Patna High Court

Bimal KumarversusThe State of Bihar

Decided: 16 April 2026
Disposal: ALLOWED
Bench: SANDEEP KUMAR

Holding

The forfeiture of the petitioners' security deposits without affording a hearing violated natural justice, rendering the collectors' orders ultra vires and subject to quashment.

Summary

The petitioners, successful bidders for sand ghats in Rohtas and Bhojpur, deposited security deposits but later claimed that sand replenishment after the 2023 monsoon was insufficient, reducing mineral potential and making mining unfeasible. The District Collectors forfeited the deposits and revoked work orders under Rule 28(1) of the Bihar Minerals Rules, 2019 for failure to pay the first royalty installment. The petitioners argued that the forfeiture was illegal, that Rule 28(1) does not apply to sand settlements governed by Chapter V, and that natural‑justice requirements of a hearing were ignored. The State contended that the bidders were contractually bound to pay the installment and that the forfeiture was authorized by the Rules and tender clauses. The Court held that the forfeiture without a show‑cause notice violated the principles of natural justice, quashed the collectors' orders, and remitted the matters for a fresh replenishment study and a reasoned order after hearing.

Issues considered

The applicability of Rule 28(1) of the Bihar Minerals (Concession, Prevention of Illegal Transportation and Storage) Rules, 2019 to sand‑settlement cases.
Whether the forfeiture of security deposits without a hearing violates the principles of natural justice.
Whether the reduction in sand replenishment after the 2023 monsoon justifies relief under contract frustration.
Whether the tender clauses and statutory provisions mandate forfeiture despite the alleged change in mineral potential.

Subjects

sand mining
security deposit forfeiture
natural justice
replenishment study
mineral lease
e‑auction
Rule 28
Rule 29A
environmental clearance
contract frustration
administrative law

Judgment

IN THE HIGH COURT OF JUDICATURE AT PATNA
Civil Writ Jurisdiction Case No.10740 of 2025
======================================================
Bimal Kumar Son of Shyam Sundar Yadav, Resident of Kurji More, Sadaquat
Ashram, P.S. Digha, District- Patna, Bihar.

... ... Petitioner
Versus

1. The State of Bihar through the Commissioner-Cum-Principal Secretary,
Department of Mines and Geology, Government of Bihar, Vikas Bhawan,
Bailey Road, Patna 800001.
2. The Principal Secretary cum Commissioner Mines, Department of Mines
and Geology, Government of Bihar, Vikas Bhawan, Bailey Road, Patna-
800001.
3. The Director, Mines and Geology Department, Government of Bihar, Vikas
Bhawan, Bailey Road, Patna.
4. The District Magistrate-cum-Collector, Rohtas, Sasaram.
5. The Mineral Development Officer, Rohtas, Sasaram.

... ... Respondents
======================================================
with
Civil Writ Jurisdiction Case No. 7128 of 2025
======================================================
Nagendra Kumar Son of Mudrika Rai Resident of New Gosai Tola, Sultanpur
Road, Dr. D.Ram, DAV Public School, Ward no. 20, Danapur Khagaul, P.O.
and P.S. - Danapur, District-Patna-801503.

... ... Petitioner
Versus

1. The State of Bihar through the Commissioner-Cum-Principal Secretary,
Department of Mines and Geology, Government of Bihar, Vikas Bhawan,
Bailey Road, Patna. 800001.
2. The Principal Secretary, Cum Commissioner Mines, Department of Bihar,
Vikas Bhawan, Bailey Road, Patna. 800001.
3. The Director, Mines and Geology Department, Government of Bihar, Vikas
Bhawan, Bailey Road, Patna.
4. The District Magistrate-Cum-Collector, Bhojpur.
5. The Mineral Development Officer, Bhojpur.

... ... Respondents
======================================================
Appearance :
In C.W.J.C. No.10740 of 2026

For the Petitioner : Mr. Suraj Samdarshi, Advocate
Patna High Court CWJC No.10740 of 2025 dt.16-04-2026
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Mr. Avinash Shekhar, Advocate
Ms. Simran Kumari, Advocate
Ms. Abhilasha Jha, Advocate
For the State : S.C.-26
For the Mines Department: Mr. Naresh Dikshit, Spl. P.P.
Mr. Brij Bihari Tiwari, Advocate
Ms. Shruti Singh, Advocate
In C.W.J.C. No.7128 of 2026

For the Petitioner : Mr. Suraj Samdarshi, Advocate
Mr. Avinash Shekhar, Advocate
Ms. Simran Kumari, Advocate
Ms. Abhilasha Jha, Advocate
For the State : G.A.-7
For the Mines Department : Mr. Naresh Dikshit, Spl. P.P.
Mr. Brij Bihari Tiwari, Advocate
Ms. Shruti Singh, Advocate
======================================================
CORAM: HONOURABLE MR. JUSTICE SANDEEP KUMAR
C.A.V. JUDGMENT
Date : 16-04-2026

Since both these cases involve similar factual

position and questions, they have been heard together and are

being disposed of by this common judgment.

2. In these cases, primarily the petitioners have

challenged the orders passed by the respective District

Magistrate-cum-Collector, by which the security deposit of the

petitioners for settlement of sand ghats have been forfeited

under Rule 28(1) of the Bihar Minerals (Concession, Prevention

of Illegal Transportation and Storage) Rules, 2019 and the in-

principal work orders have been revoked on the ground that the

petitioners have not deposited their respective first installment

of the royalty.

3. For convenience, the prayer made in both the

cases are being reproduced herein-below:-
Patna High Court CWJC No.10740 of 2025 dt.16-04-2026
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Re:- C.W.J.C. No.10740 of 2025

“(i) For issuance of a writ, order or direction in the
nature of certiorari for quashing memo no. 758
dated 11.05.2024 (Annexure-18) issued by the
Respondent Collector, Rohtas, whereby and
whereunder the security deposit of Rs.
8,97,34,500/- (Rupees Eight Crores, Ninety
Seven Lakhs, Thirty Four Thousand and Five
Hundreed Only) furnished by the petitioner for
settlement of Rohtas Sand Ghat No. 13 has been
forfeited under Rule 28(1) of the Bihar Minerals
(Concession, Prevention of Illegal
Transportation and Storage) Rules 2019 and the
in-principal work order contained in letter
no.4491 dated 26.11.2022 has been revoked on
the ground that the petitioner has not deposited
the first installment of the royalty and
commenced operation of the sand ghat.
(ii) For issuance of a writ, order or direction in the
nature of mandamus commanding the
Respondents to refund the security deposit of Rs.
8,97,34,500/- deposited by the petitioner for
settlement of Rohtas Sand ghat No.13 since the
contract between the petitioner and the
Department of Mines and Geology stands
frustrated due to unforeseen events which have
occurred after formation of the contract,
rendering its performance impossible and
fundamentally different from what the parties
originally intended.
iii. This Hon’ble Court may adjudicate and hold
that the petitioner cannot be compelled to pay
Patna High Court CWJC No.10740 of 2025 dt.16-04-2026
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the entire settlement amount when the mineral
potential of the sand ghat has been reduced that
too for no fault on the part of the petitioner.
iv. This Hon’ble Court may adjudicate and hold
that a sand ghat cannot be settled and allowed
to be operated without there being
replenishment study of the year 2023 as
contemplated under the Enforcement &
Monitoring Guidelines for Sand Mining 2020.
v. To award any other relief or reliefs for which the
petitioner is found entitled in the facts and the
circumstances of the case.”
Re:- C.W.J.C. No.7128 of 2025

(i) For issuance of a writ, order or direction in the
nature of certiorari for quashing memo no. 1919
dated 29.04.2024 (Annexure 18) issued by the
Respondent Collector, Bhojpur, whereby and
whereunder the security deposit of Rs.
2,00,47,500/- (Rupees Two Crores Forty Seven
Thousand Five Hundred Only) furnished by the
petitioner for settlement of Bhojpur Sand Ghat
No. 01 has been forfeited under Rule 28(1) of
the Bihar Minerals (Concession, Prevention of
Illegal Transportation and Storage) Rules, 2019
on the ground that the petitioner has not
deposited the first installment of the royalty and
commenced operation of the sand ghat.
ii) For issuance of a writ, order or direction in the
nature of mandamus commanding the
Respondents to refund the security deposit of Rs.
2,00,47,500/- (Rupees Two Crores Forty Seven
Thousand Five Hundred Only) deposited by the
Patna High Court CWJC No.10740 of 2025 dt.16-04-2026
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petitioner for settlement of Bhojpur Sand ghat
No. 01 since the contract between the petitioner
and the Department of Mines and Geology
stands frustrated due to unforeseen events which
have occurred after formation of the contract,
rendering its performance impossible and
fundamentally different from what the parties
originally intended.
iii. This Hon’ble Court may adjudicate and hold
that the petitioner cannot be compelled to pay
the entire settlement amount when the mineral
potential of the sand ghat has been reduced that
too for no fault on the part of the petitioner.
iv. This Hon’ble Court may adjudicate and hold
that a sand ghat cannot be settled and allowed
to be operated without there being
replenishment study of the year 2023 as
contemplated under the Enforcement &
Monitoring Guidelines for Sand Mining 2020.
v. To award any other relief or reliefs for which the
petitioner is found entitled in the facts and the
circumstances of the case.”

4. The Department of Mines and Geology,

Government of Bihar, floated tenders for e-auction of sand

ghats in different districts of the State including Rohtas Sand

Ghat No.13 and Bhojpur Sand Ghat No.01, which are subject

matter of these two writ petitions. The petitioners in both these

cases emerged as the highest bidder for Rohtas Sand Ghat No.

13 and Bhojpur Sand Ghat No. 01 respectively. The reserve
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price of Rohtas Sand Ghat No.13 was Rs.15,60,60,000/- against

which the petitioner - Bimal Kumar quoted Rs.35,89,38,000/-

and the reserve price of Bhojpur Sand Ghat No.01 was

Rs.7,29,00,000/- against which the petitioner - Nagendra Kumar

quoted Rs. 8,01,90,000/-. Thereafter, both the petitioners

deposited the requisite security deposit i.e. 25% of the

auction/bid amount, after adjustment of earnest money deposit.

5. Consequently, respective in-principle work

orders were issued in favour of the petitioners by the concerned

authorities and both the petitioners submitted the required

mining plans, which were approved by the competent authority.

After approval of the Mining Plans, both petitioners approached

the State Environment Impact Assessment Authority (SEIAA)

for issuance of Terms of Reference and further environmental

clearance, which were granted to them.

6. It is the case of the petitioners that since the

mineral potential of the sand ghats had reduced considerably

considering the fact that there was no replenishment of sand

during the monsoon season of the year 2023, the petitioners

were reluctant to commence mining operations at their

respective sand ghats, as according to the petitioners, the same

would have caused heavy financial losses to the petitioners.
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7. It is the further case of the petitioners that

after the monsoon season of 2023, there was no sufficient

replenishment of sand, resulting in substantial reduction in the

mineral potential of the respective sand ghats. Further, no

replenishment study was conducted after the monsoon season of

2023, although such exercise is mandatory under the

Enforcement & Monitoring Guidelines for Sand Mining, 2020

(EMGSM, 2020), particularly for assessing actual replenishment

and sustainable extraction. The petitioner - Nagendra Kumar,

upon learning about the reduced availability of sand, addressed

a representation dated 22.09.2023 to the Member Secretary,

SEAC, requesting that the environmental clearance be granted

only after physical verification of the sand ghat but despite the

aforesaid representation, the environmental clearance was

granted to the petitioners without proper consideration of the

issue of non-replenishment and reduced mineral potential.

8. According to the petitioners, at the time of

participating in the auction, they had inspected the respective

sand ghats and found sufficient sand availability but the

depletion in mineral potential occurred only thereafter, during

the period which was consumed in obtaining approvals and

clearances and such depletion may have occurred due to lack of
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replenishment during monsoon and/or illegal or excessive

mining by prior operators or third parties. It is the case of the

petitioners that they, under pressure, from the mining authorities

proceeded further and applied for Consent to Establish (CTE)

and Consent to Operate (CTO) from Bihar State Pollution

Control Board.

9. It is also the case of the petitioners that they

did not commence mining operations even after obtaining

necessary permissions since their consistent stand is that the

actual mineral potential had been seriously reduced due to

absence of post-monsoon replenishment. Further, the petitioners

received several letters from the respondent authorities for

making the payment of first installment in lieu of mining lease

granted in their favour but they did not pay the required

payment and ultimately, vide impugned orders the security

deposits of the petitioners have been forfeited by the

respondents under Rule 28(1) of the Bihar Minerals

(Concession, Prevention of Illegal Mining, Transportation and

Storage) Rules, 2019 on the ground that the petitioners did not

deposit the first installment of royalty and had not commenced

operation of the sand ghats.

10. Learned counsel for the petitioners submits
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that the impugned orders forfeiting the security deposits of the

petitioners are illegal, arbitrary and unsustainable in law in view

of the fact that there had been no adequate replenishment of

sand after monsoon 2023 and no fresh replenishment study of

the respective sand ghats had been conducted in terms of the

guidelines of the E.M.G.S.M., 2020. He further submits that the

actual mineral potential of the respective sand ghats had

materially reduced after the auction and before the petitioners

could even commence the operation of mining on the sand

ghats.

11. It has been submitted by learned counsel for

the petitioners that the petitioners had already undertaken all

required compliance and were not responsible for the depletion

of the availability of sand in the sand ghats.

12. It is submitted that the petitioners have been

proceeded against merely on the allegation that they did not

deposit the first installment of royalty/settlement amount and

did not commence operation of the respective sand ghats. On

this ground alone, the respondents invoked Rule 28(1) of the

2019 Rules, along with certain clauses of the tender document,

and proceeded to forfeit the security deposits of the petitioners.

13. It is the categorical submission of learned
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counsel for the petitioners that Rule 28(1) of the 2019 Rules will

not apply in the present case since the said provision forms part

of Chapter IV of the Rules, which governs the procedure for

grant of mining lease ‘except sand’. Sand settlement, on the

other hand, is specifically governed by Chapter V, namely Rules

29A to 30, which constitutes a distinct and self-contained Code

in relation to the settlement, operation and obligations

pertaining to sand ghats. Once the Rules themselves maintain

this legislative distinction, the respondents could not have

lawfully borrowed Rule 28(1) from a different chapter and

applied it to sand settlees.

14. It is the submission on behalf of the

petitioners that the action of the respondents in forfeiting the

security deposits of the petitioners cannot be justified unless

there exists a clear and specific statutory authority. Further, the

respondents could not have compelled the petitioners to proceed

with the settlement and commence mining operations without

first resolving the foundational issue of actual mineral

availability in the concerned sand ghats. It is the contention of

the petitioners that the actual mineral potential of the respective

sand ghats materially changed after the auction and before the

commencement of operation, and yet the respondents proceeded
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as though the originally assumed reserve of sand remained

intact. It is argued that such conduct is arbitrary and reflects

complete non-application of mind and therefore, the impugned

orders are liable to be set aside.

15. It is the categorical submission of learned

counsel for the petitioners that no post-monsoonal

replenishment study for the year 2023 was conducted in respect

of the concerned sand ghats, though such study is integral to the

sustainable sand mining practice. The EMGSM, 2020 expressly

recognises replenishment assessment as an essential component

of sustainable sand mining. The purpose of such study is to

ascertain the quantity replenished after monsoon, determine

actual mineable quantity, prevent ecological over-exploitation,

and regulate extraction on a scientific basis. In the absence of

such a study, the respondents could not have lawfully presumed

that the original mineral potential remained unchanged.

16. It is the submission of learned counsel for

the petitioners that at the time of participating in the auction,

they had inspected the respective sand ghats and had found

sufficient availability of sand, and their bids were made on the

basis of the mineral potential as it then existed and as

represented by the tender and related records. The bid amounts
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themselves demonstrate the bona fides of the petitioners.

17. It is submitted that the petitioners acted bona

fide throughout and were never an unwilling or defaulting

bidder. They did not abandon the settlement after being declared

successful, nor did they refuse to proceed at the threshold stage.

On the contrary, both the petitioners deposited the required

security amounts and thereafter complied with the mandatory

procedural requirements and finally obtained environmental

clearance in their favour and thereafter obtained Consent to

Establish and Consent to Operate. Such conduct is wholly

inconsistent with any allegation that the petitioners never

intended to perform their obligations.

18. It has further been submitted that the

petitioners have specifically requested the authority that

environmental clearance be granted only after physical

verification of the sand ghats since the mineral availability had

materially reduced, which clearly shows that the issue of non-

availability of sand in the sand ghats has been raised at the

initial stage. It has further been submitted that though the

petitioner - Bimal Kumar could not furnish separate detailed

replies to each departmental communications during the

relevant period, as he was unwell, such circumstance cannot
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defeat the petitioners’ substantive case.

19. It is the submission of learned counsel for

the petitioners that the respondents cannot take shelter of the

tender conditions to validate an action otherwise unsupported by

the governing statutory rules. Even otherwise, the tender clauses

relied upon by the respondents cannot be applied mechanically.

20. It is submitted that Clause 42(xix) of the

N.I.T. cannot preclude objection where the reduction in mineral

potential occurred after the auction and before commencement

of mining due to supervening developments. It is the submission

on behalf of the petitioners that their grievance is not based on

some pre-existing issue that ought to have been discovered

earlier, but on a post-auction change in the physical condition of

the sand ghats. Hence, the petitioners cannot be put to

disadvantage.

21. Learned counsel for the petitioners has

argued that even though the dispute has arisen in the context of

a tender and settlement arrangement, however, the conduct of

the respondent-State remains subject to constitutional standards

of fairness, reasonableness and non-arbitrariness. The State

cannot claim immunity from judicial review merely because the

relationship has a contractual element. Where the authority acts
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under colour of statutory power, invokes an inapplicable rule,

disregards environmental and scientific concerns, ignores bona

fide objections, and imposes penal financial consequences, its

action squarely attracts writ jurisdiction.

22. In support of this proposition, the petitioners

rely upon the decision of the Hon’ble Supreme Court in the case

of Joshi Technologies International Inc. vs. Union of India,

reported as (2015) 7 SCC 728, to contend that judicial review

remains available where State action in the contractual field is

arbitrary, unfair, unsupported by law, or violative of public law

obligations.

23. It has further been argued by learned counsel

for the petitioners that a replenishment study conducted in the

year 2022 cannot conclusively determine the actual mineral

availability after subsequent extraction. A full monsoon cycle

and the admitted absence of any updated replenishment study

for the year 2023 also cast doubt on the earlier replenishment

study conducted in the year 2022. It has further been argued that

once the petitioners raised grievance regarding non-availability

of sand, the respondent authorities ought to have conducted a

replenishment study to ascertain the actual availability of sand

and its replenishment rate.
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24. Per contra, the learned counsel for the

answering respondents has submitted that these writ petitions

are wholly misconceived and liable to be dismissed, as the

impugned orders have been passed in accordance with law and

after giving several opportunities to the petitioners to pay the

first installment and when the petitioners failed to pay the same,

the impugned orders forfeiting the earnest money of the

petitioners have been passed.

25. It is submitted by learned counsel for the

answering respondents that the petitioners have consciously

participated in the e-auction process and qualified in the

technical bid and thereafter participated in the auction held on

21.11.2022, and emerged as the highest bidders. Having

voluntarily participated in the auction with full knowledge of

the terms and conditions, the petitioners cannot now resile from

the obligations flowing from the very tender process.

26. It has further been submitted by learned

counsel for the answering respondents that under the governing

framework, the petitioners were mandatorily required to deposit

the first installment of the settlement amount before issuance of

work order and commencement of mining.

27. Adverting to Clause 19(iii) of the Tender
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Document, learned counsel for the answering respondents

submits that on perusal of the aforesaid clause, it is clear that

failure to comply with the prescribed formalities and payment

obligations, attracts the forfeiture of security deposit.

28. Learned counsel for the answering

respondents have drawn attention to Clauses- 41 and 42(xxxix)

of the Tender Document to contend that the settlee must adhere

to the Mining Rules, 2019. Further, Rule 29A(5) of the Bihar

Minerals Rules, 2019 clearly provides that if the successful

bidder fails to deposit the required amount and other payable

dues within the prescribed period, as referred to in the

prevailing Government Notification, the security deposit shall

be forfeited and fresh settlement process shall be initiated.

Therefore, the impugned action is not de hors the Rules, but is

traceable to the statutory and policy structure governing sand

settlements.

29. It has further been submitted that in the

Notification dated 10.05.2024 issued by the Department of

Mining & Geology, Government of Bihar, it has been clarified

that the successful bidder must deposit the first installment

within the prescribed period after obtaining CTE/CTO and

execute the agreement, failing which the Letter of Intent is
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liable to be revoked and the security deposit forfeited.

30. It has further been submitted by learned

counsel for the answering respondents that the inaction on the

part of the petitioners has directly prejudiced the public

exchequer since the settlement period of five years is reckoned

from the date of execution of agreement and the failure on the

part of the petitioners to deposit the first installment and execute

the agreement delayed commencement of the settlement and

caused loss of revenue to the State. The Collectors, therefore,

acted not only within law but also in discharge of their

obligation to protect public revenue and preserve the integrity of

the auction process.

31. Learned counsel for the answering

respondents has rebutted the contention of the petitioners that a

fresh replenishment study was necessary before enforcing the

settlement and has submitted that the District Survey Report

(DSR) had already been duly approved by the competent

authority and the mineable quantity stood reflected therein and

futher the Environmental Clearance was also granted to the

petitioners on that basis. The N.I.T. and the auction process were

founded on this approved DSR. Therefore, according to the

respondents, there was no legal necessity for a separate
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replenishment study at the stage now suggested by the

petitioners.

32. It has next been submitted by the learned

counsel for the answering respondents that the petitioners

instead of availing the remedy of appeal against the order of the

Collectors, they have directly approached this Court by way of

these writ petitions, which is impermissible and on this ground

also, the writ petition is liable to be dismissed.

33. I have considered the submissions of the

parties and perused the materials available on record.

34. The petitioners have emerged as the highest

bidders in the respective auction processes and subsequently,

they have completed the necessary formalities of securing

clearances and approvals from the respondent authorities. In the

interregnum, the petitioners claims that the availability of sand

in their respective sand ghats had reduced significantly

rendering the mining as not feasible. Despite repeated

communications by the respondent authorities, the petitioners

did not deposit the first installment of royalty and as a

consequence thereof, the security deposit of the petitioners were

forfeited and the in-principal work orders were revoked.

35. This Court has noted that the respondents
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have forfeited the security deposits of the petitioners without

affording an opportunity of hearing to the petitioners and

without issuing a show-cause notice, which clearly violates the

principles of nature justice.

36. Recently, the Hon’ble Supreme Court in the

case of Krishnadatt Awasthy vs. State of M.P. & Ors., reported

as (2025) 7 SCC 545 has emphasized on the imperativeness of

principles of natural justice, particularly, before an

administrative authority acting as a quasi judicial function and

has held as under:-

“43. The opportunity of hearing is considered so
fundamental to any civilised legal system that
the courts have read the principles of natural
justice into an enactment to save it from being
declared unconstitutional on procedural
grounds [Olga Tellis v. Bombay Municipal
Corpn., (1985) 3 SCC 545] .
44. It has been argued before us that if the failure to
provide hearing does not cause prejudice,
observing the principle of natural justice may
not be necessary. In this context, a three-Judge
Bench of this Court in S.L. Kapoor v. Jagmohan
[S.L. Kapoor v. Jagmohan, (1980) 4 SCC 379]
speaking through Chinappa Reddy, J.
considered such arguments to be “pernicious”
and held that “[t]he non-observance of natural
justice is itself prejudice to any man and proof
of prejudice independently of proof of denial of
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natural justice is unnecessary”. The Supreme
Court, however, has drawn out an exception
where “on the admitted or indisputable facts
only one conclusion is possible, and under the
law only one penalty is permissible, then the
Court may not compel the observance of natural
justice” [Swadeshi Cotton Mills v. Union of
India, (1981) 1 SCC 664 : (1981) 51 Comp Cas
210; Aligarh Muslim University v. Mansoor Ali
Khan, (2000) 7 SCC 529 : 2000 SCC (L&S)
965].
45. Professor I.P. Massey [I.P. Massey,
Administrative Law (8th Edn., 2012).] has
commented on this shift as under:
“Before the decision of the highest Court
in S.L. Kapoor v. Jagmohan [S.L. Kapoor
v. Jagmohan, (1980) 4 SCC 379], the
rule was that the principles of natural
justice shall apply only when an
administrative action has caused some
prejudice to the person, meaning thereby
that he must have suffered some “civil
consequences”. Therefore, the person
had to show something extra in order to
prove “prejudice” or civil consequences.
This approach had stultified the growth
of administrative law within an area of
highly practical significance. It is
gratifying that in Jagmohan [S.L. Kapoor
v. Jagmohan, (1980) 4 SCC 379] , the
Court took a bold step in holding that a
separate showing of prejudice is not
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necessary. The non-observance of
natural justice is in itself prejudice
caused. However, merely because facts
are admitted or are undisputable it does
not follow that the principles of natural
justice need not be observed.”
46. In State Bank of Patiala v. S.K. Sharma [State
Bank of Patiala v. S.K. Sharma, (1996) 3 SCC
364 : 1996 SCC (L&S) 717], the Supreme Court
observed that where an enquiry is not convened
by any statutory provision and the only
obligation of the administrative authority is to
observe the principles of natural justice, the
court/tribunal should make a distinction
between a total violation of the rule of fair
hearing and violation of the facet of that rule. In
other words, a distinction must be made between
“no opportunity” or “no adequate
opportunity”. In the case of the former, the
order passed would undoubtedly be invalid and
the authority may be asked to conduct
proceedings afresh according to the rule of fair
hearing. But in the latter case, the effect of
violation of a facet of the rule of fair hearing
has to be examined from the standpoint of
prejudice.
47. In Dharampal Satyapal Ltd. v. CCE
[Dharampal Satyapal Ltd. v. CCE, (2015) 8
SCC 519 : (2015) 33 GSTR 1], this Court dealt
with the prejudice question as under: (SCC p.
540, para 42)
“42. So far so good. However, an
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important question posed by Mr Sorabjee
is as to whether it is open to the
authority, which has to take a decision, to
dispense with the requirement of the
principles of natural justice on the
ground that affording such an
opportunity will not make any difference?
To put it otherwise, can the
administrative authority dispense with
the requirement of issuing notice by itself
deciding that no prejudice will be caused
to the person against whom the action is
contemplated? Answer has to be in the
negative. It is not permissible for the
authority to jump over the compliance
of the principles of natural justice on
the ground that even if hearing had
been provided it would have served no
useful purpose. The opportunity of
hearing will serve the purpose or not
has to be considered at a later stage and
such things cannot be presumed by the
authority. This was so held by the
English Court way back in the year 1943
in General Medical Council v. Spackman
[1943 AC 627 (HL)]. This Court also
spoke in the same language in Board of
High School & Intermediate Education,
U.P. v. Chitra Srivastava [Board of High
School & Intermediate Education, U.P. v.
Chitra Srivastava, (1970) 1 SCC 121]
….”
Patna High Court CWJC No.10740 of 2025 dt.16-04-2026
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48. In a more recent decision in State of U.P. v
Sudhir Kumar Singh [State of U.P. v. Sudhir
Kumar Singh, (2021) 19 SCC 706] , the position
of law was summarised as under: (SCC pp. 748-
49, para 42)
“42. …42.1. Natural justice is a flexible
tool in the hands of the judiciary to reach
out in fit cases to remedy injustice. The
breach of the audi alteram partem rule
cannot by itself, without more, lead to the
conclusion that prejudice is thereby
caused.
42.2. Where procedural and/or
substantive provisions of law embody the
principles of natural justice, their
infraction per se does not lead to
invalidity of the orders passed. Here
again, prejudice must be caused to the
litigant, except in the case of a
mandatory provision of law which is
conceived not only in individual interest,
but also in public interest.
42.3. No prejudice is caused to the
person complaining of the breach of
natural justice where such person does
not dispute the case against him or it.
This can happen by reason of estoppel,
acquiescence, waiver and by way of non-
challenge or non-denial or admission of
facts, in cases in which the Court finds
on facts that no real prejudice can
therefore be said to have been caused to
Patna High Court CWJC No.10740 of 2025 dt.16-04-2026
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the person complaining of the breach of
natural justice.
42.4. In cases where facts can be stated
to be admitted or indisputable, and only
one conclusion is possible, the Court
does not pass futile orders of setting
aside or remand when there is, in fact, no
prejudice caused. This conclusion must
be drawn by the Court on an appraisal of
the facts of a case, and not by the
authority who denies natural justice to a
person.
42.5. The “prejudice” exception must be
more than a mere apprehension or even a
reasonable suspicion of a litigant. It
should exist as a matter of fact, or be
based upon a definite inference of
likelihood of prejudice flowing from the
non-observance of natural justice.”

37. In an another decision of the Hon’ble

Supreme Court in the case of Raghunath Thakur vs. State of

Bihar [(1989) 1 SCC 229] it has been held as under:-

"4. ... But it is an implied principle of the
rule of law that any order having civil
consequence should be passed only after
following the principles of natural
justice. It has to be realised that
blacklisting any person in respect of
business ventures has civil consequence
for the future business of the person
Patna High Court CWJC No.10740 of 2025 dt.16-04-2026
25/29

concerned in any event. Even if the rules
do not express so, it is an elementary
principle of natural justice that parties
affected by any order should have right
of being heard and making
representations against the order. In that
view of the matter, the last portion of the
order insofar as it directs blacklisting
ofthe appellant in respect of future
contracts, cannot be sustained in law....
…"
38. The doctrine of audi alteram partem has

three basic essentials. Firstly, a person against whom an order is

required to be passed or whose rights are likely to be affected

adversely, must be granted an opportunity of being heard.

Secondly, the authority concerned should provide a fair and

transparent procedure and lastly, the authority concerned must

apply its mind and dispose of the matter by a reasoned or

speaking order.

39. Considering the aforesaid decision of the

Hon’ble Supreme Court in the case of Krishnadatt Awasthy

(supra), it is clear that the principles of nature justice must be

adhered to strictly. However, in the present case, the same has

not been adhered to since the security deposits of the petitioners

have been forfeited without having been given an opportunity of

hearing. In my opinion, the petitioners should have been issued
Patna High Court CWJC No.10740 of 2025 dt.16-04-2026
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a proper show-cause notice and should have been given an

opportunity of hearing before forfeiture of the security deposit

by the petitioners.

40. In view of the aforesaid discussions, this

Court deems it appropriate that the violation of principle of

natural justice in the present case, warrants remand of the

present matters to the Collectors of Rohtas and Bhojpur districts

respectively for passing a reasoned and speaking order after

affording an opportunity of hearing to the petitioners in

consonance with the principles of natural justice.

41. At this stage, it is required to be noted that it

is settled that the mining activities cannot be permitted beyond

the annual replenishment rate since that would endanger the

environment and if the geological processes that naturally

replenish the availability of sand cannot match the rate at which

the mining occurs then over the period of time aggressive and

continued mining activity would result in long term

environmental damage. Therefore, sustainable development is

sine qua non to strike a balance between developmental

activities and the conservation of environment.

42. Recently, this Court in the case of Manjeet

Chawla vs. State of Bihar & Ors. reported as 2026 SCC
Patna High Court CWJC No.10740 of 2025 dt.16-04-2026
27/29

OnLine Pat 535 has already held that replenishment study is

sine qua non for sand mining projects.

43. The mining over river beds cannot be

permitted contrary to the replenishment rate of sand and that a

replenishment study must be undertaken since it forms the very

basis on which the quantity of permissible mining is determined

and subsequently the environmental clearance is granted. This

Court has noted that under Clause-5 of the Enforcement &

Monitoring Guidelines for Sand Mining, 2020 issued by the

Ministry of Environment, Forest & Climate Change, the need

for replenishment study is paramount in order to nullify the

adverse impact arising due to excessive and aggressive sand

extraction. Thus, the replenishment study is not merely to

ascertain the permissible quantity of sand for extraction but also

is necessary to minimize the adverse impact therefrom and

strike a balance between sand extraction / mining and

preservation of riparian habitat.

44. It is equally settled that the State holds all

natural resources including the minerals as a trustee of the

public and must deal with them in a manner consistent with the

nature of such a trust. What is clearly crystallized, therefore, is

that the annual extractable quantity must be less than the annual
Patna High Court CWJC No.10740 of 2025 dt.16-04-2026
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replenishment rate in order to align strictly with sustainable

mining practices.

45. For the foregoing reasons, in order to strike a

fair balance and keeping in view the sustainable mining

practice, this Court deems it appropriate and in the interest of

justice to direct the concerned respondent authorities to conduct

a fresh replenishment study for the Rohtas Sand Ghat No.13 and

Bhojpur Sand Ghat No. 01 by a competent authority / institution

to ascertain the present and true quantity of sand available in the

sand ghats and its replenishment rate, which have been allotted

to the petitioners. The aforesaid exercise must be completed

within eight weeks from today. The cost of the aforesaid

replenishment studies shall be borne by the petitioners

themselves.

46. Accordingly, the impugned orders contained

in memo no.758 dated 11.05.2024 passed by the Collector,

Rohtas and memo no.1919 dated 29.04.2024 passed by the

Collector, Bhojpur are hereby quashed and set aside. The matter

is remitted to the Collectors of Bhojpur and Rohtas districts for

passing a reasoned and speaking order after giving an

opportunity of hearing to the petitioners and after considering

the fresh replenishment study reports, which would be
Patna High Court CWJC No.10740 of 2025 dt.16-04-2026
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conducted in compliance of the aforesaid directions, for the

respective sand ghats.

47. The writ petitions are allowed to the above

extent.

(Sandeep Kumar, J)

pawan/-
AFR/NAFR N.A.F.R.
CAV DATE 19.01.2026
Uploading Date 16.04.2026
Transmission Date

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