SONE VALLEY PORTLAND CEMENT CO. LTD. versus THE GENERAL MINING SYNDICATE PVT. LTD.

Citation: [1977] 1 S.C.R. 359 · Decided: 24-08-1976 · Supreme Court of India · Bench: HANS RAJ KHANNA · Disposal: Dismissed

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Judgment (excerpt)

I 
359 
SONE VALLEY PORTLAND CEMENT CO. LTD. 
v. 
THE GENERAL MINING SYNDICATE PVT. LTD. 
August 24, 1976 
[ H. R. KHANNA, R. S. SARKARIA AND JASWANT SINGH, JJ.] 
Bi/tar Lund Reforms Act, 1950-ss. 4(a) alnd IO-Lessee of mines-:-lf a 
tenure-holder or intermediary under the Act. 
lntuprl'tation-Amendment of a section-If could be used to interprtt an 
earlier provision in the Act. 
The proprietor of large tracts of land leased blocks of land to the lessees 
at a stipulated rate of royalty and rent. 
The lessees sub-leased the land to 
the appellant who undertook to pay the less'ees the same royalty and rent 
payable by them to the proprietor. 
They also agreed to pay an additional 
royalty to the head-lessee. 
The sub-lease gave an option to th'<! appellant to• 
make payment of royalty directly to the head lessor in terms of the head 
)ease. 
The lessees transferred their rights, title and interest in the head lease 
and sub-lease to the respondent. 
By virtue of a notification under s. 3 of the Bihar Land Reforms Act, 1950 
the estate belonging to the head' lessor passed to and became vested. in the 
State. 
Another notification issued under s. 3A of the Act declared that all 
intermediary interests in certain districts had passed to and became vested in 
the State. 
In exercise of its option under the sub-lease the appellant paid rent and 
royalty directly to the head lessor andi the additional royalty to the head lessee 
(respondent) but stopped payment of additional royally to the respondent in 
terms of the sub-lease, from July 1, 1958. 
On August 8, 1959· Controller of 
Mines and Leases for India passed an order enhancing the royalty payable 
to the State and in cl.(9) of the order it was stated that "royalty will be payable 
to State Government by the appellants in accordance with s. 9 of the Mines 
and Minerals (Regulation & Development) Act, 1957 and dead rent accarding 
to the order passed in these proceedings." The respondent filed a suit claiming 
arrear~ of additional royalty. 
The High Court decreed the suit. 
A 
B 
c 
D 
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In appeal to this Court, it was contended that (i) since the respondent was 
merely a tenure-holder aµd all it~ rights, title and interest as such extinguished 
alongwith the interes~ of the erstwhile proprietor with the coming into• forcei 
F 
of the 1950-Act it was the appellant as·,a sub-lessee that became a direct Jessee 
of the State and, therefore, the respondent was not entitled to claim additional 
royalty. 
(ii) since the enhanced royalty was payable by the respondent which 
was paid by the appellant, the appellant was entitled to reimbursement to the 
extent it paid the amount as agent of the respondent. 
Dismissing the appeal, 
HELD : (1) (a) A 
combined reading of ss.4(a) and 10 of the 1950cAct 
G 
leaves no room for doubt that the interests of the head lessee were Jeft un-· 
affected by the notifications. (369 DJ 
(b) The1 respondent could not be said to be a tenure-holder as 
corite~:n­
P!ated by the 
1950-A~t as it had neither acquired from the head lessor by 
Vlrtue of the lease a nght to hold the land. for the purpose of collecting rent 
nor a right to hold the land for bringing it under cultivation by ·establishing 
tenants on it. The right of the respondent as a head lessee of the mines and· 
minerals also .di(! hot cease and the appellant did not acquire the status of' a 
Jesse~. Accordmg to s. 4(a) of 1950-Act on the publication of the .notifications 
the mterests of the propnetor or tenure holder comprised 
in ·such 
estate 
or tenure inclusive of such right of a lessee of mines and minerals com]lrised 
7-1104-SCI/76 
H 
A 
B 
c 
D 
E 
F 
G 
H 
360 
SUPREME COURT REPORTS 
(1977] 1 S.C.R-
in such estate or tenure vest absolutely ih the State free from encumbrance:Y. 
and such proprietor or tenure.holder has to cease to have any interest in such 
estate or tenure other than the interest expressly saved by or under the provi· 
sions of the Act. The last words of s. 4(a) of the Act, namely, .. other than· 
the interest expressly saved by or uhder the provisions of the Act'' unequivo-
cally show that those interests which are expressly saved are not affected or 
impaired by the notifications. 
According to s.10 which itself is in the nature 
of a non-0bstante provision overriding other provisions of the Act; every lease· 
of mines ahd minerals comprised in the notified estate or tenure or any part 
thereof which may be subsisting immediately before the datel of vestin

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