Ashok Kumar Lingala
Vs. State of Karnataka & Ors.
L.V. Ashok Kumar
Lingala Vs. M/s. Sandur Maganese & Iron Ore Co. Ltd. & Ors.
J U D G M E N T
T.S. THAKUR, J.
appeals arise out of an order dated 1st September, 2010 passed by the High Court
of Karnataka - whereby Writ Petition No.17281 of 2010 filed by the appellant
has been disposed of with the direction that the question of identity of the
area forming the subject matter of the mining leases granted to the appellant on
the one hand and respondent M/s Sandur Manganese & Iron Ore Company Ltd. (`SIMORE'
for short) on the other, shall be determined by the Civil Court in the suit
pending before it on the basis of the evidence that the parties may choose to
The High Court has
further held that in case the Civil Court comes to the conclusion that the area
over which the mining leases have been granted to the rival parties does not overlap
then both of them would be entitled to carry out their mining activities under their
respective lease agreements.
In case, however, the
Civil Court is of the opinion that there is an overlapping of the area covered
by the two leases, the lessee who claims under the lease granted earlier in
point of time would have a superior right to carry out the mining activities in
preference to the one granted later. The facts in brief are as under: -
measuring 4.42 hectares situated at village Devagiri, Sandur Taluk, Bellary District
falling under Surveys No. 56/P, 57/P, 58/P and 91/P was according to the appellant
dedicated to Kumaraswamy Devaru Temple. The entire extent of land which now
falls in new Survey No.27 was given to one-Pennaiah S/o Dodda Pennaiah for
cultivation in lieu of the services which he was rendering to the temple.
With the enactment of
the Karnataka (Sandur Area) Inam Abolition Act, 1976 abolishing all rights in
inam lands and permitting the cultivators and tenants of the land to make applications
under Section 10 of the Act for re-grant and registration, the cultivator-Pennaiah
also made an application to the Land Tribunal, Sandur Taluk, Bellary District
seeking a re-grant.
The said application
eventually culminated in the Tribunal passing an order dated 22nd October, 1981
granting occupancy rights in favour of the tenant, pursuant whereto the
Tehsildar issued a registration certificate registering his occupancy rights
and entering his name in the record of rights. -
appellant's further case is that Pennaiah continued to cultivate the land
personally especially when neither the order of re-grant was challenged before the
Land Tribunal nor his cultivation objected to by anyone including the 3rd
respondent who held a lease in respect of Government and forest land situate in
Sandur Area. The appellant asserts that the land aforementioned is a piece of private
patta land that was held by Pennaiah during his life time and by his widow Yellamma
after his death.
Neither Pennaiah nor
Yellamma had in their capacity as Pattadars in cultivating possession of the
land ever offered the property to SIMORE or granted any right or any other
interest in its favour. On the contrary Yellamma in her capacity as Pattadar had
permitted the appellant to obtain a mining lease under the provisions of Minor Mineral
(Development and Regulation) Act, read with Mineral Concessions Rules, 1960 which
application was sent to the Deputy Commissioner,
Bellary District, to verify
the status of the land and also to the Deputy Director of Mining and Geology for
conducting an actual spot inspection. Both the authorities had, according to
the appellant, submitted their respective reports in which -the said property
was found to be private Patta land. They had, therefore, offered no objection
to the grant of a mining lease qua the same.
was on the basis of the reports aforementioned that the State Government had sought
the approval of the Central Government for the grant of a mining lease in
favour of the appellant which approval was upon due and proper consideration granted
by the Central Government. The State Government had pursuant thereto issued a
Notification dated 15.1.2010 sanctioning a mining lease over an area of 4.42 hectares
situate in Devagiri Village Sandur Taluk Bellary Distt., as per the sketch
furnished by the Director Department of Mines and Geology. Boundaries of the area
in question were fixed for an extent of 3.36 hectares in terms of letter dated 2.2.2010
issued by the Deputy Director Mines and Geology, Hospet and a lease deed
executed and registered with the Sub-Registrar under ML No.2622.
appellant's case is that when he started the mining activities in exercise of
his right under the lease -aforementioned, the Director of Mines and Geology,
Government of Karnataka issued a communication dated 5th March, 2010 by which the
appellant was restrained from conducting any such activities on the ground that
the area covered by the lease granted to the appellant overlapped the area stated
to have been granted to the SIMORE respondent no.3 herein.
On receipt of the said
letter the appellant filed an application to the Director of Mines and Geology objecting
to the order and pointing out that the same had been passed without issuing to
the appellant any notice or granting to him any opportunity of being heard in
the matter. The appellant also represented to the State Government against the
direction issued by the Director of Mines and Geology and asserted that even when
3rd respondent SIMORE had filed a Civil Suit in the Court of Civil Judge (Senior
Division) Kudligi and prayed for an injunction no such injunction had been issued
by the said Court.
The Director of Mines
was not, therefore, justified in 6issuing an injunction which the Civil Court
had not issued; on the very same factual matrix. The restraint order issued by
the Director of Mines and Geology continued to remain -in force despite the
objections raised by the appellant. As a matter of fact, the Director of Mines wrote
a letter dated 25.5.2010 to the appellant saying that order dated 5.3.2010
stopping mining operations could not be vacated or modified.
The appellant was in that
backdrop forced to approach the High Court of Karnataka at Bangalore in Writ
Petition No.17281 of 2010 challenging the said order/communication on several
grounds and praying for a direction to the respondent to refrain from interfering
with the mining activities of the appellant which the lease deed authorised him
to carry out. Respondent no.3, SIMORE filed Writ Petition No.18043 of 2010
challenging the very grant of the mining lease in favour of the appellant. The
said two writ petitions were finally disposed of by the High Court in terms of a
common order dated 1st September, 2010 impugned in the present appeals.
upon the orders passed by the Director, Department of Mines and Geology dated 5th
March, 2010 and 25th May, 2010, the High Court concluded that there was
overlapping of areas held by the appellant and SIMORE -under their respective lease
deeds. The High Court held that the appellant had not been in a position to
produce any evidence to show that the conclusion drawn by the Director of Mines
regarding overlapping of the areas was erroneous.
The High Court
observed: "We permitted learned counsel for Ashok Kumar Lingala to examine
the same. Even there from, learned counsel representing Ashok Kumar Lingala could
not repudiate the finding of fact recorded in the two impugned orders. xxx xxx xxx
xxx xxx xxx xxx xxx xxx xxx 15. From the two orders issued by the Director, Department
of Mines & Geology dated 05.03.2010 and 25.05.2010, we have no other
alternative or hesitation but to conclude, that `M/s Simore' had been granted a
mining lease, in respect of the same land, well before Ashok Kumar Lingala was awarded
the mining lease.
That being so, the
claim of Ashok Kumar Lingala could not have been considered for grant of a mining
lease over the area which comprised of part of the mining lease already granted
to `M/s Simore', as the application of Ashok Kumar Lingala was bound to be
treated as a premature application. This inference is inevitable from a collective
reading of rules 59 and 60 of the Mineral Rules, and Section 24A of the Mines
and Minerals Act." (underlined)
held that there was an overlapping of the areas covered by the two leases, the
High Court interpreted the rules to record a finding that even when the area
leased to SIMORE may include private land owned by Smt. Yallamma -and even when
Yallamma has not granted any surface rights to it, SIMORE could undertake
mining activity in the private area by paying compensation to Yallamma before
undertaking such activities.
The High Court
observed: "On the issue whether `M/s Simore' could carry out mining activities
over the land owned by the private owner Smt. Yallamma, the provisions relied
upon by the learned counsel representing `M/s Simore' leave no room for any doubt,
that in case mining activity is carried out by `M/s Simore' over private land, compensation
will have to be paid by `M/s Simore' to the private land owner under rule 72 of
the Mineral Rules.
But the submission of
this learned counsel representing Ashok Kumar Lingala, also leave no room for
any doubt, that `M/s Simore', in spite of the grant of a mining lease covering
private owned land, would not be in a position to unilaterally and arbitrarily conduct
mining activities thereon without the consent/permission of the land owner Smt.
The instant conclusion
is based on the second proviso under rule 22(3) (i) (h) of the Mining Rules which
mandates, that unless permission/authorization is granted by the land owner, mining
activity cannot be carried out. Even if it is assumed, that prior consent of the
land owner was not obtained by `M/s Simore' before 9 obtaining the lease deed from
the State Government, still the second proviso under rule 22(3) (i)(h) of the Mining
Rules extracted above, mandates that, prior to entering into private owned land
for mining activities, permission from the land owner is a necessary pre- requisite."
followed the above two findings, one touching the question of overlapping of
the lease areas and the other dealing with the effect of the overlapping qua privately
owned land, is interesting. The High Court took a -somersault and held that the
question of overlapping could not be decided by it authoritatively and left the
same must be decided by the Civil Court on the basis of evidence adduced before
it. It observed:
"Thus viewed, it
is not possible for us to record any concrete finding on the factual aspect of the
matter. We have noticed hereinabove that a civil suit is pending between the
parties. It will be open to the rival parties to lead evidence therein, if they
are so advised, to determine the specific identity of the property over which mining
leases have been granted to them.
In case such evidence
leads to the conclusion, that the land over which mining leases have been
granted to the rival parties, do not overlap, then both of them would be entitled
to carry out mining activities, under the lease agreements executed by the
State Government in their favour.
In case the factual finding
is to the contrary, then on account of the conclusions drawn hereinabove, the
earlier licensee will have to be granted the superior right to exclusively carry
out mining activities. As such, `M/s Simore' shall have a preferential right
over Ashok Kumar Lingala. In such an eventuality, no interference will be called
for with the impugned orders dated 05.03.2010 and 25.05.2010."
for the appellant Mr. Dushyant A. Dave, learned senior counsel strenuously argued
that the High Court had totally misdirected itself both on facts and in law. He
submitted that the High Court had failed to notice that the lease granted in
favour of respondent no.3 SIMORE was in respect of government and forest land
alone. No part of any private land covered the lease in its favour nor was any
-claim to that effect ever made by respondent no.3 SIMORE.
In support of that submission
learned counsel drew our attention to the application filed before the
Government of Karnataka by respondent no.3 SIMORE seeking renewal of the lease
in the year, 1992. In particular, he relied upon the answers given by SIMORE to
the queries made in paras viii (a), x-A(a) and (b) of the renewal application
to argue that respondent No.3
unequivocally stated that the lease sought to be renewed in its favour comprised
government land and no part of it was owned or occupied by any private party. Paras
viii (a), x-A(a) and (b) of the renewal application areas under: viii Particular
of the mining lease of ML No. 1179 which renewal is desired a) Area: 16.74 sq.
miles In Sandur Taluk of Bellary District Karnataka x-A Does the applicant continue
to Yes (Government land). have surface rights over the a) area of the land for which
he requires renewal of the mining lease. b) If not, has he obtained the Not
applicable consent of the owner and occupier for undertaking mining operations.
If so, the consent of the owner and occupier of the land obtained in writing,
also drew our attention to the report of inspection dated 22nd February, 1993 submitted
by Government of Karnataka, a copy whereof has been placed on record which too clearly
mentioned that the area covered by the lease sought to be renewed was forest
and government land. He particularly drew our attention to the following
passage in the said report: 12 "The present application for renewal is for
third renewal. The whole area of 16.74 sq. miles is bounded on the North by Sandur
State Forest on the South by Hospet Taluk on the East by Nauluti forest and on
the West by Kudligi Taluk. Area is Government and it is forest land also."
Dave next drew our attention to the plaint filed by respondent no.3 SIMORE in OS
No.9/2010 to buttress his submission that respondent no.3 SIMORE had not
claimed any private land to be a part of its mining lease area. Reference in this
regard was particularly made to para 11 of the plaint which is to the following
effect: "11. Further, the Plaintiff hereby submits that the Plaintiff is in
physical possession and enjoyment of the Schedule land for more than five decades.
The Schedule land is an
un- surveyed land and accordingly the NOC issued by the Deputy Commissioner, Bellary
on 31.03.1998 refers to the same as blocks and c onfirms that the same is a
Revenue - Land (Government Land). The claim of the Defendant that he has
obtained Mining Lease over an area of 3.36 ha under survey No.27 appears to be
dubious or it may be pertaining to some other land.
In addition to this,
the Plaintiff has paid Rs.104 crore towards Net Present Value Compensatory Afforestation
charges on the 1615.64 of forest land and Rs.2,07,79,920/- towards
Environmental Protection Fee on the 247.38 ha of Revenue land held by it under Mining
Lease Nos. 2580 (Old No.1179)."
Dave vehemently argued that inasmuch as the High Court had overlooked the material
on record it had 13fallen in a palpable error in assuming that the land leased
to the appellant could possibly overlap the area leased to respondent no.3 M/s SIMORE.
So long as the two lessees were claiming surface rights over their respective lease
areas under different owners the question of overlapping did not arise argued the
At any rate the area
leased to the appellant was not only verified as to its nature and ownership but
was spot inspected and demarcated, which fact was evidenced from the reports
placed on record. It was, therefore, wholly futile for any one to suggest that the
areas granted to the two lessees were overlapping, contended Mr. Dave.-
behalf of respondent no.3 SIMORE it was on the other hand contended by Mr. T.R.
Andhyarujina, senior counsel that the respondent no.3 SIMORE did not claim any
private land to be a part of its lease area. He submitted that even when that was
so the overlapping which the Director, Mines and Geology had referred to was
possible as according to SIMORE the area leased to appellant ought to be
treated as a part of government land. Alternatively,
it was contended that
while the appellant may claim to have obtained a lease in respect of privately
owned land the fact of the matter was that the area in which the appellant
intended to conduct his mining activities was a part of the area leased to
Anitha Shenoy, counsel appearing for the State Government and its functionaries
argued that the orders passed by the Director (Mines) suspending mining
operations were on the basis of the conclusion drawn by the drawing section of the
mining department according to which the two areas forming the subject matter
of the two leases were overlapping.
She contended that
even when -the report of the drawing section and the basis on which this
overlapping had been prima facie established had not been placed on record, the
site plans/maps placed on record supported the conclusion that there was some
Learned counsel further
submitted that the orders passed by the Director (Mines) were interim in nature
and the question whether or not there was any overlapping had yet to be determined
by the competent authority. She fairly conceded that in the process of any such
determination the rival claimants shall have to be heard by the competent
have given our careful consideration to the submissions made at the Bar and
perused the record. The facts emerging from the record place the controversy
within a narrow compass. While the appellant claims that the lease granted to
it is in respect of a privately owned area, respondent no.3 SIMORE claims that
the area leased in its favour comprises government and forest land only.
If that be so, as indeed
are the positions taken by the parties there is no question of any overlapping
of the two areas for -what is government or forest land cannot be privately
owned and vice-versa. Mr. Andhyarujina all the same made a valiant attempt to persuade
us to hold that the area falling in Survey No.27 qua which the appellant has
obtained a lease is, in fact, government land and that no part of it is or was
at any stage privately owned.
What he argued in
support of that contention was that the grant of occupancy rights in favour of
Pennaiah was not warranted in the facts and circumstances of the case, and if
that were so, any such grant could be ignored. We regret our inability to
accept that submission. We say so firstly because, the validity of the grant of
occupancy rights in favour of Pennaiah by the Statutory Tribunal was not under
challenge before the High Court nor was any challenge ever thrown to the orders
passed by it or the implementation thereof in the relevant revenue record
before any other forum.
Even the State under whom
respondent No.3 SIMORE claims the right to carry out mining operations, never
found fault with the grant of land in favour of Pennaiah. It is, therefore, too
late in the day for any one to question the legality of the order granting land
situate in Survey No. 27 to Pennaiah, or -to assert that notwithstanding what has
happened in the statutory proceedings, the area falling under Sy. No. 27 must be
recognised as government land, hence a part of area leased to SIMORE.
Secondly because in
the record of rights Survey No.27 is shown to be privately held by Pennaiah and
after his death by Yallamma his widow. The State Government and Kumaraswamy Devaru
Temple to whom the land was dedicated before its grant to Pennaiah, have accepted
that position; and raised no dispute or question as to the correctness of the
revenue record. The report submitted by the Deputy Commissioner, the spot
inspection, and the very grant of a lease qua the area in question, all lend credence
to the revenue record that recognises the land in question to be private land.
being the case the only question that calls for determination is whether
respondent no.3 SIMORE is right in insisting that the area in which the
appellant proposes to carry on his mining activity is a part of the area leased
to former. It was argued by Mr. Andhyarujina that the area sought to be
exploited for mining purposes by the appellant -comprised the workers colony of
SIMORE. That assertion was stoutly denied by the appellant according to whom
the mining operations are confined to the area originally demarcated at the
time of the grant of the lease.
Be that as it may what
needs to be examined is whether the appellant is mining within his lease area or
beyond. This would in turn require the area leased to the appellant to be
demarcated again assuming that an earlier demarcation had also taken place, especially
because SIMORE denies any such previous demarcation having been conducted.
According to SIMORE the officer said to have done so was placed under suspension
for dereliction of duties.
It is unnecessary for
us to go into the validity of any previous demarcation. It is obvious that when
large areas are granted for mining purposes, some confusion as to the
boundaries of such areas especially if they are adjacent to each other is
nothing abnormal. What in such cases needs to be done is to conduct a fresh demarcation
and fix boundaries so that the parties holding such areas stay within the
limits of their respective areas instead of straying into the adjacent area.-
may at this stage advert to another submission made by Mr. Dave that the
Director (Mines) could not have stopped the mining operations of the appellant
on the basis of what was according to Mr. Dave a frivolous complaint filed by
SMIORE that alleged overlapping of the lease areas.
He contended that a
valid lease having been granted to the appellant after following the requisite formalities
and the procedure prescribed under the relevant rules and after proper demarcation
of the privately held area that was available for mining, the Director should not
have on a sketchy report from the Drawing Section of the Department stopped the
It was further contented
by Mr. Dave that since the mining activity had been stopped under the orders of
the Director (Mines), the High Court was in error in not only upholding the said
direction but extending their efficacy till such time the dispute between the
parties was resolved by the Civil Court.
mere pendency of a suit in a Civil Court could not be an impediment for the
appellant to start or continue his mining activity, unless there was an
injunction restraining - 20him from doing so. No such injunction has been
issued by the Civil Court. That does not, however, mean that the Government or the
Director (Mines) for that matter could not in the event of any dispute between
the appellant and SIMORE regarding the identity and demarcation of the area
leased to both of them direct the appellant to refrain from carrying on the mining
activity as an interim measure till such time the issue was sorted out.
But once such an
interim direction was issued, the authority doing so had to take steps to resolve
the dispute. It could not let the dispute fester and result in a stalemate. So also
the restraint order could not be continued by the High Court till the dispute
was adjudicated upon by the Civil Court. Doing so would amount to one authority
making an interim order pending a final order to be made by another. The power
to make an interim order is, except where it is specifically taken away by the
statute, implicit in the power to make a final order.
It is exercised by the
authority who has to make the final order or an authority exercising appellate
or revisional jurisdiction, against an order granting or refusing an interim
order. The exercise of the power implies that -the authority seized of the proceedings
in which such an order is made will eventually pass a final order; the interim
order serving only as a step in aid of such final order.
The law, in our view,
does not permit the making of an interim order by one authority or Court
pending adjudication of the dispute by another except in the situation mentioned
above. Ms. Shenoy was, therefore, right in her submission that the order of
restraining mining operation was meant to be a temporary and interim
arrangement meant to remain in force only till such time the Director (Mines) examined
the issue regarding the alleged overlapping of the area and passed a final
order on the subject.
Shenoy was, however, unable to justify the restraint order passed by the Director
(Mines) in the absence of the report of the Drawing Section which was the sole
basis for the order passed by the Director (Mines). If the Drawing Section had
indeed undertaken an exercise the same ought to have been disclosed to the High
Court and 22to this Court so that the validity of any such exercise could be
Absence of the report
said to have been -made by the Drawing Section and non-production of any
material indicating the process by which the Drawing Section came to the
conclusion that there was overlapping of the two areas, one privately owned and
the other belonging to the State, lend support to the submission made by Mr.
Dave that the order of restraint passed by the Director was made in haste. We
do not, however, propose to dwell any further on this aspect nor do we propose to
vacate the interim restraint order issued by the Director on the ground that it
was based on material that was tenuous and remained un-substantiated before us.
In our opinion the real
problem lies in the demarcation of the two areas leased to the appellant on the
one hand and SIMORE on the other. As observed earlier the ownership of the areas
claimed by both the lessees vests in different owners. So long as the areas
leased to them are identifiable on spot by different survey numbers and boundaries,
there is no question of any overlapping. The confusion regarding boundaries in
turn is a matter the answer to which lies only in a proper demarcation of the
was submitted by Mr. Dave that dispute between the appellant and SIMORE has
considerably delayed the mining activity of the appellant, and that a direction
ought to be issued to the authorities to expedite the process of demarcation.
He urged that keeping in view the bad blood generated between the parties it would
be more appropriate to entrust the entire process of demarcation and identification
of the leased areas to the Geological Survey of India.
We, however, see no
reason to issue any such direction at this stage. While the appellant may have
some apprehensions about the fairness of the officers of the concerned department
we do not consider them to be sufficient for us to mistrust the State functionaries
in the absence of any material to suggest that there is any real likelihood of
bias. That does not mean that the process of identification and demarcation of the
area leased to the appellant should not be undertaken by senior level officers 24of
the State Government to ensure that there is no scope for any mischief or miscarriage
the result we allow these appeals, set aside the impugned order passed by the High
Court and allow Writ Petition No. 17281 of 2010 filed by the appellant in part
and to the following extent:(1) The Secretary, Department of Industries and
Commerce, Government of Karnataka, shall constitute a Committee of officers for
conduct of the demarcation and identification of the boundaries of the area leased
to the appellant in terms of Mining Lease No.2622.
The Committee so
constituted shall include the Deputy Commissioner of the District concerned,
the Chief Conservator of Forests or his nominee who shall be an officer not below
the rank of Assistant Conservator of Forests, the Director of Survey and a
Senior Officer of the Mines Department to be nominated by the Secretary. The
Secretary shall be free to nominate any other official or officials whom he
considers suitable for the purpose of identification and demarcation of
boundaries of the areas covered by the mine held by the appellant.(2) The
Secretary shall monitor the progress made by the Committee from time to time.
A suitable order
based on the -report and other material, if any, placed before the Secretary shall
then be passed by him after affording to each party an opportunity of being
heard in the matter. The order so passed shall supersede the order dated
5.3.2010 passed by the Director (Mines).(3) The above directions shall be carried
out by the Secretary expeditiously but not later than six months from the date a
copy of this order is received/served upon the Secretary to Government by the
parties.(4) The parties shall bear their own costs.