BHARAT COKING COAL LIMITED TATA IRON AND STEEL CO LIMITED CENTRAL COALFIELDS LIMITED Vs. STATE OF BIHAR:INDUSTRIAL FUEL MARKETING COMPANY
SUPREME COURT OF INDIA
Bharat Coking Coal Limited Tata Iron And Steel Co Limited Central Coalfields Limited
State Of Bihar:Industrial Fuel Marketing Company
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(1.)In these appeals a common question of law is involved whether the State of Bihar had legal authority to execute leases in favour of the respondents for collection of slurry on payment of royalty to it. Since the questions involved in these appeals are common the same are being disposed of by a common judgment. Civil No. 4521 of 1986 and Civil Nos. 61-62 of 1987 are directed against the judgment of the Patna High court while Civil Nos. 230-231 of 1987 are directed against the judgment of the division bench of the Calcutta High court.
(2.)In order to appreciate the controversy in question it is necessary to recapitulate the facts. M/s Bharat Coking Coal Ltd.- appellant in C. A. 4521 of 1986 is a government Company which carries coal mining operations in village Sudamdih in the State of Bihar. There is a coal washery adjacent to the appellants coal mine in village Sudamdih. After the coal is extracted from the mines, it is crushed into pieces of different sizes for purposes of grading. Since the coal is mixed up with mud and other impurities, same is brought to the washery for washing and cleaning the same for reducing the ash percentage and for use by metallurgical consumers. In the process of washing small coal particles escape from the washery in the form of slurry along with water and the same are deposited in the slurry ponds constructed for their storage by the appellant company. But when the ponds are full, the slurry overflows the pond and flows down into the river Damodar. After the water is soaked by the soil the small particles of coal get deposited in the river bed. These coal particles are collected and formed into briquettes which are sold in market for energy and fuel purposes. The slurry coal has acquired highcommercial value as it is of exceptional quality and high grade, it is used by steel plants and thermal power stations. The State of Bihar granted lease in favour of Ram Nath Singh - respondent 4 for collecting the coal particles settled in the Damodar river bed and other land including plot No. 370 of Mauza Sudamdih. The appellant claimed that plot No. 370 which formed part of river bed of Damodar belonged to it having been acquired under the Coal Bearing Areas (Acquisition and Development) Act, 1957 for the purpose of mining of coal. Pursuant to the lease, respondent 4 has been collecting the coal particles from plot No. 370. The appellant company raised objection before the revenue authorities of the State of Bihar claiming property rights to collect and obtain slurry deposited in the river bed in plot No. 370, but its objections were overruled and respondent 4 was permitted to collect the coal particles from the aforesaid plot. The appellant thereupon filed a writ petition in the High court of Patna challenging the State governments action in granting lease to respondent 4 for lifting slurry from the river bed, on the ground that the property belonged to the appellant company and the State government had no authority in law to grant a mining lease without the prior approval of the central government under S. 5 of the Mines and Minerals (Regulation and Development) Act, 1957.
(3.)Tata Iron and Steel Company Ltd.- the appellant in Civil Nos. 61-62 of 1987, is a company incorporated under the Companies Act. It owns steel plant at Jamshedpur and it also owns captive coal mines in the District of Hazari Bagh and Dhanbad. These coal mines are commonly known as West Bokaro Collieries. There is no dispute that large area of land in the District of Hazari Bagh and Dhanbad have been settled with the appellant company for purposes of mining operations and the company enjoys mineral rights in respect of the surface and sub soil. It is not necessary to refer to the historical facts relating to the acquisition of mining rights by the appellant, as there is no dispute that under S. 10 of the Bihar Land Reforms Act and appellants existing mining leases became statutory leases in the State of Bihar. The appellant has established washery plant in the District of Hazari Bagh as well as in Jama Dhoba and Zora Pokhar in District Dhanbad for purposes of washing the coal after extraction from the coal mines and crushed into different sizes. In the process of washing the coal small particles of coal escape from the washery and overflow from the plant and the same are deposited in the storage pond constructed by the appellant. But sometimes they overflow from the storage pond and settle down in the raiyati land and in the Bokaro river bed. The appellant has been claiming right that the slurry which escaped from the washery belonged to it and no other person had right to collect the same. The State government did not accept the appellants claim instead it settled the rights of collectionof slurry with the respondents under the indentures granted in their favour. Under the settlement the respondents have been authorised by the State government to collect sludge and slurry which settles down in the Bokaro river bed or in the raiyati land on payment of royalty to the State. The appellant filed two writ petitions before the Patna High court challenging the authority of the State governments action on the ground that slurry was a mineral being coal and as such its collection or mining was regulated by the provisions of the Mines and Minerals (Regulation and Development) Act, 1957 (hereinafter referred to as 'the Act') and the State government had no authority to grant any lease for collection of sludge/slurry without the previous sanction of the central government.
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