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.

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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