M/S MARUTI CLEAN COAL & POWERS LTD.versusALOK NIGAM & ANR.

                       [2010] 4 S.C.R. 325


       M/S MARUTI CLEAN COAL & POWERS LTD.                            A
                                 v.
                     ALOK NIGAM & ANR.
           (Interlocutory Application No. 3 of 2009
                (In SLP(C) No. 20238 of 2006)
                                                                      B
                       MARCH 31, 2010

 [K.G. BALAKRISHNAN, CJI., J.M. PANCHAL AND DR.
                B.S. CHAUHAN, JJ.]

     Interim Orders:                                                  c
      Interlocutory application - For issuance of interim
directions to South Eastern Coal Field Ltd. (SECL) to start·
supply o'f coal and issue Transit Passes/Delivery Orders
through washery of petitioner on behalf of linked and other
                                                                       0
customers based on instructions/requests from them -
Allowed - It is clarified that grant of this interim relief will be
subject of the result of the title suit pending in the High Court
- It is also clarified that if the issue of title is decided in favour
of SECL, it would be open to the said company to lease the
land to the petitioner or to take other steps in accordance with E
law - Coal - Coal washery.
     A lease deed dated 5.12.2002 for a period of 99 years
was executed in favour of the petitioner-Company by the
State Government through the State Industrial                         F
Development Corporation, with regard to certain lands to
enable the petitioner to set up a coal washery thereon.
Subsequently, Mis. South Eastern Coal Field Ltd. (SECL)
claiming title to the said land, filed a suit. A writ petition
was also filed before the High Court to prevent the
petitioner from setting up the coal washery on the ground             G
that the land allotted was the forest land. The High Court
passed an interim order in the writ petition allowing the
petitioner to continue the construction of the building but
restraining it from installing the machineries. In the
                               325
                                                                      H·
    326      SUPREME COURT REPORTS                 [2010] 4 S.C.R.

A petition for special leave to appeal filed by the petitioner
  before the Supreme Court, interim order staying the
  construction was vacated. Since the petitioner had
  installed the machineries and the coal washery was set
  up but as supply of coal was not started, the petitioner
B filed the instant application seeking a direction to the
  SECL to start supply of coal and issue Transit Passes/
  Delivery Orders through the washery of the petitioner.
          Partly allowing the application, the Court
C      HELD: 1. The building constructed and the
  machineries installed have remained unused since long
  causing great financial loss to the petitioner-company. It
  is relevant to notice that as on date, there is no order
  subsisting, which restrains the petitioner from operating
D the washery in question. The assertion made by the
  petitioner that it has received all necessary approvals for
  running the washery including the approval from the
  Ministry of Environment, Electricity Department,
  Commercial Tax Department, licence under the Factories
E Act etc. is not disputed by any of the respondents. [Para
  8) [333-8-C]
       2. M/s SECL is hereby directed to start supply of coal
  and issue Transit Passes/Delivery Orders through the
  washery of the petitioner on behalf of linked and other
F customers based on instructions/requests from them. It
  is clarified that the grant of this interim relief will be
  subject to the result of Civil Suit No. 1-A of 2008 pending
  in the High Court. It is also clarified that if the issue of title
  is held in favour of M/s SECL, it would be open to the said
G company to lease the land to the petitioner-company or
  to take other steps with reference to the said land in
  accordance with law. [Para 9) [333-E, F]
          T.N. Godavarman Thirumulpad vs. Union of India & Ors.
    (2006) 5 sec 28, cited.
H
  MARUTI CLEAN COAL & POWERS LTD. v. ALOK                    327
               NIGAM & ANR.
                       Case Law Reference:                           A
     (2006) s sec 2s            cited                  para 2
    CIVIL APPELLATE JURISDICTION                   Interlocutory
Application No. · 3 of 2009.
                                IN                                   B
                SLP (Civil) No.20238 of 2006.
    From the Judgment & Order dated 9.5.2003 of the High
Court of Chhattisgarh at Bilaspur in WP (C) No. 1264 of 2003.
     Mukul Rohtagi, Ranjit Kumar, Vikas Singh, Ajit Kumar C
Sinha, Saurav Kirpal, Ayush Agarwal, (for Suresh A Shroff &
Co.), Anurag Sharma, Sanjeev K.Bhardwaj, (for R.C. Kaushik),
Ambhoj Kumar Sinha, Ashwarya Sinha, Swetabh Sinha for the
appearing parties.
     The Judgment of the Court was delivered by                      D
     J.M. PANCHAL, J. 1. By filing this Interlocutory Application,
M/s. Maruti Clean Coal & Power Limited which has established
a coal washery of 10 M.T.Y. capacity on Khasra Nos.850/30,
850/24, 850/31, 850/28, 850/27 and 850/32 of Village Ratija,
District Korba leased by the State of Chhattisgarh through           E
Chhattisgarh State Industrial Development Corporation
('CSIDC' for short), has prayed to direct M/s. South Eastern
Coal Field Limited ('SECL' for short) to start supply of coal
immediately and issue Transit Passes/Delivery Orders through
the washery of the petitioner on behalf of linked and other          F
customers cin instructions/requests from. all such customers/
purchasers of coal.
      2. In order to understand the scope and ambit of the prayer
made by the petitioner, it would be relevant to notice certain       G
facts. M/s. Maruti Clean Coal & Power Limited is a company
registered under the provisions of the Companies Act. It applied
for the allotment of about 15 hectares (37.91 acres) of land of
village Nawagaon Khurd (now Ratija), District Korba, ('the land'
for short) for setting up a Coal Beneficiation Plant with a
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    328      SUPREME COURT REPORTS                    (2010) 4 S.C.R.


A capacity to wash 10 million tons of coal per annum. The land
  demanded was adjacent to already existing two coal washeries
  one of which was set up by ST-CU in which one Aryan Coal
  Beneficiation Pvt. Ltd. has 26% holdings and another Coal
  Washery set up belongs to Aryan itself. The officials of the
8 Revenue, Forest and Industry Departments of the State
  conducted a thorough inspection of the land demanded by the
  petitioner. After being satisfied that the land demanded was
  not forest land and requirements of environmental laws were
  complied with by the petitioner, the officials recommended to
C the State to allot the land to the petitioner. Pursuant to the said
  recommendation, a lease deed dated December 5, 2002 for
  a period of 99 years was executed in favour of the petitioner
  by the State of Chhattisgarh through CSIDC. The purpose for
  which the lease deed was executed was to enable the
  petitioner to set up a coal washery. Pursuant to the said lease
0 deed, the petitioner was put in possession of the land.
  However, subsequently, SECL claimed title to the land and
  alleged that the land did not belong to the State Government
  and, therefore, could not have been leased by the State to the
  petitioner.
E
         In March/April 2003, one Mr. B.L. Wadhera, a public
   spirited citizen instituted WP (C) No.1264/2003 before the High
   Court of Chhattisgarh at Bilaspur to prevent the petitioner from
   setting up its coal washery on the land allotted to it by the State
   Government on the ground that the land allotted were forest
F land. The High Court, by an ex parte order dated April 24, 2003,
   directed the petitioner to maintain status quo regarding the land
   allotted to it and not to cut trees standing on the land till further
   orders. In view of the dispute pertaining to the title of the land
   between SECL and the State Government, the Union of India,
G vide letter dated May 7, 2003 sent through the Ministry of Coal,
  ,gave the petitioner two options (1) to wait until title issue is
  decided; or (2) to proceed on the assumption that the title vests
   in SECL and on that basis, to request the SECL to allot the
   land to the petitioner. It was also mentioned in the said letter
H
  MARUTI CLEAN COAL & POWERS LTD. v. ALOK                     329
        NIGAM & ANR. [J.M. PANCHAL, J.]

that in the event the petitioner chose the second option, Coal        A
India Limited and SECL would be requested by the Ministry to
initiate action for leasing the land to the petitioner. The record
shows that by letter dated May 9, 2003, the petitioner elected
the second option. The petitioner filed an application for
vacation of the stay order. The High Court, by order dated May        B
9, 2003, modified its earlier order and allowed the petitioner
to continue with the construction of the main building but
restrained it from installing the machineries. Meanwhile, the
SECL wrote a letter dated June 27, 2003 to the Ministry of Coal
stating that it had no objection in leasing the land to the           C
petitioner subject to certain conditions including the condition
that the fact that the land belonged and belongs to SECL is
acceptable to the petitioner. Feeling aggrieved by order dated
May 9, 2003, Mr. B.L. Wadhera filed SLP (C) No.22531 of
2003. This Court, by order dated November 24, 2003 stayed             o
further construction on the land. Sub~equently, the said SLP
was tagged with IA No.857-858 of 2003 filed by Mr. Wadhera
 and one Mr. Deepak Aggarwal respectively. This Court, by
judgment dated April 10, 2006 in case of T.N. Godavarrnan
 Thirumulpad vs. Union of India & Ors. (2006) 5 SCC 28,               E
dismissed the application of Mr. Deepak Aggarwal observing
that it was filed with mala fide intention. The interim order
passed staying further construction was vacated. On the
pronouncement of judgment by this Court, the petitioner filed
an application in the writ petition pending before the High Court     F
of Chhattisgarh with a prayer to dismiss the writ petition. The
record shows that the said application was heard with two other
connected petitions and judgment was reserved. However, the
judgment could not be pronounced by the High Court. Therefore,
the petitioner filed an application for vacating the interim orders
dated April 23, 2003 and May 9, 2003. Listing of the said             G
application was refused by the Registry on the ground that in
the main matter, judgment was reserved. Meanwhile, the
petitioner completed construction of the main building. The
order for purchase of machineries to be installed was already
placed.                                                               H
    330     SUPREME COURT REPORTS                   (2010] 4 S.C.R.


A         3. On December 9, 2004, SECL filed Civil Suit No.90-A
     of 2004 against the State of Chhattisgarh and the petitioner
    contending, inter alia, that the land allotted to the petitioner
     company by the State of Chhattisgarh through CSIDC had
    vested in SECL and that SECL is the owner and in possession
B   of the land in question. Various other litigations and
    proceedings were initiated by several parties pertaining to the
     land allotted to the petitioner company. The Ministry of Coal,
    by letter dated December 30, 2005 advised SECL to
    implement the instructions dated May 7, 2003 mentioned in
c   para (b). The petitioner thereupon addressed a letter dated
    June 14, 2006 to SECL to inform the petitioner about the lease
    premium/rent to be deposited. The record of the case further
    shows that in spite of instructions issued by the Ministry of Coal
    and request made by the petitioner, SECL did not initiate steps
D   for leasing the land to the petitioner. .Therefore, the petitioner
    has filed Special Leave Petition No.20238 of 2006 challenging
    validity of order dated April 24, 2003 as modified by order dated
    May 9, 2003 in WP No.1264 of 2003 pending before the High
    Court of Chhattisgarh. In the abovereferred special leave
    petition, the Court has issued notice and the said SLP is
E   pending for final disposal. Thereupon, the petitioner company
    filed Transfer Petition No.53 of 2007 in this Court to direct that
    all the connected matters including the suit, writ petitions and/
    or appeals be heard together and transferred to the High Court
    of Chhattisgarh at Bilaspur. The said Transfer Petition was
F   allowed. Pursuant to the directions given by this Court, the
    number of Civil Suit was changed from 90-A of 2004 to Civil
    Suit No.1-A of 2008. The said suit and all other connected writ
    petitions, appeals etc. are pending adjudication before the High
    Court of Chhattisgarh at Bilaspur.
G
        4. During the pendency of proceedings before the High
    Court of Chhattisgarh, the Prime Minister's Office vide letter
    dated June 26, 2007 to the Secretary, Ministry of Coal
    approved and recommended SECL to move an appropriate
H   application before the High Court of Chhattisgarh seeking
  MARUTI CLEAN COAL & POWERS LTD. v. ALOK                     331
        NIGAM & ANR. [J.M. PANCHAL, J.]
permission of the Court for leasing the land to the petitioner        A
company for establishment of a coal washery. Having regard
to these directions, the Ministry of Coal issued a letter dated
July 4, 2007 to M/s. Coal India Ltd. which is parent company
of SECL, stating that in view of the decision by the competent
authority, SECL should take appropriate action to lease the           B
land to the petitioner company. Therefore, Mis. Coal India Ltd.
addressed a letter dated July 5, 2007 to SECL directing it to
take all necessary actions for execution of lease deed in favour
of the petitioner company. On July 9, 2007, SECL issued a
letter to the Chairman-cum-Managing Director of CMPDI                 c
requesting to make assessment of the land required to be
leased out. In view of the directions contained in letter dated
July 5, 2007 of Coal India Limited, SECL filed an application
on July 16, 2007 before the High Court of Chhattisgarh at
Bilaspur. in WP No.3094 of 2007 seeking permission to
                                                                      D
execute a lease deed in favour of petitioner's company. It was
also mentioned in the said application that the petitioner
company had agreed to take the land on lease for establishment
of a coal washery and agreed to pay the lease money to SECL.
Subsequently, on August 9, 2007, an additional affidavit was
                                                                      E
filed enumerating three conditions precedent to the execution
of lease deed in favour of petitioner-company. The record
shows that the petitioner-company showed willingness to abide
by those conditions but no lease deed is executed between the
petitioner-company and SECL. In the title suit filed by SECL,
an order we1s passed by the High Court directing the parties          F
to appear before Mr. Gopal Subramanium, the then learned
Additional Solicitor General of India, to explore the possibilities
of a settlement. The record does not indicate that any
settlement had taken place between the parties.
                                                                      G
     5. The grievance made by the petitioner in the instant
application is that it has expended almost Rs.100 crores to set
up a 10 million ton washery. It is averred in the application that
the buildings have been constructed and expensive state of art
machineries and equipments have also been purchased and
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    332       SUPREME COURT REPORTS                 [2010) 4 S.C.R.


A installed. The petitioner has mentioned that trial run was also
  done in the wahsery nearly two years ago and the petitioner is
  not able to operate the washery only due to refusal by SECL
  to issue Transit Passes/Delivery Orders for transport of coal
  purchased by the linked and other consumers through the
B petitioner's wahsery before delivery to such purchasers.
  According to the petitioner, the only ostensible reason for SECL
  to refuse grant of Transit Passes/Delivery Orders is the dispute
  as to the title of the land between the State of Chhattisgarh and
  SECL. The claim advanced by the petitioner is that washing
c of the coal before consumption has significant environmental
  benefits and is also in the public interest and as there is
  significant shortage of coal washeries, the petitioner's washery
  should be permitted to operate. Under the circumstances, the
  petitioner has filed this application and claimed relief to which
D reference is made earlier. .
          6. The respondents have filed affidavit in opposition.

       7. This Court has heard the learned counsel for the parties
  at great length and in detail. The Court has also considered the
E documents forming part of the instant application as well as
  SLP (C) No.20238 of 2006.

        8. During the course of hearing of the application, it was
  made clear by the learned counsel for the petitioner that the
  petitioner company is ready to take the land on lease from
F SECL and pay rent to the said company. The record shows that
  several cases have been clubbed together and Civil Suit No.1-
  A of 2008 relating to title of the land leased to the petitioner
  company by the State Government is pending disposal. The
  averments made by the petitioner that on the leased land, the
G petitioner has expended almost Rs.100 crores to set up a 10
  million tons washery and has installed expensive machineries
  could hardly be controverted by the respondents. The petitioner
  company is neither claiming title to the land nor asserts that the
  coal coming to its company for wash belongs to it. By a scientific
H process, the petitioner washes the coal brought to the factory
  MA,RUTI CLEAN COAL & POWERS LTD. v. ALOK                  333
         NIGAM ·~ ANR. [J.M. PANCHAL, J.]
 by the purchasers. Once SECL sells coal to the highest bidder A
 and the bidder pays the price, the property in coal would stand
 transferred to the purchaser and the purchaser would be free
 to deal with the quantity of coal purchased like any other prudent
 purchaser. Here, th~ petitioner-company is not concerned at all
 with the title of the ·~oal in question. The building constructed B
 and machineries installed have remained unused since long
 causing great finan~ial loss to the petitioner-company. It is
 relevant to notice th~t as on date, there is no order subsisting
 which restrains the petitioner from operating the washery in
 question. The assertion made by the petitioner that it has        c
 received all necessary approvals for running the washery
 including the approval from the Ministry of Environment,
 Electricity Department, Commercial Tax Department, licence
 under the Factories Act etc. is not disputed by any of the
.respondents. Therefore, this Court is of the opinio.n that the D
 prayer made by the petitioner-company in the instant
 application deserves to be granted, of course, subject to certain
 conditions.
      9. For the foregoing reasons, the application partly
succeeds. M/s South Eastern Coal Field Ltd. is hereby directed E
to start supply of coal and issue Transit Passes/Delivery Orders
through the washery of the petitioner on behalf of linked and
other customers based on instructions/requests from them. It
is clarified that the grant of this interim relief will be subject to
the result of Civil Suit No.1-A of 2008 pending in the High Court F
of Chhattisgarh at Bilaspur. It is also clarified that if issue of
the title is held in favour of M/s. South Eastern Coal Field Ltd.,
it would be open to the said company to lease the land to the
petitioner-company or to take other steps with reference to the
said land in accordance with law. Subject to above mentioned G
clarifications/observations, rule is made absolute. There shall
be no order as to costs.

R.P.                                Application Partly allowed.·