NORTH EASTERN COAL FIELDS Vs. UNION OF INDIA

JUDGEMENT

(1.) THE writ petitioner is a Unit of Coal India Limited, which is a Govt. Company incorporated under the provisions of the Companies Act, 1956. Though the petitioner has described itself as the owner of the several Coal Fields as mentioned in the writ application, such description in the context of the provisions of the Mines and Minerals (Development and Regulation), 1987 (hereinafter referred to as the Act) must be understood to be in respect of a mining lease held by the petitioner for the coal Fields/Collieries in question. The petitioner is engaged in the business of mining, production and sale of coal and in the normal course thereof, the petitioner sells the coal produced to different buyers of coal.

(2.) UNDER the provisions of Section 9(a) of the Act, the holder of a mining lease is required to pay royalty at the rate specified. Such royalty is required to be paid on removal and consumption of the mineral. Under Rule 64A of the Mineral Concession Rules framed under the Act and Government Notification dated 22.7.1988, royalty is required to be paid by the 10th day of each calendar month in respect of minerals produced during the preceding month. Under the provisions of the aforesaid Rule 64A and the Notification dated 22.7.1988 lessees have been made liable to pay simple interest @ 24% (earlier 15%) on unpaid royalty with effect from 60th day of the expiry of the date fixed for payment.

(3.) NOTWITHSTANDING the institution of the writ proceedings before this Court as noticed above and the interim order dated 26.5.1994 passed, the State Government by its letter dated 3.5.1995 made it clear to the writ petitioner/Coal India Limited that the writ petitions instituted and the interim orders passed therein does not in any way affect the liability of the lessee to pay royalty and therefore, the writ petitioner was advised to pay royalty in terms of the Notification dated 25.3.1994 failing which it was made clear that consequential liabilities as per law will follow.