DHARAMBIR SINGHversusUNION OF INDIA AND ORS.

A                           DHARAMBIR SINGH
                                    v.
                         UNION OF INDIA AND ORS.

                              SEPTEMBER 19, 1996

B    [K. RAMASWAMY, FAIZAN UDDIN AND G.B. PATTANAIK, JJ.]

          Mines & Minerals (Regulation & Development) Act, 1957/Mineral Con-
    cession Rules, 1960.

         Section 11/Rule 59-Mining licence and prospecting licenc~Applica-
c tion from  a person who had claimed that he had discovered the min~State
  Govemment notifying that area-Challenged before the Central Govem-
  ment-Mines Tribunal setting aside the notification-Declined to grant mining
  lease to petitioner on the ground that the State Goveniment had done so in
  its discretion and that the Central Govenunent would not curtail the discre-
D tion-Cliallenge negatived by High Cowt-On appeal held, the State Govem-
  ment has a discretion to grant or refuse to grant any prospective licence or
  licence to any applicant-No applicant has a right, much less vested right, to
  the grant of mining lease for mining operations in any place within the State.

          CIVIL APPELLATE JURISDICTION: Special Leave Petition (C)
E No. 18150 of 1996.
       . From the Judgment and Order dated 9.7,96 of Punjab & Haryana
    High Court in C.W.P. No. 9624of1996.

          K.B. Rohtagi, Ms. Apar.na Rohtagi for the Appellant.
F
          The following Order of the Court was delivered :

           The petitioner has file'd this special· leave petition against the judg-
    ment of the High Court of Punjab & Haryana made on Juiy 9, 1996 in CWP
    No. 9624 of 1996. The petitioner had applied for mining lease and the
G   prospecting licence claiming that he had discovered limestone minerals in
    Bhemdemti Dostpur, Mohindergarh District in the State of Haryana. The
    Government has notified that area under Rule 59 of the Mineral Conces-
    sion Rules, 1960. The petitioner challenged the reservation of the area in
    revision before the Central Government and prayed for grant of the lease
H   in his favour. The Mines Tribunal of the· Central Government while setting
                                         566
                           DHARAMBIRSINGHv. U.0.1.                            567

     aside the notification issued by the State Government, declined to grant        A
     mining lease to the petitioner stating that the State Government had done
     so in its discretion and that the Central Government would not curtail the
     said discretion as it is its property. The High Court dismissed the writ
     petition in limine. Hence this special leave petition.      .

           Shri Rohtagi, learned counsel for the petitioner, placing reliance on     B
     sub-section (2) of Section 11 of the Mines and Minerals (Regulation &

..   Development) Act, 1957, contended that the petitioner having filed an
     application for mining lease has got preferential right and the Mines
     Tribunal and the High Court were not right in rejecting his prayer. We find
     no force in the contention. Section 11 of the Act reads as under :              c
             "(1) Where a prospecting licence has been granted in respect of
             any land, the licensee shall have a preferential right for obtaining
             a mining lease in respect of that land over any other person;

                Provided that the State Government is satisfied that the licen- D
             see -

                (a) has undertaken prospecting operations to establish minerals
             resources in such land;
                                                                                     E
                 (b) has not committed any breach of the terms and conditions
             of the prospecting licence; and

                 (c) is otherwise a fit person for being granted the mining lease.

             (2) Subject to the provisions of sub-section (1), where two or more F
             persons have applied for a prospecting licence or a mining lease
             in respect of the same land, the applicant whose application was .-
             received earlier shall have a preferential right for the grant of the
             licence or lease, as the case may be, over an applicant whose
             application was received later :
                                                                                     G
                 Provided that where any such applications are received on the
             same day, the State Government, after taking into consideration
             the matters specified in sub-section (3), may grant the prospecting
             licence or mining lease, as the case may be, to such one of the
             applicants as it may deem fit.                                          H
    568                   SUPREME COURT REPORTS [1996) SUPP. 6 S.C.R.

A            (3) The matters referred to in sub-section (2) are the following :

                (a) any special knowledge, of, or experience in, prospecting
             operations or mining operations, as the case may be, possessed by
             the applicant;

B               (b) the financial resources of the applicant;

                (c) the nature and quality of the technical staff employed or to
             be employed by the applicant;      ·

                (d) such other matters as may be prescribed.
                                                                    .
                                                                                    ..
c            (4) Notwithstanding anything contained in sub-section (2) but
             subject to the provisions of sub-section (1), the State Government
             may for any special reasons to be recorded and with the previous
             approval of the Central Government, grant a prospecting licence
             or a mining lease to an applicant whose application was received
D            latter in preference to an applicant whose application was received
             earlier."

         Sub-section (1) of Section 11 envisages grant of a prospecting licence
   in respect of a land and a prospecting licensee has a preferential right for
E obtaining a mining lease in respect of the land over any other person;
   provided, however, that the conditions enumerated in clauses (a) to (c) in
   proviso thereto are satisfied. Further, sub-section (2) states that subject to
   the provisions of sub-section (1), where two or more persons have applied
   for a prospecting li:cence or a mining lease in respect of the same land, the
   applicant whose application was received earlier, shall have a preferential
F right for the grant of the licence or lease, as the case may be, over an
   applicant whose application was received later. It is also, again, subject to
  .the conditions enumerated in the proviso. Sub-section (3) is not material
   for the purposes of this case. Sub-section (4) further provides that not-
   withstanding anything contained in sub-section (2) but subject to the
G provisions of sub-section (1), the State Government, may for any special
   reasons to be recorded and with the previous approval of the Central
   Government grant a prospecting licence or a mining lease to an applicant
   whose application was received later in preference to an applicant whose
                                                                                    •
   application was received earlier.

H         Thus it would be seen that while granting a prospecting licence or
                       DHARAMBffi. SINGH v. U.O.L                       569

mining lease, the area of discretion has been circumscribed by several A
factors enumerated in Section 11. In grant of mining lease of a property of
the State, the State Government has a discretion to grant or refuse to grant
any prospective licence or licence to any applicant. No applicant has a
right, much less vested right, . to the grant of mining lease for mining
operations in any place within the State. But the State Government is
required to exercise its discretion, subject to the requirements of the law.
                                                                                B
Therefore, the Tribunal of the Central Government has rightly held that it
being in the area of discretion of the State Government, merely because
the applicant had applied for, the State Government was not enjoined to
grant the mining lease. The petitioner had taken the plea that since he
alone had discovered the mines, he has got a preferential right over any C
other peri.-on. The Tribunal of the Central Government and the High Court
rightly rejected that contention of the petitioner; that contention has not
been pressed before us. We find no illegality in the order of the Tribunal
refusing to grant mining lease to the petitioner nor is their any illegality in
the order of the High Court.
                                                                               D
       The special leave petition is dismissed.

G.N.                                                     Petition dismissed.