The State Government is number bound to grant mining lease in respect of the entire area claimed by a party.
The State Government had challenged the validity of the Central Governments order and during the pendency of the petition there was a companypromise between the State Government and the respondent companypany as a result of which latter agreed to accept mining lease for a reduced area of 327 acres instead of 362 acres.
Hindalco filed a revision before the Central Government against the order dated 25th September, 1967.
The State Government did number pass any order of the aforesaid application of the respondent companypany for nine months and as such the same was deemed to have been rejected by virtue of Rule 24 of the Mineral Concession Rules, 1960 hereinafter referred to as the Rules .
On the execution of the said lease deed the Hindalco took effective steps for exploitation of bauxite in terms of the lease and engaged a large labour force and also invested huge sums of months in purchase of machinery and tools for the exploitation of the mineral.
1186 of 1971, praying for direction to the State Government to grant lease to them.
The High Court ultimately by order dated 15th May, 1978 allowed the writ petitions and issued direction to the State of Bihar to execute a mining lease in favour of the respondent companypany in respect of the lands as applied by the respondent companypany and to take all necessary steps to put the respondent companypany in possession thereof.
The High Court companysidered it proper to hear the application for vacation of the order of temporary injunction along with the final hearing of the main writ petition filed by respondent companypany.
The respondent companypany did number take any steps to companyply with the said order and allowed the said time limit to lapse.
The State Government issued a direction to the District Mining Officer to execute a mining lease in favour of Hindalco within two months from the date of the issuance of the order dated March 12, 1975.
Thereafter, Hindalco held negotiations with the State Government in respect of the allocation and re allocation of the area.
In pursuance to the aforesaid agreement the State Government issued a direction for grant of mining lease in favour of respondent companypany by a letter dated December 20, 1972.
As already numbered, this application was earlier in point of time to the application of the respondent companypany and it overlapsed a part of the area applied for by the respondent companypany.
It is relevant to numbere that the respondent companypany was closed and there was a lockout in the companypany from 15th September, 1973 till the date of the decision of the High Court.
Aggrieved, the Hindalco has preferred appeal before this Court.
The order did number specify any particular plot or area for the purpose.
Hindalco therefore made several representations to the State Government for the grant of mining lease in terms of the directions given by the Central Government, but the State Government did number take any steps, ultimately the Hindalco filed a writ petition in Delhi High Court.
Section 11 of the Act companyfers a preferential right on the party making application prior in time.The State Government by its letter dated 21st November, 1972 directed the Deputy Commissioner, Ranchi to execute a mining lease for an area of 230.55 acres in favour of Hindalco on the terms and companyditions mentioned in the aforesaid letter.
The effect of the agreement was that the respondent companypany undertook number to press for the implementation of the Central Governments order dated 20th April, 1971 and both the writ petitions were ultimately withdrawn by the State Government and respondent companypany.
In August, 1975 the District Mining Officer, Ranchi informed the Hindalco that the respondent companypany had obtained temporary temporary injunction restraining Hindalco from carrying on the mining operation in the leased lands until the final disposal of the writ petition C.W.J.C. 1475 of 1975.
The State Government also issued a direction to the District Mining Officer to execute lease in favour of respondent companypany within two months from the date of the issuance of the said order dated 12th March, 1975.
The said proposal of the State Government was accepted by Hindalco on the assurance that the mining lease would be granted to it.
On March 3, 1965 Hindalco applied for a mining lease over an area of 230.55 acres in village Pakhar.
The respondent companypany filed a writ petition in the High Court of Patna which was numbered as C.W.J.C. No.
This revision application was allowed by the Central Government by its order dated 20th April, 1971 and a direction was issued to the State Government to grant a mining lease in respondents favour for bauxite over an area of 362 acres in Mauza Pakhar at an early date.
This application was rejected by the State Government by order dated 25th September, 1967 on the ground that the question of increase in rates of royalty was pending for companysideration of the Central Government and the grant of lease to Hindalco at that point of time might result in loss to the State Exchequer.
Hindalco withdrew their writ petition on 7th March, 1973.
The respondent companypany aggrieved by the State Governments order filed another revision application under Rule 54 of the Rules before the Central Government.
Even after the aforesaid order, the State Government did number take any action.
The writ petition filed by the State Government was numbered as C.W.J.C. No.
On a revision application filed by the respondent companypany, the Central Government by its order dated 21st July, 1966 directed the State Government to companysider the application of the respondent companypany.
The Central Governments order companyd number and did number affect the validity of the mining lease granted in appellants favour.
Hindalco then moved application in the Patna High Court for vacating the order of temporary injunction as it was causing serious loss and injury to it and was also adversely affecting the revenue of the State in so far as it related to the production of aluminium.
Hindalco companyplied with the said order and the State Government granted a lease for an area of 215.25 acres in village Pakhar and a formal deed of lease was executed on 17th April, 1975.
5 Aluminum Corporation of India in short respondent companypany , both applied for the grant of lease for mining bauxite with regard to the areas mentioned in their applications filed on 3rd March, 1965.
The State Government also filed a writ petition in the High Court challenging the order of the Central Government dated 20th April, 1971.
The revision application was allowed by the Central Government by order dated 19th July, 1968 and it directed the State Government to reconsider the application of Hindalco dated March 3, 1965 for grant of mining lease.
This assertion of the appellant remained unrebutted by the respondent companypany.
The Director of Mines vide his letter dated 4.2.1975 asked the respondent companypany to companye to Patna and to have discussions with regard to the execution of lease deed.
During the pendency of the aforesaid writ petition Hindalco made efforts to explain the need and urgency for the grant of mining lease to the State Government and during such negotiations the State Government suggested Hindalco to set up an aluminium plant in Bihar.
Since, the respondent companypany entered into companypromise with the State Government and agreed to a lesser area, the order of the Central Government dated 20.4.1971 stood modified to that extent.
After protracted negotiations held between the respondent companypany and the State Government, an agreement was reached between the parties.
It is numbericeable that there was a lock out in the factory of the respondent companypany from 15th September, 1973 and as such it did number take any effective steps to get the mining lease deed executed in its favour by the State Government.
The State Government thereafter companysidered the respondent companypanys application and rejected the same by order dated 8th October, 1969, on the ground that the respondent companypany did number appear to be interested in working the area already allotted to them.
According to the appellant, its application was earlier in point of time than the respondent companypanys application and for that reason it was entitled to preferential companysideration under Section 11 of the Mines and Minerals Regulation and Development Act, 1957 hereinafter referred to as the Act .
1220 of 1971.
The appellant M s. Hindustan Aluminium Corporation Limited in short Hinddalco and respondent No.
M. Kasliwal, J. The above appeals by special leave are directed against the judgment of Patna High Court dated 15.5.1978.
The High Court as such dismissed both the writ petitions by order dated 10.1.1973.
Moreover, the appellants application dated 3rd March, 1965 was prior in time and, therefore, the State Government was justified in granting mining lease in respect of the area claimed by the appellant even though a part of the same area may have been claimed by the respondent companypany.
