SERAJUDDIN AND CO Vs. STATE OF ORISSA

JUDGEMENT

(1.) The applicant holds a lease under the Government of Orissa for extraction of manganese ore from a certain area in Keonjhar district. The lease was first taken, by him on 29-12-1947 from the then Ruler of Keonjhar, prior to its merger with Orissa. The lease contained a stipulation for payment of royalty at a certain rate. It also contained an arbitration clause (Clause 12) providing for the settlement of any dispute between the lessor and the lessee as regards payment of royalty or any other money under the terms of the tease. After the merger of the Keonjhar State with Orissa with effect 1-1-48 that lease was annulled by the Government of Orissa. Subsequently after some vicissitudes, (which need not be mentioned in detail here) there was a compromise between the Government of Orissa on the one hand and the petitioner on the other and another agreement dated 22-12-52 (Annexure B to the Writ petition) was entered into by which the original lease of 1947 was revived subject to certain modifications embodied in the latter agreement. This agreement also contained an arbitration clause (Clause 15) in the following terms :

(2.) The statutory provisions dealing with mining leases may now be noticed. In 1948, tha then Central Legislature passed an Act known as the Mines and Minerals (Regulation and Development) Act (hereinafter referred to as the old Act) for the regulation and development of mines. Section 5 of that Act conferred rule making power on the Central Government to make Rules for regulating the grant of mining leases. In exercise of this, power the Central Government made the Mineral, Concession Rules 1949 (hereinafter referred to as the old Rules) wherein in Schedule I, the royalty payable for manganese ores was regulated as follows:

(3.) In 1957 Parliament replaced the old Act by the Mines and Minerals (Regulation and Development) Act 1957 (hereinafter referred to as the now Act), Section 9 (1) of the New Act expressly stated that: