ORDER
Pendse, J.
1. In this batch of petitions, the constitutional validity of the Maharashtra Abolition of Subsisting Proprietary Rights to Mines and Minerals in Certain Lands Act, 1985 is under challenge. It is not necessary
to set out the facts of each of the petition and it would be convenient to dispose of all the petitions by common judgment. To appreciate the contentions urged in support of the petitions, brief facts involved in writ petition No. 97 of 1986 are set out.
In the year 1774, the island of Salsette came within the political sovereignty of the British from the Peshwas. The lands comprising in the village Chandivali were wholly and inalienably granted by East India company in favour of Helenus Scott by agreement dated August 30, 1799. By diverse transactions, assignments and conveyances, the lands transferred hands and ultimately the predecessors of the petitioners secured the assignment in the year 1941. The lands were used for mining operations and some time in the year 1960, the Additional District Deputy Collector of Government of Maharashtra demanded royalty amount from the petitioners. The petitioners instituted Suit No. 94 of 1961 on the Original Side of this Court for a declaration of right to the lands as well as right to sub-soil minerals. The petitioners also sought injunction restraining the Government from recovering any royalty amount in respect of mining operations. The suit was decreed by learned single Judge by judgment dated April 28, 1967. Appeal No. 53 of 1967 preferred by the Government ended in dismissal by judgment dated April 17, 1973 delivered by Division Bench of this Court. The Government of Maharashtra then approached the Supreme Court and the appeal preferred is pending hearing and disposal before the Supreme Court. During the pendency of the proceedings, the petitioners had executed leases from time to time for carrying out the mining operations in favour of respondents Nos. 4 to 17.
2. The Central Government passed Legislation known as ‘the Mines and Minerals (Regulation and Development) Act, 1957 to provide for the regulation of mines and the development of minerals under the control of he Union. Section 2 of the Act declares that it is expedient in the public interest that the Union should take under its control the regulation of mines and the development
of minerals to the extent provided in the Act. Section 4 of the Act inter alia provides that no person shall undertake any prospecting or mining operations in any area, except under and in accordance with the terms and conditions of a prospecting licence or, as the case may be, a mining lease, granted under this Act and the rules made thereunder. Section 13(1)
of the Act confers power on the Central Government to make rules for regulating the grant of prospecting licences and mining leases in respect of minerals and for purposes connected therewith. Section 18 of the Act prescribes that it shall be the duty of the Central Government to take all such steps as may be necessary for the conservation and systematic development of minerals in India and for the protection of environment by preventing or controlling any pollution which may be caused by prospecting or mining operations.
3. The Maharashtra (Abolition of Subsisting Proprietary Rights to Mines and Minerals in Certain Lands) Act 1985, hereinafter referred to as the Act, was passed by Maharashtra Legislature and received assent of the President of India on August 1, 1985 and which was declared as the appointed date. The legislation was enacted to abolish subsisting proprietary rights to mines and minerals in any lands under the Land Tenure Abolition Laws or such other laws for the time being in force by acquisition thereof and to provide for matter connected therewith. The preamble to the Act recites that pursuant to the national policy of brining the actual cultivator into the direct relation with the Government, series of Land Tenure Abolition Laws for abolition of intermediary rights, jagir and inam tenures were enacted, but the rights of inamdars and jagirdars to mines and minerals were specifically saved thereby allowing such existing rights to survive particularly where the inams are grants of soil. The preamble further recites that the mines and minerals available with inamdars were exploited by inamdars fqr individual gains without being liable to pay any royalty to the State Government and in the manner highly detrimental and prejudicial to the public interest. The Government therefore felt it necessary to abolish subsisting
proprietary righs to mines and minerals under the land tenure abolition laws or such other laws for the time being in force. Section 4 of the Act provides for vesting of rights of alienee to mines and minerals in the State Government. This section reads as under:–
“Save as otherwise provided in this Act, notwithstanding anything contained in any settlement, kaul, grant, sanad or order, any judgment, order or decree of a Court or Tribunal or in any law or instrument for the time being in force, on the date of commencement of this Act, all subsisting rights to mines and minerals vestig in any alienee in any land shall pass from such person to and vest in the State Government, free of any encumbrances.”
The expression “alienee” is defined under Section 3(a) as follows:–
“”alienee” means an Inamdar, Jagirdar or Estate Holder as defined in the Land Tenure Abolition Laws or such other laws for the time being in force, or a person who holds any subsisting right in any sub-soil in any land under any settlement, kaul, grant, sanad or order, any judgment, order or decree of a Court or Tribunal or any law or instrument for the time being in force, but shall not include any lawful lessee holding lease-hold rights in respect of any mines or minerals on the date of commencement of this Act.”
The expression ‘sub-soil rights’, as defined under Section 3(f) means any rights to mines and minerals found or likely to be found, whether on surface or underground of any land. Section 5 of the Act provides for payment of amount for acquisition of rights to mines and minerals.
The constitutional validity of this Act was challenged in the petitions on the ground of legislative competency and infringement of fundamental rights guaranteed under Articles 14 and 19 of the Constitution. It is not in dispute that the Act was included in the 9th Schedule of the Constutition on June 7, 1990 and consequently the Act could not be challenged on the ground of violation of fundamental rights under Articles 14 and 19 of
the Constitution. The learned Counsel appearing on behalf of the petitioners consequently restricted the challenge to the legislative competency of the State Legislature to enact the Act.
4. Entry 54 of List I of the Constitution
deals with the subject of regulation of mines and minerals development to the extent to which such regulation and development under the control of the Union is declared by Parliament by law to be expedient in the public interest. Entry 23 of List II reads as under:–
“Regulation of mines and mineral development subject to the provisions of List I with respect to regulation and development under the control of the Union.”
The plain reading of the two entries makes it clear that the State Legislature can provide for regulation of mines and mineral development only in respect of the field which is not covered by the law declared by the Parliament in accordance with Item 54 List I. The Parliament enacted the legislation known as Mines and Minerals (Regulation and Development) Act, 1957 and the ambit of the provisions of this Act came up for consideration before the Supreme Court in judgment M/s. Orissa Cement Ltd. v. State of Orissa. The validity of Orissa Cess Act was challenged on the ground of legislative competency of the Orissa Legislature on the ground that the field was covered by the Act passed by the Parliament. The Supreme Court held that the Central-legislation is a clear bar on the State Legislature taxing royalty so as, in effect, to amend the Second Schedule to the Central Act. It was held that any State Legislation to the extent it encroaches on the field covered by the Central Act will be ultra vires. The Supreme Court further observed that in assessing the field covered by the Act of Parliament, one should be guided not merely by the actual provisions of the Central Act or the Rules made thereunder, but should also take into account matters and aspects which can legitimately be brought within the scope of the said statute. The counsel for the petitioners placing heavy reliance on the
decision of the Supreme Court claimed that the Act in question should be struck down as done by the Supreme Court in respect of Orissa Cess Act. It is impossible to accede to the submission because in the present case the State Legislature has not encroached on the field covered by the Central legislation in any manner. The Supreme Court examined the case where royalty for carrying out mining operations or tax thereon was imposed by reference to Entry 45, List II of the Constitution. The Supreme Court held that the royalty for carrying out mining operations cannot be equated to land revenue. It was further held that the levy cannot be treated as fee falling under Entry 66 of List II of the Constitution. It was found that it was not permissible for the State Legislature either to impose tax or levy fees in such area which is covered by the Central Legislature. Such is not the case with respect to the legislation under challenge.
5. The perusal of various provisions of the Central Act makes it clear that the Act deals with grant of prospecting licences, mining leases or other mineral concessions in respect of minor minerals and for purposes connected therewith. The Central legislation nowhere refers to the ownership rights in the sub-soil or the power to acquire such rights. Section 4 of the Act prescribes for vesting of all subsisting rights of alienees to mines and minerals in the State Government. The expression ‘alienee’ is defined under Section 3(a) of the Act which includes inamdar, Jagirdar or estate holder as defined in the land tenure abolition laws or such other laws for the time being in force. The expression takes in its sweep a person who holds any subsisting right in any sub-soil in any land under any settlement, kaul, grant, sanad or order, any judgment, order or decree of a Court or Tribunal. The definition specifically excludes any lawful lessee holding lease-hold rights in respect of any mines or minerals on the date of commencement of the Act. The proviso under Section 4 sets out that the rights of such lessees shall not be affected by this section except that such lessee shall be deemed to be a lessee holding from the Government and all the obligations to the alienee shall be deemed to have passed on to the Government. The
State Act clearly provides for taking over the rights to mines and minerals and the power to acquire was available to the State Legislature under Entry 19 of List II of the Constitution. The Central Legislature did not cover the field of acquisition of the rights to mines and minerals and was limited only to the extent of regulation and development of mines and minerals. In our judgment, the field covered by the State Legislature in no manner encroaches upon the Central Legislature and consequently the submission that the State Legislation should be struck down on the ground of legislative incompetency cannot be acceded.
Reliance was placed on behalf of the petitioners on certain observations made by the Supreme Court in judgment State of West Bengal v. Union of India. The validity of an Act of Parliament to acquire certain coal bearing areas in the State of West Bengal came up for consideration and while upholding the general right of Parliament to legislate for the acquisition of even property vested in the State, the Supreme Court pointed out that this could be done only if there is some provision in the Central Act, expressly or necessarily implying that the property of the State is to be acquired by the Union. The Supreme Court then observed that when the requisite declaration under Entry 54 is made, the power to legislate for regulation and development of mines and minerals under the control of the Union would, by necessary implication, include the power to acquire mines and minerals. Relying on these observations, it was argued that the Mines and Minerals (Regulation and Development) Act, 1957 makes requisite declaration under Section 2 of the Act and power to acquire all subsisting rights to mines and minerals are covered by the Central legislation by implication. It is not possible to accede to the submission. The observations on which reliance was placed were made by the Supreme Court in an entirely different situation and cannot be torned out of context to suggest, that the Mines and Minerals Act covers the field of acquisition of subsisting rights to mines and minerals. The latter decision of the Supreme Court State of Haryana v.
Chanan Mal specifically negatives any such contention. In the said decision, the State Legislature passed Haryana Minerals (Vesting of Rights) Act, 1973 providing for acquiring rights to the saltpetre in the lands and putting up certain saltpetre-bearing lands to auction. The High Court upheld the challenge to the validity of the notifications issued under the Act by concluding that the field covered by the Act was already fully occupied by Central legislation i.e. Mines and Minerals (Regulation and Development) Act, 1957 and therefore the State legislation was void and inoperative on the ground of repugnancy. The Supreme Court reversed the decision of the High Court observing that the stated objects and reasons of the State legislation showed that the acquisition was to be made to protect the mineral potentialities of the land and to ensure their proper development and exploitation on scientific lines. It was held that the character of the State Act has to be judged by the substance and effect of its provisions and not merely by the purpose given in the Statement of Objects and Reasons. The Supreme Court held that subject to overall supervision of the Central Government, the State Government had a sphere of its own powers and could take legally specified actions under the Central Act and Rules. It was further observed that Section 16(1)(b) of the Central Act showed that Parliament itself contemplated State legislation for vesting of lands containing mineral deposits in the State Government, a feature that could be explained only on the assumption that Parliament did not intend to touch upon the power of State Legislatures under Entry 18 of List II read with Entry 42 of List III. The decision of the Supreme Court, in our judgment, completely answers the contention of the petitioners that the State legislation lacks power to legislate for vesting of subsisting rights to mines and minerals as the field was fully occupied by the Central legislation. In our judgment, the State legislation was competent to legislate the Act under challenge and the ground of attack on legislative incompetency must fail.
6. A faint contention was raised that the
rights of only inamdars, jagirdars or estale-holders as defined in the Land Tenure Abolition Laws (which expression is defined under Section 3(d) of the Act) stand vested in the State Government. The rights held by the petitioners in Writ Petition No. 97 of 1986 were flowing from the provisions of Salsette Estate (Land Revenue Exemption Abolition) Act, 1951 and that was not covered by Land tenure Abolition Laws, The contention cannot be accepted because the definition of expression ‘alienee does not merely refer to the inamdars, jagirdars or estate-holders as defined under Land Tenure Abolition Laws but also to such other laws for the time being in force. It was very fairly conceded that the petitioners were estate-holders under the Salsette Estate (Land Revenue Exemption Abolition) Act and that being a law in force, the petitioners cannot escape from the clutches of expression ‘alienee’ as defined under Section 3(a) of the Act.
7. Writ Petition Nos. 554 of 1989, 555 of 1989, 63 of 1992, 2730 of 1986, 2738 of 1986 and 29 of 1992 are filed by persons claiming to be the lawful lessees holding leasehold rights in respect of mines and minerals on the date of the commencement of the Act. It was contended by Shri Gala, learned counsel appearing for petitioners in writ petition Nos. 554 and 555 both of 1989 that this Court by judgment delivered on April 12, 1988 in writ petition Nos. 2265 and 2266 both of 1986 declared that the petitioners in these two petitions were the lawful lessees holding leasehold rights in respect of mines and minerals on the date of the commencement of the Act. It was urged that proviso to Section 4 of the Act safeguards the rights of such lessees and the obligation to alienees arc passed over to the State Government. It was urged that the lease-deeds executed by such lessees provided for payment of amounts for diverse purposes and the liability of the lessees to the State Government in respect of payment of royalty amount has to be determined by the revenue officers in accordance with the provisions of the Bombay Minor Mineral Extraction Rules, 1955. Shri Bhatkal, learned Coun-
sel appearing on behalf of the State Government submitted that the concerned revenue officers will hear all the lawful lessees holding lease-hold rights in respect of mines and minerals on the date of the commencement of the Act and determine the liability which now has been passed on from the alienees to the State Government but on condition that such lessees have deposited the amounts demanded by the State Government. The concerned revenue officer is directed to give hearing to all such lessees provided they have paid the amounts demanded uptil now and then determine what amount or royalty such lessees are liable to pay hereafter. The tariff amount is to be determined in accordance with Bombay Minor Mineral Extraction Rules, 1955.
Shri Madnani, learned Counsel appearing on behalf of the petitioners in writ petition No. 97 of 1986, submitted that the alienee is not liable for payment of any amount to the State Government from the date of commencement of the Act and the demand made by the State Government from the petitioners cannot be sustained. Shri Gurusahani, learned Counsel appearing on behalf of the lessees, pointed out that the petitioners had recovered diverse amounts from the lessees even after year 1985 and it is futile for the petitioners to suggest that in spite of recovery of amounts, the liability to the State should be met by the lessees and not by the petitioners. It is for the officer under the Maharashtra Land Revenue Code to investigate what amounts have been recovered by the petitioners after coming into operation of the Act in respect of rights to mines and minerals from the lessees and the State Government is entitled to recover the said amount from the lessors. The balance if any, is required to be paid by the lessees.
8. Writ Petition Nos. 2402 of 1985, 97 of 1986, 1986 of 1985, 2900 of 1986 and 1306 of 1987 are filed by the alienees challenging the constitutional validity and for the reasons hereinabove, all these petitions must fail.
9. Accordingly, the validity of the Maharashtra (Abolition of Subsisting Proprietary
Rights to Mines and Minerals in Certain Lands) Act, 1985 is upheld and all the petitions stand dismissed. The iiability of lawful lessees holding lease-hold rights in respect of any mines or minerals from the date of the commencement of this Act to the State Government shall be determined by the officer under the Maharashtra Land Revenue Code, provided such of the lessees have made the payment as directed by the interim order of this Court and demanded by the State Government. The concerned officer should determine the amount of royalty payable from the date of enactment of the legislation and in accordance with the provisions of the Bombay Minor Mineral Extraction Rules, 1955 provided the mining operation is in respect of minor mineral as defined under the Central Act. Such lessees are directed to appear before the Collector, Bombay Suburban District and the concerned officer is directed to give hearing to the lessees and to the lessor, if they so chose, and then determine the amount payable. The parties will be at liberty to adopt appropriate proceedings in respect of the attachments levied during the pendency of these petitions.
10. Writ Petition No. 1178 of 1994 is filed by Laxmi Stone Supply Company challenging the legality of demand notice dated April 15, 1994. The Collector is directed to hear the petitioner and thereafter take appropriate steps to recover the amount if any found due. The Collector is directed to immediately pass the order withdrawing the attachment on the bank account of Laxmi Stone Supply Company. The attachment of bank account of the petitioners in Writ Petition No. 2402 of 1985 also to be raised forthwith and the Collector to take necessary steps for recovery of the amount, if found due, after giving hearing to the petitioners.
11. Accordingly, rule issued in each of the petition stands discharged with costs.
12. Ordered accordingly.