REPORTABLE

IN THE SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NOS. 3187-3188 OF 2011 (Arising out of SLP(C) Nos. 22023-22024 of 2010)

B.R. Surendranath Singh               …Appellant

Versus

Deputy Director, Department of Mines &  Geology, Karnataka and ors.              …Respondents

WITH

CIVIL APPEAL NO. 3189  OF 2011 (Arising out of SLP(C) No. 14120 of 2010)

B.R. Surendranath Singh        …Appellant

Versus

Union of India and ors.   …Respondents

J U D G M E N T

Dalveer Bhandari, J.

1. Leave granted.  

2. Since  the  common  questions  of  law  arise  in  these  

appeals, they are being disposed of by a common judgment.

3. These  appeals  emanate  from  the  order  dated  

25.06.2009 passed in Writ Petition No. 27521 of 2005, order  

dated 12.04.2010 passed in Review Petition No. 418 of 2009  

in Writ Petition No. 27521 of 2005 and interim order dated  

29.04.2010 passed in Writ Petition No. 15079 of 2010 by  

Division Bench of the High Court of Karnatka at Bangalore.

4. The appellant aggrieved by the said orders passed by  

the High Court of Karnataka has preferred these appeals.

5. For the sake of convenience the facts of Civil Appeal  

Nos. ______________________ of  2011 arising out of  Special  

Leave  Petition  (Civil)  NoS.  22023-22024  of  2010  entitled  

B.R.  Surendranath  Singh    v.   Deputy  Director  

Department of Mines & Geology & Ors. are recapitulated  

as under.

6. Brief facts according to the appellant are as under:

A mining lease was granted during the year 1958 in  

favour of B.K.R.N. Singh, the father of the appellant herein,  

with  respect  of  a  land  measuring  58  acres  situated  at  

Honnebagi  and  Bellenahalli  village,  Chikkanayakanahalli  

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Taluk, Tumkur District, Karnataka.  The lease was initially  

for a period of 20 years and the said period expired in the  

year 1978.  Thereafter, the mining lease was renewed for a  

further period of 10 years upto 19-10-1988, in the name of  

Smt. Kamalabai, wife of B.K.R.N. Singh.  After the death of  

Smt. Kamalabai, the appellant is continuing as the lessee  

and an application for renewal has also been made by the  

appellant.  

7. The  appellant  is  continuing  with  the  quarrying  

operations  and  accordingly  the  appellant  has  been  filing  

monthly reports with the first respondent – Deputy Director,  

Department of  Mines and Geology,  Railway Station Road,  

Tumkur.  

8. Adjacent  to  the  property  leased  in  favour  of  the  

appellant, certain persons have illegally conducted mining  

operations  and  extracted  iron  ore.   According  to  the  

appellant he immediately wrote a letter-cum-undertaking to  

the respondents that this iron ore of approximately one lakh  

ton  can  be  taken  away  by  the  respondents  and  the  

appellant  herein  has  no  claim  whatsoever  over  it.   The  

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letter/undertaking  dated  20-12-2004  of  the  appellant  is  

setout as under:

“20-12-2004

From

B.R. Surendranath Singh, 194, 4th Main Road, Chamarajpet, Bangalore – 18.

To The Director, Dept of Mines and Geology, Division Road, Bangalore.

I  would  like  to  bring  to  your  kind  notice  that  approximately about 1 lakh ton of iron ore fines has been  dumped in my ML area No.2187 and the same material you  can  take  possession  and  do  whatever  you  deem for  and  further I have no claim on the above stock.

Thanking you,

Yours faithfully,

Sd/- B.R. Surendranath Singh”

9. During the month of January, 2005, the respondents  

found that about one lakh ton of iron ore has been illegally  

quarried and this illegal material was kept in the appellant’s  

land and the appellant was directed to protect the said one  

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lakh  ton  of  iron  ore.  The  appellant  immediately  

acknowledged the approximate stock of one lakh ton of iron  

ore for which the appellant gave an undertaking to protect  

the  same.    The  relevant  portion  of  the  undertaking  is  

reproduced as under:

“AFFIDAVIT

I,  B.R.  Surendranath  Singh  son  of  late  Kamalabai,  aged about 70 years, residing at No. 195, 4th Main Road,  Chamarajpet, Bangalore 560 019, do hereby solemnly affirm  and declare the following:

Whereas  the  Department  of  Mines  and  Geology  is  having a stock of  approximately  one lakh ton of  iron ore  lying  at  Survey  No.  130  of  Honnebagi  Village,  Chikkanaikanahalli Taluk.  

We undertake to protect, safeguard and keep safe the  said stocks.

BANGALORE DATED 10/012005

B.R. SURENDRANATH SINGH”

10. It is the case of the appellant that after extracting the  

iron  ore  the  appellant  is  required  to  submit  a  monthly  

report and the monthly report indicates the production and  

dispatch  and  remaining  balance  iron  ore  on  the  mining  

lease.

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11. It  is  also  the  case  of  the  appellant  that  he  was  in  

possession of iron ore which have been legally extracted by  

him from his leased area and also he is in possession of  

another one lakh ton of iron ore which is seized by the State  

Government.  

12. According to the appellant, the Deputy Director - the  

first  respondent brought some people on 22.12.2005 who  

were interested in purchasing the iron ore,  for which the  

first respondent herein actually showed the iron ore legally  

quarried and stacked by the appellant instead of showing  

the illegally mined iron ore lying within the borders of the  

appellant’s leased land.  

13. The  appellant  submitted  a  representation  to  the  

respondent No. 1 stating that the error has been rectified  

and  appropriate  action  be  taken  in  this  regard.   The  

appellant made a complaint that instead of illegally mined  

iron ore, the respondent no. 1 was contemplating to sell the  

iron ore which was legally mined and accumulated by the  

appellant.

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14. The appellant  wrote  a letter  to the Chief  Minister  of  

Karnataka on 23.12.2005 and thereafter filed a writ petition  

No. 27521 of 2005 before the High Court of Karnataka at  

Bangalore with the prayer to issue a writ  of  mandamous  

restraining  the  respondents  from auctioning  the  iron  ore  

fines stacked in Survey No. 130, Honnebagi and Bellenhali  

Village,  Chikkanayakanahalli  Taluk,  Tumkur  District  and  

direct  the  respondents  to  conduct  an  inspection,  and  

thereafter  determine  the  iron  ore  fines,  which have  been  

legally extracted by the appellant,  and the iron ore fines,  

which are illegally dumped in the area of the appellant.  

15. The High Court by the order dated 27.12.2005 directed  

respondent No. 1 not to confirm the auction till 30.12.2005.  

In  spite  of  the  interim order  granted  by  the  High  Court,  

respondent  No.  1  issued  another  notification  dated  

21.01.2006, inviting bids for auctioning the iron ore legally  

quarried  by  the  appellant.    The  appellant  also  filed  a  

contempt petition in the High Court that when the matter  

was  pending,  the  respondents  had  no  authority  to  issue  

subsequent notification for auctioning the iron ore.  

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16. A  letter  dated  25.02.2006  was  issued  by  the  

respondent  –  Deputy  Director,  Department  of  Mines  and  

Geology,  Tumkur,  stating  that  on  a  complaint  of  illegal  

mining  activity  and  on  a  visit  to  the  site  by  the  Joint  

Director, Mysore, it was found that in an area adjacent to  

the lease of appellant, one Basanth Poddar was doing illegal  

mining in the area using sophisticated mining machineries  

and  the  said  Basanth  Poddar  transported  the  iron  ore,  

illegally removed it, by using permits of Mining Lease No.  

2187  which  belongs  to  the  appellant.   The  letter  further  

states  that  after  inspecting  the  stock  of  iron  ore  

unauthorisedly piled by the accused persons the same was  

quantified at about one lakh metric ton.  The letter further  

states that from the  preliminary enquiry it was learnt that  

one M/s. Balaji Producing Company has been granted the  

mining lease under Mining Lease No. 2208 covering Survey  

No.  130  of  Honnebagi  Village  and  in  Survey  No.  12  of  

Gollarahalli Village and he had given the raising contract for  

extraction of iron ore to  Selvaraj of Sun Minerals and the  

said Selvaraj claims to have dug a pit at ‘Biscuit Pit’  and  

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removed the iron ore  and stacked the ore  in  the  area of  

Mining Lease No. 2187, which is adjacent and owned by the  

appellant herein.  The first respondent thereafter submitted  

the  complaint  for  prosecution  of  M/s.  Karnataka  Mining  

Company, M/s. Balaji Produce Company, Chennai and their  

contractor Selvaraj of M/s. Sun Minerals and the appellant  

herein,  who  are  involved  in  committing  the  act  of  illegal  

quarrying.   The above complaint  was registered as Crime  

No. 52/2006 before the Chikkanayakanahalli Police Station.  

17. The appellant filed an application for  amendment in  

the High Court praying for a writ of certiorari and to quash  

the FIR dated 25.02.2006 registered as Crime NO. 52/2006.  

18. The appellant submitted that the respondents filed an  

application  for  appointment  of  a  Court  Commissioner  to  

identify the iron ore extracted from the area covered by the  

lease  of  the  appellant.    The  High  Court  on  12.10.2006  

passed the following order:

“The respondents  have  filed a memo dated 15.4.2006 for  appointment  of  a  Court  Commissioner,  which  reads  as  follows:-

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The  petitioner  is  a  mining  lease  holder  and  out  of  large  extent of area in Survey No. 130 of Honnebagi Village an  area of 58 acres is leased in favour of the petitioner.  Apart  from the petitioner, others also leased certain extent of land  in the same Survey Number.  The remaining extent of land  in the same survey number continued to be the Government  holding,  which is  rich in mineral  deposit.   The petitioner  who is granted the lease is adjoins by the land retained by  the State Government.

It is submitted that unauthorized mining operation in the  Government  land  was  detected  by  the  department  authorities.  Immediately, action has been taken to seize the  unauthorized mining iron ore which was deposited on the  leased area of the petitioner.  After holding mahazar same  was handed over  to the  petitioner  for  safe  custody.   The  respondent  has taken decision to auction the seized iron  ore, same was questioned by the petitioner claiming right  over the same.

It is humbly submitted that, there is a claim and counter  claim in regard to the iron ore stocked on the petitioner’s  leased  area.   This  can  be  identified  by  appointing  a  Commissioner.   The  Commissioner  requires  certain  knowledge  to  ascertain  the  area  by  examining  the  field  condition.   

It is further submitted that, the iron ore deposited which is  illegally mined in the Government land is fine in nature, but  iron ore deposited in petitioner’s lease area is lumps and  fine in nature.   The material  stocked by the petitioner is  nothing but waste and low grade material.  

Wherefore,  it  is  requested  to  appoint  any  one  the  following as a commissioner, in the interest of justice and  equity.

1. S. Ray Chaudri, Regional Controller of Mines, No.29,  Industrial  Suburb,II  Stage,  Tumkur  Road,  Goraguntepalya,

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Bangalore-560 072.

2. Dr. S.K. Bhushan, Deputy Director General, Geology Survey of India, Goa and Karnataka Circle, Vasudha Bhavan, Kumaraswamy Layout, Bangalore – 560 078.

2. As could be seen from the above, there is claim and  counterclaim with regard to certain iron ore stacked on the  petitioner’s leased area.  To determine the controversy, Shri  Ashok  haranahalli,  learned  counsel  appearing  for  the  petitioner  and Shri  B.N.  Prasad,  learned H.C.G.P.  submit  that  Dr.  S.K.  Bhushan,  named  in  the  memo  may  be  appointed as a Court Commissioner.

3. In view of the joint submission made by the learned  counsel appearing for the parties, I deem it appropriate to  appoint  Dr.  S.K.  Bhushan as the Court  Commissioner  to  submit  his  report  to  this  court  relating  to  the  aforesaid  controversy between parties, namely as to whether the iron  stacked on the petitioner’s leased area was extracted by the  petitioner  from  the  land  leased  to  him  or  was  illegally  extracted from the abutting  Government  lands.   In other  words, the Commissioner shall have to identify the illegally  extracted iron ore, if any, stacked on the petitioner’s leased  area after holding spot inspection by issuing notice to the  petitioner and R1.  This shall be done within three months  from  the  date  of  receipt  of  a  copy  of  this  order  by  the  Commissioner.   The parties shall serve a copy of this order  on the commissioner to enable him to do the commission  work.

4. The memo filed by the respondents & I.A. 4/2006 filed  by the petitioner for appointment of a Court Commissioner  stand disposed of in the above terms.

(H.G. Ramesh) Judge”

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19. The High Court  appointed  Dr.  SK Bhushan,  Deputy  

Director General, Geological Survey of India, as the Court  

Commissioner to inspect and submit a report relating to the  

controversy between the parties namely, as to whether the  

iron  ore  stacked  in  the  leased area  of  the  appellant  was  

extracted by the appellant from the land leased to him or  

was illegally extracted from the abutting government lands.  

20. On  10.01.2007  report  was  submitted  by  the  Court  

Commissioner  after  inspecting  and  verifying  the  iron  ore  

found  in  the  area  of  the  lease  of  the  appellant.   The  

Commissioner, after analyzing the chemical qualities of the  

iron ore found that the dump-in dispute stacked near the  

crusher in two lots was extracted from the Kamalabai pit  

(appellant) located in the area leased to the appellant i.e.  

M.L. No. 2187.  The Commissioner further found that no  

illegally extracted iron ore from the ‘Biscuit Pit’  located in  

the Government land is stacked on the leased area of the  

appellant.   

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21. On 21.08.2007 the High Court  of  Karnataka passed  

the following order:

“Shri R.B. Sathyanarayana Singh, learned Government  Pleader  appearing  for  the  respondents  submits  that  adequate  number  of  samples  are  not  extracted  from the  Biscuit  Pit.   He,  therefore,  submits  that  the  same Court  Commissioner be directed to go to the spot and collect the  samples from 3 points in the Biscuit Pit, which are to be  identified by the respondents.  In this regard, he undertakes  to file the memo of instructions for the Court Commissioner.

2. Shri  Ashok  Haranahalli,  learned  counsel  for  the  petitioner submits that the earlier appointment of the Court  Commissioner was at the instance of the respondents only.  The  concerned  officials  of  the  respondents,  who  were  present  on  the  spot,  did  not  object  to  the  Court  Commissioner collecting the samples from the two points in  the  Biscuits  Pit.   They  did  not  even  suggest  that  more  samples  be  collected  from  other  points  in  Biscuit  Pit.  Despite  all  these,  Shri  Ashok  Haranahalli  fairly  submits  that  he  is  agreeable  to  sending  the  same  Court  Commissioner to the spot again for collecting the samples  from 3 points in Biscuit Pit to be identified by the concerned  officials of the respondents with the understanding that the  respondents would not raise objection to the second report  of the commissioner.  He submits that although there is no  need for  sending the Court  Commissioner  for  the  second  time to the spot, he is conceding to the respondent’s request  for the purpose of ensuring finality in the litigation.

3. The  Court  Commissioner,  Dr.  SK  Bhushan,  Deputy  Director  General,  Geological  Survey  of  India,  Goa  and  Karnataka  Circle,  Vasudha  Bhavan,  Kumarasamy  layout,  Bangalore-560078  is  hereby  directed  to  go  to  the  spot  namely,  Biscuit  Pit  situated  in  Surveyy.  No.  130  of  Honnebagi and Ballenahalli  Village, Chikkanayakanabhalli  Taluk,  Tumkur  district  and  collect  the  samples  from  3  points, to be identified by the respondents.  On getting the  samples  tested  in  authorized  laboratory,  he  shall  file  his  

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reports as to whether the dump in dispute (SCK-1, SCK-2  and SCK-3) is extracted from the Biscuit Pit.  

4. The  office  is  directed  to  communicate  this  order  alongwith a copy of the terms of reference filed on behalf of  the respondents and also his earlier report, dt. 10.01.2007  to  the  Court  Commissioner  forthwith.   The  office  is  also  directed to prepare the necessary warrant in this regard and  issue  the  same  to  the  court  commissioner.  The  Court  Commissioner is directed to go to the spot at 10.30 a.m. on  1.9.2007 for  the  purpose  of  collecting  the  samples.   The  parties and their respective learned advocates are directed  to co-operate with the Court Commissioner in executing the  warrant.  It is made clear that there is no need for the Court  Commissioner to notify the parties of the time and date of  inspection.  However, if the date and time specified herein  does not suit the convenience of the Court Commissioner  for whatever reason, then he has to inform the parties of the  date and time of holding the spot inspection by him.  

5. Further it is also made clear that any intimation sent  by  the  Court  Commissioner  to  the  learned  Advocates,  S/Shri  Ashok  Haranahalli  and  Sathayanarayana  Singh  shall  be  deemed to  have  been sent  to  the  parties  to  the  petition.  The office shall  furnish the mail  address of the  advocates  for  the  petitioner  and  the  respondents  to  the  Court Commissioner.

6. The  Court  Commissioner  shall  submit  his  report  within  two  weeks  from  the  date  of  his  holding  the  spot  inspection.  Tentatively,  the Court Commissioner’s  fees is  fixed at Rs.15,000/-.  As the Commissioner is being sent for  the second time at the instance of the respondents and as  the Commissioner’s fees were borne by the petitioner’s side  on the earlier occasion, I deem it fit and necessary to direct  both  the  petitioner  and  the  respondents  to  bear  the  Commissioner’s fee on 50:50 basis.  Both the petitioner and  the respondent No. 1 shall deposit Rs.7500/- each with the  Court Commissioner within 5 days from today.  

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7. Call the case immediately after the receipt of the Court  Commissioner’s report for further submissions.

xxx xxx xxx xxx xxx xxx xxx xxx

(ASHOK B. HINCHIGRI) Judge”

22. On 26.11.2007 a further report was submitted by the  

Court Commissioner in which it is mentioned that material  

from the Biscuit Pit is distinctly different from the material  

in the dump in dispute.    According to the material in the  

dump  in  dispute,  the  Commissioner  further  stated  that  

similar inferences were arrived at in the earlier observations  

also and the presently obtained additional details confirms  

and compliments the conclusions drawn in the first report.  

23. The writ petition was heard by the Division Bench and  

while dismissing the writ petition the High Court held that  

the appellant does not have any right over the seized iron  

ore  fines  and  the  report  of  the  Commissioner  was  not  

helpful to the appellant to substantiate the contention that  

the  seized  iron  ore  fines  are  legally  extracted  by  the  

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appellant from his lease.   The appellant also filed Review  

Petition before the High Court, which was also dismissed.  

24. The appellant, aggrieved by the said judgment of the  

High Court, has preferred these appeals.  

25. In pursuance to the notice issued by this court, reply  

has  been  filed  on  behalf  of  respondents  -  State  of  

Karnataka.   Learned  counsel  appearing  for  the  State  of  

Karnataka, Ms. Anitha Shenoy has invited our attention to  

some portions of the counter affidavit.

26. She  submits  that  the  entire  controversy  arose  after  

receiving a complaint from one Selvaraju.  The complaint  

was sent by him to the Secretary of the Mining Department.  

The complaint reads as under:-

“From :

Selvaraju, Raising Contractor, Hind Mercantile Corporation, Opp. : Taluk Office, Chikkanayakanahalli Taluk, Timkur District, Karnatka State

To Smt. Latha Krishna Rao

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Secretary to Mining Department Karnataka Government, M.S. Building, Bangalore.

Madam,

Sub.:Large  scale  illegal  Mining  in  Chikkanayakanahalli  encouraged and supported by Mr. Basappa Reddy, Director  Mines and Geology, Bangalore.

*** I  am  bringing  to  your  notice  large  scale  illegal  mining  operation by Deepchand Kishanlal,  Mining Lease No.2333  and  late  Kamalabai,  Mining  Lease  No.2187  by  her  representative Surendra Singh, G.P.A. holder in the rejected  Mining lease application belonging to Ganapathi Singh.  The  illegal  working  area  is  called  as  Biscuit  pit.   The  M.L.  Application (earlier PL. No.3317) has been rejected by the  Government.  The issue and matter is pending in the court.  In the meantime, BASANT PODDAR of Deepchand Kishanlal  and SURENDRA SINGH have engaged themselves in large  scale illegal mining and already moved thousands of tones  of  iron  ore  power  using  the  permit  of  M.L.  No.2187 and  2333.   The  M.L.  No.2187  is  under  renewal  and  working  permission granted by the Director.  Illegal mining is done  very badly all most creating deaths.  The illegal operation is  done by the support of the Director Basappa Reddy who is  getting Rs.200 per ton commission.

I request you to stop this illegal mining.  Refer this illegal  mining to the D.C., Tumkur for stoppage.  If the issue is  referred to Director, no justice will be done as he is totally  and fully involved in this illegal act.  I hope justice will be  upheld at your end.

Many thanks

Yours faithfully

SELVARAJU

Copy to :

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1. Sri.  T.N.  Chaturvedi,  Governor  of  Karnataka,  Bangalore

2. Sri. N. Dharam Singh, Chief Minister of Karnataka,  Bangalore

3. Sri.  K.K.  Mishra,  Chief  Secretary,  Government  of  Karnataka, Bangalore

4. Sri. Mallikarjun Dyaberi, D.C., Tumkur District 5. The  Secretary,  Government  of  India,  Ministry  of  

Mines, New Delhi.”

27. In pursuance to the said complaint, the officials of the  

Department  of  Mines  and  Geology  visited  Mining  Lease  

No.2187  on  17.12.2004  and  found illegal  mining  and  as  

such the  same was  seized  and stored in  Survey  No.130,  

which is  the subject  matter  of  the lease in Mining Lease  

No.2187.    The illegal  mining ore which is  stored is  also  

depicted in the mahazar dated 17.12.2004 and the same is  

endorsed by the representative of the holder of Mining Lease  

No.2187.  Perhaps, on the appellant fearing some action on  

the complaint of Selvaraju, sent a letter dated 20.12.2004  

wherein he disowned the iron ore seized.  The letter dated  

20.12.2004 has been set out earlier in which it is mentioned  

that 1 lakh ton of iron ore was found lying in  Mining Lease  

No.2187 and the department can take possession and do  

whatever  they  deem  it  fit.   He  also  mentioned  that  the  

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appellant  has no claim of  the  above  stock.  Thereafter  on  

10.1.2005  the  appellant  submitted  an  affidavit  with  the  

Government of Karnataka in which it is mentioned that the  

appellant  is  undertaking  to  safeguard  and  safe  keep  the  

said  stocks.  Respondent  no.1  issued  a  notification  on  

23.12.2004 but the same could not be acted upon due to  

various  reasons  resulting  in  another  notification  of  

14.12.2005.   It  seems that  the  appellant  from this  point  

wanted to take advantage of the l lakh ton iron ore which  

could not be lifted by the respondent or sold by him.  The  

notification  dated  14.12.2005  was  challenged  in  writ  

petition  No.27521/2005 by  the  appellant.   The  appellant  

obtained  an  interim  stay.   The  said  writ  petition  was  

dismissed  on  25.06.2009.   Thereafter,  he  filed  a  Review  

Petition No.418 of 2009 in writ petition No. 27521 of 2005  

which was also dismissed on 12.04.2010. All these orders  

are the subject matter of these appeals. Since there was no  

stay granted in the review petition No.418 of 2009, the third  

notification  regarding  public  auction  was  issued  on  

09.12.2009 fixing the date of auction on 24.02.2010.  The  

appellant  again  moved  an  interim  application  in  review  

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petition No.418 of 2009 seeking for stay of auction.  The  

same was declined by the court.   From the record of the  

case, it is quite evident that the appellant went on filing writ  

petition,  review  petition  and  the  interim  application  

challenging  the  third  public  notification  resulting  in  a  

direction issued by the High Court for getting an inventory  

of  quantity  of  iron  ore  lifted  and  to  be  lifted  by  the  

successful bidder and surveyed by the Deputy Director of  

Mines and Geology.  The appellant was ready to deposit a  

sum of  Rs.15 crores as to the  value of  the  material  and  

execute  an  undertaking  not  to  lift  the  material.   This  is  

another  new  contention  raised  by  him  in  Writ  Petition  

No.15079  of  2010.   The  High  Court  did  not  grant  any  

interim relief at that stage resulting in filing of these appeals  

against the order dated 29.04.2010 and subsequently writ  

petition  no.  15079  of  2010  was  dismissed  as  withdrawn  

reserving liberty to raise all contentions in Criminal Petition  

No.2104 of 2010.

28. The respondents further submitted that the averments  

in para 5.4 of the appeal are contrary to what is pleaded in  

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para 5.1 of the appeals resulting in exposure of appellant’s  

claim of the dumps.  Thus, according to the respondents,  

when the appellant himself is not sure of the iron ore stated  

to be illegally mined by him, the appellant cannot seek any  

relief from this court.  The respondents submitted that the  

appellant was required to submit monthly report showing  

the details  of  the  quantity  of  iron ore  stacked under  the  

mining lease.   It  must also mention the total  production,  

dispatch  and  the  opening  balance.  The  respondents  

submitted that the appellant’s lease period having expired  

in the year 1998 itself and filing of renewal application in  

compliance  of  Rule  24A of  Minor  Concession Rules  1960  

and  failure  to  produce  the  statutory  requirement  like  

clearance from competent authority for availing the benefit  

under  Rule  24  (A)(6),  the  appellant  has  not  produced  

deliberately  the  working permissions obtained by him for  

the period from 1998 to 2004 for establishing a fact that he  

was legally mining.  In the absence of renewed mining lease  

and also failure to produce certificates from the competent  

authority  would indicate that the appellant  is  not a legal  

holder of the mining lease.

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29. The  respondents  also  submitted  that  the  averments  

regarding non-transporting the mine ore during the relevant  

period on the ground of alleged agitation in the period is  

totally  false.   In  fact,  during  the  years  2003-2004,  the  

appellant has transported huge quantity of iron ore and so  

also  for  the  period  2004-05.   Copy  of  the  statement  

disclosing  the  transportation  of  iron  ore  from  the  years  

2001-02 to 2005-06 has also been produced with the reply.  

30. The  respondents  submitted  that  it  is  clear  that  the  

appellant had produced 290960 tons of ore and transported  

245372 tons of iron ore than what was permissible at that  

time which was 5500 metric tons per annum as per IMB  

plan  and  also  this  statement  discloses  the  fact  that  the  

appellant is denying any illegal mining and claiming relief  

for which he is not entitled to in law.  In other words, the  

respondents clearly focused that the appellant had illegally  

mined iron ore much more than the sanctioned capacity in  

a clandestine manner and according to the respondents the  

appellant was not entitled to any relief from this court. The  

respondents  further  submitted  that  the  appellant  has  

invented entirely  a new story alleging that somebody has  

22

illegally mined and stacked the iron ore in his leased area  

without his knowledge.  According to the respondents it is a  

false statement and cannot be accepted.  According to the  

respondents, to accumulate 1 lakh ton of iron ore, one has  

to  use  thousands  of  vehicles  for  transportation  and  

accumulation.   Failure  on  the  part  of  the  appellant  to  

disclose  the  same  leads  to  the  presumption  that  the  

appellant was involved in illegal mining activity and these  

activities  would  result  in  an  action  to  be  taken  under  

section  21  read  with  section  4(1)(a)  of  The  Mines  and  

Minerals  (Development  and  Regulation)  Act,  1957.  

According to the respondents, the appellant is playing the  

game  of  hide  and  seek  and  trying  to  justify  this  action  

without  compliance  of  the  provisions  of  the  Act.  The  

respondents further submitted that for the first time in the  

above  petition  the  appellant  has  introduced  a  theory  of  

situation of iron ore dumps in northern side and southern  

side of leased area without disclosing as to where he has  

stacked the waste produced during the mining activities as  

per the mining plan.  This also substantiates the contention  

of the respondents, the reason for non production of mining  

23

plan issued from the competent  authority  along with the  

map.

31. According to the respondents, the seizure of 1 lakh ton  

of  iron  ore  from  the  leased  area  of  the  appellant  on  

17.12.2004  and  after  the  appellant  gave  a  letter  dated  

20.12.2004 invented new theory to claim the iron ore seized  

by  the  department  taking  undue  advantage  of  the  waste  

dumps stored by him on the northern side of  the leased  

area.   The  appellant  had  also  filed  an  affidavit  dated  

10.01.2005 wherein he has undertaken to protect and save  

the seized iron ore and pursuant to the said undertaking  

the appellant was permitted to lift the iron ore produced in  

his own mine.   

32. It may be relevant to submit that the Deputy Director  

of Mines and Geology, Tumkur, on the instructions from the  

Director of Mines and Geology, had visited the leased area  

of  Mining  Lease  No.2187  on  03.01.2006  along  with  the  

technical  staff  and  found  that  the  appellant   had  put  a  

board on his  waste  dump (stock belonging  to  Mines  and  

Geology).  It is also relevant to mention that the department  

has not erected any board and this fact was also reported to  

24

the  Director  on  04.01.2006.  The  respondents  further  

submitted  that  on  05.01.2006  in  the  presence  of  the  

persons who were present at the time of seizure Mahazar on  

17.12.2004, a detailed location of the seized iron ore was  

undertaken and in this regard an affidavit of V. Selvaraju  

was  also  given.   It  may  be  relevant  to  mention  that  the  

appellant filed an affidavit dated 15.02.2006 along with the  

letter addressed to the Director of Mines and Geology  in  

which  he  has  sworn  to  the  contents  that  he  will  not  

transport  either  the  material  which  was  seized  on  

17.12.2004 to the extent of 1 lakh ton illegally mined from  

biscuit pit or stacked illegally near the boundary of Mining  

Lease No.2187 located at Survey No.130 of the Honnebagi  

Village, Chikkanayakanahalli Taluk, Tumkur District for 1  

lakh ton material  that  was  found lying  near  the  crusher  

plant and which was mined from Mining Lease No.2187.

33. The  respondents  further  submitted  that  the  

continuous act of the appellant involving himself to grab the  

iron  ore  from  the  seized  dump  resulted  in  the  Deputy  

Director of Mines and Geology to visit once again the leased  

area on 28.01.2006 and found that though the appellant  

25

was not permitted to carry out any mining activity or using  

of  crushing unit  factually,  it  was seen that the appellant  

was engaged in such activities resulting in a notice issued  

to  the  appellant  on  29.3.2006.   The  respondent  filed  a  

criminal  complaint  on  25.2.2006  before  the  

Chikkanayakanahalli  Police  against  six  persons  including  

the appellant for having indulged in illegal mining activities  

and committed theft of iron ore and the same was registered  

in Criminal No.20 of 2006 for an offence punishable under  

section 21 of  The  Mines  and Minerals  (Development  and  

Regulation) Act, 1957 and under section 379 of the Indian  

Penal Code.  It is also mentioned in the affidavit that the  

auction  was  completed on 24.02.2010.   The  respondents  

also  mentioned  that  the  appellant  has also  filed criminal  

petition under  section 482 Cr.P.C.  before  the  High Court  

when the court directed the Fast Track Court to dispose of  

the criminal revision petition within a stipulated period.  At  

this juncture, the appellant withdrew his Criminal Petition  

No.2104  of  2010  seeking  liberty  to  file  criminal  revision  

petition before the District Court, Tumkur challenging the  

order of  the learned Magistrate  dated 30.03.2010 and he  

26

has filed criminal revision petition before the District Judge,  

Tumkur against the order of the learned Magistrate dated  

30.03.2010 alleging that the order passed by the learned  

Magistrate  was  one  behind  his  back.   Though  the  order  

specifically  stated that  the  counsel  for  the  appellant  was  

present and produced the copy of the order passed by the  

High Court of Karnataka in Review Petition No.418 of 2009,  

the  respondent  also  mentioned  that  the  appellant  is  

venturing all kinds of petitions suppressing the facts.  The  

appellant has an evil desire to grab the iron ore seized and  

auctioned.   According  to  the  respondent,  filing  of  this  

petition is an ultimate result of abuse of the process of law.

34. The  respondents  also  mentioned  that  the  seizure  

mahazar drawn on 17.12.2004 shows that the iron ore were  

lying within the boundaries mentioned in the said mahazar.  

This  is  the  very  same  boundary  mentioned  in  mahazar  

drawn  by  the  police  in  the  year  2006  and  the  mahazar  

drawn at the time of  handing over  of  the iron ore to the  

possession  of  the  highest  bidder  also  reveals  the  same  

boundaries.  Thus, boundaries in all the three mahazars are  

one and the same, thereby, establishing that the stand of  

27

the respondent regarding the place where actually iron ore  

auctioned is situated also negates the stand taken by the  

appellant in regard to his claim.  The respondents further  

submitted that even the prayer sought in these appeals was  

never a subject matter in Writ Petition No. 27521 of 2005  

and thus the appellant is estopped from seeking this claim  

as the auction process dated 24.2.2010 is completed and  

further he had challenged the auction proceedings in writ  

petition No.15079 of 2010 wherein the High Court refused  

to interfere with the auction proceedings and the appellant  

having withdrawn the writ petition No.15079 of 2010.  It is  

mentioned  by  the  respondents  that  auction  of  24.2.2010  

was  in  consonance  with  the  rules  and  regulations.  The  

respondents also submitted that the appellant having failed  

in  all  attempts  to  stop  the  public  auction,  came forward  

with  a  plea  to  deposit  Rs.15  crores  in  Writ  Petition  

No.15079  of  2010,  spent  some  time  and  allowed  the  

successful  bidder  to  commence  lifting  of  iron  ore  after  

depositing  the  entire  amount  of  Rs.10.10  crores  and  

allowing  the  bidder  to  transport  the  iron  ore.   The  

respondents  relied  on  the  Audit  Report  of  Kamalabai,  

28

Mining Lease No.2187 from 2000-01 to 2005-06.  The same  

is reproduced as under :

29

29

AUDIT REPORT OF SMT. KAMALA BAI, ML NO.2187 FROM 2000-01 TO 2005-06 IS AS BELOW

  Year      Production  Dispatch        Opening Balance        Current Year Demand     Total                     Recovery                 Closing Balance                                                                                               

Balance Interest Fixe d Rent

Royalty Interest Royalty/Fixe d Rent

Interest Royalty/Fixe d Rent

Interest

2000-01 21600 22160 37055 40388 0 145300 8893 231636 107579 49261 74776 0 2001-02 8900 8900 74776 0 0 79400 17946 172122 61406 17946 92770 0

2002-03 9725 9925 92770 0 0 81475 4745 178990 154682 4745 19563 0 2003-04 150340 121865 19563 0 0 1319807 3393 134276

3 1337863 3393 1507 0

2004-05 290960 245372 45582 0 0 2786598   262 278836 7

5674011 262 1507 2285906 Excess  paid

2005-06 50201 49436 0 0 0 619425 0 619425 3207972 0 0 2588547 Excess  paid

r Deputy Director

Mines and Geology Department

                                                                                          Tumkur P.S. : In the years 2004-05, the balance indicated in this Chart is 1507, but it should be 45582.

31

30

35. The respondents submitted that at that point of time  

the appellant could legally mine upto to 5500 metric tons  

only in a year.  That limit was increased to 41000 metric  

tons a year.  It is beyond comprehension how illegal iron ore  

could be found on the Mining Lease No.2187 to the tune of  

about 1 lakh ton legally mined by the appellant. This was  

possible only when the appellant had indulged in massive  

illegal mining.   

36. The audit report extracted above clearly indicate that  

the appellant had quarried and produced iron ore several  

times  more  than  its  permissible  limit  particularly  in  the  

years from 2003 to 2006.

37. The theory of somebody had put 1 lakh ton of iron ore  

of  mining  lease  is  totally  untenable  and  beyond  

comprehension.  1 lakh ton of iron ore cannot be kept on  

any mining lease all of a sudden without the knowledge of  

the appellant.  Thousands of trucks have to transport the  

said quantity of iron ore and if

it  did  not  belong  to  the  appellant  he  ought  to  have  

complained  immediately  after  someone  started  dumping  

iron ore on his mining lease. According to the respondent -  

State,  this  is  a  clear  case of  illegal  mining on a massive  

scale by the appellant.   

38. Mr. Ram Naik, learned senior advocate appearing for  

the auction purchaser contended that the appellant has not  

approached this court with clean hands.  He submitted that  

the  auction purchaser  had purchased the entire  iron ore  

and also lifted part of it and has already paid huge money to  

the respondent.  The auction purchaser cannot be denied  

right to lift the remaining iron ore.

39. We have heard the learned counsel for the parties at  

length and examined these appeals from various angles.  In  

our  considered  view,  this  court  ought  not  to  exercise  its  

extraordinary  jurisdiction  under  Article  136  of  the  

Constitution in a matter of this nature.  Interim order, if  

any, stands vacated. These appeals are totally devoid of any  

merit and are accordingly dismissed with costs.

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…………………………………..J.                                 (DALVEER BHANDARI)

…………………………………..J.

                        (DEEPAK VERMA) New Delhi; April 11, 2011

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