Supreme Court in Gorelal Dubey v.

State Of Madhya Pradesh And Others on 4 December, 1975:

Facts: After the remand, the State Government determined the royalty at Rs. 16,722/-. The said demand
was again challenged by "Gorelal Dubey" for the third time by way of a writ petition no. MP 390/72
contending that if royalty was charged from him on the basis of a major mineral, then he had paid Rs.
36,000/- and odd more. The writ was allowed in 25-3-1974 during the course of the hearing of CA
785/71 in the Supreme Court and the appeal by special leave (CA 1781/75) obtained by the
respondent State against the order dated 25-3-1974 was heard with 785/71.

PLEASE TAKE A NOTE 1: The facts of the instant case, being almost identical as Smt. Rukmani Bai
Gupta's case, with the only difference that in column 6 of his application the present appellant
had merely stated "minor minerals" reading the said expression with the expression "limestone for
burning purposes" mentioned in paragraph 1, the same result follows. We, therefore, hold that the
application of the appellant was for a minor mineral and the lease granted to him was for the same.
After the adverse decision of the High Court, he was ill-advised to take the stand that he was
liable to pay royalty on the amount of limestone quarried by him out as "a major mineral", that
the amount of royalty which is chargeable upon it as "a major mineral" is lower than one
chargeable upon it as a "minor mineral".

HELD:

Point 1: The distinctive points between the 1958 and 1961 notifications are as under:

(a) Limestone for lime burning was a 'minor mineral" under the 1958 notification irrespective of
the process of burning or the quality of the lime it produced. [882-C]

(b) After the 1961 notification only that type of limestone would be a "minor mineral" which
is capable or being used for burning in kilns for producing has quality of lime which can
ordinarily and generally be used as a building material. [882-D]

Point 2: The question of grant of a lease will have to be on the basis of the quality of the limestone in a
particular area. If a major portion in the area is such that can be used as a "minor mineral" then a lease
in accordance with the State Rules will have to be granted and a special clause like clause 18 may be
provided therein if per chance some quality of limestone quarried in the demised area is found to be of
high grade. Similarly if the major portion is found to be of high grade limestone, then a mining lease for
mining limestone as a major mineral in accordance with the Central Rules will have to be granted.

In section 3 of the Act clause (a) says: "minerals" includes all minerals except mineral oils." Clause (e)
provides:

"minor minerals" means building stones, gravel, ordinary clay, ordinary sand other than sand
used for prescribed purposes, and any other mineral which the Central Government may, by
notification in the Official Gazette, declared to be a minor mineral,"

By a subsequent notification dated the 20th September, 1961 the description of the limestone as a
minor mineral was changed and only "limestone used in kilns for manufacture of lime used as building
material" was declared as a minor mineral.

Gorelal Dubey made an application mentioning in paragraph 3 of the application "minor minerals"
against the 6th column "Minor minerals or minerals which the applicant intends to mine."
The appellant filed a writ petition (M.P. No. 3/1968) in the Madhya Pradesh High Court to challenge
the order of the Central Government. The High Court dismissed the writ application by order dated
September 2, 1970 affirming the view of the Central Government that in substance and in effect the
application for and grant of lease to the appellant by the State Government was for a major mineral
and not a minor mineral. The appellant came to this Court against the order of the High Court.

Main Ground on which case was based:

Following Rukmini Bai's case we have held that the application filed by the appellant and the lease
granted to him was for quarrying limestone as a minor mineral. But that does not entitle him to get the
relief as he wants from this Court. A peculiar feature of this case, and which may occur in respect of
some other area is that there, were two applicants-one the appellant was wanted the lease of limestone
as a minor mineral and the other respondent no. 3 who wanted it as a major mineral. In such a situation
it was not open to the State Government to merely ignore the application of respondent no. 3 and grant
lease to the appellant. Nor was it appropriate for the Central Government on the view which has been
found to be erroneous by us to direct the State Government to consider the application of respondent
no. 3 alone. The proper course in such a situation is to direct the State Government to consider both the
applications, determine the question as to whether the quality of the limestone contained in the area in
question is such that a lease to quarry it as a minor mineral should be granted or is such that a lease for
mining it as a major mineral should be granted and then it should proceed to grant the lease.

Counsel for Gorelal Dubey had offered to withdraw his writ petitions M.P. 328/68 and M.P. 390/1972
and to pay the sum of Rs. 16,722, if it be found that the lease granted to him was a lease for a minor
mineral. In view of our finding recorded above, we allow CA 1781/75, set aside the orders of the High
Court made in the two writ petitions and allow them to be withdrawn.

High Court in Gorelal Dubey vs The State Govt. Of Madhya Pradesh on 25 March, 1974:

This is a petition is seeking to quash the order of the Collector and Mining Officer, making a demand
from the petitioner for Rs. 16,722.00 on the premises that the limestone quarried by the petitioner was
for its use as minor mineral, though the petitioner had paid a royalty for quarried limestone as minor
mineral at the rate of RS. 2-00 per ton. The royalty to be "paid for limestone as a major mineral would be
Rs. 1-25 per ton".

PLEASE TAKE A NOTE 2: In the application filed there was no mention of the fact whether the
limestone was intended to be quarried for being used in kiln for building purposes.

Therefore, in order to make a claim for royalty on the premises of the limestone being used as a minor
mineral, it was necessary for the Mining Officer to find out if the purpose was consistent with the
limestone being sold as a minor mineral.

Definition of the phrase 'minor mineral' as given by Section 3(e) of the Mines and Minerals (Regulation
and Development) Act, 1957,

Section 3.- In this Act, unless the context otherwise requires,-- “(e).-- "minor minerals" means
building stones, gravel, ordinary clay, ordinary sand other than sand used for prescribed
purposes, and any other mineral which the Central Government may, by Notification in the
Official Gazette, declare to be a minor mineral."
Accordingly a Notification, D/-20-9-2001 has been issued by the Government by which limestone was
to be treated as a minor mineral only when used in kilns for manufacture of lime used as a building
material. Therefore, the limestone would be a minor mineral according to the terms of the said
Notification and in all other cases, it will be deemed to be a major mineral.

From this point of view also it was necessary for the Mining Officer to find out whether the limestone
had been used for a purpose consistent with its being a minor mineral and if he was unable to
ascertain that, the petitioner's liability would be for royalty as a major mineral only.

In this connection we might advert to the observations of a Division Bench of this Court in Ramnaresh
Swamy v. State Govt. of Madhya Pradesh, 1972 (AIR 1972 Madh Pra 86), wherein the Division Bench
made the following observations.

PLEASE TAKE A NOTE 3: It is "used in klins for manufacture of lime used as a building material". If
limestone is quarried for any other purpose, it will be a major mineral and will not be a minor mineral.
If, therefore, in column (6) merely limestone is mentioned and it is not mentioned that it, will be used
in kilns for manufacture of lime used as a building material, it would automatically mean that the
application is for mining, limestone as a major mineral. There is thus incongruity in the application.

It must be held that unless it in established that the limestone has been quarried for a purpose
consistent with its being a minor mineral, in all other events it will be taken for granted that it has
been quarried for a purpose consistent with its being a major mineral.