LexSTATE OF U.P. & ANR. versus NORTHERN COAL FIELDS
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[2024] 10 S.C.R. 1918 : 2024 INSC 948 State of U.P. & Anr. v. Northern Coal Fields (Civil Appeal No. 7614 of 2014) 03 October 2024 (Vikram Nath and Prasanna B. Varale, JJ.) Issue for Consideration Issue arose as regards the legislative competence of the State Government to realise lease rent from the respondent-Government Company under the Coal Bearing Areas (Acquisition and Development) Act, 1957. Headnotes† Coal Bearing Areas (Acquisition and Development) Act, 1957 – ss.10 and 11 – Vesting of land or rights in Central Government – Power of Central Government to direct vesting of land or rights in a Government company – Acquisition of land by the Central Government under the Act – Subsequently, the said land vested in the respondent-government company – State Government issuing letters to the respondent to deposit lease rent – Aggreived thereagainst, the respondent filed writ petition – High Court allowed the same holding that the entire area had been acquired under the Act, under which the State had no legislative competence, directing the State not to realise further lease rent from the respondent – Correctness: Held: When there is no pre-existing lease at the time of acquisition by the Central Government and the rights are subsequently vested in a Government Company, then such Government Company does not become a deemed lessee of the State – Rights in the Government Company were vested specifically by virtue of sub-section (1) of s. 11 and at that time, there did not exist any mining lease as provided under sub-section (2) – Rights u/s.11(1) are vested in the Government Company in the exact nature as they existed in the Central Government at the time – Thus, when the Central Government’s right was free from all encumbrances and completely absolute, the Government Company also acquired an absolute right over the land – No question of a qualified right in the capacity of a deemed lessee of the State Government arises [2024] 10 S.C.R. 1919 State of U.P. & Anr. v. Northern Coal Fields in such a situation – This is by virtue of the fact that when Central Government acquired such rights and also when it was further vested in the Government Company, there was no pre-existing mining lease in favour of any person and, thus, s.10(2) and s.11(2) become inapplicable in the given case – Thus, the land vested in the Government Company free from all encumbrances, subject to the conditions imposed by the Central Government – State Government not entitled to claim itself as a deemed lessor of the Government Company and the demand for “lease rent” completely unwarranted – State Government’s demand for “lease rent” not supported by any statutory provision, such a demand cannot be sustained in law. [Paras 12-14, 18] Coal Bearing Areas (Acquisition and Development) Act, 1957 – ss.10 and 11 – Interpretation – Distinction between the nature of right accrued between s.10 (1) and (2) as also between s.11 (1) and (2) – Discussed. [Paras 11, 12] Case Law Cited Mahanadi Coalfields Ltd. v. State of Odisha [2023] 1 SCR 1055 : (2023) 4 SCC 343 – distinguished. Managing Director, National Coal Development Corporation and etc. v. State of Bihar & Ors. AIR 1984 Pat 280 – approved. State of West Bengal v. Union of India [1964] SCR 1 371 : AIR 1963 SC 1241 – referred to. List of Acts Forest (Conservation) Act, 1980; Coal Bearing Areas (Acquisition and Development) Act, 1957; Mines and Minerals (Development and Regulation) Act, 1957. List of Keywords Lease rent; Legislative competence; No pre-existing lease; Deemed lessee of the State; Mining lease; Acquisition by Central Government; Vested rights in Government Company. Case Arising From CIVIL APPELLATE JURISDICTION: Civil Appeal No. 7614 of 2014 From the Judgment and Order dated 16.01.2013 of the High Court of Judicature at Allahabad in CMWP No. 50320 of 2010 1920 [2024] 10 S.C.R. Digital Supreme Court Reports Appearances for Parties K M Natraj, A.S.G., Ms. Garima Prashad, Sr. A.A.G., Sudeep Kumar, Ms. Indira Bhakar, Ms. Manisha, Ms. Rupali, Anuj Udupa, Advs. for the Appellants. Ashok Kumar Sharma, Sr. Adv., Ashwani Kumar Dubey, Kshitij Mudgal, Ms. Anshul Rajora, Advs. for the Respondent. Judgment / Order of the Supreme Court Judgment 1. The present appeal arises from the judgment and order of the High Court of Judicature at Allahabad dated 16.01.2013 in Writ (C) No. 50320/2010 wherein the Respondent’s Writ Petition was allowed, o
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