VERIGAMTO NAVEEN versus GOVERNMENT OF ANDHRA PRADESH AND ORS.

Citation: [2001] SUPP. 3 S.C.R. 112 · Decided: 18-09-2001 · Supreme Court of India · Bench: S. RAJENDRA BABU · Disposal: Case Partly allowed

Judgment (excerpt)

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VERIGAMTO NAVEEN 
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GOVERNMENT OF ANDltRA PRADESH AND ORS. 
SEPTEMBER 18, 2001 
[S. RAJENDRA BABU AND D.P. MOHAPATRA, JJ.] 
Mines and Minerals (Regulation and Development) Act, 1957-Section 
Mineral Concession Rules, 1960-Rule 37 (as amended on 20.2.1991 )-
Mining sub-lease-.Grant of before 20.2.1991-Cancellation thereof 
challenged-Expiry of period of sub-lease during pendency of the case-Held, · 
ct1Se became infructuous, hence dismissed-claim for damages for the period 
when mining work not done-High Court granted damages by extending leave 
period-Plea that provisions under Section and Rule having not complied with, 
sub-lease was void ab initio, hence not entitled for damages-Held, grant of 
sub-lease not void ab initio-However period of original lease could not have 
been extended-The question of damages has to be considered in civil court. 
Mining sub-lease-Date of grant not known-Cancellation thereof 
challenged-Held, lease, if granted later than 20.2.1991, would get e.ffected-
Govemment to determine the date of grant. 
Constitution of India, 1950-Article226-Judicial Review-Government 
entered into contract-Cancellation of contract-Plea that judicial review not 
permissible in contractual case-Held, pennissible, since present case does not 
fall purely in a contractual .field. 
Respondent-State granted mining lease in favour of Andhra Pradesh 
Mineral Development Corporation. It gave permission to grant sub-lease. 
Thereafter it withdrew the permission to sub-lease. The sub-lessees tiled 
writ petitions before High Court against the withdrawal of the permission. 
High Court allowed the petitions on the ground that the State had not 
followed due procedure as provided under section 4A of Mines and Minerals 
(Regulation and Development) Act, 1957 and Rule 37 of Mineral Concession 
Rules 1960. Writ appeal against the order was dismissed by the Full Bench 
on the terms that the State would decide the termination of the sub-leases 
as per rules within three months and if no orders were passed within the 
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VER,IGAMTO NAVEEN v. GOVT. OF A.P. 
113 
said period, it wcndd be open for the sub-lessees to proceed with the mining 
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work. 
In appe1d, this Court by Its interim order directed the sub-lessees to 
carry on the mining operation. During the pendency of the appeals, the 
Respondent-State Jn compliance of the order of the Full Bench, heard the 
appellants as per procedure provided under the Act and the Rules, and 
dedded against the appellants. The sub-leases granted in favour of all the 
appellants except one had already expired before or during the pendency 
of the appeals. Even in that one case it was not clear whether the lease was 
granted pursuant to the general permission obtained in respect of sub-
lease under Rule 37 or any separate permission was secured from the 
State. It was also not clear as to when the consent was given. 
After the abovesaid interim order passed by this Court, some of the 
present Respondents filed writ petitions before High Court claiming 
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exclusion of the period during which they were not able to operate mining 
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work due to illegal cancellation of sub-leases and due to stay order of the 
High Court and further claimed compensation for that period. State 
contended that sub-lease was not in order since the state Government is 
barred to lease without previous approval of Central Government and 
since provision under Rule 37 (as amended on 20.2.1991) was not followed 
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in subletting. High Court held that the petitioners were liable to be 
compensated since the sub-lease was in order and since the same having 
been granted prior to 20.2.1991, Rule 37 was not attracted and, therefore, 
directed the State and the Corporation to put the writ petitioners i!l 
possession of the lease-hold property to continue their mining operation 
for the period which they had lost. 
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In appeal to this Court the State Government and the Andhra Pradesh 
State Mineral Development Corporation contended that since no prior 
permission was obtained from the Central Government in granting sub-
lease, the sub-lease was void ab initio; that since the case arose purely out 
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of a contract, interference under Article 226 of the Constitution was not 
called for; and that the period of sub·lease could not have been extended 
after the expiry of period of original lease. 
Disposing of the appeals, the Court 
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SUPREME COURT REPORTS 
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