Holding

Section 3(3) of the 1976 Act is a valid, peremptory prohibition on coal mining by private agencies and does not violate Article 14; consequently, private managers are not deemed custodians and no receiver may be appointed to extract coal.

Summary

The Supreme Court examined writ petitions filed by former coal‑mine workers alleging that Section 3(3) of the Coal Mines (Nationalisation) Amendment Act, 1976, which bans coal mining by any agency other than those specified, violated Article 14 by discriminating against them. The petitioners also claimed that private managers were "deemed custodians" under Section 5 of the Coal Mines Nationalisation Act, 1973, and therefore entitled to continue mining. The Court held that Section 3(3) is a peremptory, mandatory provision backed by a penal clause and therefore constitutionally valid; it does not infringe Article 14. It further ruled that without a statutory notification under Section 5, private managers cannot claim deemed‑custodianship and cannot lawfully operate the mines. Consequently, the petitioners have no right to demand work or benefits, and all interim orders appointing receivers to extract coal were vacated. The writ petitions were dismissed with costs.

Issues considered

The constitutionality of Section 3(3) of the Coal Mines (Nationalisation) Amendment Act, 1976 under Article 14 of the Constitution
Whether private managers can be deemed custodians of coal mines under Section 5 of the Coal Mines Nationalisation Act, 1973
Whether the differential treatment of workmen in nationalised versus prohibited mines amounts to unlawful discrimination
Whether courts may appoint receivers to operate mines in violation of the statutory prohibition

Legislation cited

Subjects

Coal miningNationalisationArticle 14DiscriminationPrivate managementDeemed custodianWrit petitionSection 3(3)Labor rightsReceiver appointment

Judgment

,
586

A DBJAPADA DAS AND ANR
v.
UNION° OF INDIA AND ORS.
April 11, 1980
8 [V. R. KRISHNA IYER, 0. C!IINNAPPA REDDY AND A. P. SEN, JJ.]
Coal Mines (IValionalisation Amendment) Act, 1976 (Act No. LXVll of
1976), Sections 3 (3) and 4, scope of-Whether Section 3 (3) offends Article 14 of
the Cons;itution, inasmuch as in regard to Coal Mines, lVhere nlinuzg is
prohibited by that provision, the work1nen are left in the cold, while in regard
to nationalised coal n1ines the workmen are taken care of and benefits assured
C -Private managements whether "deenzed custodians" under Section 5 of the
Coal Mines Nationalist;itions Act, 1973.

Dismissing the Writ Petitions, the Court,

HELD : I. The provision contained in Section 3 (3) of Act LXVIl of
1976 is peremptory and the prohibition is mandatory because there is punish-
ment provided for contravention of that provision. Breach of Section 3 (3) is
D made punishable with impriso!1lll<nt. The 1976 Act totally prohibits w<>rking
of any coal mines by any agency other than those which have been set out in
Section 3 ( 3). Surely, there is no authority for the managements under whom
the present petitioners are alleged to be workmen to operate coal mines in the
face of the prohibition of the 1976 Act. Even for granting looses and their
renewal by ;the State itself, the frown and force of the law stand four square
between the mines and ~traction of coal by any but the agencies specified in
E section 3 (3) of the 1976 Act. [589F-G, 591A, B & CJ

2. Investigation of the Sta.te or . intimation by the private managements are
obligatory under the appropriate legislation and in the absence of any iittima..
tion the presumption is that there are no such coal mines as are set up before
the Court. What apparently has been done, if at all, is to d<> what has been
described as 'scratching' that is sudace mining of coal bearing areas, destmc-
F tive of 1the natural resources of the nation without any thought for the morrow
and without any reference to the pla.nned, phased programme of exploitation
of coal for the benefit of the country in the public sector. The mines, if any,
are illicitly being operated, there being no sanction of the law. It is precisely
Ito prevent this mischief of slaugter mining that s.3 (3) was introduced and s.4
was enacted to make the activity punishable. 'I'he proscription is comprehen·
sive and the penalty makes it imperative. When it is accepted that it is not
G permissible to operate these mines save by those specified in the 1976 stah1te,
it necessarily follows that workmen, genuine or other, cannot claim any funda-
mental right to work these mines,, [5910-G]

3. The prohibition of mining as under s. 3(3) of the 1976 Act, is in the pub-
lic interest and indeed, the scheme shows that wherever public interest requires
exploitation of coal mines it has been permitted in the public sector and even
H in the priva.te sector so far as certain specified industries, such as iron and steel
industries, are concerned. The ban is part of a national policy, conceived for
conservation of a vital national resource and the wisdom of the regulation of
DEJAPADA DAS v. UNION 587

fuel spurces and their planned user is beyond argument. Therefore, the A
language of s. 3 (3) is express, explicit and admits. of no exception. An aware
Court will not relax when the language is peremptory, the legislation is
charged with a critical purpose and even the commiserative cause of work-
men-not wolves in sheep's clothing,-cannot override ithe larger cause of the
nation. No nation, no workmen. [59!G-H, 592A]
4. It is audacious for the dubious managements under whom the petitioners
are supposed to be innocent workmen to represent to the Court that they are
B
"deemed custodians" working on behalf of the Central Government. [592D-E]

Under section 5, notifications are a sine qua non fori custodianship, actual
or deemed and absent such notification taking over management no private
agency can self-style. itself as "deemed custOOian". Therefore, the manage·
ments.other than those specified in section 3(3) of the 1976 Act, can not claim
to extract coal from any coal mines. If this be so, no one can . cla.im as a c
workman. although in public interest, although it is imperative that such ope-
ration 'should stop. [593E-F]

· S. There is no violation of Article 14 of the Constitution vis·a·vis the
workmen concerned assuming them to be real workmen. After the dismissal
of the management's \\'rit petitions, the argument that the Act impugned is
ultra vires vis a vis workmen is a daring legal workmanship. If a larger Bench
of this Court has already upheld the vires of a statute the discovery of a new
argument cannot invalidate that decision. That pr6position will make the bind-
ing effect of precedents, read in the light of Art. 141 a vanishing cream once
a novel thought strikes a legal brain. [593F·H]

The question of discrimination between two classes of workmen hardly
arises because one set of mines has been closed down validly. If the closure
is valid, no one- employed there has a right to force it open on the score of
discrimination. Denial of lay.off or other benefits belong to a different juris-
diction. If any \VOrkmen are really aggrieved that their interests are not pro·
tected and that their future is in jeopardy, it is certainly open to them to make
represep.tation to the Central Government for consideration of their lot. and
certainly a welfare State will give due consideration for such representation if
it is satisfied that the grievance is genuine. [594A-B] F
fl.. 6. Section 3 (3) of the 1976 Act being mandatory and having been held
constitutional by this Court, it is no longer permissible for any court in India
to appoint a receiver or otherwise permit extraction of coal or coking ooal.
[594D-El
ORIGINAL JURISDICTION: Writ Petition Nos. 1311, 11269-70,
G
1113, 1109, 1479-1480, 924-925, 1478, 1250-1251, 1219, 926-927,
1072-1076, 1565, 1652-1654, 1434-1435, 1648, 1306-1310, 1312·
1314, 1590-1591, 1588-1589 of 1979 and 400, 192, 448 and 462 of
1980.
(Under Article 32 of t11e Constitution)
A. K. Sen and S. K. Sinha for the Petitioners in WP Nos. 1306- H
1314/79, 1434, il 13, 1109, 1250-1251, 1219, 1072-1076, 1565,
1652-1654, 1435/79 and 192/80.
588 5-_UPREME COURT REPORTS [1980] 3 S.C.R.

A · K. N. Choubey and A. K. Srivastava for the Petitioners in WP
Nos. 1269-1270, 1590-1591, 1588-1589, 924-925, 926-927/79.
M. P. !ha for the Petitioners in W.P. 1648'/79.
A. K. Ganguli, for the Petitioner in W.P. Nos. 1479~1480/79.
Arun Madan' for the Petitioners in W.P. No. 400/80.
B
S. N. !ha for the Petitioners in W.P. No. 488/80.
K. N. Choubey and Mukul Mudgal for the Petitioners in W.P.
462180.
Lal Narain Sinha Att. Genl., M. K. Banerjee Addl. Sdl. Genl., and
Miss A. Subhashini for the Respondent Union of India, Central Coal
c Fields, Easter Coal Field in WP. Nos. 1307, 1310, 1312, 1314 and
Respondent 3 in W.P. Nos. 1308, 1588, 1589, 1434, 1072-1076/79.
Lal Narain Sinha Att. Genl. and U. p. Singh for the Respondents,
State of Bihar and Its officials in W.P. Nos. 1588-89, 1434, 1109,
924-925, 1250-1251, 926-927, 1219, 1250-1251, 1072, 1290-91,
D 1648, 1479-80, 1073-1074, 1565/79 and 400, 192, 488 and
462/80.
Lal Narain Sinha Att. Genl. and Rathin Dass for the Respondents
(West of Bengal) in W.P. Nos. 1306-1314, 1073-1074179.
P. K. Chatterjee for the State of West Bengal in W.P. 1072/79.
E
A. K. Srivastava for. the Caveator/Respondent No. 4 in W.P.
Nos. 1652-1654 of 1979.
The Judgment of the Court was delivered by
KRISHNA IYER, J. 'Survival after death' is the expression that
F aptly describes these writ petitions relating to coal mining by private
agencies long after a prohibitory legislation and an order by this Court
repelling the challenges to the vires of that Act. Parliament by the
Coal Mines (Nationalisation) Amendment Act, 1976 (Act No.
LXVII of 1976) (For short, the 1976 Act) totally prohibited all
mining of coal save by instrumentalities set out in s. 3, sub-s. (3)
G
which we may excerpt here :
(3) On and from the commenc,ement of Section 3 of the
Coal Mines (Nationalisation) Amendment Act, 1976.-
(a) no person, other than-
8 (i) the Central Governmerrt or a Government
company or a corporation owned, managed
or controlled by the Central Government, or
DEJAPADA DAS v. UNION (Krishna Iyer, !.) 589

a
(ii) -a· person to whom sub-lease, referred to in the .
proviso to cl. ( c), has been granted by any
such Government, compariy or corporation, or
(iii) a company engaged in the production of iron
and. steel shall carry on coal mining operation,
in India.; in any form; B
(b) excepting the mining leases granted before such
commencement in favour of the Government,
company or corporation, referred to in clause (a),
and any sub-lease granted by any such Government,
company or corporation, all other mining leases and
sub-leases in fo.:rce immediately before such com-
c
mencement, shall, in so far as they relate to the
winning or mining of coal, stand terminated;
( c) no lease for winning or mini'ng coal shall be granted
in favour of any person other than the Govern-
ment, company or corporation, referred to in clause D
(a). /
Provided that the Government, company or corporation to whom
a lease for winning or mining coal has been granted may &rant a sub-
lease to any person in any area on such terms and conditions as may
be eipecifiaj in the instrument granting the sub-lease, if the Govern- E
ment, company or corporation is satisfied that-
(i) the reserves of coal in the area are in isolated small
pockets or are not sufficient for scientific and econo-
mical development in a co-ordinated and integrated
manner, and
11'
(ii) the coal produced by the sub-lease will not be
required to be transported by rail.
It is obvious· that the provision is peremptory and the prohibition is
·1' mandatory because there is punishment provided for contravention of
that provision. Section 4(1) of the 1976 Act makes a breach of
s. 3 (3) punishable with imprisonment. G
This broad spectrum ban in law arrested the extraction of coal
and was naturally assailed as ultra vires by the managements them-
selves in writ petitions under !\rt. 32. A bench of seven judges of this
court heard erudite and elaborate arguments, at the e'nd of which the
writ petitions were dismissed. But it is not unusual for many litigants B
'even though vanquished, to argue still'. Here, however, the challenge
and challenger are. of different colour. For, the petitioners before us
590 SUPREME COURT REPORTS [19801 3 s.c.R.

A claim to be workmen who are. thrown out of employment on account
of the 197 6 Act and lament in this Court that they are discriminated.
against and on that score the law is violative of Art. 14 of the Consti-
tution. The plea put for,ward is that in regard to nationalised coal
mines the workmen are taken care of and their benefits assured, while
in regard to coal mines where milling is prohibited by s. 3 (3) of the
B
1976 Act the workmen are left in the cold. This is stated to be dis-
crimination between workmen and workmeri, thus contraveniug the
mandate of equality before the law. Maybe, the writ missiles of the
managements proved damp squibs but the workers undaunted by that
rebuff, want to try a new weapon of ultra vires. The coal will go to
c the employers and the wages to the workers.
·:....--.
The Union of India resists this relief and contends that the writ
petitioners are mere reincarnations of the old managements which
have fought and lost and are masquerading as workmen so as to
facilitate a second challenge. The State asserts that clandestine coal
mining mafia having been stopped, these racketeers are playing the
D
maricha game through bogus workers in tears. Without going into
the merits of this avernment we may state that every other conceivable
objection to the validity of the 1976 Act and other sister enactments
had been urged in vain before the seven judges' bench. Now the
alleged workmen are complaining of discriminatory denial of benefits
E to one class of workers. The Union df India counters this plea as
factually a ruse for clandestine mining operations by management
and legaUy a second battle after the legal Waterloo, hoping against
hope that there is nothing to lose in a gamble. Even if a spell of stay
were got the gain will outweigh possible losses in litigation. Indeed, the
State's contention is that considerable losses to Government and
F traumatic consequences on the nation are being daily inflicted by
such clandestine operations. The whole mischief contemplated by the
1976 Act is being continued under the guise of invalidity of the legis-
lation and, alternatively, by going to court and getting receivers
appointed so that a legal colour is imparted to lawless depradations.

G It is true that nationalisation of coal, as a policy, has been evolved
over the seventies. In the beginning, the management of coal mines
was taken over and at a later stage ownership itself vested in the
Union of India by virtue of ownership of all coal mines is the simple
and incontrovertible fact emerging from the bunch of legislation we
have' been taken through. We are not going into the catena of enact-
H ments and their Gequence covering this question, because they are
bei'ng discussed in greater detail and fuller depth in the comprehensive
judgment where ,reasons have yet to be given but the result, by way
DEJAPADA DAS v. UNION (Krishna Iyer, J.) 591

A
of brief order, has already been announced. Suffice it to say that the
1976 Act totally prohibits working of any coal mines by any agency
other than those which have been set out in s. 3(3). Surely, there is
oo authority for the managements under whom the present petitioners
are alleged to be workmen to operate coal mines in the face of the
prohibition in the, 1976 Act. There is a point of dispute raised by the B
Union of India that the managements which have come up before this
Court do not have even leases under the Mines a'nd Minerals (Regu-
lation and Development) Act, 1957. This is controverted by the
other side but we may side-step that issue because it is not essential
for the decision of this case. For one thing, no such lease is before
us. For another, what is relied on i'n some cases is hukumnamas which c
cannot do duty for leases. Even granting leases and their renewal by
the State itself as is asserted in a few cases, the grown and force of
the Jaw stand four square between the mines and extraction of coal
by any but the agencies specified in s.3(3) of the 1976 Act.

It is common ground that there is no specification of the coal D
mines in question i'n the schedule to the nationalisation legislation of
1973, nor is there any specific notification relating thereto. Investiga-
tion by the State or intimation by the private managements are obli-
gatory under the appropriate legislation and in the absence of any
intimation-none has been produced before us-we have to presume
that these are no such coal mines as are set up before us. What appa- E
rently has been done, it at all, is to do what has been described as 'scrat-
ching that is surface mining of coal bearing areas, destructive of thei
natural resonrces of the nation without any thought for the morrow·
and without any reference to the planned, phased programme of
exploitation of coal for the benefit of the country in the public sector.
We are satisfied that on the materials placed before us in all these F
cases, the mines, if a'ny, are illicitly being operated, there being no
sanction of the Jaw. It is precisely to prevent this mischief of slaughter
mining that s. 3 (3) was introduced and s. 4 was enacted to make the
) activity punishable. The proscription is comprehensive and the penalty
makes it imperative. Once we' accept the position that it is not permis-
G
sible to operate these mines save by those specified in the 1976 statute,
it necessarily follows that wor);:men, genuine or other, cannot claim
any fundamental right to work these mines. The prohibition of mining
coal except as under s. 3(3) of the 1976 Act, is in the public interest
and indeed, the scheme shows that wherever public interest requires
exploitation of coal mines it has been permitted in the public sector and B
even in the private sector so far as certai.n specified industries~ such
as iron and steel industries, are concerned. The ban is part of a
592 SUPREME COURT REPORTS [1980] 3 S.C.R.

A
national policy, conceived for conservation of a vital national resource
and the wisdom of the regulation of fuel sources and their planned
user is beyond argument. Therefore, the language of s. 3(3) is express,
explicit and admits of no exception. An aware court will not relax
when the language is peremptory, the legislation is charged with a
B critical purpose and even the commiserative cause of workmen-not
wolves in ~heep's clothing. as is asserted,-cannot override the larger
cause of the nation. No nation no workmen;

Assuming for a moment that the private managements are, as
Dr. Chitale and Shri A. K. Sen urged, deemed custodians within the
c scheme of the legislative take-over, they are necessarily to operate oil
behalf and under the direction of the Central Government. Here is the
Central Government protesting, as stridently as it can, against the
mining operations by the alleged mine-owners. Both the State and
Central Governments are making common cause and demand that no
deemed custodian need work any mine on their behalf. How can a
D surrogate custodian exceed the command of the principal to stop
mi_ning? The whole case of the Union of India is that a clandestine
cluster a sort of coal mafia which may even have got sham registers of
workmen-is defying Government and extracting coal on the sly. It
is audacious for the dubious managements, under whom the petitioners
are supposed to be innocent workmen, to represent to the court that
E they are 'deemed custodians', working on behalf of the Central Gov-
ernment.

· Nor are we prepared to accept the naive case that the petitioners'
employers can be regarded as deemed custodians under s. 5. We may
read s. 5 of the Coal Mines Nationalisation Act, 1973.
F
5. Power of Central Government to direct vesting of
rights in a Government company : -
(1) Notwithstanding anything contained in Sections
3 and 4, the Central Government may, if it is satisfied that
G a Government company is willing to comply, or has
complied, wrth such terms and conditions as that Gover'.n-
meut may think fit to impose, direct, by an order in writing,
the right, title and interest of an owner in relation to a coal
mine referred to in Section 3, shall; instead of continuing
vest in the Central Government, vest in the Government
H company either on the date of publication of the direction
or on such earlier or later date (not being a date earlier tnan
the appointed day), as may be specified in the direction.
DEJAPADA DAS v. UNION (Krishna Iyer, J.) 593

(2) Where the right, title and i11terest of an owner in A
relating to a coal mines vest in a Government company
under sub-section ( 1), the Government company shall on
and from the date of such vesting, be deemed to have
become the lessee in relation to such coal mine as if a min-
ing lease in relation to the coal mine had been granted to
the Government company and the period of such lease shall B
be the entire period for which such lease could have been
granted under the Mineral Concession Rules; and all the
rights and liabilities of the Central Government in relation
to such coal mine shall, on and from the date of such vesting,
be deemed to have become the rights and liabilities, respec-
tively, of the Governme"nt company. c
(3) The provisions of sub-section (2) of section 4
shall apply to a lease which vests in a Government company
as they apply to a lease vested in the Central Government
and references therein to the "Central Government" shall be
construed as references to the Government company. D
The notification required under s. 5 authorising the mine to be
worked, is admittedly absent. No such notification exists or has been
hinted at or is existing. In the absence of the relevant notification
contemplated by s. 5, it is impossible to postulate 'deemed
custodianship'. There are scheduled mines or notified mines, under
the scheme of statutory management in the Management Take-over E
Act. Notifications a.re a sine qua non for custodian-ship, actual or
deemed and absent such notification taking over management no pri-
vate agency can self-style itself as deemed custodian. It follows that
on any view of the matter the managements other than those specified
under s. 3(3) of the 1976 Act can claim to extract coal from any coal
mines. If this conclusion is sound, as we have demonstrated it is, the F
inference is irresistible that no one can claim to extract coal as a work-
··~
.
man, although in public interest, it is imperative that such operation
should stop. We hold that there is no violation of Art. 14 of the
) Constitution, vis-a-vis the workmen concerned assuming them to be
real workmen. We have grave doubts about the varacity of this p.iece

• of workmanship that the petitio'ners and others of their ilk are actual,
not imaginary. Anyway, after the dismissal of the managements' writ
petitions, the argument that the Act impugned is ultra vires vis a vis
G

workmen is a daring legal workmanship. If a larger bench of this
Court has already upheld the vires of a. statute the discovery of a new
argument cannot invalidate that decision. That proposition will make H
the binding effect of precedents, read i'n the light of Art. 141, a vanish-
ing cream once a novel thought strikes a legal brain.

' .1
:ff.
594 SUPREME COURT REPORTS [1980] 3 S.C.R.
r
A The question of discrimination between two classes of workmen
hardly arises because one set of mines has been closed down validly.
If the closure is valid, no' one employed there has a right to force it
open on the score of discrimination, Denial of lay"off or other benefits
belong to a different jurisdiction, If any workmen are really aggrieved
that their interests are not protected and that their future is in jeopardy,
B it is certainly open to them t_o make representation to the Central
Government for consideration of their lot, and certainly a welfare State
will give due consideration for such representation if it is satisfied tlrat
!he grievance is genuine. We dismiss the Writ Petition with costs.
It has been mentioned on more than one occasion in this court
c that interlocutory orders have been passed, that Receivers have been
appointed by civil courts, including High Courts, and that working of
mines is licitly going on. In the face of the all-pervasive statutory pro-
hibition which is peremptory in language and punishable in conse-
quence, it is surprising that any Receiver could at all dare to work
mines. While we disapprove of that conduct we make it perfectly
D plain that there will be no more _sauction for any receiver or other
officer of court to extract coal or coking coal from any mine in India.
Section 3 (3) of the 1976 Act being mandatory and having been held
constitutional by this Court, it is no longer permissible for any court
in India to appoint ll receiver or otherwise permit extraction of coal
E
or cokiug.coal. We vacate all interim orders forthwith.
It may be fair to the learned Attorney General, whose hunch we
share to state that this wealth of "workers" writ petitions is a kind of
litigative puppetry, the illicit mine exploiters being the puppetteers and
those who figiire as worker petitioners being the puppets.

F
S.R. Petitions dismissed.

(

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