TMI Blog1990 (8) TMI 394X X X X Extracts X X X X X X X X Extracts X X X X ..... the appellant's coal mine in village Sudamdih. After the coal is extracted from the mines, it is crushed into pieces of different sizes for purposes of grading. Since the coal is mixed up with mud and other impurities, same is brought to the washery for washing and cleaning the same for reducing the ash percentage and for use by metallurgical consumers. In the process of washing small coal particles escape from the washery in the form of slurry along with water and the same are deposited in the slurry ponds constructed for their storage by the appellant company. But when the ponds are full, the slurry overflows the pond and flows down into the river Damodar. After the water is soaked by the soil the small particles of coal get deposited in the river bed. These coal particles are collected and formed into briquettes which are sold in market for energy and fuel purposes. The slurry coal has acquired high commercial value as it is of exceptional quality and high grade, it is used by steel plants and thermal power stations. The State of Bihar granted lease in favour of Ram Nath Singh respondent No. 4 for collecting the coal particles settled in the Damodar fiber bed and other land ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... appellant. But sometime they overflow from the storage pond and settle down in the Raiyati land and in the Bokaro river bed. The appellant has been claiming right that the slurry which escaped from the washery belonged to it and no other person had right to collect the same. The State Government did not accept the appellant's claim instead it settled the fights of collection of slurry with the respondents under the indentures granted in their favour. Under the settlement the respondents have been authorised by the State Government to collect sludge and slurry which settles down in the Bokaro river bed or in the Raiyati land on payment of royalty to the State. The appellant filed two writ petitions before the Patna High Court challenging the authority of the State Government's action on the ground that slurry was a mineral being coal and as such its collection or mining was regulated by the provisions of the Mines and Mineral (Regulation and Development) Act, 1957 (hereinafter referred to as 'the Act') and the State Government had no authority to grant any lease for collection of sludge/slurry without the previous sanction of the Central Government. The aforesaid ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ant any lease to the respondent contractors for removal of the same. On appeal by the contractors a Division Bench of the Calcutta High Court vide its judgment (AIR 1985 Calcutta 143) held that the lease granted by the State of Bihar in favour of the contractors was not a mining lease and the provisions of the Act were not applicable to the grant of lease. On the question of appellants' claim to the property rights for collecting slurry, the Bench held that the slurry deposited on the appellant's land, belonged to them and the respondents had no right to collect the same but if the slurry settled down on other's land the respondents have right to remove the same from the river bed. Aggrieved, the Central Coal fields Ltd. and Coal India Ltd. have challenged the correctness of the High Court's view by these appeals. The main question which falls for consideration is whether the State of Bihar has authority to grant lease/settlement to the respondents for collection/lifting of coal slurry deposited in the river bed or on any other land after its escape from the appellants' washeries. Before the High Court the appellants contended that in view of the provision ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... river bed or on other land did not constitute a mineral and it was not regulated by the Central Act, consequently, the State of Bihar had authority to settle the collection of slurry. Learned counsel for the parties made elaborate submissions, before us in support of their case. On behalf of the appellants it was ' urged that slurry/sludge the subject matter of dispute in the instant cases, in substance is coal, a mineral specified in the First Schedule to the Act. The State Government had no authority in law to grant any lease to the respondents for the collection or removal or lifting of the slurry coal deposited in the river bed or on any Raiyati land without obtaining the sanction of the Central Government under Section 5 of the Act. The counsel for the appellants further emphasised that slurry which escaped from washery of the coal mines, contains small particles of coal having carbonaceous character, and it is used for energy and fuel purposes. Assailing the findings of the Full Bench of the Patna High Court and the Division Bench of the Calcutta High Court, the appellants' counsel submitted that slurry coal was not deposited in the river bed or other land by any ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ernment was justified in providing for its collection and removal to prevent pollution. The appellants could not have any right in the goods which they abandoned. It was further urged that the washeries do not form integral part of the mining operations, therefore the slurry could not be treated as a waste of coal mine. In the alternative learned counsel contended that even if slurry was a waste of a coal mine the State Government was competent to provide for its collection and removal as the Central Government had failed to make any rule under Section 18 of the Act regulating disposal of the slurry. Before, we consider the contentions of the parties, we think it necessary to briefly discuss the nature and characteristic of the slurry. There is no dispute that coal is found in seams mixed with mud and other impurities. After its extraction from the mines, it is crushed into different sizes, thereafter it is washed in the washeries of the coal mines for removing its impurities for purposes of making it fit for use for metallurgical purposes. In the washery plants, coal is washed with the medium of water mixed with pine oil and sand through mechanical process. In the process of washi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ery held that the carbonaceous particles so discharged from the coal washery is used for producing energy or heat therefore it was coal. The Bench further held that coal particles which flow out with the water from the coal washeries are formed into balls or briquettes for sale in the market for purposes of producing energy or heat, therefore, slurry was coal. The Division Bench's view was not accepted by the Full Bench of the Patna High Court as it held that the slurry deposit did not constitute a mineral. We agree with the view taken by the Division Bench in Kesari Mal's case (supra) as in our opinion the slurry coal deposited in the river bed or land, in substance as well as in its character continues to be coal. If slurry is coal, the question is whether the leases in dispute granted by the State of Bihar constitute mine leases as contemplated by Section 5(2)(a) of the Act. Mining lease as defined by Section 3(c) means a lease granted for the purpose of undertaking mining operations and include a sub-lease granted for such purpose. Mining operations as defined by Section 3(d) means any operations for the purpose of winning any mineral. Section 5(1) places res ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by the water which is discharged from the washery and the same are settled in the river-bed, any operation for the extraction or lifting of the coal particles from the river bed would involve winning operations within the meaning of Section 3(d) of the Act. We do not think it necessary to express any final opinion on this question as the appeals bound to succeed on the ground of absence of legislative competence of the State Legislature. Shri K.K. Venugopal learned counsel for the appellant urged that the recovery of coal from slurry irrespective of whether slurry is a mineral, or its collection involved mining operations or not, the State of Bihar has no authority in law to regulate disposal of slurry. Under the Constitution 'conservation and development of mines and minerals' is exclusively assigned to the Central Government, and the State Legislature has no power to make any lease with regard to the disposal of coal slurry which is waste of coal mining. He referred to the provisions of the Act and particularly to Sections 2 and 18 in support of his contention that in view of Parliamentary Legislation, the State Legislature has no legislative competence to enact any law ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lopment to the extent as provided by the Act. In order to ascertain the extent of Parliamentary declaration, it is necessary to have a glance at the provision of the Act. Section 3 of the Act defines various expressions occurring in the Act. Sections 4 to 9 prescribe restrictions on undertaking, prospecting and mining operations under licence or lease. Section 10 to 12 prescribe procedure for obtaining prospecting licences or mining lease in respect of the land in which minerals vest in Government. Sections 13 to 16 provide for framing of rules for regulating the grant of prospecting licences or mining leases. In particular s. 13 empowers the Central Government to make rules for regulating the grant of prospecting licences and mining leases in respect of minerals and for the purposes connected therewith. Section 13(2) lays down that rules may provide for all or any of the matters as enumerated under various clauses therein. Clause (0) of s. 13(2) before its amendment by the Amending Act 37 of 1986 conferred power on the Central Government to frame rules for the disposal or discharge of any tailings, slime or other waste products arising from any mining or metallurgical operations c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t means preservation of mineral; the wide scope of the expression conservation of minerals comprehends any rule reasonably connected with the purpose of protecting the loss of coal through the waste of coal mine, such a rule may also regulate the discharge of slurry or collection of coal particles after the water content of slurry is soaked by soil. In addition to the general power to frame rules for the conservation of mineral, Sec. 18(2) confers specific power for framing rules regulating disposal of waste of a mine. The Amending Act 37 of 1986 deleted clause (0) of s. 13(2) and added the same as clause (k) to s. 18(2) of the Act. After the amendment Sec. 18(2)(k) reads as under: 18(2): In particular, and without prejudice to the generality of the foregoing power, such rules may provide for all or any of the following matters, namely: (k): the disposal or discharge of waste slime or tailing arising from any mining or metallurgical operations carried out in a mine. Section 18(2)(k) confers express power on the Central Government for framing rules for the conservation and the development of mineral including the disposal or discharge of waste arising from any mining oper ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d mining leases including the disposal or discharge of any tailings, slime or other waste products. Subclause (0) of S. 13(2) was transposed into S. 18(2) as subclause (k) by the Amending Act 37 of 1986. As noted earlier, S. 18(1) confers general power on the Central Government to frame rules and to take all such steps as may be necessary for the conservation and development of minerals in India. Section 18(2) does not affect or restrict the generality or width of legislative power under Section 18(1) as the matters specified in various sub-clauses of S. 18(2) are illustrative in nature. Even in the absence of sub-s. (2) or its various sub-clauses, the Central Government was invested with the power of subordinate legislation in respect of any matter which could reasonably be connected with the purpose of conservation and development of minerals by S. 18(1) of the Act. Thus, power to frame rules, regulating the discharge or disposal of slime or slurry emanating from a coal mine including its collection from the river bed or from Raiyati land after its escape from the washery of the coal mines, would clearly fail within the expression conservation of mineral . Slurry admittedly co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n of slurry is relatable to exercise of its executive powers. Learned counsel for the appellants contended that since Entry 23 of List II of the Seventh Schedule confers legislative power on the State Legislature for making laws regulating mines and minerals, the State Government in the absence of any rule made by the Central Government has power to regulate disposal and collection of slurry. The State Government was justified in exercising its executive power making arrangements for the collection or removal of slurry which has been polluting the river water and affecting the Raiyati land's fertility. Article 162 prescribes the extent of executive power of the State, it lays down that the executive power of a State shall extend to the matters with respect to which the Legislature of the State has power to make laws. Thus, the executive power of the State Government is co-extensive with the legislative power of the State Legislature. If the State Legislature has power to enact laws on a matter enumerated in the State List or in the Concurrent List the State has executive power to deal with those matters subject to other provisions of the Constitution. If a subject matter falls ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d the law so made confers exclusive power on the Central Government to frame rules regulating the disposal of waste or industrial effluent of a mine, the State Legislature has, therefore no power either to make law under Entry 23 of List II or to exercise executive power to regulate the disposal of slurry, a waste effluent discharge of a coal mine. Learned counsel for the State of Bihar as well as for the respondent contractors contended that the lease executed by the State Government in their favour was not a mining lease within the provisions of the Act, therefore, the provisions of the Act are not applicable to it. This submission is rounded on the assumption that the slurry is not coal. We have already discussed the characteristic of slurry which shows that the coal can be transported in liquid form of slurry. The slurry which gets deposited on the river bed and on Raiyati land contains fine particles of coal, on its resumption it is used for energy and fuel purposes. It is, therefore, difficult to accept the contention that the coal particles which escape from the washery and get deposited in the river bed or in Raiyati land do not have the character of mineral. It is not, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Act defines 'mining operations' which means any operation undertaken for the purpose of winning any mineral. The expression 'mine' is not defined by the Act instead Section 3(1) says that the expression 'mine' has the same meaning as assigned to it in the Mines Act 1952. Mine as defined by Section 2(1)(j) of Mines Act 1952 means any excavation where any operation for the purpose of searching for or obtaining minerals has been or is being carried on and it includes: (xii) any premises in or adjacent to and belonging to a mine on which any process ancillary to the getting, dressing or preparation for sale of minerals or of coke is being carried on. The inclusive definition of mine is wide enough to include any premises belonging to a mine where any ancillary process is carried on for preparing the minerals or coke for sale. There is no dispute between the parties that the coal as extracted from the coal mine is crushed into pieces and thereafter it is washed to remove its impurities and ash contents to make the coal fit for sale. After the coal is washed, it assumes the form of coke which is sold to consumers. The washery, wherein the process of wa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of sludge/slurry escaping from the washeries of the appellant's coal mines including the prevention of pollution of river water or land is covered by Sec. 18 of the Act. The High Courts confined themselves to the question whether sludge/ slurry was a mineral under the Act and failed to consider the scope and effect of Section 18 of the Act. We are therefore of the opinion that in view of the admitted case of the parties disposal of sludge/slurry coming out from the washeries of appellants' coal mines is covered by the Act and the State Government had, no authority in law to grant any lease or settlement authorising collection of the same from the five bed or from any other land. Consequently, the respondents in whose favour settlements have been made by the State Government have no right to authority to collect sludge/slurry either from the five bed or from any other land. In Civil Appeal No. 4521 of 1986 the appellants' claim that plot No. 370 situated in village Sudamdih belonged to them and the sludge/ slurry discharged from their washery as settled down on that land also belonged to them therefore the State Government had no authority in law to permit respondents ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and a central company, i.e. Coal India Limited, was constituted having Bharat Coking Coal Limited as one of its subsidiary. The Bharat Coking Coal Ltd. was incorporated for running and managing the Sudamdih and Monidih coal mines of National Development Corporation. Since then the Sudamdih coal mines and the land in dispute have been under the control and management of the Bharat Coking Coal Ltd. During the pendency of the appeal before this Court proceedings were initiated against respondent No. 4 for the violation of interim orders of this Court. In the contempt proceedings Respondent No. 4 contended that plot No. 370 of village Sudamdih belonged to the State of Bihar and the appellants had no ownership rights therein. This Court held that since plot No. 370 of Sudamdih has been acquired under Section 9(1) of the Coal Bearing Areas (Acquisition and Development) Act 1957 the appellant company was its owner, and it was idle to contend the contrary. We therefore hold that the appellant is the owner of plot No. 370 of village Sudamdih and the State Government had no authority in law to make any arrangement or to settle any right with respondents for collecting slurry deposits from th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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