ASHOK GEORGE Vs. SECRETARY TO GOVERNMENT INDUSTRIES DEPT.

JUDGEMENT

(1.) Kerala State, often referred to as "God's Own Country," is rich in various mineral resources, including minor minerals. The State has a wide range of mineral deposits, making it a significant contributor to India's mineral wealth. Besides the former Malabar province, the rights over mineral wealth beneath the land across Kerala are owned by the State and are governed by the Travancore Proclamation, 1881, and the Cochin Proclamation, 1905, respectively. The question whether minerals lying beneath the soil in the former Malabar province belong to the State or the landowners with Jenm rights was considered by the Full Bench of the Kerala High Court on reference in Thressiamma Jacob v. Department of Mining and Geology, (AIR 2000 Ker 300). The reference was answered by holding that the minerals beneath the soil belong to the State, and royalty must be paid to the Government for quarrying leases. In appeal, the Supreme Court[Thressiamma Jacob v. Department of Mining and Geology, (2013) 9 SCC 725]] reversed the Kerala High Court's judgment and declared that the ownership of the subsoil/mineral wealth of the land, comprised in the former Malabar province, rests with the respective owners/jenmis and not with the State. However, the Supreme Court refused to express its opinion regarding the liability of the property owners to pay royalty to the State, as that issue had been referred to a Larger Bench in Mineral Area Development Authority v. Steel Authority of India,(2011) 4 SCC 450. The Court's declaration was based on the finding that there was no legislation that vests mineral rights or subsoil rights in the State, and the ownership of such subsoil or mineral wealth would normally follow the ownership of the land. It paved the way for the enactment of the Kerala Minerals (Vesting of Rights) Act, 2021 (for short, the Minerals Vesting Act, 2021), which vests all rights in the minerals within the soil and subsoil of all lands of any ownership and tenure in the Government. During the pendency of these writ petitions, the nine-Judge Bench of the Supreme Court[Mineral Area Development Authority etc v. Steel Authority of India, (2024) 10 SCC 1] declared that royalty is not a tax and that it is the private owner who is entitled to collect royalty when he is the owner. The petitioners in all the writ petitions are aggrieved by the demand of royalty and cost of the minerals made by the State towards the extraction of minor minerals from their respective properties under the provisions of the Mines and Minerals Development and Regulation Act, 1957 (for short, MMDR Act, 1957) and Kerala Minor Mineral Concession Rules, 2015 (for short, KMMC Rules, 2015)

(2.) The petitioners in WP(C) Nos. 14425/23, 15037/23, 10670/24, and 43302/24 operated quarries on properties owned by them, located in the former Malabar province. Following the enactment of the Minerals Vesting Act, 2021, they received a demand notice for the payment of royalty, mineral costs, and fine, alleging that they had unlawfully quarried granite from their properties. According to the petitioners, the authority of the State to collect the royalty depends on the vesting of minerals in the State. They challenge the constitutional validity of the Minerals Vesting Act, 2021, which vests ownership of the subsoil and mineral wealth of the land within the former Malabar province in the State, primarily on the ground that it violates Articles 300A and 14 of the Constitution of India, since it does not compensate mineral owners upon vesting these rights in the State. They contend that if the Minerals Vesting Act, 2021, is found to be unconstitutional, they are not liable to pay royalty for minerals extracted from their own land, referring to the Supreme Court's declaration in Thressiamma Jacob[Thressiamma Jacob v. Department of Mining and Geology, (2013) 9 SCC 725] that minerals in the Malabar area do not belong to the State, but to the surface owner. Furthermore, they contend that neither the MMDR Act, 1957, nor the KMMC Rules, 2015, contain provisions requiring permission for self-extraction of minerals from one's own land; therefore, the respondent State cannot claim the cost of the extracted minerals or fine on the ground that the extraction was unauthorised or illegal.

(3.) The petitioner in WP(C) No. 38526/2023 developed his land situated in the former Malabar province by excavating and removing earth to establish a petroleum retail outlet. The second respondent/Geologist issued Ext. P11 Assessment Order under the provisions of the MMDR Act, 1957, and the KMMC Rules, 2015, stating that the petitioner had unlawfully and without authorisation extracted granites from his property and directing him to pay the value of the minerals, royalty, and fine. According to the petitioner, the Minerals Vesting Act, 2021, which served as the basis for Ext. P11 is unconstitutional. He disputes the constitutional validity of that Act on the ground that it not only lacks provisions to compensate property owners when mineral rights vest with the State but also exceeds the legislative competence of the State. Additionally, it is alleged that the Minerals Vesting Act, 2021, is repugnant to the central legislation, such as the MMDR Act and the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013 (RFCTLARR Act, 2013). The petitioner further asserts that development activities undertaken on his own land should not be classified as mining operations subject to royalties and other charges under the KMMC Rules, 2015. He also contends that as the land is located in the former Malabar province, the collection of royalty cannot be justified, even if the activity were of a commercial nature, in accordance with the legal pronouncements by the Supreme Court in Thressiamma Jacob[Thressiamma Jacob v. Department of Mining and Geology, (2013) 9 SCC 725].