- (1.) CHALLENGE in this writ application is to the letter No. 5/40/2004-MIV dated 24-8-2006 (Annexure-10), issued by the Respondent No. 6 whereby approval was granted by the Central Government to the proposal for grant of mining lease of iron ore in favour of the private Respondent No. 7 and also against the recommendation made by the Respondent-State Government on the basis of which the Central Government had granted the approval. The petitioner has further prayed for issuance of a direction to the respondents to reconsider the application of the petitioner for grant of mining lease of iron ore and manganese ore. An alternative prayer has also been made for a direction to the concerned respondents-authorities to reconsider the grant of mining lease to at least half of the area applied for by the petitioner.
(2.) THE facts of the petitioner's case in brief are as follows : -The petitioner being a Company registered under the Companies Act and engaged in the business of manufacturing Sponge iron, had applied to the Respondents-State government of Jharkhand for grant of mining lease for the specified area of land, way back on 8-1-2003 along with the prescribed fees and other requirements. Besides the petitioner-Company, three other applicants, including the Respondent no. 7, had also applied for the grant of mining lease for the same area comprising of 922. 30 acres of mining area identified by the state Government. Out of the total four applicants, two had withdrawn, leaving the petitioner and the respondent No. 7 only in the fray. In response to the applications, the Respondent No. 3, namely, the Director, Department of Mines and Geology, Mines Directorate, Ranchi invited the petitioner and the other applicants for granting hearing to them under the provisions of Rule 26 of the Mineral Concession Rules, 1960 fixing 12-3-2004 as the date for hearing. Though the hearing was conducted but no further action was taken by the Respondent No. 3. In the meantime, the petitioner-Company entered into a memorandum of understanding on 1-6-2004 for establishing an iron ore manufacturing industry in the State of jharkhand. The petitioner's grievance is that though at the time of hearing, the Respondent No. 3 had assured the petitioner-Company of granting mining lease of 50 per cent of the applied area but ultimately the entire area was sanctioned to the Respondent No. 7 without giving the petitioner any further opportunity of being heard or for negotiation. The petitioner's further contention is that vide letter No. 2531 dated 8-12-2005, Respondent No. 4, namely, the Deputy Secretary to the Government, Department of mines and Geology, Jharkhand, Ranchi had forwarded a misleading comparative chart containing particulars of the petitioner's application and that of the Respondent No. 7 to the Respondent No. 6, namely, the Under Secretary to the Government of India, ministry of Mines, New Delhi along with the state Government's recommendation approving the grant of mining lease to the Respondent No. 7. Being aggrieved by such conduct of the respondent-State Government, the petitioner filed a representation on 27-7-2005 before the Respondent No. 4 followed by another representation on 20-12-2005 to the respondent No. 5, namely, the Secretary, ministry of Mines, Union of India, New Delhi. On receipt of the petitioner's representation, the Respondent No. 6 forwarded the same to the Respondent No. 2, namely, the secretary, Department of Mines and Geology, Jharkhand, Ranchi along with a covering letter asking the Respondent No. 2 to send his reply to two queries, namely the date of the application of each of the applicant over the area and to clarify as to whether the Respondent No. 7 is the first applicant or a later applicant and also to submit his comments on the representation of the petitioner. In the meanwhile, the petitioner also filed a fresh representation dated 28-2-2006, praying for recommending the petitioner's name to the Central Government for approval and also praying for allotment of the above iron ore mines to the petitioner-Company. However, while the petitioner was eagerly waiting for a positive response, the Central government vide its impugned letter No. 5/ 40/2004-MIV dated 24-8-2006, under the signature of Respondent No. 6, conveyed to the State Government its approval for the grant of mining lease of the same area comprising of 922. 30 acres, in favour of the Respondent No. 7. The petitioner filed a fresh representation before Respondent No. 3 for reconsideration of the matter pointing out that certain relevant and material facts were not taken into consideration while granting the mining lease in favour of the Respondent No. 7. The petitioner had also tried to point out that on proper and rational comparison, the petitioner certainly stands superior in all respects to the Respondent No. 7 and that the petitioner-Company was eligible in all respects for the grant of mining lease.
(3.) ASSAILING the impugned approval of the central Government, Mr. S. K. Kapoor, learned senior counsel appearing for the petitioner, submits the following grounds : - (i) That the impugned approval of the Central Government dated 24-8-2006 is founded upon the recommendation of the State Government dated 29-6-2004 is wholly without due application of mind and based entirely on misrepresentations made by the State government and also without considering the superior merit of the petitioner's eligibility vis-a-vis the Respondent No. 7, in proper perspective. It is explained that even as admitted by the respondents, the State Government's recommendation dated 29-6-2004 was treated by the Central Government as incomplete and insufficient requiring further informations from the State Government on certain relevant issues. The subsequent recommendation of the State Government dated 8-12-2005 was also bad in law, as because it was based partly upon irrelevant, incorrect, misconceived and absurd considerations and was reached leaving out all material and relevant considerations qua pawanjay Steel and Power Ltd. (the petitioner ). (ii) The records, including the notes maintained on the basis of the correspondences exchanged between the State Government and the Central Government, would reveal that the information sought for by the Central Government by its letter dated 17-1-2006, in response to the State Government's letter dated 29-6-2004 was never furnished by the State Government and even in absence of the requisite information, the Central Government had abruptly proceeded to grant the impugned approval of the State government's recommendation in favour of the private Respondent No. 7. Learned counsel refers in this context to the office notes of several dates in between 20-12-2005 to 24-8-2006. (iii) That the action of the State Government is against the provisions of Rule 26 of the Mines and Minerals (Development and regulation) Act, 1957 as because the concerned authorities of the Respondent-State have totally ignored the fact that all the conditions mentioned under the provisions of rule 26 of the Act were in favour of the petitioner and not in favour of the Respondent no. 7. (iv) That while making the recommendation in favour of the Respondent No. 7, the respondents-State authorities have not assigned any reason whatsoever as to why the petitioner has been refused the grant of lease. (v) That the State Government has with mala fide intentions, ignored certain vital facts, particularly that the State Government had itself entered into a memorandum of understanding with the petitioner-Company for establishing an Iron and Steel Manufacturing Plant in the State of Jharkhand and also the fact that the petitioner-Company has substantial experience in the business of manufacturing Sponge iron at its established plant at Rourkela (Orissa) and has its associated ancillary industries, some of them having long been established in the state of Jharkhand itself. (vi) That the correspondences exchanged by and between the State and the Central government, were in the context of the provisions of Section 11 (5) of the M. M. D. and R. Act and Section 5 (1) of the Act. Since this was so, the respondents could not have decided on the basis of the provisions of Section 11 (2) of the Act, since the provisions of section 11 (2) of the Act is not conclusive where the provisions of Section 11, (5) and its proviso, has been considered as invokable. In this context, learned eop,nsel refers to and relies upon a judgment of the supreme Court in the case of Indian Metals and Ferro Alloys Ltd. v. Union of India and others, reported in AIR 1991 SC 818. Learned counsel argues that the principle of first come first serve does not conclude the issue and it is the party best suited as per the criteria laid down under the provisions of section 11 (3) of the Act that deserves to be granted the mining lease in the interest of the National Mines and Mineral Development. (vii) That the impugned recommendation of the State Government is violative of the rules of Executive Business since the procedure as laid down in Rule 15 of the Rules regarding taking of a decision on the grant of mining lease has not been followed. Therefore, the decision taken by the State Government culminating in the recommendations made in favour of the Respondent No. 7, is ultra vires, the statutory rules. Learned counsel refers in this context to the judgment of the Supreme Court in the case of m/s. Indian Charge Chrome Ltd. and Anr. v. Union of India and others, reported in 2006 (12) SCC 331. ;