LAKSHMINARAYANA MINING Vs. TALUK DEVELOPMENT BOARD SANDUR

JUDGEMENT

(1.) The petitioners in these two cases are holders of mineral concessions granted by the State Government authorising them to conduct mining operations within Sandur Taluk, Bellary District. The petitioner in Writ Petition No.1934 of 1967 is engaged in winning iron ore and the petitioner in WP. No.2131 of 1967 is winning both iron ore and manganese ore. By a notification issued under Ss.143 and 144 of the Mysore Village Panchayats and Local Boards Act, 1959 (hereinafter referred to as the State Act), the Taluk Development Board of Sandur having jurisdiction over the mining areas in which the petitioners are interested, levied licence fee on the mining of manganese ore, iron ore, red-oxide, barytes, etc., Under Entry 62 of Schedule I attached to the notification, persons engaged in mining of manganese and iron ore with the help of machinery had to pay Rs. 500 per area and under Entry 63 persons engaged in mining of manganese and iron ore without the help of machinery had to pay Rs.200 per area. On the basis of the aboye notification imposing licence fee, the petitioner in WP.No.1934 of 1967 was called uprn by the Chief Executive Officer of the Taluk Development Board, Sandur (respondent 2) by his notice bearing F.No.30/67 LI. dt. 18-7-1967 to pay Rs.3,000 being the arrears of licence fee from 1963-64 to 1967-68 in respect of three areas, namely, an area of 640 acres in Karadikolla, another area of 175-63 Hectares in Kardikolla and Bhavihalli area. The petitioner in WP.No.2131 of 1967 was similarly called upon by the respondents by notice bearing F. No.13/67 dt.22-7-1967 to pay in all Rs.10,500 by way of licence fee in respect of the areas in which the petitioner was engaged in mining within Sandur Taluk. Aggrieved by the notices of demand and the notification issued under Ss.143 and 144 of the State Act referred to above, the petitioners have filed the above petitions for the issue of an appropriate writ, direction or order quashing the notices of demand and the notification in so far as it levies licence fe under Ss.143 and 144 of the State Act on the petitioners. In the affidavits field in support of the writ petitions, three main contentions have been urged by the petitioners (i) that the State Legislature could not make a law authorising the imposition of the impugned levy after the Mines and Minerals (Regulation and Development) Act, 1957 (Central Act LXVII of 1957) (hereinafter referred to as the Central Act) came into force; (ii) that the notification in so far as it levies licence fee on the mining activities carried on by the petitioners is outside the scope of Ss.143 and 144 of the State Act; and (iii) that the licence fee in question which is in the nature of a tax cannot be levied because Ss. 143 and 144 of the State Act do not confer the power on the Taluk Development Board to levy a tax. The respondents have opposed these writ petitions. It is urged on behalf of the respondents that the levy in question was within the scope of Ss.143 and 144 of the State Act and the demands made under the impugned notices have been validly made. It is also stated that the licence fee demanded by the respondents is in the nature of a tax and that the Taluk Development Board had the competence to levy the same.

(2.) We shall presently take up the first contention urged on behalf of the petitioners. In order to understand the case of the petitioners, it is necessary to briefly refer to the relevant provisions of law.

(3.) The State Legislature is authorised by Entry 23 in List II of the Seventh Schedule of the Constitution to make law with respect to regulation of mines and mineral development subject to the provisions of List I with respect to regulation and development under the control of the Union. Entry 50 in the same list authorises the State Legislature to levy tax on mineral rights subject to any limitations imposed by Parliament by law relating to mineral development. Entry 54 in List I of the Seventh Schedule of the Constitution confers Legislative power on the Parliament to make law with respect to the regulation of mines and mineral development to the extent to which such regulation and development under the control of the Union is declared by Parliament by law to be expedient in the public interest. A combined reading of Enrties 23 and 50 in List II and Entry 54 in List I, establishes that as long as the Parliament does not make any law in exercise of its power in Entry 54, the powers of the State Legislature in Entry 23 and in Entry 50 would be exercisable by the State Legislature. But when once the Parliament makes a declaration by law that it is expedient in the public interest to make regulation of mines and mineral development under the control of the Union, to the extent to' which such regulation and development is undertaken by the law made by the Parliament, the power of the State Legislature under Entries 23 and 50 of List II would get denuded