Supreme Court of India

M/S INDIAN CHARGE CHROME LTD. AND ANR.versusUNION OF INDIA AND ORS.

Citation: 2006 INSC 986
Decided: 11 December 2006
Disposal: Disposed off
Bench: Y K SABHARWAL

Holding

The State Government may validly recommend reservation of the mining area for a government corporation under Section 17A(2), but the out‑of‑turn lease to Nava Bharat under Section 11(5) is invalid.

Summary

The Supreme Court examined multiple appeals concerning the allocation of chromite mining leases in Orissa. The State Government had recommended, under Section 17A(2) of the Mines and Minerals (Regulation and Development) Act, 1957, that a block of 436.295 hectares be reserved for exploitation by the state‑controlled Orissa Mining Corporation (OMC), seeking Central Government approval. It also granted an out‑of‑turn lease to Nava Bharat under Section 11(5) of the same Act, bypassing earlier applicants. The Court held that the State's power under Section 17A(2) is independent, not barred by prior judgments, and may be exercised until a lease is actually granted, but the lease to Nava Bharat was invalid as the conditions of Section 11(5) were not satisfied and Rule 59 of the Mineral Concession Rules, 1960, was breached. Consequently, the appeals of the State and OMC were allowed, the lease to Nava Bharat was set aside, and the transferred cases were disposed, with costs awarded to the parties.

Issues considered

The validity of the State Government's recommendation under Section 17A(2) of the Mines and Minerals Act to reserve mining area for a government corporation.
Whether prior Supreme Court and High Court directions preclude the State from exercising power under Section 17A(2).
The legality of granting an out‑of‑turn lease to Nava Bharat under Section 11(5) of the Act.
Whether the conditions of Section 11(5) and Rule 59 of the Mineral Concession Rules were complied with.
The requirement of Central Government approval for the State's recommendation under Section 17A(2).

Legislation cited

Mineral Concession Rules, 1960s. Rule 59
Mines and Minerals (Regulation and Development) Act, 1957s. 11(5), s. 17A(2)

Subjects

mining leaseMines and Minerals ActSection 11Section 17Aout‑of‑turn leasestatutory powerestoppelRule 59government corporationchromite ore

Judgment

A MIS INDIAN CHARGE CHROME LTD. AND ANR.
v.
UNION OF INDIA AND ORS.

DECEMBER 11, 2006

B [Y.K. SABHARWAL, CJ., C.K. THAKKERAND P.K.
BALASUBRAMANYAN, JJ.]

Mines and Minerals (Regulation and Development) Act, 1957; sections
C 11(5) & 17A (2)-Minera/ Concession Rules, 1960 ; Rule 59-
Recommendation by State to Central Government for approval to grant
mining lease to a State Corporation under the Act-Correctness of-Held,
State has power under the Act to make such recommendation-State cannot
be estoppedfrom exercising its statutory power-On facts, the recommendation
is neither mala fide nor a colourable exercise of power and hence, valid
D
Grant of mining lease out-ofturn by State to a private company in
preference to claimants steel companies-Correctness of-Held, on facts,
State has not fulfilled the conditions under the Act and Rules-No reasons
were disclosed and hence, the grant is unjustified and illegal.

E Challenges in all the appeals, transferred cases and the cases covered
by transfer petitions ate the correctness of the decision of the State
Government to grant lease of land for mining purpose to State Mining
Corporation and to grant out-of-turn lease to a steel company N in preference
to other applicants-steel companies claiming lease.

F The steel companies, who opposed grant of lease to the steel company
and the State Mining Corporation, contended that the Central Government
and not the State Government has power to grant lease to the Corporation
under section 17 A (2) of the Mines and Minerals (Regulation and
Development) Act, 1957 in view of the heading of the section; that the Central
G Government rejected the approval sought by the State Government u/s 17A
(2) of the Act; that the State Government u/s had not disclosed all relevant
material facts to Central Government about the efficiency of the Corporation;
that the decision is irrational; that the change of policy of allotting land is
ma/a fide and is a colourable exercise of power to defeat the earlier judgments
of the High Court and this Court; that the Committee, which was set up to
H . .. 640
INDIAN CHARGE CHROME LTD v. U.0.1. 641
look into distribution of lands of mining among the applicants-steel companies, A
rejected the grant of lease to the State Corporation; that no reasons were
given for granting out-of-turn lease to N and hence the lease was unjustified
and illegal; that conditions laid down under section 11(5) of the Act have not
been fulfilled and hence, the State Government cannot grant the lease to N;

Steel company N contended that the State Government granted lease to B
it in exercise of power conferred under section 11(5) of the Act.

The State and the State Mining Corporation contended that the ore is
required by many industries in the country and that ifthe whole area is divided
and given for private exploitation, there may be difficulty in ensuring equitable C
distribution of the ore; the power vested under sedion 17A of the Act was
independent of the power under section 11 of the Act; that it was always open
to the State Government with the approval of the Central Government to grant
lease to it under·the Act; that the decision of this Court in earlier proceedings
does not stand in the way of exercising power by the State Government under
~~ D
Disposing of the cases, the Court

HELD: 1.1. On the scheme of the Mines and Minerals (Regulation and
Development) Act, 1957, the decision or recommendation under section 17A
of the Act can be taken or made until the area in question is actually leased E
·. out to any applicant in terms of Section 11 of the Act. The power of the State
Government saved by Section 17 A (2) of the act is in no way fettered or
curtailed. It cannot be said that the recommendation made by the State
Government is per se invalid or that it is one without authority. The State
Government could exercise the power under section 17A (2) of the Act until
a grant is actually made since it is an overriding power. [652-D-F) F
1.2. The direction of the Court in earlier proceedings to deal with the
land on the basis of the recommendations of the Committee does not by itself
preclude the exercise of power by the State under Section 17A (2) of the act
to make a recommendation that the exploitation be left to a corporation owned G
or controlled by it. (653-A, BJ

1.3. Adoption of a particular stand by the State Government in earlier
proceedings cannot estop the State from taking a decision under Section 17A
(2) of the Act to recommend to the Central Government to grant lease to the
State Corporation so as to ensure a fair and just distribution of the scarce . H
642 SUPREME COURT REPORTS [2006] SUPP. IO S.C.R.

A mineral. The same cannot be taken to be malafide. The power under Section
17A (2) of the act is a statutory power and there could be no estoppel against
the exercise of statutory power. It cannot be said that the decision of the State
Government is vitiated by male fides or is borne of colourable exercise of power
or that it is irrational. [653-F-G; 654-A, CJ

B 1.4. The recommendation of the State government for the approval of
the Central Government for leasing out land to a State Corporation is well
within the power of the State Government under Section 17A (2) of the Act.
The heading of the Section cannot control the natural effect of sub-section
(2) of Sedion 17A of the Act or the power conferred by it. [654-F)
c 1.5. The State Government took the decision that further fragmentation
of the area would not be in the interests of scientific mining and that t() ensure
even distribution among the consumers in the country, it is necessary to leave
the mining to a Corporation controlled by the Government~ It is a policy
decision and in the present case, the decision is not irrational, unreasonable
D or patently illegal as to justify interference by this Court. [655-B, C, DJ

1.6. The Central Government took the stand that as the matter was
pending in this Court, it would not be appropriate for it to take a decision. It
cannot be said that the Central Government has rejected the request of the
State Government for reserving the area for exploitation by the Corporation.
E
1.7. In the absence of any material, it cannot be said that the
recommendation of the State Minister was not bona fide or that is was tainted
in any manner by malafides. The decision was reiterated by the Cabinet It
was really a policy decis~on and the role of this Court in respect of such a
policy decision and its Scrutiny is limited and within the scope of that limited
F scrutiny, there was no justification in interfering with the decision of the
Government. The decision of the State Government to seek the approval of
the Central Government for grant of a lease to a corporation controlled by it,
cannot be held to be invalid. [656-D-H; 657-A, D]

G Indian Metals and Ferro Alloys Ltd v. Union of India and Ors., [1990)
Supp. 2 SCR 27; Tata Iron and Steel Company Ltd v. Union of India and
Anr., (1996] Supp. 3 SCR 808 and Ferro Alloys Corporation Ltd. and Anr. v.
Union of India and Ors., [1992) 2 SCR 49, referred to.

2.1. The reason of granting out-of-turn lease to the company N
H overriding the claims of others is n()t disclosed. On the materials, it cannot
INDIAN CHARGE CHROME LTD v. U.0.1. 643
be said that the conditions under Section 11(5) of the Act are fulfilled in this A
case. [659-C, DJ

2.2. The State Government had to proceed on the basis of the directions
of this Court in earlier proceedings and make allotments as recommended
by the Committee. The State Government did not forward ttie application of
the company N to the committee for consideration and recommendation. The B
decision to lease to the company N was straight away taken. Hence, the decision
to grant lease to the company N out-of-turn was not justified, legal or proper.
... On materials, what emerges is that there was no valid recommendation by
the State Government for the grant of a lease to the company N and there was
hence no valid approval of the Central Government Non-compliance with Rule C
59 of the Mineral concession Rules, 1960 also vitiated the proposal to lease
to the company N. [659-E-F; 660-CI

CIVIL APPEL LA TE JURISDICTION : Civil Appeal No. 850 l of 2002.

From the final order and Judgment dated 18.5.2001 of the High Court of D
Orissa at Cuttack in O.J.C. No. 1830/J 999.

WITH

Civil Appeal NOS.8502/2002, 6787/2004, 6788/2004, Transferred Case
Nos. 912002, 21/2005 and Transfer Petition (C) Nos. 928/2005, 701/2005, 932/ E
~ 2005 a..d 446/2005.

B. Dutta, A.S.G., K.K. Venugopal, Dr. A.M. Singhvi, Mukul Rohtagi, P.P.
Rao, T.S. Doabia, Ashok Desai, Dr. Rajiv Dhawan, C.A. Sundaram, D.A. Dave,
· B.A. Mohanty, Anuradha dutt, Fereshte D. Sethna, Vijayalakshmi Memon,

- Ekta Kapil, Anupam, Amit Bhandari, Haripriya, Raj Kumar Mehta, Dashmeet F
singh chadha, Abhishek Kumar, Anshuman Ashok, Suman Kukrety, K.K.
Lahiri. Indu Sharma, Praveen Kumar, Ejaj Maqbool, Jana Kalyan Das, Suman
Jyoti Khaitan, P.S. Sudheer, Rishi Maheshwari, Shally B. Maheshwari, Anne .
Mathew, Prantik Hazarika, S. Santanam Swaminadhan, Rohini Musa, Ashok K.
Srivastava, Anita Sahani, R.N. Verma, V.K. Verma, A. Bobde, K.K. Lahiri, G
Keshav Mohan, Vikash Singh, Taruna Singh, Abhijit Sinha, Ashok Mathur,
Ajay choudhary, S.B. Upadhyay and Shibashish Mishras for the appearing
Parties.

The Judgment of the Court was delivered by
H
644 SUPREME COURT REPORTS [2006) SUPP. 10 S.C.R.

A P.K. BALASUBRAMANYAN, J. 1. M/s Indian Charge Chrome Limited
(hereinafter referred to as, "I.C.C.L.") has challenged the decision of the
Orissa High Court in O.J.C. No. 1830of1999 in Civil Appeal Nos. 8501 and
8502 of 2002. In Transferred Case (C) No. 9 of 2002, which was withdrawn
to this Court from the High Court of Delhi, the same Company had challenged
by way of C. W.P. No. 4230 of 200 l the grant of approval for what it called
B an out of turn lease to r·.1/s Nava Bharat Ferro Alloys Ltd. (hereinafter referred
to as, "Nava Bharat"}, respondent No. 3 in the Civil Appeals. Whereas, the
Writ Petitions in the Orissa High Court challenged the recommendation of the
State· Government, the Writ Petition in the Delhi High Court ch~llenged the
grant of approval by the Central Government to the lease in favour Nava
C Bharat. r'

2. M/s GMR Technologies & Industries Limited (hereinafter referred to
as, "GMR") filed O.J.C. No. 2236 of2002 in the High Court ofOrissa challenging
the decision of the State-Government to grant a lease of the extent of 436.295
hectares to the Orissa Mining Corporation Limited (hereinafter referred to as,
D "OMC") against a recommendation to grant a lease to it of an extent of 43.579
hectares out of it. The said Writ Petition was allowed by the High Court of
Orissa and the said decision is challenged by OMC in C.A. No. 6787 of 2004
and in C.A. No. 6788 of 2004.

E
3. M/s Jindal Strips Ltd. (hereinafter referred to as, "JINDAL") challenged
in the High Court of Orissa by way of Writ Petition No. 7575 of 2003 the
'

decision of the State Government to recommend the grant of the lease in
. -
r

favour of OMC ignoring its own claim for a lease and the said Writ Petition
was got transferred to this Court and is numbered as Transferred Case No.
21 of 2005. This case also challenges the recommendation of the State
p

-
Government for grant of a lease to OMC of the remaining extent of 436.295
hectares.

4. The proposal of the State Government to grant a lease to OMC was
also challenged by I.C.C.L. before the Orissa High Court in Writ Petition (C)
No. 1326 of 2005 and that is sought to be got transferred to this Court by
G way of Transfer Petition No. 928 of 2005. Similarly, M/s Ferro Alloys
Corporation Limited (hereinafter referred to as, "FACOR") also challenged the ,...
r-
recommendation of the State Government for grant of lease to OMC by filing
Writ Petition (C) No. 5960 of 2005 in the High Court of Orissa and the same
is sought to be got transferred to this Court in Transfer Petition (Civil) No.
701 of2005. Nava Bharat, in its tum, challenged the proposal to grant a lease
H

·,
INDIAN CHARGE CHROME LTD v. U.0.1. [BALASUBRAMANYAN, J.J 645

to the OMC, in Writ Petition (Civil) No. 6459 of 2005 in the High Court of A
Orissa and the same is sought to be got transferred to this Court by way of
Transfer Petition (Civil) No. 932 of2005. Balasore Alloys Limited, formerly
known as lspat Alloys Limited (hereinafter referred to as, "ISPA T") filed Writ
Petition (Civil) No. 3767 of 2005 in the High Court of Orissa challenging the
very same proposal to grant a lease to OMC and that Writ Petition is sought
to be got transferred to this Court in Transfer Petition (Civil) No. 446 of2005. B
5. Thus, the challenges in all these appeals, transferred cases and the
cases covered by the transfer petitions, are. to the proposal for grant of a lease
of an extent of 84.881 hectares to Nava Bharat, the denial of a lease to GMR
and the recommendation of the Staie Government to grant a lease of the entire C
remaining extent of 436.295 hectares (which includes the extent of 84.881
hectares proposed to be leased out to Nava Bharat) to OMC. Considering
that the questions to be decided in the appeals and transferred cases by this
Court are the same as the ones raised in the writ petitions in the High Court
that are sought to be transferred to this Court, the transfer petitions are
allowed and the cases withdrawn thereby are also disposed of by this D
Judgment. Arguments have been addressed in all the matters.

6. This litigation has had a chequered career. It had come to this Court
on three prior occasions. The facts are detailed in those decisions in Indian
Metals & Ferro Alloys Ltd v. Union of India & Ors., [ 1990] Supp. 2 S.C.R.
27, Tata Iron & Steel Company Ltd. v. Union of India & Anr., [1996] Supp. E
3 S.C.R. 808 and Ferro Alloys Corporation Ltd. & Anr. v. Union of India &
Ors., [1999] 2 S.C.R. 49. Still, a few facts may be reiterated. Chromite ore is
said to be a scarce metal ore in India. It is mainly available in the State of
Orissa in the Sukinda Valley. An extent of 1812.993 hectares of land was
granted on mining lease to Tata Iron and Steel Company (hereinafter referred
F
to as, "TISCO") on 22. l 0.1952. The lease was for.20 years. In the year l 972,
TISCO obtained a renewal of the lease, but the area was reduced to 1261.476
hectares. This renewal was again for 20 years. Before the expiry of the term,
TISCO applied in the year 1991 for renewal of the lease for a further period
of 20 years in respect of the entire extent of 1261.4 76 hectares. The State
Government recommended the renewal and the Central Government granted G
its approval under Section 8(3) of the Mines and Minerals (Regulation and
Development) Act, 1957. But, at the instance of some interested persons, the
Central Government reviewed its decision and granted approval for renewal
of the lease only in respect of 650 hectares, roughly half of the original area.
TISCO challenged the said decision to reduce the extent, by way of a writ H
646 SUPREME COURT REPORTS [2006] SUPP. 10 S.C.R.

A petition in the High Court of Orissa. l.C.C.L., Indian Metals & Ferro Alloys
('IMFA', for short), JINDAL and !SPAT also filed writ petitions in the High
Court of Orissa challenging the approval for r~ne_wal of the lease to TISCO
in respect of an extent of 650 hectares. Alf these writ petitions raising a
challenge to the decision of the Union Government dated 5.10.1993 were
allowed by the High Court, which directed the Union Government to consider
B the matter afresh after hearing all those who had filed writ petitions. The
decision of the Orissa High Court was challenged by TISCO in this Court.
This Court dismissed the appeal filed by TISCO, thus confirming the decision
of the High Court and directed the Union Government to consider the matter
afresh. But pending the proceedings in this Court, since there was no order
C of stay passed by this Court, the Union Government on 17.8.1995, granted
sanction for renewal of the mining lease in favour ofTISCO in respect of 406
hectares. The Union Government also directed that the balance area of
855.476 hectares be distributed by way of leases among the other claimants
in terms of a Committee report prepared as per the direction of this Court, in
an earlier proceeding.
D
7. Subsequently, regarding 855.476 hectares remaining for grant of leases
to the applicants other than TISCO, the State Government recommended to
the Union Government that one-half of the said area could be allotted to the
other four pending applicants and the balance half of the area of 855.476
hectares can be leased to others who also required the mineral. This proposal
E was implemented. After these four grants, the balance extent left is said to
be 436.295 hectares.

8. Meanwhile, FACOR filed Writ Petition No. 12032of1997 in the High
Court of Orissa challenging the assessment of its need made by what came
F to be known as Sharma Committee constituted as directed by this Court. That
Writ Petition was dismissed by the Orissa High Court on 31.8.1998. Meanwhile,
the State Government set up another Committee, the Dash Committee, for
considering the distribution of the area of 436.295 bee.tares, the area remaining
out of 855.476 hectares, after the distribution among the four companies.
FACOR challenged the decision of the High Court ofOrissa before this Court.
· G While Dash Committee was considering the claims of the various applicants,
a recommendation was made by the State Government for grant of a lease to
Nava Bharat of an extent of 84.881 hectares out of the 436.295 hectares in
respect of which claims were being considered by the Dash Committee. This
recommendation was challenged by I.C.C.L. in the Orissa High Court in O.J.C.
1830of1999. Meanwhile, on ?2.3.1999, this Court in the FACOR's appeal
H
INDIAN CHARGECHROMELTDv. U.0.1. [BALA~UBRAMANYAN, J.] 647

upheld the recommendations of Sharma Committee as also the recommendation A
of the State Government dated 29.6.1997 allotting 50% of 855.476 hectares to
the four applicants then claiming and leaving out 436.295 hectares for
distribution by way of lease among other needy entities. This Court directed
that the remaining 436.295 hectares be allotted after the report of the Dash
Committee. It may be· noted here that after Mr. Dash left the scene, the
Committee came to be known after his successor, as the Chahar Committee. B
9. The Orissa High Court, meanwhile, dismissed the Writ Petition, O.J.C.
No. l 830 of l 999 filed by I.C.C.L. challenging the decision recommending an
out of turn lease to Nava Bharat. l.C.C.L., as we have noticed in the beginning,
has challenged that decision in the appeals. Subsequently, the Orissa C
Government decided that the balance extent of 436.295 hectares be granted
on lease to OMC and that decision also has been challenged in the High
Court and the High Court held the decision invalid. That decision of the High
Court is also under challenge. The position, therefore, now is that the
correctness of the decision to grant a lease to Nava Bharat of 84.881 hectares
and the validity of the recommendation of the State Government to grant a D
lease of the remaining area of 436.295 hectares to OMC, are both in question
before this Court. The challenge to the grant in favour of Nava Bharat is
on the basis that Nava Bharat was nowhere in the picture when the four
companies that were dealt with in the earlier judgments were claiming the
grant of leases and in respect of whom directions were issued by this Court
and there was no reason for ignoring the priority in their favour and granting E
a lease out of tum to Nava Bharat especially in the teeth of the report of
Sharma Committee and the partial implementation of its recommendations by
lease of 50% of the areas claimed by the four companies. The decision to
grant the mining lease to OMC was struck down by the High Court by taking
the view that in the light of the earlier orders of this Court, it was not open F
to the State Government to take such a decision. The correctness of the same
is also in question. . Thus, we are concerned with the question whether the
decision to grant a lease to Nava Bharat on the facts and in the circumstances
of the case was justified and whether the proposal of the State Government
to grant the balance area to OMC could be justified. Actually, if the claim
of OMC were to be upheld in the sense that the recommendation of the State G
Government for the grant of a lease to OMC in respect of the balance extent
left, is found sustainable, there would be no need to consider specifically the
challenge made by I.C.C.L. and GMR to the grant of a lease to Nava Bharat.
But since the recommendation of the State Government to grant the lease to
OMC has to have prior approval of the Central Government and the approval H
648 SUPREME COURT REPORTS [2006) SUPP. 10 S.C.R.

A had not yet been granted, that aspect will also have to be decided on merits.
-
We, therefore, think that it will be appropriate to consider first, the question
whether it was open to the State Government to make a recommendation that
the balance extent of 436.295 hectares be leased to OMC in preference to the
other private parties who are making claims for the lease and thereafter
consider the challenge raised to the grant of lease to Nava Bharat.
B
10. Based on the arguments raised before us, the two important
provisions of the Mines and Minerals (Regulation and Development) Act,
1957 that fall for our consideration are Sections 11 and 17A. The challenge
to the grant of lease to Nava Bharat involves interpretation of Section 11 and
the role of the various sub-sections therein. The challenge to the
C recommendation of the State Government to grant the balance extent to OMC
involves interpretation of Section 17 A and the nature of power conferred
thereunder. What is the effect of the prior proceedings in this Court will also
arise. In the background facts of this case, Rule 59 of the Mineral Concession
Rules, 1960 has also relevance. This is for the reason that the area was
D previously held under lease by TISCO and it would become available for grant
only on compliance with Rule 59(1) or in terms of Rule 59 (2), whereunder a
power is vested with the Central Government to relax the provisions of sub-
Rule (1).

11. Section I 0 of the Act provides for applications for prospecting
E licences or mining leases being made to the State Goxemment by a person
interested. Section 11 deals with the preferential right amongst such applicants
for the grant of a lease. Sub-section (1) of Section 11 confers a preferential
right on a person, who had already been granted a reconnaissance permit or
prospecting licence. We are not concerned with that provision in this case:
F Sub-section (2) of Section 11 provides that in a case where the Government
has not notified a particular area in the official gazette as being available, and
two or more persons have applied for a mining lease; the applicant whose
application was received earlier shall have a preferential right to be considered
for grant of a mining lease over the applicant whose application was received
later. According to the proviso, in a case where the State Government had
G invited applications, all applications received during the period specified for
the making of such application and applications which had been received
prior to the publication of the notification inviting applications and which are
pending, shall be deemed to have been received on the same day for the
purpose of assigning priority under sub-section (2). In other words, all
applications received ur.til the dead line fixed, had to be considered on the
H
INDIAN CHARGE CHROME LTD v. U.0.1. [BALASUBRAMANYAN, J.] 649

same footing. The further provi110 indicates that where such applications are A
received on the same day, the Government may take into consideration the
matters specified in sub-section (3) and may grant the mining lease to such
one of the applicants as it may deem fit. Sub-section (3) sets out the matters
to be considered. They include, the special knowledge or experience of the
applicant, financial resources of the applicant, the nature and quality of the
technical staff employed or to be employed by the applicant, the investment B
which the applicant proposes to make and such other matters as may be
prescribed. Sub-section ( 4) provides that subject to the preferential right
available to a reconnaissance permit holder or a prospecting licensee, all
applications received pursuant to a notification by the State Government
during the period specified in the Notification shall be considered C
simultaneously as if they all had been received on the same day and the
Government had to take into consideration the matters specified in sub-
section (3) and grant the lease to such one of the applicants as it deemed fit.
Sub-section (5) of Section 11 has particular relevance in respect of the grant
to Nava Bharat, since Nava Bharat entered the fray only after this Court had
directed that the balance area of 855.476 hectares be allotted to the four D
applicants other than TISCO that were in the fray at that stage. We think it
appropriate to set down here, sub-section (5) of Section 11 with the proviso
thereto:

"11 (5). Notwithstanding anything contained in sub-section (2), but
subject to the provisions of sub-section (l), the State Government E
may, for any special reasons to be recorded, grant a reconnaissance
permit, prospecting licence or mining lease, as the case may be, to an
applicant whose application was received later in preference to an
applicant whose application was received earlier.

Provided that in respect of minerals specified in the First Schedule, F
prior approval of the Central Government shall be obtained before
passing any order under this sub-section."

It is the case of Nava Bharat that though it had applied later, its application
was considered and the lease to it recommended and got approved in view
of the exercise of power by the State Government under sub-Section (5) of G
Section 11 of the Act. We shall consider this aspect at the appropriate stage.

12. Section 17 A deals with reservation of area for purposes of
conservation. Sub-Section (1) provides that the Central Government, with a
view to conserving any mineral and after consultation with the State H
650 SUPREME COURT REPORTS (2006] SUPP. 10 S.C.R.

A Government, may reserve any area not already held under any prospecting
licence or mining lease and notify in the official gazette such area by specifying
the boundaries thereof and the mineral or minerals in respect of which such
area will be reserved. Sub-section (IA) of Section I 7A enables the Central
Government to reserve any such area for undertaking mining operations
through a Government Company or corporation owned or controlled by it.
B Sub-section (2) of Section 17A enables the State Government, with the approval
of the Central Government, to reserve any area not granted on lease for
undertaking prospecting or mining operations through a Government company
or corporation owned or controlled by it and its right to notify the same.
Since, OMC relies heavily on this provision, we think it appropriate to set
C down sub-section (2) of Section 17A hereunder.

"I 7A(2). The State Government may, with the approval of the Central
Government, reserve any area not already held under any prospecting
licence or mining lease, for undertaking prospecting or mining
operations through a Government company or corporation owned or
D controlled by it and where it proposes to do so, it shall, by notification
in the Official Gazette, specify the boundaries of such area and the
mineral or minerals in respect of which such areas will be reserved."

Sub-section (3) of Section 17 A is not relevant for our present purposes.

E I 3. It is the case of Nava Bharat that the grant to it was justified in tenns
of Section I I (5) of the Act and the State Government was entitled to extend
a preference to Nava Bharat and the decisions of this Court rendered earlier
cannot and did not stand in the way of such exercise of power by the State
Government. The case of those who oppose the grant to Nava Bharat is that
the conditions of sub-Section (5) of Section 11 have not been fulfilled in the
F case on hand and even otherwise, at the present stage, it was not open to
the State Government to act under sub-Section (5) in the light of the directions
contained in Indian Metals & Ferro Alloys Ltd v. Union of India & Ors.,
(supra), Tata Iron & Steel Company ltd v. Union of India & Anr., (supra)
,and Ferro Alloys Corporation Ltd & Anr. v. Union of India & Ors., (supra)
G [decisions rendered by this Court. Similarly, the case ofOMC is that the power
under Section 17 A was independent of any other power, or the power under
Section 11 and it was always open to the State Government, no doubt, with
the approval of the Central Government, to reserve any area that may be
available for exploitation by a corporation owned or controlled by the
Government. OMC was such a corporation and the State Government having
H
INDIAN CHARGE CHROME LTD v. U.0.1. [BALASUBRAMANYAN, J.] 651

made that recommendation to the Central Government, it was for the Central A
Government to take a decision on the question of approval as contemplated
by sub-Section (2) of Section 17A of the Act and on the grant of such
approval it was perfectly open to the State Government to grant a lease in
respect of the b,1llance 436.295 hectares to OMC and there was nothing in the
prior decisions of this Court which stood in the way or which could control
the exercise of power, the independent power, by the State Governme_nt under B
Section 17A of the Act. The case of those who oppose the stand of OMC
is that in the light of the prior decisions of this Court and the binding
directions issued therein, and the stand it had adopted earlier, the State
Government could not invoke its power or exercise its right under Section
17 A(2) of the Act at this stage and the Orissa High Court was right in taking C
up that position while striking down the recommendation of the State
Government.

14. As a result of the prior directions of this Court, what has transpired
is that out of the 1261.476 hectares earlier leased to TISCO, a renewal has
been granted to it in respect of 406 hectares. Out of the balance extent of D
855A76 hectares, leases of varying extents have been granted to I.C.C.L./
1.M.F.A., JINDAL, ISPAT and FACOR and what is left is said to be 436.295
hectares. This Court directed in the last of the decisions that this area had
to be distributed in tenns of the recommendations of the Dash Committee, that
became Chahar Committee. It is therefore the case of the applicants other
than OMC that the distribution of this area could only be in terms of the E
recommendations of the Chahar Committee. The Chahar Committee not having
recommended the grant of any extent to OMC, in fact it had rejected the claim
of OMC altogether, it was not open to the State Government to purport to
recommend the grant of a lease of that extent to OMC. It is the further
submission that while making the recommendation to the Central Government, p
the State Government had not disclosed all the relevant facts and the material
fact that OMC was inefficient, was not in a position to exploit the areas
already held by .it and that a number of mines under it were remaining idle
had not been brought to the notice of the Central Government. The Orissa
High Court did not go into the latter question or the scope of the power under
Section 17A of the Act; but proceeded on the footing that in the light of the G
prior directions of this Court, it was not open to the State Government to
exercise its right or power under Section 17A of the Act.

15. As we see it, the power under Section 17A is an independent power.
It is not related to the power available under Section 11 of the Act. It is open
H
652 SUPREME COURT REPORTS [2006] SUPP. 10 S.C.R.

A to the Central Government to reserve an area in terms of Section 17A(l) if it
is thought expedient and it is in the interests of the nation or that it is
necessary to conserve a particular metal or ore or the area producing it. It
is also open to the Central Government to decide that such area should be
exploited by a company or corporation owned or controlled by it. Of course,
that situation has not arisen in this case. Under sub-section (2) of Section
B 17A, with the approval of the Central Government, the State Government may
reserve any area not already held under any prospecting licence or mining
lease for undertaking the exploitation through a Government company or
corporation owned or controlled by it and on fulfilling the conditions referred
to in sub-section (2) and in an appropriate case, also the conditions of sub-
C section (3). Again, the exercise of power by the State Government under sub-
section (2) of Section 17A has no reference to the entertaining of applications
under Section 11 or the preferences available thereunder. The area in question
was under a mining lease to TISCO and after the mining lease expired, the area ...
of 436.295 hectares had not been leased out to any other person. According
to us, nothing stands in the way of the State Government seeking the approval
D of the Central Government for the exploitation of that area in respect of a
precious metal ore by a Government company or a corporation owned or
controlled by it like OMC. Therefore, it cannot be said that the recommendation
made by the State Government is per se invalid or that it is one without
authority. On the scheme of the Act, the decision or recommendation under
E Section 17A can be taken or made until the area in question is actually leased
out to any applicant in terms of Section 11 of the Act. Here, the area had
not actually been leased at this relevant time though a decision has been
taken to lease out 84.88 l hectares out of it and the power of the State
Government saved by Section 17A (2) of the Act is in no way fettered or
curtailed.
F
16. In that perspective, the two relevant aspects to be considered are
whether the prior decisions of this Court have in any way fettered the exercise
of that power by the State Government and whether the decision of the State
Government in that behalf is vitiated for any other reason. On the first aspect,
it is true that this Court accepted the report of the Sharma Committee and
G directed that the recommendation therein be considered for implementation.
At that stage, the State Government allotted 50% of the area available, to the
four entities based on their applications, in partial fulfilment of the
recommendations of Sharma Committee. When the matter came up again
before this Court, this Court ultimately directed that the balance 50% of the
H left out area, namely, 436.295 hectares be dealt with on the basis of the report
INDIAN CHARGE CHROME LTD v. U.O.I. [BALASUBRAMANYAN, J.] 653

of the Dash Committee. When this Court made that direction, this Court was A
not dealing with any exercise of power by the State Government under
Section 17A(2) of the Act or was not dealing with the question, in the context
of exercise of any such power. Therefore, the direction to deal with 436.295
hectares on the basis of the recommendations of Dash Committee, succeeded
by Chahar Committee, does not by itself preclude the exercise of power by
the State under Section 17 A(2) of the Act to make a recommendation that the B
exploitation be left to a corporation owned or controlled by it. We are
therefore not in a position to accept the argument that the prior decisions
precluded the State Government from invoking its right under Section 17A(2)
of the Act. Of course, the prior approval of the Central Government, that
is necessary, is to be sought and obtained and in that context, the State C
Government has moved the Central Government for approval.

17. What is argued on behalf of GMR is that though the submission that
the power under Section 17 A(2) of the Act could be exercised at any time
could be considered sound and logical, the question in the present case has
to be viewed in the background of events leading to the said decision and D
the context in which that decision was taken so as to determine whether the
alleged change of so-called policy is ma/a fide or arising out of colourable
exercise of power with the sole purpose of defeating the prior judgments of
the court and especially the direction of the Orissa High Court in favour of
GMR. It is true that on the prior occasions when the dispute before the High
Court and before this Court centered round the entitlement of various E
applicants for grant of fresh leases after the TISCO lease was not renewed
in full, the stand of the State Government was that it would abide by the
recommendations of Dash ·committee transformed into Chahar Committee.
But it is difficult to postulate that the adoption of such a stand in.the context
of the disputes then arising, could estop the State from taking a decision p
under Section 17A(2) of the Act to recommend to the Central Government that
the compact area left, which was the only balance area left, be granted on
lease to the Government controlled Corporation, OMC so as to ensure a fair
..
and just distribution of the Ore, which was a scarce commodity in the country.
There is no dispute that there were various entities that needed the ore in
question and that some of them had made requests for grant of leases of G
varied extents of lands. If at that stage the Government, after considering
what was contained in the Chahar Committee report itself and the noting of
the concerned Minister, decided to reconsider the question and take a decision
to recommend the grant of the area without it being fragmented on lease to
OMC, it is difficult to accept the contention that the same must be taken to H
654 SUPREME COURT REPORTS [2006] SUPP. 10 S.C.R.

A be ma/a fide. The power under Section 17A(2) is a statutory power and
normally there could be no estoppel against the exercise of statutory power.
That apart, though the claims were being considered as directed by this
Court, the various claimants had not changed their positions or had made any
investments towards mining and in that context, the contention that the
decision that was taken was one in colourable exercise of power, cannot be
B accepted. The considerations relating to environment, relating to fragmentation
and relating to even distribution of the ore to be extracted for supplies to
industries in the country as a whole are all relevant considerations and it
cannot be said that the decision of the Cabinet dated 27.8.2001 is vitiated by
ma/a jides or is borne of colourable exercise of power or that it is irrational.
c 18. It is argued on behalf of the I.C.C.L. that the purpose put forward
by the State Government for exercise of power under Section 17 A (2) of the
Act is not within the province of that provision since extraction and equitable
distribution of the mineral is not one of the aspects relevant for exercise of
power under Section 17A of the Act. Learned counsel pointed out that the
D heading of the Section is "Reservation of area for purposes of conservation"
and exploitation and distribution is not conservation. Moreover, it was
submitted that the said power under sub-section (1) of Section l 7A of the Act
rested with the Central Government and not with the State Government.
There may be substance in the submission of learned counsel, but what we
E are concerned with is the power of the State Government, of course, with the
approval of the Central Government, to reserve an area for undertaking mining
operations through a Government company or corporation owned or controlled
by it. This is exactly what is sought to be done by the State Government
in this case, of carrying on the mining operations in the balance· area through
a corporation owned or controlled by the State Government. We are therefore
F of the view that the recommendation of the State Government for the approval
of the Central Government for leasing out the extent to OMC is well within
the power of the State Government under S~ction 17A(2) of the Act. The
heading of the Section cannot control the natural effect of sub-section (2) of
Section 17A of the Act or the power conferred by it. That provision deals
specifically with the power of the State Government to carry on mining
G operations through a corporation owned or controlled by it. The said argument
cannot also be accepted to invalidate the decision of the State Government
to seek the approval of the Central Government for grant of lease to OMC
of the balance area left, in a bloc.

19. We also do not find any substance m the contention that the
H
INDIAN CHARGE CHROME LTD v. U.O.I. [BALASUBRAMANYAN, J.] 655

decision to grant a lease of the remaining extent to OMC is irrational in the A
context of the performance of OMC and the other attendant circumstances of
the case and in the context of the National Mining Policy. The argument that
on principle the necessity of industries established in Orissa for captive
mining had also been approved and the said aspect could not be lost sight
of while taking such a decision cannot be the controlling factor. What we
find is that the area available for chromite ore mining has already been divided B
among TISCO, the four companies and AIKITH and what is left is the extent
of 436.295 hectares. It is clear that a number of companies have applied for
leases of varying extents from that remaining extent and ifthe State Government
took a decision that further fragmentation of the area would not be in the
interests of scientific mining and to ensure even distribution among the C
consumers in the country, it is necessary to leave the mining to a corporation
controlled by the Government, it is difficult to say that the decision is
irrational. In a sense, it is a policy decision and though in a given case this
Court could interfere with a policy decision of the Government, we cannot say
that the present case is one where the decision is so irrational, unreasonable
or patently illegal as to justify interference by this Court. All industries D
outside the State of Orissa also require the precious ore and it is the duty
of the Government to ensure a just distribution at a fair price. In the
circumstances, it is difficult to say that the decision taken to retain the area
in a compact bloc for mining by a Government controlled Corporation is
irrational. We therefore reject this contention. E
20. The contention on behalf of the Companies, that the Central
Government must be taken to have rejected the approval sought by the State
Government under Section 17A(2) of the Act, cannot be accepted. It is seen
that the Central Government took the stand that as the matter was pending
in this Court, it would not be appropriate for it to take a decision. The F
application or request of the State Government is seen to have been returned.
Of course, the Central Government is also entitled to seek further clarifications
or additional facts so as to make up its mind on the question of approval. As
matters stand at this stage, the Central Government has refused to take a
decision one way or the other on the request of the State Government. It is
therefore not possible to proceed on the basis that the Central Government G
has already rejected the request of the State Government for reserving the
area for exploitation by OMC.

21. Then the question is whether there is anything in the process of
decision making by the State Government that makes the decision itself H
656 SUPREME COURT REPORTS [2006].SUPP. 10 S.C.R.

A vitiated. What is contended is that the Chahar Committee had recommended
that the distribution be made among the various applicants and that OMC
was not eligible for getting a lease of any extent. It was when that
recommendation was put up that the concerned Minister made a noting
indicating a sudden turn around, recommending consideration of the question
B whether the lands or the area available with the State, should also be divided
among the private operators and whether it would not be in the interests of
a just and equitable distribution of the ore and the protection of the
environment, to have the area in a bloc for being exploited by OMC. It is
true that the earlier stand of the Government was that leases could be granted
to private players iricluding industries established in the State for captive
C mining. But, when the recommendation of the Chahar Committee was put up
before him for his final view, it was open to the Minister concerned to go
through the report and record his views thereon. In fact, Chahar Committee
report itself had indicated some of these aspects, though it had overridden
them and made recommendations for grant of leases to the various applicants
D in the light of the directions of this Court and the High Court. If a Minister,
on going through the report, feels that the aspects highlighted in the report
themselves would justify the retaining of the resources with the State so as
to ensure a just distribution of the mineral among the needy and for protection
of the environment, in the absence of any other material, it could not be said
that the recommendation of the Minister was not bona fide or that it was
E tainted in any manner by ma/a fides. It is interesting to note that Mr. Chahar
himself as Secretary of the Ministry concerned thereafter highlighted the
aspects pointed out by the Minister and recommended in his capacity as
S_ecretary of the concerned Ministry that it would be appropriate to retain the
area for being exploited by the Government controlled corporation. The file
F shows that this noting of the Minister in the light of the recommendation of
the Secretary to the Ministry was considered by the Cabinet and the Cabinet
approved the noting of the Minister or the course recommended therein to
exploit the mineral through OMC and not to divide the balanc~. area left with
the Government among various private entrepreneurs. The decision was
reiterated by the Cabinet and a request was made by the State Government
G to the Central Government for approval of this proposal. There is nothing
to show that the noting of the Minister was tainted in any manner or that the
subsequent cabinet decision was vitiated for any reason that could be gone
into by the Court. In a sense, counsel for OMC and the State of Orissa are
right in submitting that it was really a policy decision and the role of this
Court in respect of such a policy decision and its scrutiny was limited and
H
INDIANCHARGECHROMELTDv. U.0.1. [BALASUBRAMANYAN,J.] 657
within the scope of that limited scrutiny, there was no justification in interfering A
with the decision of the Government. Of course, as we have indicated earlier,
it is for the Central Government to give its approval or not to give its approval
to the proposal of the State Government. The Central Government is yet to
take a decision. Since, we have not reached that stage, we are also not called
upon to pronounce on it at this stage.
B
22. It is urged that it was a volte-face by the Minister concerned and
what changed in three days between the stand till then adopted and the note
made has not been explained. What is put forward is that the Chahar
Committee report itself justified such a change in perspective and ifthe taking
of such a decision of this nature is not precluded by the prior proceedings,
the recommt:ndation of the Minister was a rational one and the Cabinet was c
justified in approving it. We have already held that the orders earlier made
by this Court did not preclude such a decision being taken. There is nothing
to show that the noting was not made bona fide or that any extraneous
consideration influenced it. When the occasion arose, the Minister made the
noting. It put forward a relevant point of view. There is no merit in the D
contention that it was a hurried tum around on the part of the Minister.

23. We are therefore satisfied that the decision of the State Government
to seek the approval of the Central Government for grant of a lease to OMC,
a corporation controlled by it, could not be held to be invalid.
E
24. In this context, it was contended that the State Government had not
disclosed the full facts to the Central Government. Learned Senior Counsel
for I.C.C.L. was at pains to point out that OMC was inefficient; that it had
failed to exploit the area earlier granted to it on lease; that many of its mines
remain unexploited and that it would be imprudent to entrust this area also
to OMC for mining of chromite ore. Learned counsel also contended that F
OMC did not have even qualified persons at his helm and elsewhere and in
that situation, the recommendation of the State Government must be found
to be imprudent and ineffective. Learned counsel for the OMC and the State
of Orissa sought to controvert these submissions with reference to certain
materials to show that there was no merit in these charges against OMC. We G
do not think that we are called upon to go into this question here. It is for
the Central Government to consider whether all these aspects are relevant. It
has to consider all the relevant facts while applying its mind to the question
of grant of permission sought for by the State Government in terms of Section
17 A(2) of the Act. It would, therefore, be premature for us to pronounce on
H
...
658 SUPREME COURT REPORTS [2006) SUPP. IO S.C.R.

A the merits or demerits of the arguments sought to be raised regarding the
efficiency and the competency of OMC to exploit minerals. But certainly
these arguments - whether they are relevant or not in the context of Section
17A(2) of the Act, the Central Government will have to decide - should alert
the State Government to ensure that competent, honest and qualified persons
B are put in charge of OMC and the requisite expertise obtained for the purpose
of making its working more efficient. This is independent of the question
of approval involved in this case.

25. We find some merit in the contention oflearned counsel for the State
and OMC that the fact that the ore is required by many industries in the
C country other than the applicants for leases for captive mining and if the
whole area is divided and given for private exploitation, there may be difficulty
in ensuring equitable distribution of the ore was a relevant consideration for
the State Government in making the recommendation under Section 17A (2)
of the Act. We cannot certainly say that this aspect is not a relevant
circumstance. Anyway, as we have indicated, it is not for us to pronounce
D on it at this stage and that would also be one of the aspects to be considered
by the Central Government when it considers the request of the State
Government for approval under Section 17A(2) of the Act.

26. In our view, the High Court was not right in holding that what had
E transpired thus far, or the directions of this Court earlier made, precluded the
State Government from· exercising the power and seeking approval in terms
of Section 17A(2) of the Act. A~ we have held, the State Government could
exercise that power until a grant is actually· made since it is an overriding
power. The taking up of a particular stand earlier, cannot also preclude the
exercise of that power. Whether it has· Jaid itself open to claims for damages
F by its prior actions is a different question and that canno~ control the exercise
of the power under Section 17 A of the Act.

27. Now, we come to the lease proposed to be granted to Nava Bharat.
In view of our upholding the decision of the State Government subject to
approval by the Central Government, the lease proposed has to be found to
G be still born; or that the decision no more survives. But it is necessary to
consider the contentions put forward, since the question would become
relevant if for any reason, the Central Government chooses not to approve
the request or decision of the State Government to lease the balance extent
of 436.295 hectares to OMC.
H
INDIANCHARGECHROMELTDv. U.O.I. [BALASUBRAMANYAN, J.] 659

28. As regards the allotment to Nava Bharat, we see considerable force A
in the submission on behalf of the l.C.C.L. that the decision to grant lease
to Nava Bharat in preference to the other applicants who were before the
Government was incorrect and calls for interference. On the materials, it is
not established that the State Government exercised its power under sub-
section (5) of Seetion 11 of the Act. Nava Bharat was a subsequent entrant
into the fray and had claimed the grant even while the claims of various B
applicants were being considered by Dash Committee. Even without sending
the request of Nava Bharat to Dash Committee for consideration and
recommendation, the State Government proceeded to recommend the grant of
a lease to Nava Bharat from out of the extent available with it. This was a
case to which the rule of preference under Section 11 of the Act as modified C
by the earlier orders of this Court applied and there was a preference available
to those who had applied for leases earlier. Of course, the position had been
explained in the first decision in Indian Metals & Ferro Alloys Ltd. v. Union
of India & Ors. (supra). What is the reason that led to overriding the claims
of others is not disclosed. On the materials, it cannot be said that the
conditions of sub-Section (5) of Section 11 are fulfilled in this case. No D
special reasons are recorded justifying such an out of tum grant.

29. If it was a case of consideration of the claims under Section 11 of
the Act, we feel that the State Government was bound by the directions of
this Court issued ultimately in Ferro Alloys Corporation Ltd. & Anr. v. Union
of India & Ors., (supra). The State Government had to proceed on the basis
E
of the directions contained therein and make allotments as recommended by
the Dash Committee or the successor Chahar Committee. Of course, the State
Government might have been in a position to forward the application of Nava
Bharat also to the said Committe for consideration and recommendation and
might have thereafter acted on the basis of recommendations of the Chahar F
Committee. But that was not done and the decision to lease to Nava Bharat
was straight away taken. We see some force in the submission on behalf of
1.C.C.L and GMR that no proper reasons are given ·for overriding the
preferences of others especially in the light of the directions of this Court
while deciding to grant a lease in favour of Nava Bharat. Notwithstanding G
the valiant effort in that behalf made by learned Senior Counsel for Nava
Bharat to salvage the grant made to it, we are of the view that on the facts
and in the circumstances of the case, the decision to grant a lease to Nava
Bharat out of turn was not justified, legal or proper.
30. When the State Government made the recommendation for grant of H
660 SUPREME COURT REPORTS (2006) SUPP. 10 S.C.R.
...
A a lease to Nava Bharat, the infirmities in that recommendation were pointed
out by the Central Government, in its letter dated 27 .6.200 I. The violation of
Rule 59 was also pointed out. Instead of placing the letter before the Chief
Minister or the Cabinet and obtaining directions thereon, the Steel and Mines
Department on its own chose to send a letter dated 30.6.2001 purporting to
conform to the requirements. When the matter reached the Chief Minister and
B the Cabinet, the decision taken was to withdraw the earlier request for grant
of approval of lease to Nava Bharat. On the materials, it is clear that the letter
dated 30.6.2001 sent by the Secretary of the Steel and Mines Department was
not one consistent with the Rules of Business framed ur.der Article 166 of
the Constitution of India. The letter also lost its efficacy in view of the
C decision taken by the Cabinet to withdraw the recommendation itself. The
position that emerges is that there was no valid recommendation by the State
Government for the grant of a lease to Nava Bharat and there was hence no
valid approval of the Central Government. Non-compliance with Rule 59 of
the Rules also vitiated the proposal to lease to Nava Bharat.

D 31. In view of our conclusion that the State Government was entitled
to seek the approval of the Central Government in respect of the balance
extent of 436.295 hectares, in which was included the proposed Nava Bharat
grant, for exploitation by OMC and since, we.are satisfied that the grant to
Nava Bharat cannot be sustained, the proposed grant or grant to it has to
E be set aside. We do so. If it is a question of reconsideration of the
applications of various entities for grant of leases in respect of 436.295
hectares, it would be a case where the claim of Nava Bharat would also have
to be considered along with the claim of others in the light of the directions
earlier issued by this Court. This contingency may arise only if the Central
Government does not grant approval to the request of the State Government
F under Section 17A(2) of the Act. To that extent, we allow the appeals of
l.C.C.L.

32. Taking note of the circumstances, it is for the State Government to
make a fresh request to the Central Government in terms of Section 17A(2)
of the Act setting out all the relevant details for consideration of the Central
G Government. Thereupon the Central Governelent will have to take a decision
in terms of Section 17A(2) of the Act and in the context of Section 17A of ,
the Act and all relevant attendant circumstances. We make it clear that the
prior directions of this Court or that of the High Court cannot and do not
stand in the way of the Centr~l Government in applying its mind to the
H request made by the State Government under Section 17A(2) of the Act and
.. INDIAN CHARGE CHROME LTD v. U.O.I. [BALASUBRAMANYAN, J.] 661

in taking an independent decision thereon. All that is necessary at the A
moment is to hold that the recommendation of the State Government cannot
be rejected by the Central Government on the ground that it has no freedom
or right to take a decision on the request, in view of the prior orders of this
Court or on the ground that adequate details are not forthcoming. In the
latter contingency, it is for the Central Government to seek such further details
from the State Government as it deems fit and thereafter to come to a decision. B
33. The decisions of the High Court of Orissa are thus set aside. The
appeals are allowed in the manner indicated above. The State Government
is directed to make a proper request in terms of Section I 7A(2) of the Act and
the Central Government is directed to take a decision thereon bearing in mind
all the aspects as indicated hereinbefore. What is to happen thereafter will C
depend upon the decision the Central Government takes and the consequences
that flow therefrom. Those are aspects that will have to be tackled at the
appropriate time, if the need or occasion for it arises.

34. Since, this matter has been pending for years and what is involved D
is exploitation of a precious mineral, we direct the State Government and the
Central Government to comply with the directions we have made expeditiously.
The State Government should send its request within a period of four months
from today with all relevant details and the Central Government should take
its decision on the recommendation within a period of four months from the
date of receipt of the recommendation, if necessary, after calling for any E
further detail that it may consider relevant.

35. Thus, the appeals of the State of Orissa and OMC are allowed, that
of I.C.C.L. and GMR are.allowed to the extent of setting aside the grant of.
lease to Nava Bharat and the Transferred Cases are disposed of in the light
of the above decision. The parties are directed to bear their costs in this F
Court.

B.S. Matters disposed of.

Search Indian case law

Ask in plain English, not just keywords. 25,000 AI words free, no card.

Try "mining lease"Sign in to search