High Court Orissa High Court

Welfare Society Of Orissa vs Unknown on 7 April, 2010

Orissa High Court
Welfare Society Of Orissa vs Unknown on 7 April, 2010
                         W.P.(C) No. 3352 of 2010

In the matter of an application under Articles 226 and 227 of the
Constitution of India.
                             ____________


Welfare Society of Orissa,
(represented by its Secretary,
Bhutkun Mandal),Jajpur             ...                         Petitioner

                                  - versus -

Union of India                      ...                 Opposite Parties
Represented by its Secretary,
Department of Coal,
New Delhi & 3 Ors.


               For petitioner      ---   M/s. Bhagban Mohanty,
                                         B.Moharana,.S.Mohanty
                                         and D.Chhotray.

               For opp. parties   --     M/s. Saktidhar Das, A.S.G.
                                         ( For O. P. no.1 )

                                         M/s. Jagannath Patnaik,
                                         B. Mohanty, J.K. Patnaik &
                                         B.S. Rajgur. (For O. P. no.2)

                                         Mr. Sanjit Mohanty, Sr.Adv.,
                                         Ms. Suruchi Agrawal
                                         M/s. S. S. Das,
                                         Soubhagya S. Das,
                                         Ramakanta Sahoo &
                                         K.C. Mohapatra.
                                         ( For O.P.No. 3 )

                                         M/s. P.K. Mohapatra, S.K. Nayak,
                                         and S.K. Sahu
                                         ( For O.P. No. 4 )

                           ______________
                                               2


              PRESENT ;

                     THE HONOURABLE CHIEF JUSTICE MR V. GOPALA GOWDA

AND
THE HONOURABLE MR. JUSTICE B.P. DAS
______________________________________________________________________
Date of hearing & Date of judgment – 07.04.2010
______________________________________________________________________

V. Gopala Gowda, C.J. This writ petition in the shape of Public Interest

Litigation has been filed by the Welfare Society of Orissa represented by

its Secretary seeking following reliefs urging various facts and legal

contentions.

“(1) For issuing a Rule Nisi in the nature
of writ of mandamus and/or certiorari and/or any
other appropriate writ/writs, order/orders,
direction/directions calling upon the opposite parties
to show cause as to why the allotment of 97 million
tons of coal blocks out of total 291 million tons in
Mandakini Coal Block of Mahanadi Coal Fields Ltd.
made by the opposite party No.1 in favour of the
opposite party No.3 as per Annexure-5 shall not be
quashed.

(2) if the opposite parties fail to show
cause and /or show insufficient and /or false cause,
make the said rule nisi absolute by issuing
appropriate writ/writs, order/orders, direction/
directions as this Court deems fit and proper.

(3) Pass such other order/orders and
direction/directions as this Court deems fit and
proper in the facts and circumstances of the case.”

2. The brief facts for the purpose of appreciating the rival

legal contentions urged on behalf of the parties are that the petitioner is a

registered Non-Government Organization (NGO) claims to be dedicated

itself for the cause of the public justice and to weeding out corruption and

other mal-practices at all levels. It has dedicated itself to achieve the

principles enshrined in the Constitution of India, particularly, the

Directive Principles of State Policy to establish an egalitarian society to
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bring social and economic order in the country. It was registered in the

year 2009. The aim and objective of the Society is to carry out several

awareness campaigns, relief and rehabilitation activity, cultural activities

and to spread awareness among the under privileged and deprived

sections of the society with a vision to establish a classless and casteless

society.

3. The focus and objectives of the Society is for the social

and economic upliftment of the poor masses of Orissa State.

4. The Mandakini Coal Block of Talcher Coalfields

(Mahanadi Coalfields Ltd.) is situated in Orissa with a geological reserves

of 291 million tons of coal block. The Ministry of Coal, New Delhi issued

notification in the month of November, 2006 inviting application from

interested parties for allocation of 38 coal blocks in various parts of the

country for captive mining by Companies engaged in generation of power,

production of iron and steel and cement. Out of these 15 coal blocks are

earmarked for power generation and 23 coal blocks would be available for

other specified end uses. As per the notification, preference will be given

to the power sector and steel sector. Out of power sector, priority shall be

accorded to projects with more than 500 MW Capacity so also in the steel

sector, priority will be given to steel plants with more than 1 million tons

per annum capacity. Copy of the notification is produced and marked as

Annexure-3. It is the case of the petitioner that pursuant to the said

notification many number of companies like Monnet Ispat, Tatas, Sterlite,

Lanco, GMR, Reliance, Mittal Steel, Navabharat etc. having many years of

experience in the coal industry which have their own power plant

transmission line and coal mining business applied for the allotment of
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the Mandakini Coal Block. It is the case of the petitioner that opposite

party no.3, Jindal Photo Ltd. which has no experience in the field of

mining and power generation applied for the allotment of the coal block in

Mandakini Coal Block of Talcher Coalfields on 9.1.2007.

5. It is the case of the petitioner that Opposite party no.3,

Jindal Photo Limited (hereinafter called as ‘JPL’) has been allotted 97

million tons of coal block from the Mandakini Coal Block overlooking

other experienced and reputed Companies. It is the case of the petitioner

that opposite party no.2 did not scrutinize the application of opposite

party No.3-JPL in accordance with the guidelines for allocation of captive

blocks and conditions of allotment through the Screening Committee. The

allotment of blocks which was issued in favour of the JPL is produced and

marked as Annexure-5. The guidelines for allocation of captive blocks and

conditions of allotment through the Screening Committee is produced and

annexed as Annexure-6. It is the further case of the petitioner that two

portions of the same block have been allotted to Monnet-Ispat and Tatas,

who have got wide experience in the filed. The allotment of coal blocks

received by other bidders such as Sterlite, Lanco, GMR, Reliance, Mittal

Steel, Navabharat etc. as referred to above are comparatively very small.

The aforesaid companies are allotted Greenfield blocks where the

development cost is much higher than open cast blocks, though the said

companies have got sufficient experience in the industries and therefore

they are likely to make much better use of the highly efficient coal blocks

than the JPL. Most of them had applied for allotment of the Mandakini

coal block several years before the JPL has applied for the same.
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6. It is alleged, on the basis of facts stated supra, that JPL

having hand in gloves with the opposite parties is going to sell away the

high grade coal which has been allotted to it by illegal means. The

purpose of allotment of coal block for the existing power projects is to

combat the power scarcity prevailing in the State of Orissa. The allotment

of high grade coal and that too one-third of the total reserve of Mandakini

Block in favour of JPL is illegal, arbitrary and opposed to the public

policy. It is further alleged that it has reliably learnt that JPL has

obtained the said allotment of coal block by influencing the authorities

concerned. It has suppressed the fact about the earlier coal linkage

allotment in its favour and obtained the present allotment illegally by

undue influence and on extraneous considerations. Therefore, it is illegal

and void, which would results in inappropriate and improper utilization of

the coal block.

7. Mr. Bhagaban Mohanty, learned counsel appearing on

behalf of the petitioner, contends that the opposite party No.1-Union of

India was required to verify the expertise and other technical abilities of

JPL before allotting such a huge quantity of coal block for captive mining.

Allotment of the said coal blocks in favour of JPL, which has not

possessed the experience in the power generation plant and other plants,

defeats the purpose and objects of allotment of such major mineral in its

favour, thereby the public interest is affected so also public injury and it

is also in violation of rule of law are the relevant grounds on which the

present petition is filed seeking for the aforesaid relief. It is further

contended by him that the opposite party No.1, in the matter of entering

into contract of allotment of coal block, which is a major mineral, which
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shall be used for the common good as provided in the Directive Principles

of State Policy under Article 39 (b) of the Constitution, has violated in

allotting the coal blocks in favour of an illegal person as it does not

possess the required experience in the filed of power generation. It is

further contended that opposite party No.1 was required to exercise its

jurisdiction by following the mandate of Article 14 of the Constitution,

which excludes arbitrariness on its part and requires to act fairly and

reasonably when the contract concerns the public interest at large. It is

urged that as the JPL is not fulfilling the legal requirement having not

possessing the experience in the field of power generation for the

allotment of coal blocks in its favour and it is in violation of the guidelines

and the criteria required to be followed by the opposite party No.1.

Therefore, the action on the part of the opposite party No.1 is arbitrary

and unreasonable as it will be a loss to the State exchequer. It is further

contended that the opposite party No.1 has not discharged its function

properly as it has neither scrutinized the applications in proper

perspective nor acted in a fair and reasonable manner in the allotment of

coal blocks in favour of JPL.

8. Learned counsel for the petitioner in support of his

submission has placed reliance upon the case of Ramana Dayaram Shetty

Vrs. International Airport Authority of India, AIR 1979 SC 1628, Kasturi

Lal Lakshmi Reddy Vrs. Union of India, (1980) 4 SCC 1, Fasih Chaudhury

Vrs. Director General, Doordarshan, (1989) 1 SCC 89 and Sterling

Computers Ltd. Vrs. M&N Publications Ltd., (1993) 1 SCC 445. By relying

upon the aforesaid decisions of the Apex Court, learned counsel for the
7

petitioner prays to grant the relief as the public interest and public injury

is involved in this public interest litigation.

9. Learned Assistant Solicitor General has filed notes of

preliminary submission on behalf of the opposite party No.1 by referring

to various facts pleaded in the writ petition. It is stated that the Ministry

had advertised 38 coal blocks on 6th November, 2006 inviting application

for allocation of the said blocks for captive mining for specified end uses,

namely, power generation, production of iron & steel and production of

cement as per the provisions of Coal Mines (Nationalization) Act, 1973

(hereinafter called “the Act, 1973”) as amended from time to time. In

response to the said advertisement, more than 1400 applications were

received for allocation of said blocks, out of which 744 applications were

for power sector blocks. In all, about 207 companies had applied for

power sector coal blocks. Notice along with details of blocks, guidelines

indicating procedure for submission of application, criteria for allocation

etc. were placed on the Ministry’s website as well. As per the procedure

laid down in the guidelines, allocation of coal/lignite blocks was made

through the Screening Committee as the said applications were sent to

the Central Ministries of Power, Commerce and Industry (Department of

Industrial policy & Promotion) Steel as well as the State Governments

concerned, where the blocks were located and where the end use projects

were proposed to be located for their comments. The first meeting of the

Screening Committee was held from 20.06.2007 to 23.06.2007. All the

applicants were invited to make their representations individually outlying

the salient features of their respective cases. Altogether, 193 companies

came and made presentation before the Committee. Ministry of Coal
8

could not finalise the recommendation since the Ministry of Power

informed that they had not been able to examine the applications.

Subsequent thereto another meeting of the Screening Committee was

convened on 30.07.2007. Ministry of power had furnished their views

with the observation that authenticity of data/comments submitted need

to be verified separately. Accordingly, the Committee decided that the

State Governments may be asked to carry out a quick verification of the

data used by the Ministry of power for techno-economic evaluation of end

use projects. The next Committee meeting was convened on 13.9.2007.

The verification reports from the State Government as requested were

received and placed before the screening committee. Financial strength of

applicants was scrutinized independently with the help of financial

experts from Coal India Ltd. Taking cognizance of the advice given by the

Ministry of Power that in view of the capacity constraints in transmission

network, power producers should limit plant capacity to 500 to 1000 MW,

the Committee agreed that this should be taken as the guiding principle.

Therefore, 1000 MW was taken as the maximum limit for allocation of coal

blocks and the shares of geological reserves in the block, in case the

capacity indicated in the application is higher than the maximum limit

suggested by the Ministry of Power.

10. Based on the recommendation of the Screening

Committee as approved by the Government, the Mandakini captive coal-

blocks have jointly been allocated to M/s. Monnet Ispat & Energy Ltd., M/

s. Jindal Photo Ltd and M/s. Tata Power Company Ltd., for their

respective power plant. It is specifically asserted that Ministry of Power

and Ministry of Coal have applied uniformly the guidelines before deciding
9

the allocation of coal blocks and consequent equitable proportionate

distribution of shares of geological reserves in favour of the allottee.

Therefore, the allegation of not following the guidelines, so also the

allegation of arbitrariness, unreasonableness and illegality on the part of

the opposite party No.1 in allotting the coal blocks in favour of JPL is

specifically denied by Mr. Das, learned Assistant Solicitor General.

11. It is further stated that based on the recommendation of

the Screening Committee as approved by the Government, an offer letter

was issued on 09.01.2008 intimating the option for allocation of

Mandakini captive coal block jointly to M/s. Monnet Ispat & Energy Ltd.,

M/s. Jindal Photo Ltd and M/s. Tata Power Company Ltd. with equal

shares of the geological reserves for their power plants of 1000 MW

capacity. Further it is contended that the allottees were asked to

intimate their option and form a Joint Venture Company by entering into

a joint venture agreement within four weeks from the date of the aforesaid

offer letter, failing which appropriate action would be taken by the

Government. Accordingly, they entered into a joint venture agreement

and submitted the required bank guarantee and purchased the geological

report from CMPDIL within the prescribed time limit. The mining plan in

respect of the coal block was approved by the Ministry under the MC

Rules of Mines and Minerals (Regulation and Development) Act, 1957

(hereinafter called “MMRD Act”). Therefore, the contention of the

petitioner that the coal block has been allotted illegally and arbitrarily in

favour of JPL is not correct.

12. Opposite party No.3 has filed the counter affidavit raising

certain preliminary objections regarding maintainability of the writ
10

petition to the effect that the petitioner-Society was registered in the year

2009, but the allotment of coal blocks was made in the year 2008. It is

further alleged that the present writ petition has been filed to abuse the

process of the Court and so also to sub-serve some private interest and for

harassing the opposite party No.3. Therefore, it deserves to be dismissed.

13. Further, with regard to the allegation made for allotment

of coal blocks, the petitioner is unable to show anything by furnishing

relevant material facts that the opposite party No.3 was allotted the coal

block by using influence or on extraneous consideration. The allegation

with regard to illegal allotment of coal block in its favour for power

generation and so also to sell it outside the State is not supported by any

other factual foundation is vague and lacks material particulars.

14. Mr. Sanjit Mohanty, learned Senior Counsel appearing

for opposite party No.3, placed strong reliance upon the counter affidavit

by referring to the judgment of the Apex Court in the case of State of

Uttaranchal Vs. Balwant Singh Chaufal, reported in JT 2010 (1) SC 329,

wherein it has been held that frivolous and vexatious petitions in the garb

of public interest litigation must be discouraged by the Court in exercise

of its Constitutional power. He has placed reliance on the relevant

guidelines laid down in the aforesaid case in justification of allotment of

coal block in favour of JPL and the Joint Venture Companies (JVC).

15. The relevant guidelines enumerated in the said case are

extracted hereunder for better appreciation of rival contentions in this

matter:

“(a) Verification of the credentials of the P.I.L. petitioner.

(b) Satisfaction of correctness of the contents of the
petition,
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(c) Substantial public interest is involved.

(d) Petition should involve larger public interest, gravity
and urgency,

(e) The PIL is aimed at redressal of genuine public harm
or public injury and that there should be no personal
gain, private motive or oblique motive behind filing the
public interest litigation.

(f) Petitions filed by busybodies for extraneous and
ulterior motives must be discouraged by imposing
exemplary costs or by adopting similar novel methods
to curb frivolous petitions and the petitions filed for
extraneous considerations.”

16. Further it is contended by Mr. Mohanty that no substantial public

interest are involved in the present case and it does not amount to redressal

of genuine public interest or public injury. Therefore, it is requested that the

writ petition should be dismissed with exemplary costs, as the same has

been filed with ulterior motive and on extraneous consideration. It is further

alleged that the attempt of the petitioner to challenge the allotment of

Mandakini Coal Block of Talcher coal fields in favour of JPL, which has got

only 33% shareholding does not involve redressal of any public injury and no

public interest is shown to be served by filing the present writ petition as

observed by the Hon’ble Supreme Court in Balwant Singh Chaufal (supra)

and also in a catena of decisions on PIL matter. Further, as the petitioner

has no grievance against M/s. Monnet Ispat & Energy Ltd and M/s. Tata

Power Company Ltd. who are the JVC of JPL and as JPL has got only 33%

share in the project, it cannot be said that there will be any public injury

even if the JPL is having no experience in the filed of power generation. It is

contended that this Court having regard to the facts and circumstances of

the case, as the petitioner is unable to show to this Court that neither public

interest nor any public injury or any violation of rule of law is involved in this

case, this Court should decline to exercise its Constitutional power under
12

Article 226 of the Constitution of India. Mr. Mohanty further seeks to justify

the allotment in favour of opposite party No.3 and its status contending that

opposite party No.3 is a flagship company of the B.C. Jindal Group which is

one of the well reputed industrial groups in the country known for its multi-

product on multi location manufacturing establishment for the last five

decades, such as Jindal Photo Ltd., Jindal Poly Films Ltd., Jindal India Ltd..

However, we do not feel it necessary to elaborate the

details about the company in this judgment, which are given in the counter

affidavit.

17. It is further submitted that opposite party No.3 is acting

in the interest of public and a Memorandum of Understanding (MOU) has

been entered into with Govt. of Orissa for establishment of a power project of

1200 MW by using coal as fuel. Several measures involving huge financial

investment and stake have been taken for establishment of the Thermal

Power Plant in Angul district in the State of Orissa. It is duty bound to act in

terms of the undertakings given to the Govt. of Orissa with regard to the

establishment of its Thermal Power Plant. The conditions include supply of

generated power to the State of Orissa in the proportion as stipulated under

the MOU at concessional rate. The opposite party No.3 has to utilize the coal

from assured captive coal mines /coal linkages by the Govt. of Orissa for End

Use Projects, namely, the power plant alone, to be located in the State of

Orissa and to provide employment to local people in terms of the allotment

letter as well as MOU. Therefore, the allegation made in the PIL that

allotment of coalmines in its favour will hamper the public at large is

certainly a wrong understanding of the petitioner with the concept of public

interest or injury. Rather it will sub-serve the public interest by generating
13

large number of employment and also supply of power directly to the

consumer in the rural parts of the Orissa State as well as in the town and

urban areas and will certainly augment the per capita income of the people of

the State of Orissa. Therefore, the allotment of the coal block in its favour is

in the public interest and it definitely subserves the interest of the common

man of the State. Hence, the petition is wholly untenable in the eye of law

and deserves to be rejected.

18. Mr. Mohanty, further referred to the allotment of the coal

blocks in favour of the JVC on the basis of the recommendation of the State

of Orissa and submits that the coal block allocation is subject to terms and

conditions related to performance and the opposite party No.3 is bound by

the terms and conditions of utilization of coal block allotted in its favour for

the purpose of End Use. If the same is not used for that purpose and is sold

in the public market it has to face the consequence of cancellation of the

allotment as per the condition enumerated in the MOU. Therefore, the

apprehension of the petitioner’s society that the JPL will not utilize the

material resources of coal block and sale it in the open market is also

without any factual foundation and is devoid of any merit.

19. Justifying the stand taken by the learned Assistant

Solicitor General with regard to non violation of any guideline for allocation of

Coal Blocks in favour of JPL, it is contended that strictly in conformity with

the guidelines the allocation has been made. Further, huge investments has

already been made by the company for setting up of the power plant, several

measures have already been taken and infrastructural facilities have been

obtained from the State Government, for acquiring 1055 acres of land (both

Government and private) investment to the tune of Rs. 72 crores have been
14

made, water commitment for 40 cusecs of water has been obtained from the

State Government and various other approvals, namely, clearance from the

Ministry of Environment and Forest, Pollution control Board, Airport

Authority etc. have already been obtained and financial closures for 1200

MW for first and second unit has been completed and it is almost ready for

manufacturing / production activities by establishing the plant but on

account of the status quo order passed by this Court, further steps as

required to be taken are stalled.

20. Mr. Mohanty placing reliance upon the guidelines under

Annexure-6 sought to justify the allocation of coal blocks in favour of JPL

and its JVC and further submitted that the company has fulfilled all the

criteria prescribed in the guidelines. In order to fortify his submission, he

has relied upon the provisions of Sub-Section (3) to Section 3 of the Act,

1973 which reads thus :

“(iii) a company engaged in :

(1) the production of iron and steel,
(2) generation of power
(3) washing of coal obtained from a mine, or
(4) such other end use as the Central Government may
by notification specify
xxx xx xxx xxx”

Clause (iii) of Sub-section (3) came by way of amendment

to the aforesaid provision of the Act,1973 with effect from 9.6.1993. By

careful reading of the aforesaid provisions of the Act and the guidelines, Mr.

Mohanty, learned Senior Counsel on behalf of the JPL submits that the

exclusively power generation is not the criteria for allotment of coal blocks as

contended by the learned counsel for the petitioner. He submits that the

Screening Committee has verified the application of the applicants, examined

each one of the application on merit, applying its mind after procuring
15

reports from the respective State Governments and keeping in view the

public interest of the State, the contract is awarded in favour of opposite

party no.3 for a period of 30 years for generating power. Therefore, he

submits that there is no public interest involved in this matter. Further, it

is contended that after lapse of two years from the date of allocation, when

the company has already invested huge amounts of money and obtained all

necessary permission from different Authorities as required under the

various Statutory enactments, at this stage petitioner has come up before

this Court seeking to quash the allocation of coal block in favour of JPL

contending that it is bad in law and as there is delay and latches on the part

of the petitioner, the petition is devoid of any merit and deserves to be

dismissed.

21. Mr. P.K.Mohapatra, learned counsel appearing for

opposite party no.4 submits that he has no submission to make for the

reason that opposite party no.4 is neither a proper or necessary party to this

proceeding as no relief is sought against it. The same is placed on record.

22. With regard to the above rival contentions, the following

questions are framed for consideration of this Court.

(i) Whether the JPL, in whose favour award of the
contract of coal blocks was made for establishment
of power generation plant, is a eligible person to
submit the application pursuant to the notification
under Annexure-3 ?

(ii) Whether the allotment of coal blocks in favour of
opposite party no.3-JPL, for establishment of
power plant for generation of power by using the
coal blocks which are end uses, is vitiated on
account of illegality, arbitrariness and
unreasonableness as contended by the petitioner ?

(iii) Whether there is any public interest involved by
allotting Mandakini Coal Block of Talcher
Coalfields in favour of JPL and its consortium
16

companies or it will affect either any public interest
or injury or is in violation of Rule of Law ?

23. To answer the first question, it is necessary for us to refer

the guidelines at Annexure-6 and the same are considered in the backdrop of

the statutory provisions of Sub-Section (3) to Section 3 of the Act, 1973. On

careful reading of the notification and guidelines, it appears that the

applications were invited by opposite party No.1 for the purpose of allotment

of coal blocks for generating power by establishing the plant. In our

considered view, the contention urged by the petitioner’s counsel that the

JPL is ineligible as it did not have engaged itself in any power generation as

on the date of filing the application, cannot be accepted by this Court for the

reason that the guidelines are read with the statutory provisions referred to

supra, did not provide anywhere that a person must have the experience in

the field of power generation at the time of submission of its application.

Such type of interpretation of the notification by the learned counsel for the

petitioner cannot be accepted. If such an interpretation is given, the same

would be contrary to the statutory provisions and the guidelines. As long as

the statutory provision and the guidelines are intact, this Court cannot go

beyond the same and fix a criteria that if a person not having existing power

generation plant cannot submit the application as contended by the

petitioner, which would run contrary to the statutory provisions and defeat

the purpose for which the applications were invited by the opposite party

no.1 for allotment of coal blocks in favour of a successful Tenderer for

establishment of power generating plant. Accordingly the first question is

answered against the petitioner.

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24. To answer the second and third questions, it is necessary

to mention that, elaborate procedure has been followed by the Union of India

and other Ministries. A Screening Committee headed by the Secretary (Coal)

as the Chairman, was constituted to process the applications received

pursuant to the notification. It would be seen from the notes of preliminary

submission made on behalf of the opposite party No.1 that the Committee

has met on several occasions i.e. from 20.06.2007 to 23.06.2007 and on

30.07.2007. The applications were scrutinized, processed, and the reports

from the concerned State Governments were received for the purpose of

allotment of coal blocks and thereafter the same were considered. During

the process of scrutinisation of the applications, Screening Committee

thoroughly examined the same on the basis of the detailed data and notes

submitted by each one of the applicants and the representations which were

filed before the said Committee. The Screening Committee is the fact finding

Committee to examine various relevant factors like, financial capacity,

technical capacity and various other aspects as required, which have been

examined for allotting the coal blocks in favour of the eligible applicants for

the purpose of establishment of power generation plant, by using the coal

blocks for that purpose. On the basis of relevant criteria and guidelines the

Committee has applied its mind, expressed its opinion and recommended for

allotment of the coal blocks in favour of Opposite party No.3-JPL and its

consortium companies. Unless cogent and positive materials are produced

before this Court regarding the correctness of the decision of the fact finding

Committee, it is not possible for this Court to interfere with the same.

Therefore, the allegation made by the petitioner that the allotment of coal

blocks awarded in favour of opposite party No.3 and its consortium
18

companies is illegal, arbitrary and unreasonable which attracts Article 14 of

the Constitution of India is not based on any valid grounds and evidence. We

are of the view that petitioner’s society has got very limited resources in

placing the materials before this Court. In public interest litigation, it is not

for this Court to go into the correctness of the allegations made against the

granting authority in the absence of material evidence to substantiate the

allegations. Opposite party No.1 is the authority which has allotted the coal

blocks in favour of JPL and its consortium companies. Further, a Committee

constituted by some responsible bureaucrat headed by the Secretary (coal) as

its Chairman has carefully scrutinized the applications and being satisfied

with the eligibility of opposite party No.3, has awarded the contract in its

favour. The said fact is not at all denied by the petitioner as incorrect. In the

absence of the same we cannot, on the basis of surmises, record any finding

that the action of the Ministry of Coal in allotting the coal blocks in the

favour of JPL is bad in law and JPL has influenced the Ministry in getting the

allocation of coal blocks in its favour, and the same cannot be accepted by

this Court.

25. The Court should be very cautious while deciding a

matter relating to PIL, if there is any public interest affected or any injury or

any violation of rule of law is made out, then only this Court has to exercise

its Judicial Review Power.

26. In S.P. Gupta Vs. Union of India & Anr., AIR 1982 SC

149, a Seven Judge Bench of Hon’ble Supreme Court has clearly defined

‘what PIL means and is’ and held as follows :

“It may therefore now be taken as well established
that where a legal wrong or a legal injury is caused to a
19

person or to a determinate class of persons by reason of
violation of any constitutional or legal right or any burden
is imposed in contravention of any constitutional or legal
provision or without authority of law or any such legal
wrong or legal injury or illegal burden is threatened and
such person or determinate class of persons is by reason of
poverty, helplessness, or disability or socially or
economically disadvantaged position, unable to approach
the court for relief, any member of the public can maintain
an application for an appropriate direction, order or writ in
the High Court under Article 226 and in case of breach of
any fundamental right of such person or determinate class
of persons, in this Court under Article 32 seeking judicial
redress for the legal wrong or injury caused to such person
or determinate class of persons …………… This Court will
readily respond even to a letter addressed by such
individual acting pro bono publico. It is true that there are
rules made by this Court prescribing the procedure for
moving this Court for relief under Article 32 and they
require various formalities to be gone through by a person
seeking to approach this Court. But it must not be
forgotten that procedure is but a handmaiden of justice
and the cause of justice can never be allowed to be
thwarted by any procedural technicalities. The court would
therefore unhesitatingly and without the slightest qualms
of conscience cast aside the technical rules of procedure in
the exercise of its dispensing power and treat the letter of
public-minded individual as a writ petition and act upon
it …. But we must hasten to make it clear that the
individual who moves the court for judicial redress in cases
of this kind must be acting bona fide with a view to
vindicating the cause of justice and if he is acting for
personal gain or private profit or out of political motivation
or other oblique consideration, the court should not allow
itself to be activised at the instance of such person and
must reject his application at the threshold, whether it be
in the form of a letter addressed to the court or even in the
form of a regular writ petition filed in court. We may also
point out that as a matter of prudence and not as a rule of
law, the court may confine this strategic exercise of
jurisdiction to cases where legal wrong or legal injury is
caused to a determinate class or group of persons or the
constitutional or legal right of such determinate class or
group of persons is violated and as far as possible, not
entertain cases of individual wrong or injury at the
instance of a third party, where there is an effective legal-
aid organisation which can take care of such cases.”

In Janata Dal Vs. H.S. Chowdhary & Ors., AIR 1993 SC

892, the Hon’ble Supreme Court while deciding a PIL matter, referred to the

decision in S.P.Gupta (supra) and held that the decision in Gupta’s case is a
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golden master key which has provided access to the Courts for the poor and

down trodden.

27. In Giani Devender Singh Sant Sepoy Sikh Vs. Union of

Inida & Anr, AIR 1995 SC 1847, the Hon’ble Supreme Court held as under :

“….If the High Court intends to pass an order on an
application presented before it by treating it as a public
interest litigation, the High Court must precisely indicate the
allegations or the statements contained in such petition
relating to public interest litigation and should indicate how
public interest was involved and only after ascertaining the
correctness of the allegation, should give specific direction as
may deem, just and proper in the facts of the case.”

28. The Hon’ble Supreme Court in the case of R&M Trust Vs.

Koramangala Residents Vigilance Group & Ors, AIR 2005 SC 894 held as

under :

“……Courts should be very very slow in entertaining
petitions involving public interest: in very rare cases where
the public at large stand to suffer….”

29. In M/s. Holicow Pictures Pvt. Ltd. Vs. Prem Chandra

Mishra & Ors, AIR 2008 SC 913, the Hon’ble Supreme Court held as under :

“……Public interest litigation is a weapon which has to be
used with great care and circumspection and the judiciary
has to be extremely careful to see that behind the beautiful
veil of public interest an ugly private malice, vested interest
and/or publicity-seeking is not lurking. It is to be used as an
effective weapon in the armory of law for delivering social
justice to the citizens. The attractive brand name of public
interest litigation should not be used for suspicious products
of mischief. It should be aimed at redressal of genuine public
wrong or public injury and not publicity-oriented or founded
on personal vendetta…..”

30. In the instant case, as could be seen from the event that

had taken place, only after the allotment of coal blocks is made in favour of

JPL, particularly when, private and Government lands to the extent of 1055

acres have been acquired by the State Government and handed over in
21

favour of the JPL is the statement of counter filed by the opposite parties.

The aforesaid land which includes both Government and Private lands, were

provided to the JPL for establishment of plant by using coal blocks for end

uses. Further, this writ petition has been filed in the year 2010 but the offer

of allotment was made in the year 2008. Thereafter, the MOU and the

supplementary agreement were entered into by opposite party No.1 with JPL

and its consortium companies. Apart from the said agreement, necessary

permissions from the different departments like Pollution Control Board,

Airport Authority and other necessary organizations had already been

obtained for establishment of the plant. As stated by the learned Senior

Counsel huge investment has already been made for the purpose of

procuring the water, for obtaining geological reports from CMPDI and GSI,

bank guarantees, approval of mining plans etc. for establishment of the

plant. Further, as per the terms and conditions of the agreement, JPL and

its consortium companies have entered into an agreement with the State

Government to supply the power that would be generated for consumption of

the consumers of the State at large. Therefore, this writ petition at the

instance of a public spirited person alleging that the public interest will

suffer in the present case is not correct. Rather, in our considered view, if we

interfere at this stage and quash the allotment by granting relief sought for

by the petitioner, in that event, the public interest will suffer and injury will

be caused to the public at large. Therefore, we are of the view that public

interest is in favour of the allocation of coal blocks and not against it as

alleged in the writ petition, for the reason that awarding of the contract in

favour of JPL and its consortium companies for establishment of plant,

referred to supra, by using the coal blocks for end uses is in the public
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interest, which will generate employment for thousands of unemployed youth

of the State and will augment the State exchequer. Not only it will mitigate

the unemployment problem of the State but also mitigate the power

generation problem as per the MOU entered into by the JPL and its

consortium companies with the State Government. The State Government

under Section 11 of the Electricity Supply Act, 2002 can issue notification to

the power generating companies to supply power to the Corporation which

will supply the same to the consumers and in that process both the

agricultural and industrial development would take place in the State and as

a result of which large number of farmers and industrial workers will be

benefited and the per capita income of the people of the State will increase

and in that process the public interest is protected and safeguarded. In view

of the aforesaid reasons, we have answered the question Nos. 2 and 3 in

justification of the allocation of the coal blocks in favour of JPL and its

consortium companies.

31. As we have answered all the points in justification of the

award in allotting the coal blocks in favour of JPL and its consortium

companies, the fact situation is not in favour of the petitioner’s society,

which has filed this public interest litigation for grant of the reliefs.

Accordingly the writ petition is dismissed. Since we have dismissed the writ

petition the status quo order granted by this Court on 25.2.2010 stands

vacated.