BANWARILAL AGARWALA Vs. COAL BOARD

JUDGEMENT

(1.) THE petitioner in this application is the owner of several collieries including the East Lohapati Colliery in the district of Dhanbad. The respondent in this application is the Coal Board which is a statutory body created by the Coal Mines (Conservation and Safety) Act, 1952, which came into operation on the 4th March, 1952 (hereinafter referred to as the said Act ). In order to understand the dispute between the parties it would be necessary to refer firstly, to the Colliery Control Order (hereinafter referred to as the said Order) which was published in 1945 under Rule 81 (2) of the Defence of India Rules and secondly to the said Act The said Order provides inter alia for the grading of coal and the fixing of prices at which coal could be sold. Under paragraph 3 of the said order, the Central Government has been given power to prescribe classes, grades or sizes into which coal may be categorised and the specification for each such class, grade or size of coal. Under paragraph 4, the Central Government may, by notification in the Official Gazette, fix the price at which, or the maximum or the minimum price, or both, subject to which, coal may be sold by colliery owners. Specifications of grades have been prescribed. For collieries situated in West Bengal and Bihar, it has been prescribed that with regard to coal from seams of the Ranigunj series, with which we are concerned in this case, the grades will be as follows: -if the ash and moisture content thereof:. On and from the 1st April, 1946 the petitioner's colliery namely, the East Lohapati Colliery was placed in the grade of Selected Grade B' which appears from a letter of the Deputy Coal Commissioner (Production) dated 9th April, 1946 which is annexure 'a' to the petition. In March, 1952 was passed the said Act mentioned above. On or about 24th September, 1954 was passed the Coal Mines (Conservation and Safety) Rules, 1954 (hereinafter referred to as the 'said Rules'), in exercise of powers conferred by section 17 of the said Act. It will now be necessary to consider the relevant parts of the said Act and the said Rules. It appears from the statement of objects and reasons of the said Act, that it was enacted in order to preserve India's reserves of metallurgical coal. It has been found that India has only limited reserves of metallurgical coal and unless steps were taken to control such reserves the same would be wasted and rapidly disappear. The Planning Commission having urgently recommended measures for such conservation, an Ordinance was introduced in 1952 entitled, the Coal Mines (Conservation and Safety) Ordinance, 1952 and a Coal Board was established. This was followed by the promulgation of the said Act and the Rules prescribed thereunder. The preamble of the said Act states that it is an Act to provide for the conservation of coal and to make further provision for safety of coal mines. Section 4 provides for the establishment of a Coal Board which was to exercise such powers and such duties as might be assigned to it by on under the said Act. Under section 7 the Central Government may, for the purpose of maintenance of safety in coal mines or for conservation of coal, exercise such powers and take or cause to be taken all such measures as it may deem necessary or proper or as may be prescribed. Under section 8, coal of Selected Grade A, Selected Grade B and Grade I, means coal graded as such by the Board in. accordance with the specifications laid down by the Central Government from time to time. Under section 17, the Central Government has been given power by notification in the Official Gazette to make rules for carrying out the purposes of the said Act which, includes measures to be taken for the purpose of maintenance of safety in coal mines or for the conservation of coal. I have already mentioned that in or about September, 1954 rules have been prescribed under section 17 of the said Act. The provisions of Rules 33 and 39 are important and are set out below: -"33. Coal Samples for analysis.- (1) The Board may for determining the grade and type of coal in any coal mine authorise in writing any technical officer of the Board or of the Central Government suitably qualified in this behalf to draw samples of coal for analysis from any seam or section of a seam of the coal mine and the owner, agent or manager of the coal mine shall afford reasonable facilities 'to the officer so authorised for the collection of such samples. (2) Grading will be done in accordance with the specifications prescribed by the Central Government from time to time for the purpose of the Colliery Control Order, 1945. 39. Opening and reopening of coal mines,-- (1) No coal mine or seam or section of a seam shall be opened and no coal mine or seam or section of a seam the working whereof has been discontinued for a period exceeding six months shall be reopened and no operation shall be commenced without the prior permission in writing of the Board and except in accordance with such directions as the Board may give. (2)When the coal produced in any coal mine or seam or section of a seam has not been graded, the board shall when granting permission under sub-rule (1) require the owner to apply for a certificate of the grade or grades of coal produced in each seam or section of a seam of the coal mine. The owner shall accordingly submit an application in the manner prescribed by the Board. (3)The Board shall grant a provisional grade on the basis of the seam sample. When the coal is allowed to be dispatched on the basis of the provisional grade the board shall have power to draw wagon samples in the presence of a representative of the colliery to determine the quality of the coal pertaining to the seam or seams.

(2.) ON the basis of the wagon sample drawn on at least three different days the final grade of the seam or seams of the particular colliery will be fixed by the Board. (3a) The final grade fixed by the Board under sub-rule (3) for a seam or section of a seam of a coal mine may be altered by the Board from time to time on the basis of analysis of wagon samples if the Board is satisfied that the grade so fixed cannot be maintained. The drawal of seam samples and wagon samples by the Board for the purpose of sub-rule (3) or this sub-rule shall be in accordance with such procedure as may from time to time be laid down by the Board. (3b) The Board may withdraw the grade fixed for a seam or any section of a seam in cases where the production or dispatches of coal from the seam or section of the seam have stopped for a continuous period of six months or where the production of coal from the seam or section of the seam has been prohibited by law for the time being in force. (3c) No order under sub-rule (3a) or sub-rule (3b) shall be passed unless the owner concerned has been given an opportunity of making a representation against the order proposed. (4) No coal shall be dispatched from a coal mine without getting certificate of grade under sub-rule (3) indicating the grade or grades of coal to be produced and dispatched and no two grades of coal shall be mixed before dispatch without the prior permission in writing of the Board. (5) In the case of any coal mine producing more than one grade of coal the owner, agent or manager shall make such arrangements as may be required by the Board to ensure that different grades of coal are not mixed before dispatch. The petitioner has been raising and dispatching coal from the said colliery since before 1944, that is to say, before the passing of the said Order or the said Act. After the passing of the said Order, the petitioner's colliery was graded under the said order as Selected grade B'. It is alleged that since the year 1959, the authorities have been trying to alter the grade, and wagon samples were taken on the 28th December, 1959, 12th May, 1960 and 25th July, 1960. On or about the 20th May, 1961 the following certificate was issued by the Coal Board :- <FRM>JUDGEMENT_89_TLCAL0_1965Html1.htm</FRM> .

(3.) THIS is to certify that the above-motioned seam for the section and at the colliery indicated above, has been pleased provisionally in the following m a de, in canceling of previous grade certificate, if any, with effect from the date of this certification. Grade I (one ). On or about 1st August , 1961 the petitioner objected to the said order and certification. On the 1st September, 1961 the petitioner received a letter from the Coal Board the relevant portion where is set out below- <FRM>JUDGEMENT_89_TLCAL0_1965Html2.htm</FRM> . On the 1st December, 1962 a further latter was sent in respect of rereading, the relevant part whereof is setout low:- <FRM>JUDGEMENT_89_TLCAL0_1965Html3.htm</FRM> .