi-processed BSMs and raw sand, belongs to them and that they have validly paid advance ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nvolvement in this major scam is inevitable. 358. Any reasonable man cannot deny the involvement of officials in this illegal mining keeping the backdrop of the facts and findings in this case. The brazenness with which this illicit action was done shows the level of support found in the then Government administration during the period when illegalities was perpetrated. The political patronage to this huge scam cannot be ruled out. This Court has witnessed cases, where officials find shelter in unavoidable systemic delays and by the time the issue comes to the fore, the perpetrators walk away legally unscathed. The Officials involved in the scam, irrespective of the positions they hold in the system ought to be inquired and requisite action should be taken including disciplinary action and criminal prosecution or both as the case may be. 359. This exploitation of natural resources at the cost of people's life, health and National revenue is not a child's play. Already the environmental damage today is becoming a cause of international concern and adding to that, just to satiate the greed of a few, the future of our natural resources and human life cannot be put in jeopardy. It is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ecord. 364. The Government of Tamil Nadu has stated that it could not have been possible for the Joint Inspection team to have conducted a detailed study on illicit mining of Beach Sand Minerals in 4 days. It is stated that the Government does not accept this report, as they have already constituted a special team headed by Mr. Gagandeep Singh Bedi, IAS and the report has also been submitted to the Court. The counter has also pointed out that the findings of the Joint Inspection team that the mining lessees have obtained licences from AERB and mining has been carried out as per approved mining plans, is not supported by any documents. The Report has stated that all royalty has been paid and exports are within limits, without verifying the reconciled statement of State Government and without the export details. On the contrary, the Principal Secretary to the Government of Tamil Nadu has pointed that the District Level Committee constituted by the District Collector, Tirunelveli, as per G.O.Ms.No.179, Industries (MMD.1) Department, dated 27.07.2015 on 18.10.2016 and 09.11.2016 reported excess quantum of raw sand, Garnet, Ilmenite, Rutile, Zircon, Sillimanite, and Leucoxene against t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e otherwise. The entire illegalities was committed right under the watch of the State Government officials and they failed to take any action and chose to stay silent. Some officials have gone a step further by denying any such illegal mining/transportation/storage to have taken place. 366. To deny any knowledge of a scam as huge as this, which is an organised crime and planned to the tee at all levels in terms of executions by bending and subverting the laws of the land is unheard of. This is deeply disturbing and alarming. Hence, the officials who have claimed that no allegations have taken place inspite of repeated complaints received by them and the officials, who have submitted reports with untrue and false findings claiming no illegal mining has taken place inspite of having knowledge about the same, should be brought to the book and enquired about their involvement in this scam. Any such nexus between the perpetrators and officials, who submitted reports with false findings denying illegal mining in the area, where offence was committed must be ascertained. Giving false inspection reports is degrading the position of office held by them and strict action must be taken again ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to this issue. 370. The Show Cause notices issued by IBM officials clearly reveals that, even as far back as in 2006 - 07 itself, they were fully aware of the brazen and open violation of the laws by the mining companies. As noted before, in some cases, the illegally transported raw sand production was sometimes 14 to 18 times more than the quantity permitted to be transported. Yet apart from giving token notices, the IBM officials did nothing to strictly enforce the law. 371. As rightly raised in the Amicus Curiae report, the moot question is, as to whether the inaction of the officials to enforce the law is sheer inaction and indifference or did it arose from collusion with mining companies. This aspect requires detailed investigation by the investigating agencies. 372. The Amicus Curiae report reveals that the inaction of the State Government officials, despite evidence of the numerous illegalities committed by the mining companies in general, and more particularly M/s.V.V.Mineral and other mining companies controlled by Mr.S.Vaikuntarajan or being run by close family members, is very obviously the result of considerable influence wielded by 8th and 22nd Respondent and the cl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... es each year, thereby resulting in major loss to the State revenue and unjust enrichment of the mining companies concerned. There is a key finding in the Amicus Curiae report that the officials of the District Geology and Mining department, as also the District Collectors of each of the three districts Tirunelveli, Thoothukudi and Kanniyakumari have not only acted in violation of the requirements of the provisions of Section 9 and Second Schedule of the MMDR Act, 1957 and provisions of Rule 64D MCR, 1960, but have actually colluded and connived with different mining companies to ensure beneficial fixation of royalty, thereby reducing the royalty amount that the companies need to pay to the Government each year of the assessment period, but also to ensure that the mining companies gained financially by defrauding and cheating the Government of just dues for the mineral sold by them. 378. This can be further deduced from the wrongful application of Rule 64B(2) of MCR, 1960 for calculation of royalty on ROM transported and that too this wrongful method was adopted arbitrarily only for companies associated with M/s.V.V.Mineral, including M/s.Transworld Garnet India(P) Ltd and M/s.Indu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by the competent authorities and the ultimate accountability is on the District Collectors. 382. When officials fail to act on complaints and remain mute spectator to the wrong doings happening, it is not only unconstitutional, but erodes public confidence, thereby leading to systemic dissolution. Power has been constitutionally granted to the executive to act for the protection and benefit of the public and any omission to act is in itself unconstitutional. 383. Fixation of accountability is of primacy in the issue on hand. Sand mining has become uncontrollable and unless accountability is fixed, the officials tend to wriggle away from their responsibilities. It is surprising that this unfortunate illegality has been going on for decades irrespective of the change in governance. There appears to be a clear political nexus in this and the investigating agencies must investigate thoroughly to cull out the perpetrators. The illegal sand mining in the State of Tamil Nadu is operating in the form of a sand Mafia, a completely organised crime, with money power and political power. 384. Activist and journalists have not been given adequate protection by the District Administration. W ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as effected way back in August, 2013. So this shows that till 2021-2022, the illegality was still carrying on. This shows the blatant disregard for the orders of this Court. 388. 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. X. Conclusion: 389. This issue has been agitated for nearly a decade. 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. 390. By seeking formation of more new committees and by alleging bias on the existing ones is a mere abuse of judicial process. When the committee h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al 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. 394. 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 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ht of the elaborate discussions in W.A.No.1168 and 1169 of 2015, heard together along with the present suo motu PIL, the constitution of the expert committee headed by Mr.Gagandeep Singh Bedi, I.A.S vide G.O.Ms.No.156, Industries Department, dated 08.08.2013 and G.O.Ms.No.173, Industries Department, dated 17.09.2013 by the State Government in exercise of powers conferred under Section 24 of MMDR Act to inspect and file report in regard to illicit mining of BSM is upheld. (c) The reports and findings of the Special Team headed by Mr.Gagandeep Singh Bedi, I.A.S., pertaining to the illegal mining and transport of 1.01 Crore M.T of raw sand over an extent of 234.55.0 hectares of non-leased out areas in the three coastal districts is held valid and sustainable in the eye of law. (d) The report of the Special Team headed by Mr.Satyabrata Sahoo, I.A.S., and findings on the quantum of stocks kept with the private respondents to the tune of 1.50 Crore M.T in the three districts is held to be legally valid. (e) The quantum of BSMs unlawfully mined and transported by the private respondents during the pre-ban period as estimated by the Learned Amicus Curiae in his first report dated 20. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to be handed over to IREL India Limited forthwith. (o) The actions of the State Government on inclusion of not only Monazite but also other atomic minerals like Leucoxene, Zircon and Sillimanite to the existing mining leases of the private respondent companies without the prior permission of the Central Government is held invalid. (p) The Public Notice No.50 of 2016 dated 23.11.2016 issued by the Customs department to verify the source of BSMs and for production of requisite certificate from the District Collectors certifying legal source of minerals to permit export under section 50 of the Customs Act, 1962 is held valid. (q) 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. (r) The royalty accounts wrongfully settled by the District Collector of Tirunelveli, Thoothukudi and Kanniyakumari by computing royalty for raw sand transported by wrongful application ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... onstitute required number of Special Investigation Teams, consisting of officials with expertise and High integrity to conduct the investigations into this scam. Further, The Director, CBI is directed to monitor the investigation of the SITs to be constituted. (x) The key issues that needs to be investigated includes: (1) The modus operandi of the illegal beach sand mining Mafia. (2) The role of officials including the omissions and commissions of all the officials from the senior most official in the Chain of command responsible for this huge economic loss to the State exchequer. (3) The Corruption and connivance of the officials with the mining companies indulged in illegal beach sand mining, transportation, storage and export must be probed across all departments which are accountable and responsible. (4) The role of officials involved in the Royalty settlement proceedings whereby arbitrary fixation of royalty was done by benefiting the respondent companies must be investigated. (5) 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 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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