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Judgment
Dr. A.K. Jayasankaran Nambiar, J.
As the issue involved in all these appeals is the same, they are taken up together for consideration and disposed by this common judgment.
W.A.No.665 of 2017 impugns the judgment dated 14.12.2016 of a learned Single Judge in W.P.(C).No.25006 of 2015. The petitioners in the said writ petition were owners of property in Kozhikode district in which they were carrying on granite operations. By virtue of the judgment of the Supreme Court in Thresiamma Jacob v. Geologist - [2013 (3) KLT 275 (SC)] persons in ownership of land in the Malabar region of Kerala State, had to be treated as owners of the land as well as the sub-soil, and consequently, unless there was an enactment vesting the ownership of the sub-soil/mineral wealth in the State of Kerala, there could be no demand of royalty from the said landowners when they exploited the mineral wealth from their own lands. It was therefore their case in the writ petition that the provisions of Rule 2 to 9, 11, 12, 20 and 49 of the Kerala Minor Mineral Concession Rules, 2015 that stipulated a payment of royalty as a precondition for issuance of movement permits, and made Environmental Clearance a mandatory condition for grant of mining permits, had to be read down in the light of the declaration of law by the Supreme Court in Thresiamma Jacob [supra]. The writ petition was however dismissed by a learned Single Judge who held that mere ownership over the land/sub-soil did not mean that the State could not impose royalty as a precondition for grant of movement permits and other facilities which formed part of the regulation of minor minerals by the State, as authorized under the Mines and Minerals (Development and Regulation) Act, 1957 read with the Kerala Minor Mineral Concession Rules, 2015. It was also clarified by the learned Single Judge that the quarrying activities could not be done without obtaining an Environmental Clearance.
During the pendency of the appeal, the State Legislature enacted the Kerala Minerals (Vesting of Rights) Act, 2021 [hereinafter referred to as the “2021 Act”] vesting all rights in the minerals in the soil and sub-soil of all lands of whatsoever ownership or tenure in the Malabar region, in the State of Kerala. The Act was given operation with effect from 30.12.2019, the date on which the Ordinance in that regard was first promulgated. The validity of the said enactment had been challenged through various writ petitions, which came to be dismissed by another learned Single Judge through a judgment dated 19.12.2025 in W.P.(C).No.43302 of 2024 and connected cases, wherein the learned Single Judge considered the decisions of the Supreme Court in Mineral Area Development Authority and another v. Steel Authority of India and another - [(2024) 10 SCC 1] and Mineral Area Development Authority and another v. Steel Authority of India and another - [(2024) 10 SCC 257] that clarified that royalty is not a tax and further, that royalty is always payable to the owner of the property (minerals) and cannot be demanded by persons other than the owner of the minerals concerned. The Writ Appeals preferred against the said judgment of the learned Single Judge by the writ petitioners [W.A.Nos.3218 of 2025 and 590 of 2026] as well as by the State [W.A.Nos.440 of 2026, 587 of 2026 and 1263 of 2026] are also posted before us for hearing and considered by us in this judgment.
W.A.Nos.3218 of 2025 and 590 of 2026 are preferred by the writ petitioners in W.P.(C).No.43302 of 2024 and W.P.(C).No.10670 of 2024 and W.A.Nos.440 of 2026, 587 of 2026 and 1263 of 2026 by the State aggrieved by the judgment dated 19.12.2025 of a learned Single Judge that partly allowed the writ petitions. The writ petitioners in the said cases were owners of land in the Malabar region of the State wherein quarries were operated. Despite their lands falling within the territorial limits of the erstwhile Malabar region of the State, they were served demand notices for payment of royalty on the granite extracted from their respective quarries. Inasmuch as the case of the petitioners was that they were not aware of the period for which royalty was demanded, their challenge to the demand notices issued to them was multi-pronged. Firstly, they challenged the demand of royalty for the period prior to the coming into force of the 2021 Act with effect from 30.12.2019. They relied on the judgment of the Supreme Court in Thresiamma Jacob [supra] which had clarified that the State Government could claim ownership and demand royalty only if there was a specific vesting of minerals in the State through proper legal process. Since the vesting was effected only through the 2021 Act that came into force with effect on 30.12.2019, it was their case that the demand of royalty for the period prior to the 2021 Act was in any event illegal and unconstitutional. Secondly, the petitioners impugned the validity of the 2021 Act inter alia on the contention that the State Legislature lacked the legislative competence to enact the 2021 Act. In particular, they pointed out that 'Acquisition of property' was a subject mentioned in Entry 42 of List III of the Seventh Schedule to the Constitution of India, and since, the said field of legislation was already occupied by the Central Legislation, namely, Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013, there was no residual field in respect of which the State Legislature could legislate. Alternatively, it was contended that even if the State Legislature could be seen as having the legislative competence to enact the 2021 Act, the enactment would still fail the test of constitutionality because it did not provide for any compensation. Referring to the decision in K.T. Plantation Private Limited and another v. State of Karnataka - [(2011) 9 SCC 1], it was contended that a legislation that envisages acquisition of property, but does not provide for any compensation would fail to provide the necessary “authority of law” for the purposes of permissible deprivation of property under Article 300-A of the Constitution of India.
The State Government, through a counter affidavit filed in the writ petition, contended that merely because the ownership of the sub-soil/minerals was vested in the owner of the property, it did not follow that the State Government could not, in exercise of its regulatory power under the Mines and Minerals (Development and Regulation) Act, 1957 and the Kerala Minor Mineral Concessions Rules, 2015 seek a payment of royalty from the owner of the property as a condition for the grant of mining lease/license/permit to extract and transport minor minerals/ordinary earth from their respective lands. It was pointed out that, at any rate, with effect from 30.12.2019, the 2021 Act had come into force and thereafter there was a specific provision vesting the mineral rights in the State, and hence, the arguments of the writ petitioners based on Thresiamma Jacob [supra] would no longer apply. Referring to the 2021 Act, it was the case of the State Government that the said legislation was one that was enacted to pursue the objectives under Article 39(b) of the Constitution of India towards securing that the ownership and control of mineral resources of the community are so distributed as best to sub serve the common good. In that context therefore, it was argued that there was no need to incorporate a provision in the 2021 Act for payment of compensation to the owners of the property whose sub-soil/mineral rights were proposed to be vested in the State through the provisions therein. It was also pointed out that providing for a payment of compensation to the owners of land in the Malabar region from whom the vesting of minerals in the State was contemplated under the 2021 Act, while at the same time not granting compensation to the owners of lands in Travancore and Cochin regions where vesting had occurred through pre-independence legislation, would result in an arbitrary discrimination between two sets of landowners within the State. The 2021 Act itself was stated to be traceable to Entries 18 and 23 of List II in the Seventh Schedule to the Constitution of India read with Entry 42 of List III of the said Schedule to the Constitution. In the context of interpretation of Entry 42 of List III, it was argued that the non obstante clause in the 2021 Act enabled the State Government to get over the argument of occupied field vis-a-vis the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013.
The learned Single Judge, who considered the writ petitions, summarized his findings on the various contentions urged in the writ petition as follows:
72.Findings on the points (i) to (ix) above are summarised below:
•The Minerals Vesting Act, 2021, does not violate Articles 300A and 14 of the Constitution of India.
•The State Legislature has legislative competence to enact the Minerals Vesting Act, 2021.
•The Minerals Vesting Act, 2021, is not repugnant to the MMDR Act, 1957 and the RFTLARR Act, 2013.
•The granting retrospective effect to the Minerals Vesting Act, 2021, w.e.f. 30/12/2019 is valid and legal.
•Thus, Minerals Vesting Act, 2021 is constitutional and valid.
•Royalty is the consideration payable by the person extracting minerals to the owner of the minerals in proportion to the quantity extracted to compensate for the loss of value of minerals suffered by the owner of the minerals. So much so, only the owner of the minerals can claim royalty.
•The State cannot claim royalty for minerals extracted by private persons from their own land that fall within the Malabar area, prior to the Minerals Vesting Act, 2021.
•Even for the self-extraction of minerals from one’s own land, where minerals are vested with him, the owner of the land has to comply with the statutory preconditions as contemplated under the MMDR Act, 1957, and the Rules made thereunder and obtain statutory permissions/licences/clearances from the competent authorities concerned. The extraction of minor minerals from such lands without obtaining any statutory permissions/ licences/clearance would be illegal; in which event, it will be open to the State to invoke the provisions under sub-section (5) of Section 21 of the MMDR Act, 1957 and Rule 108 of the KMMC Rules, 2015 and can recover from such a person the value of the minerals so raised as well as fine.
•Rule 89 of the KMMC Rules, 2015 is not ultra vires the delegated powers of the State Legislature under Section 15 of the MMDR Act, 1957. Nor does it violate Article 19(1)(g) of the Constitution.
He then proceeded to dispose the writ petitions as follows:
“85.Resultantly, WP(C) Nos.10670/2024, 38526/2023, 43302/2024, 15986/2023 and 254/2024 are dismissed. WP(C) Nos. 36843/2015, 11397/2017, 14425/2023 and 15037/2023 are disposed of as follows:
(i)Exts.P2 and P3 in WP(C) No.36843/2015 to the extent they claim royalty are quashed. The 3 respondent therein is directed to issue a fresh demand notice excluding the component of royalty within two months from the date of receipt of a copy of this judgment.
(ii)Ext.P5 order to the extent it claims royalty in WP(C) No.11397/2017 is quashed. The 4 respondent therein is directed to issue a fresh order excluding the royalty component within two months from the date of receipt of a copy of this judgment.
(iii)Exts.P1 and P2 in WP(C) No.14425/2023 to the extent they claim royalty prior to 30/12/2019 are quashed. The 1 respondent therein is directed to issue a fresh demand notice excluding the royalty component for the minerals extracted prior to 30/12/2019 within two months from the date of receipt of a copy of this judgment.
(iv)Exts.P1 and P2 in WP(C) No.15037/2023 to the extent they claim royalty prior to 30/12/2019 are quashed. The 1st respondent therein is directed to issue a fresh demand notice excluding the royalty component for the minerals extracted prior to 30/12/2019 within two months from the date of receipt of a copy of this judgment.”
In the appeals before us, we have heard Sri.MKS Menon, the learned counsel for the appellants in W.A.Nos.665 of 2017 and 3218 of 2025 and the learned Additional Advocate General Sri.P.A. Mohammed Shah for the appellant - State Government in W.A.Nos.440 of 2026, 587 of 2026 and 1263 of 2026, which is also the respondent in the other Writ Appeals.
We note that the challenge in the writ petitions was essentially two-fold. Firstly, there was a challenge to the demand of royalty for the period prior to the introduction of the 2021 Act with effect from 30.12.2019. Secondly, there was a challenge to the legislative competence of the State legislature to enact the 2021 Act by which the entirety of the rights held by the landowners in the Malabar region over the minerals/sub-soil, was vested in the State Government for the purpose of legitimizing the demand of royalty by the State Government. A third and alternate contention also challenged the 2021 Act as violative of Articles 14, 19, 21 and 300-A of the Constitution. As already noticed, the learned Single Judge, who decided the batch of writ petitions in which the validity of the 2021 Act was challenged, found in favour of the writ petitioners on the first issue and held that they would not be liable to pay royalty in respect of the minerals extracted from their lands prior to 30.12.2019 since the judgment of the Supreme Court in Thresiamma Jacob [supra] insulated them from a demand for royalty. As for the validity of the 2021 Act itself, the learned Single Judge held the Act to be constitutionally valid by treating the legislation in question as one that was enacted to further the objectives under Article 39(b) of the Constitution of India read with the doctrine of public trust by which the State was obliged to preserve its mineral wealth and protect it from indiscriminate exploitation at the hands of private persons. In that process, the learned Judge also found the impugned legislation traceable to Entries 18 and 23 of List II in the Seventh Schedule to the Constitution of India and rejected the contention of the writ petitioners that the legislation violated the provisions of Article 300-A inasmuch as it did not provide for any compensation for the deprivation of property rights.
Before considering the contentions of the learned counsel in the appeals before us, since the issue that we are called upon to adjudicate concerns the validity of a State legislation, we deem it apposite to notice the principles that must guide us in the exercise of our jurisdiction. It is trite that in exercise of the power of judicial review, the Indian Courts are invested with powers to strike down primary legislation enacted by the Parliament or the State legislatures. However, while undertaking this exercise of judicial review, the same is to be done at three levels. In the first stage, the Court would examine as to whether impugned provision in a legislation is compatible with the fundamental rights or the constitutional provisions (substantive judicial review) or it falls foul of the federal distribution of powers (procedural judicial review). If it is not found to be so, no further exercise is needed as the challenge would fail. On the other hand, if it is found that legislature lacks competence as the subject legislated was not within the powers assigned in the List in Schedule VII, no further enquiry is needed and such a law is to be declared as ultra vires the Constitution. However, while undertaking substantive judicial review, if it is found that the impugned provision appears to be violative of fundamental rights or other constitutional rights, the Court reaches the second stage of review. At this second phase of enquiry, the Court is supposed to undertake the exercise as to whether the impugned provision can still be saved by reading it down so as to bring it in conformity with the constitutional provisions. If that is not achievable then the enquiry enters the third stage. If the offending portion of the statute is severable, it is severed and the Court strikes down the impugned provision declaring the same as unconstitutional. [Binoy Viswam v. Union of India and Others – [(2017) 7 SCC 59]].
It is also well settled that where there is challenge to the constitutional validity of a law enacted by the legislature, the Court must keep in view that there is always a presumption of constitutionality of an enactment, and a clear transgression of constitutional principles must be shown. The fundamental nature and importance of the legislative process needs to be recognized by the Court and due regard and deference must be accorded to the legislative process. Where the legislation is sought to be challenged as being unconstitutional and violative of Article 14 of the Constitution, the Court must remind itself of the principles relating to the applicability of Article 14 in relation to invalidation of legislation. The two dimensions of Article 14 in its application to legislation and rendering legislation invalid are now well recognized and these are (i) discrimination, based on an impermissible or invalid classification and (ii) excessive delegation of powers; conferment of uncanalised and unguided powers on the executive, whether in the form of delegated legislation or by way of conferment of authority to pass administrative orders – if such conferment is without any guidance, control or checks, it is violative of Article 14 of the Constitution. The Court also needs to be mindful that a legislation does not become unconstitutional merely because there is another view or because another method may be considered to be as good or even more effective, like any issue of social, or even economic policy. It is well settled that the courts do not substitute their views on what the policy is. [Subramanian Swamy v. Director, Central Bureau of Investigation and another – [(2014) 8 SCC 682]].
Keeping the above principles in mind, when we look to the provisions of the impugned legislation, we notice that it provides for a vesting of 'all rights in the minerals in the soil and sub-soil of all lands of whatsoever ownership or tenure' in the State of Kerala. The term 'minerals' is defined as meaning ‘minerals and minor minerals as defined in clause (ad) and clause (e) respectively, of Section 3 of the Mines and Minerals (Development & Regulation) Act, 1957’. While clause (ad) of Section 3 refers to all minerals except mineral oils and therefore includes major minerals over which the State legislature cannot legislate owing to the exclusion of legislative power envisaged through the declaration under Section 2 of the Mines and Minerals (Development & Regulation) Act, 1957, clause (e) of Section 3 refers to minor minerals over which the State legislature can be seen as having limited legislative power as conceded under the Mines and Minerals (Development & Regulation) Act, 1957. Further, Section 4 of the impugned legislation stipulates that ‘the manner of vesting of the rights of the minerals in the soil and sub-soil of the land in the State…. shall be in the same manner as is vested in the State in the Travancore and Cochin areas’. In other words, the impugned legislation envisaged a similar vesting of minerals as was effected under the Travancore Proclamation dated 14.06.1881 and the Cochin Proclamation of 1905, both of which were pre-constitution legislations. Although Section 5 of the impugned legislation provided for a power to make Rules, we have not been shown any set of Rules that were promulgated in exercise of the Rule-making power of the State Government. The only other provisions contained in the impugned legislation are those dealing with the power to remove difficulties and the repeal and savings provision. Our task now is to determine whether the State legislature had the legislative competence to enact the impugned legislation that provides solely for the vesting in the State, of all rights in the minerals in the soil and sub-soil of lands in the Malabar region of the State, and in a manner that is similar to the manner specified under pre-constitutional legislations.
The explanation offered by the State when asked to clarify regarding the source of the power exercised by its legislature while enacting the impugned legislation, was to point variously to Article 39(b), Entries 18 and 23 of List II and Entry 42 of List III under the Seventh Schedule to the Constitution of India. We therefore proceed to consider the legislative competence of the impugned legislation against each of the aforesaid alleged sources.
Re: Article 39(b):
At the outset, we might observe that it is not the case of the State, as indeed it cannot be, that the impugned legislation can get the protection under Article 31-A or Article 31-C of the Constitution and be immune to a challenge under Article 14 and Article 19 of the Constitution of India. Admittedly, the impugned legislation was neither reserved for, nor obtained the assent of the President and hence the mandatory pre-condition for obtaining the protection under the aforementioned provisions was not satisfied in the case of the impugned legislation. Therefore, the impugned legislation, even if enacted to further the objectives under Article 39(b), must trace its origin to either Entry 18 or Entry 23 of List II or Entry 42 of List III under the Seventh Schedule to the Constitution of India to be constitutionally valid.
Entries enumerated in the three lists under the Seventh Schedule to the Constitution of India merely demarcate the legislative field of the legislature concerned. They do not provide the competence or the power to legislate on the legislature for which the source of power is contained in Article 246 or 246-A of the Constitution. While interpreting the various entries in the legislative lists, they cannot be read in a narrow and pedantic manner but must be given their fullest meaning and the widest amplitude and be held to extend to all ancillary and subsidiary matters which can fairly and reasonably be said to be comprehended in them [Tripura Goods Transport Association and Another v. Commissioner of Taxes and others – [(1999) 2 SCC 253]; I.T.C. Limited v. Agricultural Produce Market Committee -[JT (2002) 1 SC 294]].
Re: Entry 23 of List II:
Entry 23 of List II reads ‘Regulation of mines and mineral development subject to the provisions of List I with respect to regulation and development under the control of the Union.’ Entry 54 of List I reads ‘Regulation of mines and mineral development to the extent to which such regulation and development under the control of the Union is declared by Parliament by law to be expedient in the public interest.’ Section 2 of the Mines and Minerals (Development & Regulation) Act, 1957 that deals with the ‘Declaration as to expediency of Union Control’ reads ‘It is hereby declared that it is expedient in the public interest that the Union should take under its control the regulation of mines and the development of minerals to the extent hereinafter provided.’ Discussing the inter-relationship between Entry 54 of List I and Entry 23 of List II, and in particular the effect of the legal declaration under Entry 54 of List I, the nine Judge Bench of the Supreme Court in Mineral Area Development Authority v. Steel Authority of India – [2024 KLT Online 1945 (SC)], after an exhaustive analysis of the earlier precedents, observed as follows at paragraphs 160-163:
“160.The requirement of a legal declaration under Entry 54 of List I serves twofold purposes: first, it enables a clear demarcation of the subject matter under the control of Parliament and determines the extent of such control; and second, it enshrines the precept of the rule of law where the basis for trenching upon the legislative powers of the State has to be found in a law made by Parliament. The Parliamentary enactment through which legislative control is being assumed by the Union, to the exclusion of state legislatures, cannot be abstract, vague, and general. While Parliament has the power to denude the field given to the states under Entry 23 of List II by making a declaration in the law which it enacts pursuant to the field reserved by Entry 54 of List I, the law enacted by Parliament must specify the field of regulation and development which it has taken over, and the extent to which the control of the Union is deemed to be in the public interest.
161.The use of the expression “to the extent” under Entry 54 of List I carries the consequence that the Parliamentary legislation has to specify the subject matter or field over which it seeks to legislate. In M A Tulloch (supra), this Court held that the intention of the legislation to occupy a particular subject matter has to be gathered from the words of the provisions. As a consequence, the coverage of the fields by Parliament has to be express. The ambit of the MMDR Act has to be determined from the express words used in the provisions and not by mere implications or inference. This legal principle has already been accepted by this Court. (Ishwari Khetan Sugar Mills v. State of Uttar Pradesh, (1980 KLT OnLine 1120 (SC) = (1980) 4 SCC 136); Rajasthan Roller Flour Mills Association v. State of Rajasthan, 1993 (2) KLT OnLine 1165 (SC) = 1994 Supp (1) SCC 413).
162.In Ishwari Khetan Sugar Mills v. State of Uttar Pradesh, 1980 KLT OnLine 1120 (SC) = (1980) 4 SCC 136 a Constitution Bench was called upon to interpret the ambit of Entry 52 of List I and Entry 24 of List II. The Industries (Development and Regulation) Act 1951 (“IDR Act”) was enacted by Parliament to assume control over specified industries in pursuance of Entry 52 of List I. Section 2 of the IDR Act contained the legislative declaration to the effect that the Union shall take under its control the industries specified in Schedule I. The majority, speaking through Justice D A Desai, observed that the legislative declaration under the IDR Act has the effect of denying the legislative powers to the state legislature under Entry 24 of List II. (Ishwari Khetan Sugar Mills (supra)). Therefore, it was held that the legislative declaration contained under Section 2 of the IDR Act has to be construed strictly. The Court held that the legislative competence of state legislature would be eroded only to the extent to which control was assumed by the Union in terms of the legislative declaration under the IDR Act. A legislative declaration which has the impact of denuding or depriving the legislative power of the state legislature has to be construed strictly.
163.The inter-relationship between Entry 54 of List I and Entry 23 of List II can be formulated as follows:
(i)The state legislatures possess plenary legislative power in respect of regulation of mines and mineral development under Entry 23 of List II;
(ii)Entry 23 of List II is, however, subject to the operation of Entry 54 of List I;
(iii)The field under Entry 23 of List II is subordinated to the extent to which Parliament has brought under its control the regulation of mines and development of minerals under the MMDR Act;
(iv)The expression of the legislative intention to cover a particular field relating to mines and mineral development excludes or denudes the legislative powers of the State with respect to that particular field; and
(v)Parliamentary intention to cover a particular field relating to the regulation of mines and mineral development and the extent to which control of the Union is regarded to be in the public interest has to be ascertained from the language of the statute.
Keeping these principles in mind, we now move on to analyzing the inter-relationship between Entry 54 of List I and Entry 50 of List II.”
It is apparent therefore that the vesting of minerals envisaged under the impugned legislation, to the extent it includes even major minerals that are excluded from the ambit of the State legislature’s power to regulate through legislation, is ultra vires and beyond the legislative competence of the State legislature. Had this been the only defect, we could have tried and saved the legislation by reading down its provisions to confine its ambit to regulation of only minor minerals for which the State legislature does have the necessary legislative competence. However, we find that even then the legislation, as read down, would not qualify to be valid law for the purposes of Art.300A of the Constitution of India – an aspect that we propose to deal with shortly.
Re: Entry 18 of List II:
Entry 18 of List II reads ‘Land, that is to say, rights in or over land, land tenures including the relation of landlord and tenant, and the collection of rents; transfer and alienation of agricultural land; land improvement and agricultural loans; colonization.’ As already noticed, the impugned legislation only deals with vesting in the State, of all rights in the minerals in the soil and sub-soil of lands owned by private persons. While, in a broad sense, the subject matter of the impugned legislation could relate to ‘rights in or over land,’ when there is a specific entry in the legislative lists in Schedule VII to the Constitution of India that deals with vesting of ownership of property in the State, that entry has to be seen as providing the field of legislation for the purposes of determining legislative competence of the legislature concerned. This is especially so because the enumeration of the different entries in the three lists under the Seventh Schedule is for the purpose of delineating the fields on which the Central and State legislatures are empowered to legislate under the scheme of distribution of legislative powers envisaged under the Constitution. As observed by the nine judge bench of the Supreme Court in State of U.P. v. Lalta Prasad Vaish – [(2024) 17 SCC 1], the question that a court must pose in such situations is whether two entries would overlap when interpreted widely ? If they overlap, the court must reconcile them; but the method of reconciliation must maintain the federal balance. The court must also ensure that neither of the entries is rendered redundant. Towards ensuring the latter, the courts generally resort to the principle of generalia specialibus non derogant. On an application of the said principle to reconcile a situation where Entries 18 of List II and Entry 42 of List III overlap, we find that Entry 42 of List III reads ‘Acquisition and Requisitioning of property’ and would be the more specific entry to which the impugned legislation relates. While Entry 18 of List II deals generally with Land, and rights in or over land, which is only one type of property, Entry 42 of List III deals specifically with acquisition and requisition of all types of property including land and minerals.
Re: Entry 42 of List III:
As already noticed, while Entry 42 of List III deals with acquisition and requisitioning of property, it being an entry in the concurrent list, if there is already a central legislation occupying the field, the State legislature will be denuded of its power to legislate on the subject, unless such State legislation is reserved for the assent of the President and receives his assent. Admittedly, the impugned legislation has not received the assent of the President. However, with a view to try and save the legislation, we could find that the field occupied by the central legislation – the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013 deals only with acquisition and requisition of land and building and does not specifically deal with acquisition of mineral rights. So viewed, the impugned legislation could possibly be traced to Entry 42 of List III, and the State legislature can be seen as having the competence to legislate on the subject of acquisition of rights in minor minerals in the soil and sub-soil of lands in the Malabar region of the State. However, even in such an event, the legislation would fail to qualify as a valid law that provides the ‘authority of law’ for the purposes of Article 300-A of the Constitution of India.
The upshot of the above discussion as regards the possible legislative entries to which the impugned legislation could be traced for upholding its constitutional validity is that, we are of the view that in the exercise of our jurisdiction of judicial review, while it may be possible to read down the provisions of the impugned legislation to render it legislatively competent by tracing it to either Entry 23 of List II or Entry 42 of List III, in that order of preference, for the reasons that follow, we find that the impugned legislation cannot be saved against a declaration of invalidity when tested against the provisions of Articles 14, 19, 21 and 300-A of the Constitution of India.
It must be noted that the impugned legislation effectively seeks to deprive a person of his property (in this case, all his rights in the minerals in the soil and sub-soil of his land) without specifying any procedure for effecting such deprivation of property, and without providing for any compensation therefor. In the absence of any protection offered through Article 31-A or 31-C of the Constitution of India, the validity of the impugned legislation must depend on the extent to which it can withstand a challenge under Articles 14, 19, 21 and 300-A of the Constitution of India.
With the deletion of Articles 19(f) and 31 through the 44th amendment to the Constitution, the express constitutional guarantee of compensation for compulsory acquisition of property was taken away. The right to compensation thereafter depended on whether the acquisition statute in question provided for it. However, courts have since declared that a statute that does not provide for just compensation can be challenged on the ground of violation of Article 14 [as being arbitrary or discriminatory], Article 19 [as imposing an unreasonable restriction on the freedom to carry on a vocation/profession] or Article 21 [as depriving a person of his right to livelihood]. There is also a line of authority that now treats property rights as human rights and therefore an integral part of the right to life under Article 21 of the Constitution. That the human rights perspective of property rights still holds appeal is evident from the recent judgment of the Supreme Court in Dharnidhar Mishra (D) & Anr v. State of Bihar & Ors – [(2024) 10 SCC 605], where the Court re-iterated that although the right to property ceased to be a fundamental right by the Constitution (44th Amendment) Act, 1978, it continues to be a human right in a welfare state, and a constitutional right under Article 300-A of the Constitution. Accordingly, the State cannot dispossess a citizen of his property except in accordance with the procedure established by law. The court went on to observe that the obligation to pay compensation, though not expressly included in Article 300-A, can be inferred from that Article since the court has recognized the right to property as a basic human right.
That apart, in Kolkata Municipal Corporation & Anr v. Bimal Kumar Shah & Ors – [(2024) 10 SCC 533], the court while rejecting the contention of the Corporation that it had effectively acquired the property of a citizen, drew a distinction between a statutory provision that confers a power of acquisition to the Corporation and other provisions that deal with the procedure to be followed in the exercise of that power. The court found that Article 300-A of the Constitution, that prohibited the deprivation of property of a citizen save as authorized by law, conferred on a citizen seven sub-rights viz. (i) the right to a notice of the proposed acquisition, (ii) the right to be heard on the objections if any to such proposal (iii) the right to a reasoned decision thereon (iv) the right to insist that the acquisition could only be for a public purpose (v) the right to restitution or fair compensation (vi) the right to an efficient and expeditious process and (vii) the right to a conclusion of the proceedings. In essence, the court saw the concepts of substantive and procedural due process as integral aspects of the phrase ‘authority of law’ in Article 300-A of the Constitution.
It might also be apposite in this connection to refer to the judgment of the Supreme Court in K.T. Plantation Private Limited and another v. State of Karnataka – [(2011) 9 SCC 1], where at paragraphs 189 to 192, it was observed as follows:
189.Requirement of public purpose, for deprivation of a person of his property under Article 300-A, is a precondition, but no compensation or nil compensation or its illusiveness has to be justified by the State on judicially justiciable standards. Measures designed to achieve greater social justice, may call for lesser compensation and such a limitation by itself will not make legislation invalid or unconstitutional or confiscatory. In other words, the right to claim compensation or the obligation to pay, though not expressly included in Article 300-A, it can be inferred in that article and it is for the State to justify its stand on justifiable grounds which may depend upon the legislative policy, object and purpose of the statute and host of other factors.
190.Article 300-A would be equally violated if the provisions of law authorising deprivation of property have not been complied with. While enacting Article 300-A Parliament has only borrowed Article 31(1) (the "Rule of Law" doctrine) and not Article 31(2) (which had embodied the doctrine of eminent domain). Article 300-A enables the State to put restrictions on the right to property by law. That law has to be reasonable. It must comply with other provisions of the Constitution. The limitation or restriction should not be arbitrary or excessive or what is beyond what is required in public interest. The limitation or restriction must not be disproportionate to the situation or excessive.
191.The legislation providing for deprivation of property under Article 300-A must be "just, fair and reasonable" as understood in terms of Articles 14, 19(1)(g), 26(b), 301, etc. Thus in each case, courts will have to examine the scheme of the impugned Act, its object, purpose as also the question whether payment of nil compensation or nominal compensation would make the impugned law unjust, unfair or unreasonable in terms of other provisions of the Constitution as indicated above.
192.At this stage, we may clarify that there is a difference between "no" compensation and "nil" compensation. A law seeking to acquire private property for public purpose cannot say that "no compensation shall be paid". However, there could be a law awarding “nil” compensation in cases where the State undertakes to discharge the liabilities charged on the property under acquisition and onus is on the Government to establish validity of such law. In the latter case, the Court in exercise of judicial review will test such a law keeping in mind the above parameters.”
The aforesaid legal position was re-iterated by the Supreme Court in Property Owners Association & Ors. v. State of Maharashtra & Ors. – [(2024) 11 S.C.R. 1] where, at paragraph 203 of the majority judgment, it is clearly stated that even if a law is in furtherance of Article 39(b) and protected by Article 31-C it is susceptible to a challenge to its constitutionality under other provisions of the Constitution (except Articles 14 and 19), including Article 300-A. In her separate concurring judgment Nagaratna J. held that when the State adopts methods for converting private material resources into 'material resources of the community', two processes take place viz. (i) there is a process of conversion of the private resource into a resource of the community by vesting in the State; and (ii) A distribution of the said material resources so vested in the State for the common good. It was also made clear that when private persons are so deprived of ownership as well as the control of the material resources which belong to them or are controlled by them, they must be compensated justly and fairly. Otherwise the conversion of private material resources into resources of the community would be contrary to Article 300-A of the Constitution which states that no person shall be deprived of his property save by authority of law.
In the case of the impugned legislation, the only substantive provision that it contains envisages the vesting of all rights in the minerals in the soil and sub-soil of all lands of whatsoever ownership or tenure in the Malabar region, in the State of Kerala. There are no provisions, either substantive or procedural, that deal with the compensation payable to the owners of the lands for deprivation/acquisition of their rights over the minerals in the soil and sub-soil of their lands. As the impugned legislation does not enjoy the protection under Articles 31-A or 31-C of the Constitution, does not contain any provision that safeguards any of the seven sub-rights of a citizen under Article 300-A, and does not provide for any compensation at all or, in other words, it is one that provides for 'no compensation' as opposed to 'nil compensation', it has to be seen as one that does not satisfy the requirements of Articles 14, 19 and 21 and therefore as invalid for the purposes of Article 300-A of the Constitution. To save the legislation from a declaration of invalidity we would have to read in provisions into the legislation, which we cannot do on account of the principle of separation of powers envisaged under the Constitution. We are therefore constrained to hold that the impugned legislation fails to qualify as valid law that provides the 'authority of law' to legitimize a deprivation of property under Article 300-A of the Constitution.
In the result, we dispose these writ appeals with the following directions:
The Kerala Minerals (Vesting of Rights) Act, 2021 is declared to be in violation of Articles 14, 19, 21 and 300-A of the Constitution of India and hence unconstitutional.
W.A.Nos.3218 of 2025 and 590 of 2026 are allowed by setting aside the judgment impugned therein to the extent that it upholds the constitutional validity of the Kerala Minerals (Vesting of Rights) Act, 2021. The appellants shall also be entitled to a consequential refund of the royalty amounts collected from them pursuant to the said enactment.
W.A.No.665 of 2017 is partly allowed by setting aside only the finding in the judgment impugned therein that holds the writ petitioner liable to pay royalty to the State for the period prior to 30.12.2019 either directly or as a condition for obtaining regulatory permits. The State shall refund to the appellant/writ petitioner the amounts collected by way of royalty from him during the said period, within three months from the date of receipt of a copy of this judgment.
W.A.Nos.440 of 2026, 587 of 2026 and 1263 of 2026 filed by the State Government are dismissed.
APPENDIX OF W.A.NO.3218 OF 2025
PETITIONER'S EXHIBITS:
English translation 1 English translation of EXT P1 in WP(c)
English translation 2 English translation of EXT P2 in WP(c)
English translation 3 English translation of EXT P4 in WP(c)
English translation 4 English translation of EXT R1(a) in counter Affidavit in WP(c)
English translation 5 English translation of EXT R1(b) in WP(c)
English translation 6 English translation of EXT R1(c) in WP(c)
English translation 7 English translation of EXT R1(d) in WP(c)
English translation 8 English translation of EXT R1(e)in WP(c)
English translation 9 English translation of EXT R1(f) in WP(c)
RESPONDENTS EXHIBITS:
EXHIBIT R4(a) True copy of the Kerala Minerals (Vesting of Rights) Bill of 2021 (Bill No.59) laid before the 15th Kerala Legislative Assembly
EXHIBIT R4(b) True copy of the relevant extract of the deliberations culminated in enactment of the Act of 2021 along with its free English translation
