TATA IRON AND STEEL CO. LTD. ETC. versus UNION OF INDIA AND ANR.

Citation: [1996] SUPP. 3 S.C.R. 808 · Decided: 23-07-1996 · Supreme Court of India · Bench: A.M. AHMADI · Disposal: Dismissed

Judgment (excerpt)

A 
B 
TATA IRON AND STEEL CO. LTD. ETC. 
v. 
UNION OF INDIA AND ANR. 
JULY 23, 1996 
!A.M. AHMADI, CJ.AND B.L. HANSARIA, J.] 
Mines and Minerals (Regulation & Development) Act, 1957-Secrion 
8-Pen·ads for ivhiciz niining leases n1ay be granted or renelred-Renewal of 
C lease in interest of niineral developn1ent-Order nzust rc.:ord 
reason.s-Relevance of c1iterion of captive requircn1e11t of n1i11ing industries 
and principle of equitable distribution of 111ining lease-Pro.~q1cctivc a11-
plicants-Held, proper pwties. 
The appellant, TISCO, a limited company claiming that it was the 
D first to discover Chrome Ore in Orissa, in the year 1949, applied for a 
prospecting licence and \\·as granted a inining lease over an area of 1813 
hectares for chromite for a period of 20 years w.e.f. 12.1.1953. Since the 
lease was to expire on 12.1.1973, TISCO sought its renewal which was duly 
granted u/S 8(2) of the Mines and Minerals (Regulation & Development) 
Act, 1957, for a further period of 20 years, till 11-1 1993. In 1991, a year 
E prior to the date of expiry of the lease, TISCO applied for a second renewal 
u/s 8(3) of the Act for a further period of 20 years. The Central Govern-
ment rene'\\'ed TISCO's lease over a reduced urea of 651 hectares and it 
was decided to distribute the balance area in an equitable manner taking 
into consideration the need of genuine consumers for captive ronsu1nption. 
F TISCO filed a \\Tit petition in the High Court challenging the order on the 
ground that the scheme of equitable distribution of mining leases on the 
basis of need of an industry is extraneous to the concept of' mineral 
development, which alone is relevant u/s 8(3) of the Act. The High Court 
struck down the renewal of TISCO's lease granted by the Central Govern-
ment inter alia on the ground that the Central Government had not kept 
G in view the recommendations made by the Rao committee and thereafter 
directed the Central Government to reconsider TISCO's application for 
renewal of the lease in accordance with Jaw. In 1995, the Ministry of Mines, 
Government of India constituted a co1nmittee for rehearing and recon~ 
sidering the issue in regard to the rene'\\'al of nlining lease to TISCO. The 
H Co1nn1ittce sulJmittcd a report recornmending renewal of the lease for a 
808 
I AT,, !RON /\N ll STEEL CO. LTD.''· lJ.O.l. 
809 
reduced areido TISCO. stating that Articles 39(h) & 14 orthe Constitution A 
n1ust be taktn into consideration for deciding the issue of equitabJc 
distribution of resources and that ~rlSCO "'01Jld not claiin to have any 
legal right over tht rene\ral of its lease for the second tirne and, if the 
Central (;ovcrnn1cnt "'as to rcnC\\' it, it n·ould havr to record reasons \rhy 
such a 1neasure \\'Ould he in the interest of n1ineral devcloprucnt. Tht 
Cou11nittee \.ras of the opinion that it \\ould be necessary in the interest of 
n1ineral devclop1ncnt to authorise the rtne\ral of chron1ite lease to TISC() 
B 
11/s 8(3) of the Act >trictly in terms of TISC!)'s requirement and keeping 
in vie\V the require111ents of needy 111a1111facturing industries. The Com1nit-
tcc approved the principle of allotting leases to different industries by 
taking into consideration tht:ir re£1uire1nents for captive mining holding C 
an opinion that tht• best \\-'ay of benefitting an established chro1ne based 
industry with a large ore consu1nption \\'as tn provide a n1inc owner status 
to the different industrial units and that TISCO should make efforts to 
initiate underground 1nining on a large scale "'hich would allo"' it to better 
exploit the ore within its lease hold area. In its view, the appropriate area D 
catering to TISCO's requirement would total 461 hectares. The Committee 
also formed an estimate of requirements of the other parties appearing 
before it. 
In these appeals liled against the judgn1ent of the High Court, the 
issues raised for consideration were : 
(i) Whether the High Court of Orissa was justiticd in striking down 
the decisions of the Central Government dated 3.6.1993 and 5.10.1993 on 
E 
the ground that the requirement of Section 8(3) of the Act had not been 
met; (ii) Whether the reJJOrt of the Rao Committee and the decision of this F 
Court in Indian Afetals case are relevant for the consideration of renewal 
of leases under Section 8(3) of the Act; (iii) Whether the High Court and 
the Comn1ittee \\'ere justified in hearing prospective applicants while con~ 
sidering the issue of renewal o

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