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The Allahabad High Court has dismissed the petition filed challenging the 48th Amendment in Uttar Pradesh Minor Minerals (Concession) Rules, 1963.
The Division Bench of Justice Mahesh Chandra Tripathi and Justice Prashant Kumar passed this order while hearing a petition filed by Chhatarpur Crasher Association and another.
By means of the petition the petitioners, who are members of registered society are, in the business of extracting, crushing transporting, and selling the minor minerals in Madhya Pradesh and in other States, are challenging the 48th Amendment in Uttar Pradesh Minor Minerals (Concession) Rules, 1963, Rule 21 (4) and Rule 70 (2) of the Uttar Pradesh Minor Mineral (Concession) Rules, 2020, and Rule 21 (5) and Rule 72 (2) of the Uttar Pradesh Minor Mineral (Concession) Rules, 2021 and the Government Order dated 24.02.2020 and 10.08.2022.
The Court noted that,
In the petitions, the petitioners have challenged the vires of Rule 21(4) and Rule 70(2) of UP Minor Minerals (Concession) Rules 2020 and Rule 21(5) and Rule 72(2) of UP Minor Minerals (Concession) Rules 2021 and G.O dated 24.2.2020 and G.O dated 10.8.2022 on the ground that the same are violative of the provisions of MMRD Act and Part XIII of the Constitution of India.
Mines and Minerals (Regulation and Development) Act, 1957 (MMRD Act 1957), has been enacted by the Parliament to provide for development and regulation of mines and minerals.
The State Government, under the powers conferred under Section 15 of the MMRD Act 1957 had framed Uttar Pradesh Minor Minerals (Concession) Rules, 1963.
The State of Uttar Pradesh in exercise of power granted under the Section 23 (C) framed a Rule which was “Uttar Pradesh Minerals (Prevention of Illegal Mining, Transport and Storage) Rules 2002”. These Rules were superseded in 2018 by a new Rules which was “Uttar Pradesh Minerals (Prevention of Illegal Mining, Transport and Storage) Rules 2018”. These Rules of 2018 were again amended in 2019 and the said Rules were called “Uttar Pradesh Minerals (Prevention of Illegal Mining, Transport and Storage) Rules 2019”
The Uttar Pradesh Minor Minerals (Concession) Rules, 1963 was amended in 2020 by the State Government, and was called “Uttar Pradesh Minor Minerals (Concession) (Forty Eight Amendment) Rules, 2020”, By this Rule 21 and Rule 70 were amended, and “Regulating Fees was introduced”.
The Uttar Pradesh Minor Minerals (Concession) Rules, 1963 was again amended in 2021 by the State Government, this was called “Uttar Pradesh Minor Minerals (Concession) Rules, 2021”.
In furtherance to the Rules the state government issued a Government Order on 24.02.2022, imposing a Regulatory Fee of Rs 50/- per cubic meter in respect of transportation of Building Stones, Ballast, Bolder transported from other States into the State of Uttar Pradesh.
The state government issued another Government Order on 10.08.2022, whereby the Regulatory Fee of Rs 50/- per cubic meter in respect of transportation of Building Stones, Ballast, Bolder transported from other States into the State of Uttar Pradesh, was increased to Rs 100/- per cubic meter.
A plain reading of the objects of the Government Order, make it very clear that the reasons for imposing the regulatory fees was only to set up a proper infrastructure for the strict compliance of the conditions laid down by the in Section 23(c) of the MMRDA Act.
The petitioner who claims himself to be an association of stone-crusher, by means of the petition challenged the vires of the Rules and the G.O issued for charging Regulatory Fees.
The counsel for the petitioner submitted that on 05.02.2020 by way of the 48th amendment the State Government notified Uttar Pradesh Minor Minerals (Concession) (Forty Eight Amendment) Rules, 2020, whereby, the State Government has added Rule 21 (4) as well as added a proviso under the Rule 70 (2) of Rules 1963. By Rule 21 (4) of the Amended Rules 2020, the State Government has reserved the power to impose regulating fees on minerals which were brought from other States into the State of Uttar Pradesh.
Counsel for the petitioners further submitted that the Regulating Fees was imposed because of the difference of rate in minor minerals in other States as compared to the State of Uttar Pradesh. This reason for imposing regulating fees violates the very objective for which the Rules have been framed. The State has exceeded its jurisdiction by incorrect interpretation of law and passed such an order. Therefore, the Government Order dated 24.02.2020 and G.O dated 10.08.2022 deserves to be quashed.
M.C Chaturvedi, Additional Advocate General submitted that the petitioners’ Association in the Petition has no locus standi to prefer the petition. He brought to the notice of this Court about the objects for which the society was formed. As per the objects the society was framed to address the problems faced by the members who were in the business of crushing stones. None of the members of the society are in the business of mining or transporting minerals to other States. The members of the association were not even remotely connected with the rules which they have challenged in the petition. Hence, the petition ought to be dismissed on Locus at the outset.
The Court noted that the Mines Act, 1952 was first enacted with the object of regulation of labour and safety in mines. Thereafter, parliament enacted MMRD Act, 1957 wherein it was declared that it is expedient in the public interest that the Union should take under its control the regulation of mines and the development of minerals. Whereas, Section 13 of the MMRD Act 1957 gives power to the Central Government to make Rules in respect of major minerals for regulating the grant of reconnaissance permits, prospecting licenses and mining leases with respect to minerals. Section 15 of the MMRD Act gives the same power to the State Government to make rules in respect of minor minerals, and the State Government by way of notification in the official gazette, may make Rules for, regulating the grant of quarry leases and mining leases or other minerals concession in respect to minor minerals and “for purposes connected therewith”. The power of Central Government and the State Government are identical in these two Sections i.e. Section 13 and 15 of the MMRD Act, 1957.
The Court held that Section 15 (1) of the MMRD Act is constitutional and valid and the rule-making power conferred thereunder upon the State Government does not amount to excessive delegation of legislative power to the executive. There are sufficient guidelines provided in the 1957 Act for the exercise of the rule-making power of the State Government . These guidelines are to be found in the object for which such power is conferred namely, “ for regulating the grant of quarry leases, mining leases or other mineral concessions in respect of minor minerals and for purposes connected therewith, the meaning of the word ‘regulating’, and the scope of the phrase “for purposes connected therewith” are set out in the provisions of the Act. The power to make rules under Section 15 (1) includes the power to amend the rules so made, including the power to enhance the rates of royalty and dead rent.
“A perusal of the Rules and the Section discloses that full regulatory control vests with the State over transportation of minerals more so, upon minor minerals. Section 4(1-A) gives plenary power to the State Government to regulate transportation of minerals. The entire field of transportation stands regulated at the hands of the State Government whether it is intra-State or it is inter-State.
Hence, the Regulatory Fees imposed by Rules 2020 and Rules 2021 to meet out the obligations set out by the State under Section 23(C) of the Statute, cannot be said to be in violation of Part XIII of the Constitution of India.
State has the power to frame rules under Section 15-1 of the MMDR Act. The Rule 21(4) and Rule 70(2) of Rule, 2020 and the Rule 21(5) and Rule 72(2) of UP Mining and Concession Rules, 2021 are intra vires to the provisions of MMDR Act.
The G.O dated 24.02.2020 and 10.08.2022 issued charging the regulatory fees on the minerals dropped from other State into the State of U.P is held valid as the same has been issued in accordance with the aforementioned rules and in furtherance of the new Mining Policy, 2021.
The Regulatory Fees imposed does not violate Part XIII of the Constitution of India”, the Court observed while dismissing the petitions.