SAKETH INDIA LTD Vs. STATE OF TAMIL NADU

JUDGEMENT

(1.) WRIT Petition filed under Article 226 of the Constitution of India for the issue of writ of declaration declaring that the lease amount and the security deposit totalling to Rs. 29,70,990/- retained by the first respondent paid for the quarry lands measuring 2. 40. 0 hectares comprised in survey No. 539/1 of Vinnamangalam village, Vaniyambadi Taluk, Vellore District and the demand for dead rent and area assessment in respect of the said land is illegal and consequently direct the respondents to refund the said sum together with interest @ 24% per annum. The writ petitioner has approached this Court by filing this writ petition seeking for the relief of issuance of writ of declaration declaring that the lease amount and the security deposit totalling to Rs. 29,70,990/- retained by the first respondent paid for the quarry lands measuring 2. 40. 0 hectares comprised in survey No. 539/1 of Vinnamangalam village, Vaniyambadi Taluk, Vellore District and the demand for dead rent and area assessment in respect of the said land is illegal and consequently direct the respondents to refund the said sum together with interest @ 24% per annum.

(2.) THE facts giving raise to the filing of the writ petition is as follows : under the then existing Rule 8a of the Tamil Nadu Minor Mineral Concession Rules, the second respondent invited tenders in respect of several granite quarries situated in the Government poromboke lands. The petitioner submitted the tender application in respect of 2. 40. 0 hectares of black granite quarry in survey No. 539/1 situated at Vinnamangalam village, Vaniyambadi taluk, by quoting a sum of Rs. 27,00,900/ -. The petitioner's bid was declared as the highest bid and the lease in respect of the said land was confirmed in favour of the petitioner. The petitioner deposited the entire tender amount of Rs. 27,00,900 and complied with all the requirements and formalities contemplated under the law. Pursuant to the same, necessary lease agreement was executed on 29. 05. 1992 for a period of ten years. The petitioner started quarrying granite blocks. When the petitioner produced first marketable blocks and processed it in its factory, it found that the material quarried was defective and could not be processed because of the soft nature of the stone. The quarry was a total failure and there was no granite deposit in the said quarry. The available stones could be used only as blue metal jelly. The petitioner unsuccessfully pursued the second respondent for refund of the bid amount. The respondents neither granted the petitioner an alternative site nor refunded the lease amount. Apart from the tender amount of Rs. 27,00,900/- the petitioner has spent Rs. 2,13,050/- for stamp paper and Rs. 27,090/- towards registration fees. In addition to that, the petitioner has spent several lakhs of rupees for removing the over burden and for quarrying the first production. The entire investment has become a waste. Having received a huge amount, the respondents ought to have allotted an alternative site or ought to have returned the tender amount. According to the petitioner, the respondents have auctioned the blue metal quarry wrongly describing it as a granite quarry. When the quarry was found to be unfit for quarrying granite, in law and in facts, the respondents are duty bound to refund the lease amount. Inspite of the petitioner's demand for refund of the lease amount, the respondents have not refunded the same. There is no jurisdiction or the authority for the respondents to retain the amount.

(3.) THE District Collector, the second respondent has filed a counter affidavit admitting that the quarrying lease in respect of the subject land was granted to the petitioner for a period of ten years. However, it is contended that the petitioner, after execution of the lease deed, commenced quarrying operation. It produced and transported 50. 889 cubic meter of black granite from the subject quarry after obtaining due permit. From the above act, it could be seen that the petitioner carried on the quarrying operations for more than 1-1/2 years. Now all of a sudden, the petitioner has filed the present writ petition stating that the materials available in the said quarry are defective. Had the petitioner found that the materials were defective one, they ought to have stopped quarrying operations at the initial stage itself, but they did not do so. They operated the quarry for more than 1-1/2 years and obtained due transport permit for the period from 25. 10. 1993 to 28. 10. 1995 continuously. As per the provisions of Section 8a (1) (b) of the Act, the quarry in question were notified in the North Arcot District Gazette. The respondents never compelled the petitioner to participate in the auction, but the petitioner on its own volition participated. The second respondent has denied that the petitioner has made any representation either to the second respondent or to the first respondent for refund of tender amount or for allotment of alternative site. The respondent further denied the contention of the petitioner that the said quarry was a jelly quarry, but they affirmed that the quarry is a black granite quarry. It was further contended that as per section 4a (4) of the Mines and Minerals (Development and Regulation) Act, 1957, where the holder of the mining lease fails to undertake mining operations for a period of one year after the date of execution of the lease or having commenced mining operations, and discontinued the same for a period of one year, the lease shall lapse after a period of one year from the date of execution of the lease or, as the case may be, discontinuance of the mining operations, provided that the State Government may, on application made by the holder of such lease before expiry, renew the same. With these averments the respondents sought to dismiss the writ petition.