State Has A Duty To Obtain & Produce Credible Evidence Regarding Illegal Mining: Allahabad HC Sets Aside DM’s Order Cancelling Mining Lease

The Court also noted that the inspection report in the case was prepared in a cryptic manner which merely recorded that the petitioner made excavation and extracted minor minerals from the areas outside the mining area, however, no clinching materials were collected against the petitioner.

“It is nowhere mentioned when and where the inspection was carried out, who were present during the inspection and most importantly whether the inspection was carried out at the location allotted to the petitioner is also doubtful as the plot is identifiable by G.P.S. Coordinates and there is no mention that G.P.S. Coordinates were used for identification of the plot. These are the essential facts which go to the root of the matter,” the bench of Justice Alok Mathur observed.

In this regard, the Court stressed that it is the duty of the State to obtain and produce credible evidence in support of the allegations of illegal mining to bring home the charges, however, in the instant case, the onus on the State has not been discharged and consequently, the proceedings against the lessee, only on the basis of the inspection report was arbitrary & liable to be set aside.

Importantly, the court also found faults with the direction, the Director, of Geology and Mining gave to the DM concerned to cancel the mining lease of the lessee in question/petitioner [M/S Radhika Constructions through its Proprietor Mr Rakesh Tiwari] and then, while sitting as a revision authority, rejected the challenge made to the DM’s order by the lessee.

“…Dr. Roshan Jacob, who was also the Director, Geology and Mining had directed the District Magistrate to proceed against the petitioner and to cancel his mining lease, which order duly complied, and subsequently, she herself, as the revisional authority against the order of cancellation of the mining lease proceeded to hear and reject the revision, which order would certainly be hit by the vice of bias.”

The Court also noted that the limited power of a higher authority [Ministry/Department] in any given case is to forward the relevant/credible information that can prove the guilt of the accused to the competent authority, this, cannot and must not, extend to dictating of orders by the higher authority, as had happened in the instant case.

The bench further observed that the act of the Director, Mining and Geology in forwarding the report to the DM and specifically directing to cancel the lease of the petitioner and other similarly situated persons, in addition to blacklisting them reveals “pre-ordained” results of the inquiry, rendering final order as well as the revisional order (by the State Govt.) – illegal and arbitrary.

The bench further added that the statutory limit of passing an order of cancellation cannot be done prior to the expiry of the notice – which in the present case would have expired on 26.05.2021 whereas the order of cancellation was passed a month before, that is, on 26.04.2021

Reliance was placed on Ranveer Singh v. State of U.P., (2017) 1 ADJ 240, Gorkha Security Services v. Government (NCT of Delhi) and others, (2014) 9 SCC 105, Mustafa v. Union of India, (2022) 1 SCC 294, and Rule 58 of the Uttar Pradesh Minor Mineral (Concession) Rules, 1963 as amended in 2021.

Facts in brief

Petitioner participated in an e-auction for mining and was adjudged to be the highest bidder, following which a lease deed was executed in favor of the petitioner on June 6, 2020, for the of 5 years. While the mining operations were in full swing, DM Banda stopped the OTP on March 19, 2021.

An inspection of the mining site was conducted by a team of officers of the Directorate, Mining, and Geology, UP between March 13, 2021, and March 18, 2021, and thereafter, a show cause notice was served upon the petitioner on March 22, 2021, wherein allegations of illegal mining were made.

It was alleged that the petitioner had extracted minor minerals from the area not allotted to him and extracted minerals to a depth that was not permissible as per the lease deed.

Consequently, a penalty of Rs. 50,000/- and recovery of royalty for an amount of Rs. 7,81,61,400/- was further fixed by the said notice.

A reply to show cause was submitted by the petitioner on March 30, 2021, denying all allegations and also stating that no documents/credible evidence was provided, substantiating the same.

However, on April 26, 2021, the DM canceled the mining lease of the petitioner prompting him to prefer a revision before the State Government, the same was rejected on March 16, 2022.

In its order, the Court specifically noted that no evidence regarding illegal mining had been placed on record before the Court or during the course of inquiry conducted by the respondents culminating in the cancellation of the lease licenses.

Hence, the impugned order passed by the State Government in Revision as well as the order passed by the District Magistrate, Banda being illegal and arbitrary, were set aside.

However, considering the seriousness of the allegations and the amount of recovery, the respondents were given the liberty to proceed against the petitioner in accordance with the law if they so choose.

Appearances:

Counsel for Petitioner: Shishir Chandra

Counsel for Respondent: C.S.C., Tushar Verma

Case title - M/S Radhika Constructions through its Proprietor Mr. Rakesh Tiwari vs. State Of U.P. Thru. Secy Deptt. Of Geology And Mines Lko. And another

Case Citation: 2023 LiveLaw (AB) 114

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