WP(C)/1262/2022 of BHAT STONE CRUSHER AND ANR. Vs GOVERNMENT OF J AND K AND ORS. (INDUSTRIES AND COMMERCE DEPARTMENT) on 30 December 2022

JUDGMENT

1) The petitioners are aggrieved of notice bearing No.NN2/DGM/001/092 dated 18.05.2022, issued by respondent No.3, in terms whereof the said respondent has asked the petitioners to clear the outstanding amount of Rs.6,64,224/ on account of unauthorized extraction/ removal/dumping of 2960 metric tons of Nallah Boulder (minor mineral).

2) As per case of the petitioners, they have set up a stone crusher on a plot of land measuring 27 kanals under Survey No.8/1 situated at Waheedpora, Ganderbal, after purchasing the same by virtue of three sale deeds executed in the year 2010. It is averred that the unit of the petitioners is registered vide No.17/09/0350/PMT/SSI dated 03.03.1989. It is further averred that after the purchase of the unit, sanction was accorded to the change of its constitution in terms of order dated 18.12.2010 issued by District Industries Centre, Ganderbal. It is also averred that the petitioners were operating the unit and paying the royalty to the respondent department.

3) According to the petitioners, the respondent No.3 issued notice dated 25.08.2020, whereby they were directed to furnish month-wise details of raw material consumed and royalty paid for the material and month wise electricity bills of the unit. The petitioners are stated to have apprised respondent No.3 with the fact that the unit remained closed from the year 2015 onwards and also furnished all the requisite details to support their contention. However, without considering the details furnished by the petitioners, respondent No.3 issued notice dated 10.08.2021, wherein it was observed that the petitioners have failed to submit the details of royalty paid for the year 2017-18, 2018-19, 2019-20 up to July, 2021 as also the electricity bills. It was directed vide the aforesaid notice that the petitioners should deposit the penalty amount of Rs.6,64,224/ for the consumption and transportation of minor minerals illegally, within a week’s time.

4) The petitioners are stated to have again apprised respondent No.3 about the fact that their unit was not functional from the year 2015 onwards but in spite of this, impugned notice dated 18.05.2022 came to be issued by respondent No.3.

5) The petitioners have challenged the impugned action of the respondents on the grounds that the respondents have not taken into consideration the fact that the petitioners’ unit remained closed from the year 2015 onwards. It is further contended that while issuing the impugned notice, the respondents have not followed the procedure prescribed under the Jammu and Kashmir Minor Mineral Concession, Storage, Transportation of Minerals and Prevention of Illegal Mining Rules, 2016 (hereinafter referred as the Rules of 2016)

6) The writ petition has been contested by the respondents by filing a reply thereto. In their reply, it has been submitted that vide letter dated 25.08.2020, the petitioners were asked to submit the details of month wise electricity bills, raw material consumed and royalty paid for

Conclusion

the material but they failed to submit the requisite details. It is further averred that another notice dated 05.10.2021 was served upon the petitioners and they were directed to deposit a penalty of Rs.6,64,224/ for the consumption, transportation and dumping of minor minerals without any lawful authority. It is also submitted that the penalty amount has been calculated only for the period October, 2020 to July, 2021 on the basis of the reports furnished by the concerned Area Incharge. According to the respondents, the actual penalty shall be determined as per the bills of electricity consumed by the unit holder from the period 2017 to 2021 till date excluding the period mentioned in the notice i.e., October, 2020 to July, 2021.

7) It has been further contended that the contention of the petitioners that the unit was closed is negated by the electricity consumption bills furnished by the Power Development Department. It has been contended that the petitioners are misrepresenting the facts as they have been served with notice along with other 12 unit holders of the district. According to the respondents, the other unit holders of the district have deposited the penalty but the petitioners have failed to do so. It is further averred that the notices issued to the petitioners are in accordance with the Rules of

2016. In this regard, reference has been made to Rules 96, 97 and 98 of the Rules of 2016. It has been further claimed that the Executive Magistrate (Tehsildar), Lar, has closed down the unit of the petitioners on 07.08.2022, pursuant to the decision dated 06.08.2022 passed by the Financial Commissioner, Revenue, J&K.

8) I have heard learned counsel for the parties and perused the record produced by the respondents.

9) In order to ascertain as to what is the nature of action taken by the respondents against the petitioners in the instant case, it would be apt to refer to the communications addressed by the respondents to the petitioners. Vide letter dated 25.087.2020, the petitioners were asked to furnish month wise details of raw material consumed and royalty paid for the material used in the crusher unit along with month wise electricity bills of the unit. When the petitioner failed to provide the necessary details, the respondents issued notice dated 10.08.2021, directing the petitioners to pay an amount of Rs.6,64,224/ on account of consumption and transportation of minor minerals illegally without any lawful authority. Notice dated 05.10.2021 and impugned notice dated 18.05.2022 were issued by the respondents to the petitioners when they failed to clear the amount in terms of notice dated 10.08.2021 and it was provided in the impugned notice that the outstanding amount shall be recovered as arrears of land revenue.

10) Learned counsel for the petitioners has vehemently argued that no assessment has been made by the respondents before issuing the aforesaid notice in terms of Chapter XI of the Rules of 2016 and if it is a case of illegal or unauthorized mining, then the provisions contained in Chapter XII should have been followed.

11) The most significant document, for determination

of the nature of action taken by the respondents, is the notice dated 10.08.2021. The said notice clearly provides that the amount of Rs.6,64,224/ is being recovered from the petitioners on account of the fact that they have illegally brought the miner mineral from Nallah Sindh and its tributaries without any formal permission/lease and as per the report of the field staff, 2960 metric tons have been dumped/transported in the petitioners’ unit.

12) The contention of learned counsel for the petitioners appears to be misconceived because in the instant case, the respondents have not proceeded under Chapter XI or Chapter XII of the Rules of 2016 but they have proceeded under the provisions contained in Chapter IX of the said Rules, which relates to establishment of mineral check posts, storage and transportation of minerals. Sub-rule (4) of Rule 70 of the Rules of 2016, which finds placed in Chapter IX of the Rules, provides that if the in-charge of the check post or any other officer mentioned in sub-rule (2), has a reason to believe that royalty has been evaded in respect of any mineral, such officer/official may require the owner or person in-charge of the carrier to pay an amount equal to 10 times the amount of royalty payable on the mineral in accordance with Schedule-I. Thus, if the authorized officer has reason to believe that royalty has been evaded in respect of any mineral which has been transported, the owner can be asked to pay 10 times the amount of royalty as per Schedule-I to the Rules, which prescribes the rates of royalty.

13) The respondents have exercised their power under Rule 70(4) of the Rules of 2016 and calculated the amount payable by the petitioners in respect of the miner mineral that was found transported and dumped in the premises of the petitioners’ unit without paying any royalty. The amount sought to be recovered from the petitioners has been calculated as per Schedule-I to the Rules of 2016.

14) Learned counsel for the petitioners has submitted that no prior notice has been served upon the petitioners as the unit was lying closed. Thus, without hearing the petitioners and without serving notice upon them, it was not open to the respondents to direct recovery of the amount against them.

15) In the writ petition, the petitioners have repeatedly stated that they did bring to the notice of the respondents the fact that their unit is lying closed since 2015 and, as such, no amount is payable by them but in spite of this, the recovery notice has been issued. This means that the petitioners were in knowledge of the proceedings before the respondents and they had even made representations before the respondents. They cannot be now heard saying that the impugned recovery notice has been issued without observing the principles of natural justice.

16) The question whether the petitioners’ unit was actually lying closed during the relevant period and that there was no transportation of miner minerals undertaken by the petitioners during the relevant period, cannot be determined by this Court in these proceedings as the same involves determination of intricate issues of fact. These contentions could have been raised by the petitioners by filing an appeal under Rule 85 of the Rules of 2016. Under the said Rule, any

person aggrieved of an order passed by any officer in-charge subordinate to the Director, has the right of appeal to the Director and any person aggrieved by the order passed in appeal or any other order passed by the Director, has a right to file appeal to the Government. Without exhausting the said remedy, which is an efficacious remedy provided under the Rules, the petitioners’ have filed the instant writ petition which, on account of this position, is not maintainable.

17) For the foregoing reasons, the writ petition is dismissed with liberty to the petitioners to work out appropriate remedy against the impugned notice, as may be available to them under law.

18) The record be returned to the learned counsel for the respondents.

(SANJAY DHAR) JUDGE

Srinagar, 30.12.2022“Bhat Altaf, PS”

Whether the order is speaking: Yes/NoWhether the order is reportable: Yes/No