B.P. Sinha, C.J. - (1.) THIS appeal on a certificate granted by the High Court of Madhya Pradesh at Jabalpur on April 16, 1958, under Article 133 of the Constitution, is directed against the judgment and decree of that Court in First Appeal No. 181 of 1962, reversing those of the Additional District Judge, Chindwara, in Civil Suit No. 3 -A of 1951, decided on September 25, 1952, by which the Trial Court had decreed the Plaintiffs' claim for Rs. 40,865/ - and interest.
(2.) IT is necessary to state the following facts in order to bring out the points in controversy between the parties. One Haji Syed Zahiruddin of Bhopal held a mining lease -Ex P -2 - dated May 29, 1923, in respect of 189. 76 acres of land in the district of Chindwara, for extracting coal. The Appellants took an assignment of that lease by Ex. P -1 dated September 4, 1940. There were coal bearing areas adjacent to the area covered by the lease aforesaid. The Appellants were anxious to acquire those adjacent collieries from their respective owners. The transfers in favour of the Appellants could not take place without the sanction of the State Government. After protracted correspondence and negotiations, the Government agreed to grant the necessary sanction to the transfer of those adjacent lands to the Appellants subject to the condition that they took a consolidated lease in respect of the whole additional area at an enhanced rate of royalty. The Appellants entered into an agreement with the Government of January 11, 1949 (Ex. P -3) by which the rate of royalty payable to Government was raised from Rs. 5/ -, Rs. 10/ - per ton. Though no formal lease deed was executed, the Appellants worked the mines with the permission of the Government during the period October 27, 1947 to June 30, 1949. In respect of the coal thus extracted, the Appellants paid to the Government the sum of Rs. 40,865/ -, including interest, by way of royalty. The Plaintiffs paid the aforesaid sum under protest in February -March, 1960. The Plaintiffs commenced the present action in February 1951, for a declaration that they were not bound by the terms of the agreement dated January 11, 1949, aforesaid and that, therefore, they were not liable to pay to Government any sum in excess of that fixed by the lease of 1923, and by the lease of January 21, 1944, in respect of lands transferred to them. They also claimed an injunction against the Defendant, the State of Madhya Pradesh, which was the sole Defendant, now Respondent. There was also a prayer for refund of the said amount of Rs. 40,865/ - plus interest amounting to Rs. 1,985/ - from the date of payment of those several sums aggregating to Rs. 40,865/ -. Interest Pendente lite and future interest at 6 per cent. On the decretal amount was also claimed.
(3.) THE contentions raised on behalf of the Plaintiffs in support of their claim were that the agreement aforesaid was void as it was in contravention of Rule 50 of the mining(sic) Rules of 1913, as also that the same was in contravention of Section 4 of the Mines and Minerals (Regulation and Development) Act (XIII of 1948). It was also contended that a representation was made by the Government in the correspondence that passed between the parties that Government was going to adopt a new policy in respect of mining Leases, including grant of leases at enhanced royalty. The agreement, the Plaintiffs further asserted, had been entered into under the influence of that misrepresentation and was, therefore, not enforceable against them.;