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IN THE SUPREME COURT OF INDIA CIVIL ORIGINAL JURISDICTION

I.A.NOS.259 & 263 IN I.A.NO.259

IN

WRIT PETITION (CIVIL) NO.562 OF 2009

SAMAJ PARIVARTANA  SAMUDAYA & ORS.                 PETITIONER(S)

VERSUS

STATE OF KARNATAKA & ORS.  RESPONDENT(S)

J U D G M E N T

RANJAN GOGOI, J.

I.A.NO.259 of 2016 1. This application has been filed by the Karnataka Iron

and  Steel  Manufacturers  Association  seeking  the  following

reliefs:-

a) Allow  the  instant  application  and  direct

NMDC to restrain from adopting differential

pricing mechanism for the iron ore sold in

the e-auction in the State of Karnataka.

b) Direct the CEC/Monitoring Committee to fix

the  floor  price  of  iron  ore  on  realistic

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2 grounds and to ensure that NMDC does not

take undue advantage of acute shortage of

iron  ore  availability  in  the  State  of

Karnataka.

c) Pass  any  such  further  orders/directions

which this Hon'ble Court may deem fit and

proper in the interest of justice.

2. Specifically  it  is  contended  on  behalf  of  the

applicant-Association  that  the  NMDC  had  all  along  been

fixing  the  floor  price/sale  price  by  adopting  PAN  India

Uniform  pricing.  However,  since  April,  2016  by  taking

advantage  of  an  increased  demand   a  differential  pricing

policy  has  been  adopted  so  far  as  State  of  Karnataka  is

concerned and the  identical  floor  price/sale  price  that  was

prevailing  in  respect  of  the  States  of  Chhattisgarh  and

Karnataka has been altered and the floor price for Karnataka

has been increased. Hence the prayers made.

3. Comments  of  the  C.E.C.  on  the  prayers  made  in  I.A.

No.259 of 2016 have been called for and received. The stand

of  the  NMDC  and  the  State  of  Karnataka  has  also  been

submitted in writing. One M/s. Vedanta Limited, a lessee of a

'B' category mine, has filed an application for permission to

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3 file reply to I.A. No.259 and has opposed the prayers made

therein.

4. The response of the C.E.C. to the said application filed

by M/s.  Vedanta  Limited has  also  been duly  received  and

considered.  

5. By our previous orders passed in the Writ Petition (C)

No.562 of 2009 titled Samaj Parivartana Samudaya & Ors. vs.

State of Karnataka & Ors., out of which these miscellaneous

matters/applications have arisen, we had held that the issue

of base price should be left to be decided by the concerned

lessee.  This  has  been  affirmed  in  our  final  order  dated

18.04.2013 disposing of the Writ Petition [paragraph 7(E)]. A

somewhat  similar  prayer  made  by  the  present

applicant-Karnataka  Iron  and  Steel  Manufactrurers

Association to tag/fix the base price to the sale price fixed by

the  NMDC  in  a  situation  where  private  leaseholders  were

artificially hiking their prices, was rejected by this Court on

24.02.2014 in I.A.No.209 with the following order :

“The grievance  of  the  applicants  is  that

the leaseholders are jacking up the base price

of  iron  ore  and  as  a  result  the  industrial

consumers  of  iron  ore  are  suffering  a  lot  of

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4 prejudice.

We find from the judgment of this Court

in  Samaj  Parivartan  Samudaya  v.  State  of

karnataka and Ors. (2013) 8 SCC 154 that the

lessees have been given the right to fix the base

price.

Hence,  we are not  inclined to pass any

orders  on  this  application  filed  by  the

applicants.”

6. The above apart, it is the stand of the NMDC before the

Court  that  the  base  price/floor  price  fixed by  it  has  been

determined  by  market  conditions  and  despite  the  higher

price in Karnataka than in Chhattisgarh, the cost of landing

in Karnataka is lower than in Chhattisgarh.

7. The C.E.C. in its response has indicated that as NMDC

is  working  under  a  special  dispensation  granted  by  this

Court,  until  such dispensation continues  it  should  not  be

allowed to resort to dual pricing. While it is correct that the

special dispensation granted to NMDC by this Court cannot

continue  in  perpetuity  and  the  regulatory  measures

prescribed  by  this  Court  for  other  leaseholders  must  also

apply to NMDC, the working of its leases by NMDC under the

special dispensation, by itself, cannot be a legitimate ground

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5 for not resorting to a dual price mechanism if the same is

dictated by market forces. There is nothing in the report of

the C.E.C. to indicate otherwise. We, therefore, do not accept

the said part of the recommendation of C.E.C. The issue of

continuity of the special dispensation in favour of NMDC will

be considered in due course.

8. Insofar  as  the  statements  made  on  behalf  of  M/s.

Vedanta Limited are concerned, all we would like to observe,

at this stage, is that the inability of M/s. Vedanta Limited to

sell the output from its leases, as expressed, could very well

be because of the pricing patterns adopted by it. Inability to

sell on account of higher prices cannot be a ground for export

of  the  mineral,  at  least  at  this  stage  of  developments

pursuant to the final order dated 18.04.2013. Permission for

export must be governed by norms and parameters of general

application  as  distinguished  from  ad  hoc decisions  in

individual cases. Until such guidelines are framed, the prayer

of M/s. Vedanta Limited for export of its iron ore cannot be

granted. So far as issue of framing of guidelines/norms for

exports are concerned, the same will be dealt with separately

at an appropriate time and stage. Consequently and in light

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6 of the foregoing, I.A. No. 259 is dismissed.

9. Shri  Shyam Divan,  learned  amicus curiae, may at  an

appropriate  stage, mention the matter so for as the issues

relating to continuance of the special dispensation in favour

of NMDC and norms to govern exports are concerned.

I.A. No.263 IN I.A.NO.259  

10. In view of the dismissal of the I.A. No.259 of 2016, no

separate orders will be called for on I.A. No.263 of 2016 and

is dismissed accordingly.

……….....................,J. (RANJAN GOGOI)

……….....................,J. (PRAFULLA C. PANT)

……….....................,J. (A.M. KHANWILKAR)

NEW DELHI SEPTEMBER 1, 2016.