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Judgment
W.P.No.12397 & 12407 of 2025 are filed challenging the proceedings of the 4th respondent dated 26.04.2025 in refusing to renew the quarry lease.
W.P.No.12900 & 13002 of 2025 are filed challenging the proceedings of the Divisional Mines and Geology Officer, raising demand for payment of the normal seigniorage fee and penalty.
W.P.No.4002 of 2023 is filed challenging the inaction of the respondents in extending the lease period for not less than five years in respect of the subject extents of the land in 0.920 hectares and 0.860 hectares in Sy.No.1072, Basinikonda Village, Madanapalli Mandal, Chittoor District, and consequently sought for a direction for issuance of transport, dispatch permits as well as transit passes.
W.P.No.17849 of 2024 is filed challenging the inaction of the respondents in considering the application in Form-B filed by the petitioner dated 19.05.2023 to renew the same for a period of ten years.
For the sake of convenience, the facts of W.P.No.12397 of 2025 are taken into consideration as the lead case, and the other Writ Petitions are considered in the light of the facts and circumstances arising therein.
Heard the submissions of learned Senior Counsel Sri K.G. Krishna Murthy, appearing for Sri K. Raghuveer, learned counsel for the petitioners and learned Government Pleader for Mines and Geology, appearing for the respondents.
The petitioners in the Writ Petitions are wife and husband. They were granted quarry lease in respect of two different extents of lands namely 0.860 hectares and 0.920 hectares, for road metal and building stone in Sy. No.1072, Basinikonda Village, Madanapalli Mandal, Chittoor District. The petitioner contends that the Deputy Director of Mines and Geology, Kadapa, by proceedings dated 12.10.2009, granted a quarry lease in favour of the petitioner for a period of ten years for road metal and building stone over an extent of the land in 0.920 hectares in Sy. No.1072, Basinikonda Village, Madanapalli Mandal, Chittoor District, and, pursuant to the said lease, the 2nd respondent, the Director of Mines and Geology, executed a quarry lease in favour of the petitioner on 12.10.2009. The quarry lease was valid for ten years, from 12.10.2009 to 11.10.2019. He contends that after execution of the lease deed, the quarry lease was put in operation. The 3rd respondent had raised certain demands for collection of seigniorage fee and penalty, alleging excessive excavation without payment of seigniorage fee. Against the said demand notice, the petitioner has filed a revision application before the 1st respondent, along with the stay petition. As the Revision case was not taken up for consideration, the petitioner has approached the High Court of Andhra Pradesh at Hyderabad by way of Writ Petition in W.P. No.4767 of 2016. The said Writ Petition was disposed of by order dated 15.02.2016, directing the 1st respondent to consider the stay application filed by the petitioner in the Revision Petition, in accordance with law, and dispose of the same by a reasoned order within two weeks. Pursuant to the directions of the High Court, the 1st respondent considered the petitioner's stay petition in the Revision Petition and stayed the demand raised in the proceedings dated 25.05.2015.
The petitioner's application for renewal of quarry lease was initially rejected on 23.08.2024 by the 3rd respondent. Challenging the said rejection, the petitioner had earlier filed a Writ Petition in W.P.No.571 of 2025. The said Writ Petition was disposed of, remanding the matter to the respondents for passing orders afresh after considering the petitioner's explanation submitted on 25.10.2023, subject to payment of any due amount within three (03) months from the date of receipt of the order. While disposing of the Writ Petition in W.P.No.571 of 2025, this Court observed that, subject to payment of any amount due, the respondents were directed to pass reasoned orders. In the light of the said order, the 4th respondent issued proceedings dated 19-04-2025 directing the petitioner to pay the pending demand of Rs.68,17,800/-, the said proceedings are subject matter of challenge in W.P.No.12900 of 2025.
It is contended that, against the Demand Notice issued on 25-05-2015, the petitioner filed a Revision Petition before the 1st respondent, and the demand was stayed on 19.03.2016. Despite the said suspension, respondent No.4 passed the impugned proceedings. Accordingly, the petitioner prays for setting aside the demand raised under the impugned proceedings. It is further contended that the demand levied is not sustainable for the reason, namely that the petitioner had supplied the material to the Government works relating to the R&B Department, as the seigniorage fee was earlier deducted from the bills of the contractors by the R&B Department and that, without verification of records, the order was passed. Any such further levy would amount to double taxation.
In W.P.No.12397 of 2025, the petitioner contends that he filed a quarry lease renewal application on 02-07-2019 and enclosed all documents through Mee Seva. Since the renewal application was not considered, the petitioner filed a Writ Petition in W.P.No.4022 of 2023 seeking directions to renew the application dated 02-07-2019. While the petitioner's renewal application was pending, the Government issued G.O.Ms.No.13 dated 14-03-2022, amending the provisions for Renewal of existing quarry leases, extending the lease period up to 31-03-2023. Accordingly, by collecting an enhanced security deposit, the Assistant Director of Mines and Geology issued an addendum to the existing quarry lease by the proceedings dated 24-08-2022, extending the quarry lease up to 31-03-2023.
While the Writ Petition in W.P.No.4022 of 2023, seeking a direction to pass orders on the renewal application filed on 02-07-2019, was still pending, the Government has issued another amendment to the existing Rules for Renewal of quarry releases vide G.O.Ms. No.25 dated 06-04-2023. Based on the said G.O., the Director of Mines and Geology issued instructions to the ADMGs in the State to follow the Standard Operating Procedure. In pursuance thereof, the petitioner contends that the Divisional Mines and Geology Officer, Madanapalli, directed the petitioner to file a renewal quarry lease application in Form-B, along with ten times the dead rent as premium, for grant of quarry lease over the subject area on or before 31-05-2023. The petitioner accordingly filed a renewal quarry lease application in Form-B afresh along with the premium amount on 19-05-2023.
On the said renewal application, the respondents have issued a show-cause notice dated 19-10-2023 proposing rejection of the quarry lease application. In response to the said show-cause notice, the petitioner has filed his objections on 25-10-2023. By the proceedings dated 23-08-2024, the District Mines and Geology Office, Chittoor, rejected the renewal quarry lease application. Challenging the said rejection order, the petitioner filed a Writ Petition in W.P.No.571 of 2025. The said Writ Petition was disposed of, directing the respondents to consider the petitioner's explanation submitted on 25-10-2023 and pass appropriate orders.
Pursuant to the said directions in W.P.No.571 of 2025, the order impugned in the present Writ Petitions (W.P.Nos.12397 & 12407 of 2025) was passed by proceedings dated 26-04-2025; rejecting the petitioner's application for Renewal. Before passing the said order, the impugned proceedings in the Writ Petition W.P.No.12900 of 2025 were passed, directing the petitioner to pay Rs.68,17,800/-.
Challenging the rejection of quarry lease renewal, the petitioner filed Writ Petitions in W.P.Nos.12397 & 12407 of 2025, challenging the directions to pay the pending demand of Rs Rs.68,17,800/-, W.P.Nos.12900 & 13002 of 2025 are filed respectively. As the issues are interconnected, the Writ Petitions are being disposed of by way of a ‘Common Order’.
Respondents filed counter affidavit (in W.P.No.12397 of 2025), while not disputing the fact of grating of quarry license in favour of the petitioner in 2009, valid up to 11.10.2019, it is stated by respondents that the technical team of the mines department conducted inspection on 09-04-2015 and submitted a report to the Assistant Director of Mines and Geology, Palamaner, stating that the petitioner extracted the mineral of 18,876 cubic meters without payment of seigniorage fee to the Government within the leased area and extracted the mineral for a tune of 2,100 cubic meters outside the leased area. Based on the enquiry report, the Assistant Director of Mines and Geology, Palamaner, issued a Show Cause Notice on 15-04-2015 directed the petitioner to submit explanation within 15 days, as to why action should not be initiated against him for not paying the seigniorage fee along with the penalty as per the provisions of APMMC Rules, 1966. In response, the petitioner submitted an explanation on 01-05-2015 denying the contentions in the show cause notice. After submitting the reply to the show cause notice, the petitioner filed a Revision Petition on 20-05-2015 before the 1st respondent against the Show Cause Notice dated 09-04-2015. And after considering the reply to the Show Cause Notice, Demand Notice was issued on 25-05-2015 raising a demand of Rs.68,17,800/- It is contended that suppressing the same, the petitioner filed a Writ Petition in W.P.No.4767 of 2016 for dispatch permits. The said Writ Petition was disposed of by order dated 15.02.2016, directing the 1st respondent to consider the stay application filed by the petitioner in the Revision Petition. Thereafter, the Revision Petition was dismissed vide order dated 21-11-2016.
It is contended that the 1st respondent dismissed the said Revision after giving ample opportunity of hearing on 21-11-2016. In view of the dismissal of Revision, the petitioner has a mineral due pursuant to the Demand Notice dated 25-05-2015. But the petitioner did not discharge the same. The respondents contend that the petitioner has misrepresented while filing the application for renewal, stating that there are no mineral dues, despite an outstanding demand of Rs.68,17,800/-, is pending against him.
The respondents states that the petitioner filed Form-B application for grant of renewal on 03-07-2019 and filed a false affidavit that he did not have any mineral due to the State Government or Government of India. It is further stated that misrepresentation itself amounts to fraud and therefore, the petitioner is not entitled to claim renewal of the lease.
It is stated that, the Andhra Pradesh Minor Mineral Concession Rules, 1966 ("APMMC Rules") were amended vide G.O.Ms.No.25, dated 06.04.2023, and G.O.Ms. No.73, dated 18.08.2023, substituting Rule 12(5)(h)(xi)(i). As per the amended provisions, renewal applications for leases expiring on or before 31.03.2023 were required to be submitted by 31.08.2023 along with the payment of a premium amount equivalent to ten times the dead rent, in addition to other statutory dues. It is contended that taking advantage of the same, the petitioner filed a renewal application by misrepresenting that he does not have any mineral revenue dues to the State Government or the Central Government on 18-05-2023.
It is further contended that admittedly the petitioner has a mineral due of Rs.68,17,800/- and the High Court while disposing the Writ Petition in W.P.No.571 of 2025, directed the respondents to consider the case of the petitioner subject to payment of due amount. In view of the same, the petitioner is not entitled to get any dispatch permits as per the Rule 34(1) of APMMC Rules, 1966.
The learned Senior Counsel Sri K.G. Krishna Murthy, appearing for the Sri K. Raghuveer, learned counsel for the petitioners contends that in the light of G.O.Ms.No.100 dated 26.06.2025 which amended the Rule 12 of A.P. Minor Mineral Concession Rules, 1966 introducing the A.P. Minor Mineral policy, 2025 provides that all renewal applications, which are pending as on date of issue of these Rules shall be considered for disposal by the Deputy Director concerned on payment of first installments of premium amount equivalent to three times of annual dead rent .The period of renewal would be considered from the date of expiry of the lease.
He further contends that in the light of the G.O.Rt.No.131 dated 07.08.2025 which provides for liberalizing the policy of quarry lease issuing guidelines providing one time settlements (OTS Scheme). Pending revisions, the scheme of OTS would apply to the case of the petitioner and the as the petitioner has paid the dead rent ten times more than the amount provided under the G.O.Ms.No.100 dated 26.06.2025, prays for a direction to consider the renewal application in terms G.O.Ms.No.100.
The learned Government Pleader for Mines and Geology, appearing for the respondents, relies on the decision of the Hon’ble Supreme Court in the case of State of Rajasthan and Others Vs. Sharwan Kumar Kumawat,1 etc., wherein it is observed as under:
“17.It is far too settled that there is no right vested over an application made which is pending seeking lease of a Government land or over the minerals beneath the soil in any type of land over which the Government has a vested right and regulatory control. In other words, a mere filing of an application ipso facto does not create any right. The power of the Government to amend, being an independent one, pending applications do not come in the way. For a right to be vested there has to be a statutory recognition. Such a right has to accrue and any decision will have to create the resultant injury. When a decision is taken by a competent authority in public interest by evolving a better process such as auction, a right, if any, to an applicant seeking lease over a Government land evaporates on its own. An applicant cannot have an exclusive right in seeking a grant of license of a mineral unless facilitated accordingly by a statute. State of Tamil Nadu v. Hind Stone & Others, (1981) 2 SCC 205 : -
“13.Another submission of the learned counsel in connection with the consideration of applications for renewal was that applications made sixty days or more before the date of G.O.Ms No. 1312 (December 2, 1977) should be dealt with as if Rule 8-C had not come into force. It was also contended that even applications for grant of leases made long before the date of G.O.Ms No. 1312 should be dealt with as if Rule 8-C had not come into force. The submission was that it was not open to the government to keep applications for the grant of leases and applications for renewal pending for a long time and then to reject them on the basis of Rule 8-C notwithstanding the fact that the applications had been made long prior to the date on which Rule 8-C came into force. While it is true that such applications should be dealt with within a reasonable time, it cannot on that account be said that the right to have an application disposed of in a reasonable time clothes an applicant for a lease with a right to have the application disposed of on the basis of the rules in force at the time of the making of the application. No one has a vested right to the grant or renewal of a lease and none can claim a vested right to have an application for the grant or renewal of a lease dealt with in a particular way, by applying particular provisions. In the absence of any vested rights in anyone, an application for a lease has necessarily to be dealt with according to the rules in force on the date of the disposal of the application despite the fact that there is a long delay since the making of the application. We are, therefore, unable to accept the submission of the learned counsel that applications for the grant of renewal of leases made long prior to the date of G.O.Ms No. 1312 should be dealt with as if Rule 8-C did not exist.” (emphasis supplied)
Fundamental Right
The question of applicants not having fundamental right in mining is no longer res integra, Monnet Ispat & Energy Ltd. v. Union of India, (2012) 11 SCC 1 may shed some light,
“No fundamental right in mining
133.The appellants have applied for mining leases in a land belonging to the Government of Jharkhand (erstwhile Bihar) and it is for iron ore which is a mineral included in Schedule I to the 1957 Act in respect of which no mining lease can be granted without the prior approval of the Central Government. It goes without saying that no person can claim any right in any land belonging to the Government or in any mines in any land belonging to the Government except under the 1957 Act and the 1960 Rules. No person has any fundamental right to claim that he should be granted mining lease or prospecting licence or permitted reconnaissance operation in any land belonging to the Government. It is apt to quote the following statement of O. Chinnappa Reddy, J. in Hind Stone [(1981) 2 SCC 205] (SCC p. 213, para 6) albeit in the context of minor mineral,
“6.… The public interest which induced Parliament to make the declaration contained in Section 2 … has naturally to be the paramount consideration in all matters concerning the regulation of mines and the development of minerals”. He went on to say: (Hind Stone case [(1981) 2 SCC 205], SCC p. 217, para 10)
“10.… The statute with which we are concerned, the Mines and Minerals (Development and Regulation) Act, is aimed … at the conservation and the prudent and discriminating exploitation of minerals. Surely, in the case of a scarce mineral, to permit exploitation by the State or its agency and to prohibit exploitation by private agencies is the most effective method of conservation and prudent exploitation. If you want to conserve for the future, you must prohibit in the present.”
And contends that the lease renewal cannot be sought as a matter of right and the same is rightly rejected in the case.
Considered the submissions.
The Assistant Director of Mines and Geology, Palamaner, in the light of the G.O.Ms.No.13 dated 14.03.2022, vide proceedings dated 24.08.2022, extended the lease up to 31.03.2023. In connection thereto, the Assistant Director, Mines and Geology, Palamaner, also executed a lease deed extending the lease up to 31.03.2023 in favour of the petitioner. Subsequent thereto, after the expiry of the said lease, in the light of a subsequent G.O. i.e., G.O.Ms.No.25 dated 06.04.2023 and the Circular Memo dated 26.04.2023, the petitioner was asked to file a renewal lease application along with premium amounts equivalent to ten times the annual dead rent in Form-B on or before 31.05.2023, failing which the respective area would be considered for E-auction. By the said proceedings, the respondents have expressed their intention to renew the lease. In light of the said promise, the petitioner filed Form-B dated 19.05.2023. As the same was not considered, petitioner filed W.P.No.17849 of 2024. Thereafter by giving show cause notice dated 19-10-2023, the impugned proceedings have been passed rejecting the renewal. Show Cause Notice reflects the reasons namely the (a) petitioner had failed to pay the demand amount as per the proceedings of the Revisional authority. And (b) that the District Collector, Annamayya District, vide proceedings dated 01-04-2023, had directed the ADMG not to extend the lease due to public safety and for the reasons that around 100 acres of assigned lands were resumed for issuance of house site pattas to the beneficiaries of Madanapalle Town, under the scheme of ‘Navarathnalu Pedalandiriki Illu’, thus proposed for rejection of the renewal. However ultimately, the order, rejecting the renewal of quarry lease is by taking into certain new criterion such as environmental clearance certificate issued by SEIAA (State Environmental Impact Assessment Authority)/MoEF. A glance at the Show Cause Notice reflects that the said issue, regarding certification of the environmental authorities was never put to the petitioner either in the subject show cause or subsequently.
Having regard to the same, I am of the view that the order impugned order is passed based on certain considerations, which even assuming that they are relevant, that they were never put to the petitioner.
Apart from the same, second ground on which the renewal was refused was the letter of the District Collector dated 01-04-2023 and based on the same refused to grant license on the ground of safety concerns. If the respondents were intending to act upon the said letter of the Collector dated 01-04-2023, they could not have issued subsequent proceedings on 15-05-2023, requiring the petitioner to file the renewal application by paying premium amount pursuant to the G.O.Ms.No.25 dated 06.04.2023, while assuring renewal of license.
The Third reason on which the quarry lease renewal was rejected was nonpayment of outstanding demand. The failure to pay the demanded amount for the alleged unauthorized quarrying, which does not by itself create an automatic statutory bar on renewal of a quarry license nor the same would constitute a valid reason for rejection of renewal, while the same may be a valid reason to refuse issue dispatch permits. The provisions of Rule 26 of the A.P. Minor Mineral Concession Rules, 1966, provides for the procedure in case of failure to pay the demanded amount within the stipulated time.
In the light of the foregoing, this Court is of the view that the order impugned (dated 26.04.2025) in the Writ Petitions in W.P.Nos.12397 & 12407 of 2025 smacks of arbitrariness and unreasonableness, the same are accordingly set aside and the matter is remanded to the authorities for passing orders afresh. The respondents shall pass orders in accordance with law on the renewal application of the petitioners, after giving due opportunity of hearing to both the petitioners.
As the petitioners claim for renewal of the quarry lease is now being remanded to the authorities, for consideration afresh, this Court is not inclined to go into the claim of the petitioners for consideration of their case in the terms of G.O.Ms.No.100 dated 26.06.2025,
This order take will not come in the way of the respondents for recovery of any mineral dues that are due to the State from the petitioners in accordance with law. With regard to the contention of the petitioners for OTS Scheme under G.O.Rt.No.131 dated 07.08.2025, in respect of the demand outstanding against them, it is for the authorities to adjudicate on the said issue and pass orders, if the same is applicable to the case of the petitioners. The petitioners are at liberty to raise the same before the appropriate authorities, if, advised.
With the above observations, the Writ Petitions are disposed of. There shall be no order as to costs.
As a sequel, all pending miscellaneous applications shall stand closed.
Footnotes
- 1.2023 SCC Online SC 898