M/S INDIAN CHARGE CHROME LTD. AND ANR. versus UNION OF INDIA AND ORS.

Citation: [2006] SUPP. 10 S.C.R. 640 · Decided: 11-12-2006 · Supreme Court of India · Bench: Y.K. SABHARWAL · Disposal: Disposed off
cites 1 · see the full citation network in Lexace
Open in Lexace · Ask the AI about this case
Judgment (excerpt)

A 
MIS INDIAN CHARGE CHROME LTD. AND ANR. 
v. 
UNION OF INDIA AND ORS. 
DECEMBER 11, 2006 
B 
[Y.K. SABHARWAL, CJ., C.K. THAKKERAND P.K. 
BALASUBRAMANY AN, JJ.] 
Mines and Minerals (Regulation and Development) Act, 1957; sections 
C 11(5) & 17A (2)-Minera/ Concession Rules, 1960 ; Rule 59-
Recommendation by State to Central Government for approval to grant 
mining lease to a State Corporation under the Act-Correctness of-Held, 
State has power under the Act to make such recommendation-State cannot 
be estoppedfrom exercising its statutory power-On facts, the recommendation 
is neither mala fide nor a colourable exercise of power and hence, valid 
D 
Grant of mining lease out-ofturn by State to a private company in 
preference to claimants steel companies-Correctness of-Held, on facts, 
State has not fulfilled the conditions under the Act and Rules-No reasons 
were disclosed and hence, the grant is unjustified and illegal. 
E 
Challenges in all the appeals, transferred cases and the cases covered 
by transfer petitions ate the correctness of the decision of the State 
Government to grant lease of land for mining purpose to State Mining 
Corporation and to grant out-of-turn lease to a steel company N in preference 
to other applicants-steel companies claiming lease. 
F 
The steel companies, who opposed grant of lease to the steel company 
and the State Mining Corporation, contended that the Central Government 
and not the State Government has power to grant lease to the Corporation 
under section 17 A (2) of the Mines and Minerals (Regulation and 
Development) Act, 1957 in view of the heading of the section; that the Central 
G Government rejected the approval sought by the State Government u/s 17 A 
(2) of the Act; that the State Government u/s had not disclosed all relevant 
material facts to Central Government about the efficiency of the Corporation; 
that the decision is irrational; that the change of policy of allotting land is 
ma/a fide and is a colourable exercise of power to defeat the earlier judgments 
of the High Court and this Court; that the Committee, which was set up to 
H 
. .. 
640 
·. 
INDIAN CHARGE CHROME LTD v. U.0.1. 
641 
look into distribution of lands of mining among the applicants-steel companies, A 
rejected the grant of lease to the State Corporation; that no reasons were 
given for granting out-of-turn lease to N and hence the lease was unjustified 
and illegal; that conditions laid down under section 11(5) of the Act have not 
been fulfilled and hence, the State Government cannot grant the lease to N; 
Steel company N contended that the State Government granted lease to B 
it in exercise of power conferred under section 11(5) of the Act. 
The State and the State Mining Corporation contended that the ore is 
required by many industries in the country and that ifthe whole area is divided 
and given for private exploitation, there may be difficulty in ensuring equitable C 
distribution of the ore; the power vested under sedion 17 A of the Act was 
independent of the power under section 11 of the Act; that it was always open 
to the State Government with the approval of the Central Government to grant 
lease to it under·the Act; that the decision of this Court in earlier proceedings 
does not stand in the way of exercising power by the State Government under 
~~ 
D 
Disposing of the cases, the Court 
HELD: 1.1. On the scheme of the Mines and Minerals (Regulation and 
Development) Act, 1957, the decision or recommendation under section 17 A 
of the Act can be taken or made until the area in question is actually leased E 
out to any applicant in terms of Section 11 of the Act. The power of the State 
Government saved by Section 17 A (2) of the act is in no way fettered or 
curtailed. It cannot be said that the recommendation made by the State 
Government is per se invalid or that it is one without authority. The State 
Government could exercise the power under section 17 A (2) of the Act until 
a grant is actually made since it is an overriding power. [652-D-F) 
F 
1.2. The direction of the Court in earlier proceedings to deal with the 
land on the basis of the recommendations of the Committee does not by itself 
preclude the exercise of power by the State under Section 17 A (2) of the act 
to make a recommendation that the exploitation be left to a corporation owned G 
or controlled by it. (653-A, BJ 
1.3. Adoption of a particular stand by the State Government in earlier 
proceedings cannot est
Excerpt shown. Read the full judgment & AI analysis in Lexace.