BHARAT COKING COAL LTD. versus THE STATE OF BIHAR AND ANR.

Citation: [1994] SUPP. 1 S.C.R. 112 · Decided: 13-05-1994 · Supreme Court of India · Bench: KULDIP SINGH · Disposal: Appeal(s) allowed

Judgment (excerpt)

A 
BHARAT COKING COAL LTD. 
v. 
THE STATE OF BIHAR AND ANR. 
MAY 13, 1994 
B 
[KULDIP SINGHAND YOGESHWAR DAYAL, JJ.) 
BihOJ' Land Refonns Act 1951>-Sections 10, 11, and 2(m)-Miniilg 
lease-On a small portion of the suiface land, a bazaOJ' and cinema house 
set up for benefit of colliery workers-Held, entire OJ'ea including land· on 
C which bazaOJ' and cinema house located would be covered by mining lease 
and hence deemed to have been leased by State Government by viltUe of 
Section 10(1). 
The appellant company had snbslsting leases In respect of an area 
D of 627 blghas of land for a period of 999 years. The surface land had been 
taken on lease from the tenure holders. Apart from bungalows, labour 
quarters, pits, quarries, coal depots and other things connected with coal 
mining operations no part of the surface land was used for agricultural 
purposes. On a small portion of the land a small bazaar and a cinema 
E house had also been set up. 
A notice under section 4 of the Blhar Land Reforms Act, 1950 was 
served on the Company asking It to deliver possession of the land on the 
ground that it had been vested In the State of Bihar. The Trial Court on 
the company's suit held that the whole estate In dispute had vested in the 
p State and by virtue of Section 10(1) and 11 of the Act and the Company 
became the mining lessee under the State of Bihar for the remainder of 
the terms of the lease of999 years granted in 1894. The Trial Court decreed 
the suit and restrained the State of Bihar from Interfering with the 
possession of the Coinpany over the entire land. 
G 
The Single Judge of the High Court in the State's Appeal however, 
took the view that the cinema and bazaar portions of the land would not 
get protection of Section 10 read with Section 11 of the Act and modified 
the Trial Court decree to that extent. 
H 
The company appealed to the Supreme Court by Special Leave. 
112 
> 
BHARAT COKING COAL LTD. v. STATE OF BIHAR 
113 
Allowing the Appeal, 
A 
HELD: 1. The original lease in favour of the plaintiffs is a subsisting 
lease for extraction of mines and minerals comprised in the entire estate. 
Merely because in a very small part of it by way of amenities to the 
employees working at the mines, a portion is reserved by way of bazaar for B 
purchase of daily needs of the employees and for a cinema house, it cannot 
be said that the subsisting lease is being used for a purpose other than 
those of mines and minerals. The term "mine" has been defined in Section 
2(m) of the Bihar Land Reforms Act. It merely defines what "mine" is. 
There is no definition of "subsisting lease of mines and minerals". The lease C 
itself was for mining operations during the period of the lease. It does not 
require that every area must be under actual mining operation. It was not 
the case of the State that there were no minerals in the area where the 
shops and cinema hall were there. The lease being a long-term lease of 999 
years, it will take its own time for the lessee to work on different portions D 
of the area. The purpose of Section 10 of the Act was to exclude subsisting 
leases for purposes of mining or minerals. It contemplated that the land 
should not be used for agricultural purposes or such like purposes to enjoy 
the benefit of Sections 10 and 11 of the Act. [118-D-E-F-G] 
2. The High Court erred in its interpretation of Section 10 of the Act 
and in ignoring the full effect of Section 11 of the Act. The trial court was 
in any case right in inclnding buildings and land which were appertaining 
to the mines and which were not covered under Sections 9 and 10 of the 
Act to be covered under Section 11 of the Act. But it is not a true 
interpretation of Section 10(1) of the Act so long as the area is covered by 
lease for mining. The estate or tenure comprised in such lease which vests 
in the State would be deemed to have been leased by the State Government 
to the holder oflease. Section 11 comes into operation when certain leases 
E 
do not include the buildings and land as part of the lease. On the facts of 
·the present case the lease is such that everything in the area of the lease G 
vests in the State Government and is deemed to be have been leased by the 
State Government to the lessee. The lease in the present case is of the 
entire village for purposes of mining. Therefore, everything comprised in 
the village on vesting in the State would be deemed to have been leased by 
the State Government to the

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