Transportation doesn’t form the part of Mining operation

Rabia Basaria | Panjab University, Chandigarh | 3rd February 202

State of Odisha and Ors. Vs.  M/s Jindal Steel and Power Ltd and Ors. Civil Appeal No. 850 of 2020

FACTS:

• Herein, JSPL – Jindal Steel and Power Ltd; SMLP – Sarda Mines Pvt. Ltd; CEC – Central Environment committee.

• JSPL has entered into an arrangement with SMPL to purchase certain iron ore which was to be processed and transported to JSPL’s plant. The mining activities were conducting by SMPL and possession of the stock handed over to JSPL with SMPL’s leasehold area.
• On 31-03-14, letter issued by Deputy Director of Joda (Odisha) stating SMPL’s environmental clearance for enhanced production has expired. Hence transit permit could not be granted to JSPL for transporting the processed iron ore from dispatch point.
• JSPL approached the State authority contending that stock lying at the dispatch point owned by JSPL and royalty had also been paid on it. But same was rejected by the State authority through letter.
• Aggrieved, JSPL approached the High Court challenging the decision of State authority.
• High Court held that mining operation doesn’t include transportation and High Court quashed the appellant’s letter refusing transit permit.

CONTENTION’S OF PARTIES:

• Appellant contended that SMPL has extracted far more than the permit limit i.e. 4 MPTA and at least some part of the ore sold to JSPL came from this unauthorized excess production and JSPL could not be said to have validly to procure the material. Further appellant claim that mining operation covers the transportation within the leasehold area.
• Respondent (JSPL) submitted that it is only seeking the transportation of the ore already procured, processed, and stored at the dispatch point prior to the expiry of the environment clearance of SMPL and also claimed the transportation was not to be the part of mining process. And as per Clause 5 of Part – IX of Form K (Model Form of Mining Lease under Rule 31(1) of MC Rules, 1960) lifting and transportation of minerals were claimed as allowed upto 6 month after the expiry of the lease.
• During the pendency of this appeal SMPL filed an application for intervention, to this court directed SMPL to pay its due as assessed by CEC. SMPL filed another application for extending the time limit till the end of February for ding the needful.
• ICICI Bank and the State Bank of India have also filed intervention application stating that they would be adversely affected if transit permit would not be granted to JSPL, as they have granted sum to the JSPL.
• JSPL has also filed an application seeking directions to allow it to transport the iron ore and direction to the State of Odisha to grant necessary transit permit.

HELD:

The court disposes all the I.A.’s and civil appeals with the following directions:-

• SMPL’s prayer for extending the time limit to pay its due is accepted. SMPL must pay its due and give requisite undertaking by 29 February, 2020. After which it shall be allowed to resume its mining operation as per order dated 15-01-2020, As per its own will.
• Once SMPL complies with direction (1) above. JSPL can lift the processed iron ore lying at the dispatch point with SMPL’s premises. Proceeds thereof must be deposited with Trust & Retention Account under the custody of State Bank of India.
• Failure to comply with these directions shall result in any such sale being deemed legally void.