THE CHIEF OF MARKETING (MARKETING DIVISION), COAL INDIA LTD. AND ANR. versus MEWAT CHEMICALS & TINY S.S.I. COAL PULVERISATION UNIT AND ORS.

Citation: [2004] 3 S.C.R. 597 · Decided: 26-03-2004 · Supreme Court of India · Bench: S.N. VARIAVA · Disposal: Disposed off

Judgment (excerpt)

THE CHIEF OF MARKETING (MARKETING DIVISION), COAL 
INDIA LTD. AND ANR. 
v. 
MEWAT CHEMICALS & TINY S.S.!. COAL PULVERISATION UNIT 
AND ORS. 
MARCH 26, 2004 
[S.N. VARIAVA AND H.K. SEMA, JJ.] 
Colliery Control Order, 1945: 
A 
B 
c 
Powers of Coal Controller-Scope and ambit of-Held: Although Coal 
Controller was competent to allot coal, his orders were subject to Central 
Government's instructions-The control of the Central Government was all 
pervasive-Coal Conirol/er was not an authority equal to Central 
Government-Hence, overruling the Coal Controller's order by the Central D 
Government did not amount to a review-Moreover, Coal Controller not 
_empowered to grant linkages of coal. 
Clause 12-A--Guidelines issued by Director, Ministry a/Coal-Binding 
nature of-Held: Was binding on the Coal Controller although such guidelines 
not issued by the Joint Secretary (Coal). 
E 
Clause 12-A-Allotment of coal-Central Government's instructions 
in the matter of-Applicability-Held: Central Government's instructions on 
the date of allotment took precedence over those on the date of filing of 
application for allotment of coal-Hence, Coal Controller bound to apply 
those instructions on the date of allotment and not those on the date of filing F 
applications-Administrative Law. 
The Central Government issued a Notification specifying the Coal 
Controller as the competent authority to allot coal under the Colliery Control 
Order, 1945. By another circular, the appellant was authorized to give coal G 
clearances/linkages to the new applicants up to 5,000 tones per month and 
applications for more than 5,000 tones per month were to be decided by the 
Ministry of Coal. 
The respondents had made applications for allotment of coal and had 
597 
H 
598 
SUPREME COURT REPORTS • 
[2004] 3 S.C.R. 
A also applied for linkages. The High Court directed the Coal Controller to 
consider the said applications within a certain period. The Joint Secretary 
(Coal) pointed out that the Coal Controller was not authorized to give linkages 
but could only allot coal. 
Thereafter, by a circular, the then Director, Ministry of Coal specified 
B that all grades of coal which were governed by notified prices should only be 
allotted to power sector. It was also specified that other consumers of coal 
had to be given coals of grades for which the prices have been decontrolled. 
c 
Subsequently, the Coal Controller in exercise of his power under Clause 
12-A of the Colliery Control Order, 1945, allotted more than 5,000 tones of 
coal from two coalfields to the respondents. Thereafter, the Joint Secretary, 
Ministry of Coal issued an order that the Coal Controller was not authorized 
to grant any long term linkages and that allotment of coal by the Coal 
Controller had to be subject to such instructions that the Central Government 
may issue from time to time. The Joint Secretary also held that the order of 
D the Coal Controller being contrary to the instructions issued by the Central 
Government no action was to be taken to supply coal as per that order till a 
final decision was taken by the Central Government. 
The respondents filed a writ petition before the High Court challenging 
the said order of the Joint Secretary. The High Court held that the Coal 
E Controller was competent to grant linkages and that in any case he being a 
competent authority the Central Government could not sit in review over the 
order passed by the Coal Controller. It further held the allotment to the 
respondents had to be governed by the position prevailing on the date they 
made their applications. The High Court also held that the guidelines having 
F been issued by a Director could not be said to be the guidelines issued by the 
Central Government. Hence the appeal. 
On behalf of the appellant, it was contended that under the Colliery 
Control Order the control of the Central Government was all-pervasive; that 
the Coal Controller was bound to comply with the instructions of the Central 
G Government; and that the Coal Controller had no power to grant linkages 
contrary to the instructions issued by the Central Government. 
On behalf of the respondents, it was contended that that the Coal 
Controller was an independent authority under the Colliery Control Order; 
that he had the powers equal to those of the Central Government; and, 
H therefore, the Central Government could not sit in Appeal over or Review 
·-I:. 
CHIEF OF MAKT. COAL INDIA LTD. 1·. MEWA T Cl IEMI. & 

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