SYMBIOSIS INTERNATIONAL UNIVERSITY,

SCHOOL OF LAW, HYDERABAD

PROJECT ASSIGNMENT

ON
CASE STUDIES: INTER LINKING AND HYPER LINKING

CASE: COMMON CAUSE VS UNION OF INDIA

COURSE TEACHER:

Ms.TASKEEN RAFAT

SUBMITTED BY:

NAME-M.SATHVIK REDDY

ROLL.NO-38

DIVISION-D

SEMESTER-4
 ACKNOWLEDGEMENT

I would like to express my sincere gratitude and indebtedness to

Ms.Taskenn rafat for her enlightening lectures on Case studies: Interlinking
and Hyper linking. I would also like to express my sincere gratitude to our
teaching staff for guiding me the path towards gaining knowledge. I would also
like to thank Symbiosis Law School, Hyderabad, library for the wealth of
information therein. I would like to thank Library Staff as well for their co-
operation.

Name-M.sathvik reddy
Roll no-38

Semester-4

COMMON CAUSE VS UNION OF INDIA

 [Writ Petition (civil) no.114 of 2014]

INTRODUCTION:
The Hon'ble Supreme Court of India, in Common Cause vs. Union of India, vide its order
dated 16 May 2014, inter-alia restrained 102 mining leaseholders from carrying on any
mining operations on the ground that the leaseholders were not in possession of the requisite
clearances and approvals for carrying mining operations ('16 May 2014 Suspension Order').
However, liberty was granted to the leaseholders to move the Hon'ble Supreme Court to
revoke the 16 May 2014 Suspension Order after obtaining the requisite clearances and
approvals for carrying mining operations. Pursuant to the liberty granted, several leaseholders
moved the Hon'ble Supreme Court of India for lifting the 16 May 2014 Suspension Order.

FACTS:

1. The facts revealed during the hearing of these writ petitions filed under Article 32 of the
Constitution suggest a mining scandal of enormous proportions and one involving
megabucks. Lessees in the districts of Keonjhar, Sundergarh and Mayurbhanj in Odisha have
rapaciously mined iron ore and manganese ore, apparently destroyed the environment and
forests and perhaps caused untold misery to the tribal in the area. However, to be fair to the
lessees, they did the detail steps taken to ameliorate the hardships of the tribal, but it appears
to us that their contribution is perhaps not more than a drop in the ocean - also too little, too
late.

Facts leading up to the report of the Central Empowered Committee

2. Rabi Das, the editor of a daily newspaper called Ama Rajdhani filed I.A. No. 2746-2748 of
2009 in a pending writ petition being T.N. Godavarman v. Union of India.1 He prayed,
inter alia, for the following directions from this Court: "

a) Issue a direction to the Central Empowered Committee to conduct an exhaustive fact-

finding study of the illegal mining in Keonjhar, Sundargarh and other Districts of Orissa;

b) Direct appointment of a "Commission" to investigate and study the modalities of the

illegal machinations, fix responsibility on individuals (in Government and outside it) and
recommend remedial measures to be immediately implemented by the Government of India
and the Government of Orissa;
c) Direct the Respondents to take effective and appropriate action to ensure closure/stoppage
of all the illegal mining activities in the concerned areas and direct prosecution and punish all
those found guilty of this illegal mining in violation of the Mines and Minerals (Development
and Regulation) Forest (Conservation) Act, 1980 and other relevant laws."

3. The applications were taken up for consideration on 6th November, 2009 when notice was
issued to the Central Empowered Committee (for short 'the CEC') to file its report/response
within six weeks.

4. On 26th April, 2010 the CEC submitted an interim report which was noted by this Court
and taken on record. The report was of a general nature but contained quite a few
recommendations. Some of the recommendations presently relevant are as follows:

"(b) Even otherwise the Rule 24-A (6), MCR, 1960 does not authorize the lessee to operate a
mine without the statutory clearances/approvals. Therefore, in respect of a mine covered
under the 'deemed extension' clause, the mining operations should be permitted to be
undertaken in the non-forest area of the mining lease only if

(i) it has the requisite environmental clearance;

(ii) it has the consent to operate from the State Pollution Control Board under the Air and
Water Acts;

(iii) Mining Plan is duly approved by the competent authority; and

(iv) the NPV for the entire forest falling within the mining lease is deposited in the
Compensatory Afforestation Fund. The mining in the forest land included in the mining lease
should be permissible only if, in addition to the above, the approval under the FC Act/TWP
has been obtained;

(c) No forest land can be leased/assigned without first obtaining the approval under the FC
Act. Therefore, the forest area approved under the FC Act should not be lesser than the total
forest area included in the mining leases approved under the MMDR Act, 1957. Both
necessarily have to be the same. In view of the above, this Hon'ble Court while permitting
grant of Temporary Working Permission to the mines in Orissa and Goa has made it one of
the pre-conditions that the NPV will be paid for the entire forest area included in the mining
leases. Similarly, all the mining lease holders in Orissa should be directed to pay the NPV for
the entire forest area, included in the mining lease;
(d) In Orissa, substantial areas included in the mining leases as non-forest land have
subsequently been identified as DLC forest (deemed forest/forest like areas) by the Expert
Committee constituted by the State Government pursuant to this Hon'ble Court's order dated
12.12.1996.

While processing and/or approving the proposals under the FC Act in many cases such areas
have been treated as non-forest land.

It is recommended that

(i) the NPV for the entire DLC area included in the mining lease, after deducting the NPV
already paid, should be deposited by the concerned lease holder and

(ii) the mining operations in the unbroken DLC land (virgin land) should be permissible only
if the permission under the FC Act has been obtained/is obtained for such area. Keeping in
view the peculiar circumstances as was existing in Orissa and subject to the above, the
mining operations in the broken DLC land may be allowed to be continued provided the other
statutory requirements and Rules are otherwise being complied with."

The report concluded by recording as follows: "

a) an attempt has been made for the first time by the CEC to comply and analyse the status of
all the mining leases in a State and to suggest effective and remedial measures - something
made possible because of the unstinted cooperation extended by the senior functionaries of
the Forest and Mines Departments of the State Government; and

b) the above recommendations if accepted and implemented will, besides ensuring that
mining is done in compliance with the statutory provisions, result in recovery of additional
amount towards the NPV etc. running into hundreds of crores of rupees. It would be
appropriate that a part of this additional amount, say 50% is used through a SPV for
undertaking specific tribal welfare and area development works so as to ensure inclusive
growth of the mineral bearing areas. The CEC proposes to file detailed schemes in this regard
for seeking permission of this Hon'ble Court provided the State of Orissa as well as the
MoEF endorse the course of action proposed above." The significance of the second
conclusion will be discussed by us a little later.

5. Notice was issued on the report returnable on 7th May, 2010. On the adjourned date, the
following order was passed by this Court: "The CEC has filed its Report. The State would
like to file its response. Six weeks’ time is granted for the same. The recommendations of the
CEC which are acceptable to the State Government can be complied with." It may be
mentioned that some of the recommendations made by the CEC have been accepted and
implemented by the State of Odisha.

6. The issue of mining in Odisha again came up for consideration on 16th September, 2013
and this Court passed the following order: "We call for a report from the Central Empowered
Committee within a period of six weeks. We direct that the parties of the State Government
of Odisha and the Central Government will cooperate with the Central Empowered
Committee to enquire into the matter and furnish a report. The matter be listed on a Monday
after six weeks."

7. With reference to the order passed on 16th September, 2013 the CEC conducted an inquiry
and some information was sought from M/s Sarda Mines Private Limited (for short 'SMPL').
This was objected to by SMPL who filed an application which was taken up for consideration
on 9th December, 2013. The following order was passed on that day: "By our order dated
16th September, 2013, we had called for a Report from the Central Empowered Committee
within a period of six weeks. It is stated on behalf of the Central Empowered Committee that
the Report could not be ready as part of the information called for have not been furnished by
the State Government.

Mr. Venugopal, learned senior counsel for the applicant M/s. Sarda Mines Private Limited in
IA No.3721 submits that since some of the matters are pending before the High Court, a
prayer has been made for not furnishing the required information to the Central Empowered
Committee. List this matter in the second week of January, 2014. In the meantime, the
Central Empowered Committee may not submit its final Report."

8. The matter was again taken up on 13th January, 2014 and this Court passed the following
order: "We have heard learned counsel for the parties. We have also perused the letter dated
17th October, 2013 of the Member Secretary, Central Empowered Committee sent to the
Chief Secretary, Government of Odisha along with its annexures and in particular, the
Statement of Details of information and documents sought by Central Empowered
Committee for the meeting convened on 30th October, 2013, which cover forest and
environmental issues.

JUDGEMENT:
The Court in this Judgment has exhaustively addressed the issue of legitimacy of claims
raised by the mining leaseholders to recommence mining operations, in furtherance of the
order dated 16 May 2014, whereby the Court, on account of absence of
clearances/approvals/consent from concerned authorities, had restrained 102 mining
leaseholders from carrying on any mining operations. The intricate question to be considered
by the Court, was whether the applicants, seeking revocation of the above-mentioned order of
restraint/suspension, retain a valid mining lease (ML) and a consequent subsisting right to
carry on mining operations under the amended Mines and Minerals (Development and
Regulation) Amendment Act, 2015 (MMDR Act) read with the amended Mineral Concession
Rules, 1960 (MCR).

The broad issues pertaining to the changed mining regime of the grant, subsistence and
extension of mining leases, that have been decided by the Court are:

When will a ML be considered as valid and subsisting, as per Section 8A (providing for
period of grant of a ML for minerals other than coal, lignite and atomic minerals) of MMDR
Act and Rule 24 of MCR and the consequent entitlement of benefit under Section 8A of the
MMDR Act;

Whether Section 4A (4) (providing for termination of prospecting licenses and MLs) of the
MMDR Act triggers automatically after the leaseholder fails to commence or carryout (as the
case maybe) mining operations for a continuous period of 2 years.

The key highlights of the Judgment are set out herein below:

Leaseholders would have a subsisting ML and a resultant benefit of Section 8A of the

MMDR Act, if:

The original grant period of the ML was in currency on 12 January 2015;

The original grant period of the ML had been renewed subsequent to its expiry and the
renewal period was still in currency on 12 January 2015.

Leaseholders would not have a subsisting ML and a resultant benefit of Section 8A of the
MMDR Act, if:
No application for renewal of ML, due to expire before 12 January 2015, had been made at
least 12 months before expiry of the existing lease period (under the un-amended MMDR Act
and MCR);

An application for renewal (original/first or subsequent renewal) of ML has been made, at

least 12 months before its expiry, and has subsequently, on consideration, been rejected due
to its express exclusion under Section 8A (9) of the MMDR Act.

Leaseholders would have a subsisting ML and a resultant benefit of Sections 8A (5) and (6)
of the MMDR Act and Rule 24A of the MCR, if:

An application for “first renewal” of the original ML has been made, at least 12 months
before its expiry and has not been rejected. Such a ML would be valid till the expiry of 2
years after 18 July 2014, i.e., up to 17 July 2016 (under the amended as well as un-amended
Rule 24A of the MCR);

An application for “second (third/subsequent) renewal” has been made under Section 8(3) of
the un-amended MMDR, at least 12 months before expiry of the renewed lease, and has not
been considered and rejected up to 12 January 2015. However, such a leaseholder would not
be entitled to any benefit under the un-amended Section 8A of MMDR Act and the amended
Rule 24A (6) of the MCR.

In addition to the above, the Judgment seeks to interpret and summarise Section 4A (4) of the
MMDR Act along-with Rule 28 of the MCR, in the following manner:

Mining leases would be deemed to be subsisting up to the date of expiry of the lease period
(as provided by the lease document), unless an order is passed by the State Government
declaring lapse of the same;

In cases, wherein an application has been filed by a leaseholder, while not being in a position
to, or for not carrying on mining operations, for a continuous period of 2 years, the lease
period will not be deemed to have lapsed, until an order is passed by the State Government on
such an application. However, where no order is passed, the lease shall be deemed to have
been extended beyond the original lease period, for a further period of 2 years;

Pursuant to suffering a lapse, a leaseholder is disentitled to any benefit under the amended
MMDR Act, due to the express exclusion contemplated under Section 8A (9) of the amended
MMDR Act.
The Court has also clarified, in unambiguous terms, the contingencies stipulated under
Section 8A (5) and (6) of the MMDR Act, whereby the renewed lease period is to be
determined and the subsequent benefits are accordingly relished by the leaseholder for such
period.

CASE OUTLINE:

In view of the foregoing conclusions and findings, it is interesting to understand and analyse
the approach adopted by the Apex Court as follows:

A. Law First- Approach

The Hon'ble Supreme Court of India was mindful that the subsisting lease issue will not only
impact the applicant-leaseholders in Orissa who had moved the Court pursuant to the liberty
given to them vide the 16 May 2014 Suspension Order but will impact the entire mining
industry in the country. Hence, it seems to have decided to interpret the letter of the law
without complicating the same by applying the facts while interpreting the law and left the
application of complicated leaseholder peculiar facts for later.

B. Supreme Pedestal to Principles of Natural Justice

The finding of the Hon'ble Supreme Court of India that: "It is not possible for us to accept,
that vital vested rights in a leaseholder, can be curtailed without affording him an opportunity
to repudiate the impression(s) of the competent authority, namely, that the leaseholder could
not have (or had actually not) carried out mining operations, for a continuous period of two
years has in unequivocal terms re-affirmed the rule of law and the non-negotiable compliance
with the principles of natural justice by the State.

C. Judiciary recognizes the Legislature's Intention to Support the Executive

The Hon'ble Supreme Court of India gave due importance to the legislative intent behind
the 12 January 2015 MMDRA by noting that: "The purpose for which the instant amendment
came to be made by the Parliament, whereby the amended Section 8A was inserted into the
MMDR Act reveals, that past litigation resulting in different interpretations of the provisions
of the MMDR Act, and the alleged hardship caused to the mining industry, due to second and
subsequent renewals remaining pending with the State Government without any decision, had
occasioned the passing of the instant amendment. Hence, the Hon'ble Supreme Court of India
gave due importance to the Legislature's intention to support the Executive in addressing the
predicament of pending (second and subsequent) applications under the old Section 8 of the
MMDR Act, 1957, by explicitly laying down parameters for being entitled to the extension of
mining lease by Section 8A of the 12 January 2015 MMDRA.

D. No injustice by the operation of Law?

The Hon'ble Supreme Court of India has held that: A leaseholder who had moved a second
(third or subsequent) renewal application under Section 8(3) of the unamended MMDR Act,
1957 within the prescribed time period and whose application had not been considered and
rejected (though not entitled to any benefit under the unamended Section 8 A of the MMDR
Act, 1957 and the amended Rule 24 A (6) of the Mineral Concession Rules, 1960' 19) up to 12
January 2015, would still have the benefit of sub-sections (5) and (6) of Section 8A. 20 Hence,
the Hon'ble Supreme Court appears to have saved injustice by operation of law for those
whose (second and subsequent) renewal applications which were in a limbo during the period
from 18 July 2014 (date of legislative amendment) to 12 January 2015, by holding that such
applicants are entitled to the extension of the mining lease under Section 8A.

However, there may be confusion as the Hon'ble Supreme Court of India also expressed its
view that: "all second renewals which were assumed to be subsisting by State Governments,
would expire with effect from the date of the judgment in the Goa Foundation case, i.e.,
21.4.2014, and expressly, with effect from 18.7.2014, when the second proviso to Rule 24A
(6) provided accordingly. Unless of course, the Government had passed an express order in
writing, as mandated under Section 8(3) of the MMDR Act, extending the subsisting mining
lease by a second or subsequent renewal.

4. CONCLUSION & WHAT NEXT?

Although the Law-first Approach is praise-worthy as it benefits all the mining industry
stakeholders to understand the law, however, much more is awaited from the Hon'ble
Supreme Court of India as follows:

A. Application of complicated leaseholder peculiar facts will shed clarity on how to

apply the law on facts and set factual instances for other to follow.  In the meantime,
the State authorities or the leaseholders will be (dis)advantaged due to ambiguity on
whether a mining lease is subsisting or not in absence of a factual example by the
Hon'ble Supreme Court of India.
 B. Mercy on the already anguished mining industry due to the approaching cut-off date
of 31 March 2030/31 March 2020 (as applicable) for entitlement of the extension of
mining lease under Section 8A, who as on date is losing time in litigation
proceedings.

C. Balancing idle natural resources versus illegally utilized resources.

D. Balancing the revenue generated from mining operations benefitting the economy
versus protection of the environment.

COMMENT:

The Judgment is a welcome move and has finally put an end to the ambiguities surrounding
the amended MMDR Act. What was merely believed to be a follow up of the order dated 16
May 2014 for recommencement of iron ore mining operations in the State of Orissa, has
turned out to be a pivotal judgment in mining law in India due to the amendment introduced
in the MMDR Act in the interregnum. The Judgment is extremely crucial in determining the
issue of subsistence of mining leases under the amended provisions of the MMDR Act, as the
same has been adjudicated upon by the Court for the first time. The conclusions arrived at by
the Court appear to be in consonance with the intention behind the amended provisions and
provide a glimpse of hope to the otherwise anguished mining industry.