B.L.A. INDUSTRIES PRIVATE LIMITED Versus UNION OF INDIA AND ANOTHER

B.L.A. INDUSTRIES PRIVATE LIMITED Versus UNION OF INDIA AND ANOTHER


Landmark Cases of India / सुप्रीम कोर्ट के ऐतिहासिक फैसले



WP (C) No. 63 of 2015 and Contempt Petition (Crl.) No.7 of 2016 in WP (Crl.) No.120 of 2012
 REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL ORIGINAL JURISDICTION
WRIT PETITION (CIVIL) NO. 63 OF 2015
B.L.A. INDUSTRIES PRIVATE LIMITED .… PETITIONER
Versus
UNION OF INDIA AND ANOTHER …. RESPONDENTS
AND
CRIMINAL ORIGINAL JURISDICTION
CONTEMPT PETITION (CRIMINAL) NO. 7 OF 2016
IN
WRIT PETITION (CRIMINAL) NO.120 OF 2012
UNION OF INDIA .… PETITIONER
Versus
SHRI ANUP AGARWALLA …. RESPONDENT

J U D G M E N T
HIMA KOHLI, J.
1. The petitioner has approached this Court under Article 32 of the Constitution of
India raising a grievance against the respondent No.1 – Ministry of Coal, Union of India1
for having included its name and mining lease area in the Schedules appended to the
Coal Mines (Special Provisions) Ordinance, 20142
, even though, the Screening
1 For short ‘UOI’
2 For short ‘Ordinance’
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Committee constituted by the Ministry of Coal, Union of India had not allocated any coal
block to it.
2. A quick glance at the relevant chronology of events, as narrated in the petition,
are considered necessary. The petitioner had submitted an application dated 8th
November, 1994 under Section 2 of the Forest (Conservation) Act, 19803
 to the District
Collector, Narsinghpur District, Narsingpur, Madhya Pradesh for permission to undertake
coal mining on forest land. On 21st November, 1994, the petitioner applied to the
respondent No.2 – State of Madhya Pradesh4
 in Form-I under the Mineral Concession
Rules, 19605
 for grant of a mining lease. On 7th April, 1995, the petitioner submitted an
application to the respondent No.1 – UOI under Section 5(2) of the Mines and Minerals
(Development & Regulation) Act, 19576
 for approval of the mining plan.
3. On 15th May, 1995, the District Collector, Narsinghpur forwarded the petitioner’s
application to the Principal Secretary of the respondent No.2 – State Government with a
recommendation for grant of a mining lease in its favour. In the very same month, in
reply to a letter dated 5th May, 1995 received from the respondent No. 1 – UOI seeking
essential details regarding the approval of the mining plan, the petitioner furnished the
necessary information under cover of letter dated 19th May, 1995. On 15th December,
1995, the respondent No. 1- UOI issued a letter to the petitioner calling upon it to appear
before the Screening Committee in a meeting scheduled on 20th December, 1995 for
3 For short ‘FC Act’
4 For short ‘State Government’
5 For short ‘MC Rules’
6 For short ‘MMDR Act’
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screening the proposals relating to captive mining by power generation companies and
companies engaged in the manufacture of iron and steel. Accordingly, the petitioner
participated in the 9th Meeting held by the Screening Committee on 20th December,
1995.
4. On 23rd December, 1995, the Department of Mineral Resources of the
respondent No.2 – State Government addressed a letter to the respondent No.1 – UOI
for seeking prior approval under Section 5(1) of MMDR Act for grant of mining lease for
coal in favour of the petitioner for a period of 30 years over an area measuring 249.243
hectares situated in Villages Mohapani, Richhai and Chargaonkhurd. On 21st June,
1996, the respondent No.1 – UOI wrote a letter to the petitioner informing it that the
Screening Committee had identified "Gotitoria (East & West) Coal Blocks" in Mohapani
Coalfield, Madhya Pradesh to meet the coal requirements of the captive power plant and
that the petitioner should approach the authorities for obtaining a mining lease of the
specified blocks. Pertinently, a copy of the aforesaid letter was not marked by the
respondent No.1 – UOI to the respondent No.2 – State Government. Instead, the same
was marked to the Chief Secretary, Government of Maharashtra, Mumbai. The fact that
the said letter was not endorsed to the respondent No.2 – State Government was also
confirmed by the respondent No.1 – UOI in its reply dated 10th April, 2015 to a query
raised in an application under the Right to Information Act, 20057
.
7 For short ‘RTI’
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5. On its part, the petitioner responded to the letter dated 21st June, 1996 sent by
the respondent No.1 – Union of India by writing back on 3rd July, 1996, stating inter alia
that it had already applied to the State Government in the prescribed form for grant of a
mining lease through the District Collector, Narsinghpur, Madhya Pradesh and the said
proposal had been recommended by the respondent No. 2 – State Government to the
Ministry of Coal for grant of approval. The petitioner requested that the approval to the
proposal forwarded by the respondent No.2 – State Government for grant of a mining
lease be accorded by the respondent No.1 – UOI at the earliest.
6. Finally, vide letter dated 27th August, 1997, addressed by the respondent No.1 –
UOI to the respondent No.2 – State Government, approval was accorded by the Central
Government for grant of a mining lease in favour of the petitioner under Section 5(1) of
the MMDR Act. Pursuant to the aforesaid letter, the mining lease for the area in question
was executed by the respondent No.2 – State Government in favour of the petitioner on
21st May, 1998. On the petitioner setting up a coal washery operation in September,
2001, coal mining operations were finally commenced in October, 2014.
7. After passage of almost a decade, a group of petitions in the nature of Public
Interest Litigations were filed before this Court with the grievance that coal blocks had
been arbitrarily allocated between the years 1993 to 2011 without adhering to the
mandatory legal procedure prescribed under the MMDR Act and in breach of the
relevant provisions of the Coal Mines (Nationalization) Act, 19738
, to favour ineligible
8 For short ‘CMN Act’
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companies tainted with mala fides and corruption. The said group of petitions were
decided by a three Judges Bench of this Court, by a detailed judgment dated 25th
August, 20149
 in Manohar Lal Sharma v. Principal Secretary and Others10 wherein,
the prayer regarding quashing of the allocation of coal blocks to private companies
made by the Central Government between 1993 to 2011, was considered extensively
and it was held that the exercise undertaken by the Central Government of allocation of
coal blocks, was neither traceable to the MMDR Act or the CMN Act and the practice
and procedure adopted by the Central Government for allocation of coal blocks to the
beneficiaries through the Screening Committee Route, was inconsistent with the extant
law already enacted and the Rules framed. Consequently, this Court declared that the
entire allocation of coal blocks, as per the recommendations made by the Screening
Committee constituted by the respondent No.1 – Union of India from 14th July, 1993
onwards and the allocations made through the Government Dispensation Route after
1993 suffered from the vice of arbitrariness and were illegal.
8. The outcome of the illegal allocations were the subject matter of the subsequent
judgment dated 24th September, 201411 delivered in the same case12. After carefully
examining all the consequences of cancellation of the coal blocks, as put forth by the
respondent No.1 – UOI and the learned counsel appearing for the allottees, this Court
divided the coal block allotments in two categories on the basis of the documents that
9 For short ‘First Judgment’
10 (2014) 9 SCC 516
11 For short ‘Second Judgment’
12 (2014) 9 SCC 614
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were furnished by the respondent No.1 – UOI. The first category was of allotments
other than those that were mentioned by the respondent No.1 – UOI in Annexure-1 and
Annexure-2, filed by it. The second category comprised of 46 coal blocks mentioned in
Annexure-1 and Annexure-2 that could possibly be “saved” from cancellation on
imposition of certain terms and conditions. The first category of the allotments was
quashed outright by the Court as patently illegal and arbitrary. This left the second
category of coal block allotments that had come into production or were likely to come
into production.
9. Out of 46 coal blocks, mentioned in Annexure-1 and Annexure-2, 42 coal blocks
were cancelled with a grace period of six months granted for the said cancellation to
take effect. Pertinently, the coal blocks allocated to the petitioner herein were mentioned
at Sr. No.22 and 23 of Annexure-1 that was extracted at the end of the Second
Judgment. Besides deferment of cancellation, this Court issued the following directions:
“38. In addition to the request for deferment of cancellation, we also
accept the submission of the learned Attorney General that the allottees
of the coal blocks other than those covered by the judgment and the four
coal blocks covered by this order must pay an amount of Rs 295 per
metric tonne of coal extracted as an additional levy. This compensatory
amount is based on the assessment made by CAG. It may well be that
the cost of extraction of coal from an underground mine has not been
taken into consideration by CAG, but in matters of this nature it is difficult
to arrive at any mathematically acceptable figure quantifying the loss
sustained. The estimated loss of Rs 295 per metric tonne of coal is,
therefore, accepted for the purposes of these cases. The compensatory
payment on this basis should be made within a period of three months
and in any case on or before 31-12-2014. The coal extracted hereafter till
31-3-2015 will also attract the additional levy of Rs 295 per metric tonne.”
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10. We have been informed in the course of arguments that the coal blocks in
question allocated to the petitioner have already been allocated to a third party. Learned
counsel for the petitioner states that the only issue that survives for consideration in this
petition relates to the liability of the petitioner to pay compensation towards the coal
extracted as an additional levy demanded by the respondent No.1 – UOI, in terms of the
directions issued in para 38 of the Second Judgment extracted above. Notably,
respondent No.1 – UOI has filed a contempt petition registered as Contempt Petition
(Criminal) No. 7/2016 alleging inter alia that the petitioner herein is in willful
disobedience of the First and Second Judgments that had directed payment of additional
levy compensatory amount @ Rs. 295 per MT on the allottees of the coal blocks which
was to be paid latest by 31st December, 2014. Stating that respondent No. 1 – UOI had
already filed Contempt Petition No. 2/2014 against prior allottees, the captioned
contempt petition has been filed against the petitioner herein on account of its failure to
pay the additional levy for the second phase, i.e., for coal produced from 25th
September, 2014 till 31st March, 2015 that was directed to be paid by 30th June, 2015.
11. Mr. Abhimanyu Bhandari, learned counsel for the petitioner has argued that the
erroneous inclusion of the name of the petitioner in the list of 46 allottees of coal blocks
and its mining lease area in the Schedule appended to the Ordinance as also the
erroneous inclusion of its name at serial No. 22 and 23 in Annexure-1 filed by the
respondent No. 1 – UOI before this Court, has resulted in cancellation /quashing of the
lease that was validly granted in its favour. The petitioner was neither the beneficiary of
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the Screening Committee Route nor of the Government Dispensation Route. It had
followed the correct procedure prescribed under the MMDR Act/MC Rules by submitting
an application for grant of a lease directly to the respondent No. 2 - State Government
and only after the latter had processed the application and recommended the same for
approval to the respondent No.1 – UOI, was the mining lease granted in favour of the
petitioner. Therefore, the petitioner ought not to be saddled with any compensation/levy
towards the coal extracted. Learned counsel submitted that had an opportunity of
hearing being granted to the petitioner, the above position would have been clarified but
no such opportunity was given.
12. Per Contra, Mr. Balbir Singh, learned ASG appearing for the respondent No.1 –
Union of India explained that the levy has been imposed in principle on the beneficiaries
of illegal allocation just like the petitioner herein. The additional levy is in the nature of
penalty as well as compensation for the loss caused to the public exchequer. He stated
that the object and purpose of imposition of the additional levy was that since the
process of allocation was found to be fundamentally flawed by this Court therefore, all
the beneficiaries of the said flawed process including the petitioner herein ought to suffer
the consequences and compensate the public exchequer for the loss caused. Stating
that as it was the Screening Committee constituted by the respondent No. 1 – UOI that
had identified Gotitoria (East and West Blocks) in Mohapani Coalfield in Madhya
Pradesh for captive mining by the petitioner herein to meet the coal requirements of the
captive power plant vide allocation letter dated 21st June, 1996, the petitioner was
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covered under both the judgments but it has failed to pay any amount towards additional
levy in the first phase that was to be paid on or before 31st December, 2014 and the
second phase that was to be paid on or before 30th June, 2015. He specifically referred
to the First Judgment in particular, para 125 thereof to urge that the petitioner’s name
was mentioned along with some other allottees in the 11th Meeting of the Screening
Committee held on 26th-27th September, 1997 and once the allocations made by the
Central Government on the recommendations of the Screening Committee have been
held by this Court to be illegal, the petitioner cannot claim any different treatment from
that extended to the other allottees. To rebut the contention of the learned counsel for
the petitioner that principles of natural justice have been violated in the instant case, as
the petitioner was not afforded an opportunity of hearing, learned ASG had drawn the
attention of this Court to the observations made in the Second Judgment to the effect
that all parties who were adversely affected, were duly given a hearing before the First
Judgment was pronounced. He submitted that the petitioner was afforded an opportunity
of hearing along with several other allottees and only thereafter the First and Second
Judgments were passed.
13. In his rejoinder, learned counsel for the petitioner has vehemently opposed the
submission made on behalf of the respondent No. 1 – UOI that the petitioner was
afforded an opportunity of hearing by the Court which he submits is quite apparent from
a perusal of para 24 of the Second Judgment, where this Court has itself observed that
“The judgment did not deal with any individual case. It dealt only with the process of
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allotment of coal blocks and found it to be illegal and arbitrary.” He reiterated the fact
that the mining lease was granted in favour of the petitioner in the same manner and
sequence as was approved by this Court in the First Judgment and therefore the
petitioner’s case did not fall foul of the said judgment. To reinforce the aforesaid stand,
learned counsel also alluded to the counter affidavit filed by the respondent No. 2 –
State Government on 09th February, 2016 which supports the plea of the petitioner that
the State Government’s decision to grant a mining lease in its favour was not the result
of any allocation letter issued by the Central Government and/or the Screening
Committee, but was based on its own independent consideration done strictly under the
provision of MMDR Act read with the MC Rules.
14. We have heard the rival submissions advanced by learned counsel for the parties
and perused the records in the backdrop of the First Judgment dated 25th August, 2014
and the Second Judgment dated 24th September, 2014 rendered in the case of
Manohar Lal Sharma (supra). The issue that requires to be answered in the instant
case is whether the petitioner was allocated coal mines through the Screening
Committee Route and/or the Government Dispensation Route. Only if the answer to the
said question is in the affirmative, would the respondent No. 1 – UOI be entitled to claim
compensatory payment from the petitioner in terms of the Second Judgment and not
otherwise.
15. A perusal of the First Judgment leaves no manner of doubt that this Court held
that the practice and procedure adopted by the respondent No. 1 – UOI for allocation of
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coal blocks through the administrative route was not consistent with the statute and the
Rules and that the legal regime under the MMDR Act imposes a statutory obligation
upon the State Governments to recommend or not to recommend to the Central
Government, grant of prospecting license or mining lease for coal. This Court also
questioned the entire exercise of allocation of coal mines through the Screening
Committee Route and observed that it suffered from the vice of arbitrariness; that there
was no evaluation on merits and no inter se comparison of the applicants; that the
determination of the Screening Committee was subjective and most of the companies
which had been allocated coal blocks, were not engaged in the production of steel,
power or cement at the time of allocation and nor did they disclose in their applications
whether or not the power, steel or cement plants were operational. Noting the aforesaid
legal flaws that went to the root of the matter, the entire allocation of the coal blocks in
terms of the recommendations made by the Screening Committee in 36 meetings
conducted by it from 14thJuly, 1993 onwards and the consequential allocation through
the Central Government Dispensation Route were struck down as being unfair,
ambiguous and in gross breach of the guidelines.
16. To test the veracity of the submission made by the petitioner that in its case, the
procedure laid down was followed “to the T” for allocation of the coal blocks, it is
imperative to examine the chronology of the events and the documents placed on
record. Admittedly, the petitioner had submitted a mining lease application to the
Collector (Mining), Narsingpur, Madhya Pradesh on 8th November, 1994. The said
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application was forwarded to the Tehsildar, Gadarwara and the Mining Inspector,
Narsingpur for seeking an inspection report for the area applied for. Ground work was
done by the Tehsildar and the Mining Inspector who submitted a report of the proposed
area which in turn was confirmed by the Mine Surveyor. The map of the applied area
submitted by the petitioner was also certified by the Divisional Forest Officer and a
consent from Chief Conservator of Forest was obtained. Additionally, a mineral analysis
report was sought from the petitioner and after all the aforementioned information was
gathered and analyzed, the Collector, Narsingpur addressed a letter dated 15th May,
1995 to the Principal Secretary, Mineral Resource Department, Bhopal (Madhya
Pradesh) stating inter alia that if no Government authorized unit was prepared to operate
in the area and the petitioner is granted the lease, it would result in development of the
area and generation of employment. Therefore, the Collector (Mining) recommended
grant of a mining lease for a period of 30 years to the petitioner in accordance with the
Rules and the policy of the Government. Based on the aforesaid input received from the
Collector (Mining), Narsingpur, the respondent No. 2 – State Government wrote a letter
dated 23rd December, 1995 to the respondent No. 1 – UOI specifically stating inter alia
that the petitioner had furnished all the relevant information as required under Rule 22
(3) (d) (e) (f) and (g) of the MC Rules, 1960 along with the coal mining plan of the
specified area and after examination, the petitioner was found to be eligible under the
Rules for grant of a mining lease. Stating that prior approval of the Central Government
was necessary under Section 5(1) of the MMDR Act, the respondent No. 2 – State
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Government requested the respondent No. 1 – UOI to grant requisite approval in favour
of the petitioner. It was in the aforesaid background that the recommendation received
from the respondent No. 2- State Government was acted on by the respondent No. 1 –
UOI and the letter dated 27th August, 1997 was issued granting approval of the mining
lease in favour of the petitioner.
17. The aforesaid sequence of events belies the plea taken by the respondent No. 1
– UOI that the mining lease was granted in favour of the petitioner solely on the basis of
the recommendations made by the Screening Committee. Simply because the petitioner
had participated in the meetings conducted by the Screening Committee cannot be held
against it. Participation in the said meetings can also not be taken to mean that the
petitioner had applied directly to the respondent No. 1 – UOI for grant of the mining
lease. In fact, the records reveal that the letter dated 21st June, 1996 issued by the
respondent No. 1 – UOI stating that the petitioner’s proposal for identification of the
captive mining block for supply of coal to the 24 MW captive power plant in Madhya
Pradesh was considered in the meeting of the Screening Committee and was approved,
never found its way to the respondent No. 2 – State Government. This position is borne
out on a perusal of the copies of the said letter endorsed by the respondent No. 1 – UOI
to different authorities. At Serial No. (iv), the name of the “Chief Secretary, Government
of Maharashtra, Mumbai” has been endorsed instead of the “Chief Secretary,
Government of Madhya Pradesh” which fact stand confirmed from the reply dated 10th
April, 2015 issued by the respondent No. 1 – UOI to an RTI query received by it. A
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similar stand has been taken by the respondent No. 2- State Government in its reply
dated 6th April, 2015 to an RTI query received by the concerned department. The
petitioner had also clarified that it had applied to the State Government for grant of a
mining lease through the District Collector, Narsingpur, Madhya Pradesh in the
prescribed form and it was the said proposal that had been recommended by the State
Government to the respondent No. 1 – UOI for necessary approval. The said position is
apparent from the letter dated 3rd July, 1996 addressed by the petitioner to the
respondent No. 1 – UOI. The letter dated 27th August, 1997 issued by the respondent
No. 1 – UOI to the respondent No. 2 – State Government, contents whereof are
extracted below for ready reference, is also on similar lines: -
“13011/1/96-CA Dated : 27.08.1997
To,
Shri A.K. Trivedi,
Under Secretary,
Department of Mineral Resources,
Government of Madhya Pradesh,
Ballav Bhawan,
Bhopal
Subject: Grant of mining lease over 2.49 sq. kms. of Mohpani Block M/s BLA
Industries-communication of Prior approval of the Central Government
Regarding.
Sir,
I am directed to refer to the endorsement of this Ministry’s letter of even
number dated 08.07.1997, addressed to Shri Anup Kumar Agarwalla, President,
BLA Industries, wherein it was stated that fresh recommendation of the State
Government for grant of Mining lease over 2.49 Sq. kms will be required.
However, this has been re-examined in this Ministry. It has been decided to
consider the recommendations of the State Government dated 23.12.95 for grant
of mining lease over 2.49 sq. kms. Particularly in view of the fact that the area
over which the mining plan has been prepared and approved and the area which
as been recommended by the State government for grant of mining lease, are
same, though the date of recommendation precedes substantially the date of
communication of the Central Government’s approval on the mining plan.
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2. In view of the above, the Central Government, on consideration of the
recommendations of the State Government vide their letter No. 3-72/95/12/2/5
dated 23.12.95 for grant of mining lease over an area of 249 .243 hectares in
Mohapani and two other villages in Narsinghpur District of Madhya Pradesh, the
approval of the Central Government for grant of mining lease in favour of M/s
BLA Industries over an area of 249.243 hectares as recommended is hereby
accorded under section 5(1) of the Mines and Minerals (Regulation and
Development) Act, 1957.
3. The area co-ordinates of the mining block of 2.49 Sq. Kms. Over which the
approval of the Central Government has been communicated for grant of mining
lease are detailed in the Annexure for accurate and correct physical identification
of the Coal Mining block. These may appropriately be incorporated in the mining
lease deed executed between the State Government and M/s BLA Industries
Limited. A copy of the lease deed may also be furnished to the Ministry of Coal.
Yours faithfully,
Sd/-
 (A. Banerjee)
 Director”
18. Another relevant aspect that tips the scale in favour of the petitioner is the
counter affidavit filed by the respondent No. 2 – State Government which is in
consonance with the plea taken by the petitioner that the decision to grant the mining
lease in its favour was not based on any allocation letter issued directly by the Central
Government and/or the Screening Committee, but was founded on an independent
consideration of the petitioner’s application made by the State Government and done in
accordance with the provisions of the MMDR Act read with the MC Rules. Respondent
No. 2 – State Government has also referred to its earlier affidavit dated 28th October,
2013 filed before this Court in the connected matters decided by the First Judgment,
wherein it had explained the procedure adopted for allocation of coal blocks by the
Screening Committee constituted by the Central Government and had categorically
averred that the said procedure was followed in all cases “Other than one”, where the
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application was made directly to the State Government and not to the Central
Government. The said one case was explained to be that of the petitioner herein.
19. In other words, the respondent No. 2 – State Government has affirmed the stand
taken by the petitioner that the procedure of allocation of the coal block through the
Screening Committee Route/Government Dispensation Route had not been followed in
the case of the petitioner and therefore there was no illegality in allocation of the
specified coal mines in its favour, unlike the other cases. In the light of the aforesaid
stand taken by the respondent No. 2 – State Government which can be co-related with
the correspondence placed on record, the plea of the respondent No. 1 – UOI that the
case of the petitioner was considered by the Screening Committee in its 9th, 10th, 14th
,
15th, 16th and 20th meetings, would not make the allocation illegal. No parity can be
drawn between the petitioner and the other allottees of the coal blocks when the
petitioner followed the correct procedure of applying through proper channel for grant of
a mining lease which application on being received, was routed by the Office of the
Collector (Mines), Narsingpur to the Mineral Resource Department, Government of
Madhya Pradesh and onwards to the respondent No. 1 – UOI, for prior approval.
20. Given the aforesaid facts and circumstances of the instant case, we find force in
the submission made by the learned counsel for the petitioner that the mining lease
granted in favour of the petitioner was not tainted by mala fides, as was the case of the
other allottees. It was the respondent No. 2 – State Government that had undertaken a
diligent exercise to examine the petitioner’s application before recommending its case to
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the respondent No. 1 – UOI for grant of the mining lease. Founded on the said
recommendations, the respondent No. 1 – UOI had issued the letter allocating the coal
block to the petitioner and not the other way round. Given the aforesaid position, the
respondent No. 1 - UOI ought not to have included the name of the petitioner and the
coal blocks allotted to it in Annexure – 1 filed before this Court that forms a part of the
Second Judgment. Taking the contents of the said Annexures – 1 and 2 filed by the
respondent No. 1 – UOI as true and correct, this Court passed the consequential order
directing payment of compensation as an additional levy. The fact that the petitioner did
not get an opportunity to inform the Court about the error on the part of the respondent
No. 1 – UOI of including its name in Annexure – 1 can be discerned from the
observations made in para 24 of the Second Judgment to the effect that the Court had
not dealt with any individual case but only with the process of allotment of coal blocks
which was found to be fatally flawed.
21. It is therefore held that allocation of the coal block made in form of the petitioner
did not run foul of the procedure prescribed in the MMDR Act and the MC Rules. The
petitioner was not allocated the coal block either through the Screening Committee
Route or the Central Government Dispensation Route, which fact was not pointed out by
the respondent No. 1 – UOI at the appropriate stage, that led to painting the petitioner
with the same brush as the other allottee listed in Annexures – 1 and 2. Having held that
the petitioner was not a beneficiary of the flawed process, the consequences spelt out in
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the Second Judgment would not apply to it and therefore, it cannot be called upon to pay
penalty as compensatory payment, as demanded by the respondent No. 1 – UOI.
22. The upshot of the aforesaid discussion is that the respondent No. 1 – UOI is not
entitled to claim payment of an additional levy for the coal extracted by the petitioner
from the subject mine. Any such demand raised by the respondent No. 1 – UOI is
hereby quashed and set aside. The writ petition is allowed on the aforesaid terms.
Contempt Petition (Crl.) No.7 of 2016 is dismissed as meritless.
23. Before parting with this matter, we are constrained to make certain observations
regarding the conduct of the respondent no. 1 – UOI. Here is a case where a private
party followed all the rules and the law, as applicable, before investing large sums of
money to undertake business. In fact, it appears from the facts of the case that it was
the respondent no. 1 – UOI that did not follow the letter of the law. But ultimately, it was
the private party that had to suffer the consequences of the careless and callous
approach of the respondent no. 1 – UOI. To compound the petitioner’s woes, the
respondent no. 1 – UOI filed an affidavit before this Court including the petitioner in the
list of errant mine owners, based on its own unlawful conduct. It did not undertake the
necessary due diligence to determine as to whether the petitioner had been allotted the
mine through the lawful procedure. As a result of this callous, careless and casual
approach of the respondent no. 1 – UOI, the present petitioner had to suffer loss and
ignominy.
Page 18 of 19
WP (C) No. 63 of 2015 and Contempt Petition (Crl.) No.7 of 2016 in WP (Crl.) No.120 of 2012
24. Therefore, litigation costs quantified at ₹ 1,00,000/- (Rupees one lakh) shall be
paid by the respondent No.1 – UOI to the petitioner within four weeks.
………………………CJI.
 [N.V. RAMANA]
.................................J.
 [KRISHNA MURARI]
 ...................................J.
 [HIMA KOHLI]
NEW DELHI,
AUGUST 17, 2022
Page 19 of 19

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