Prior hearing required before premature mining lease termination; invalid order led to arbitration for compensation and damages.

Premature termination of a mining lease under section 4A of the Mines and Minerals (Regulation and Development) Act, 1957 was held to require a prior hearing because the statute did not clearly exclude natural justice, and the later express hearing amendment reinforced that interpretation. The contention that a hearing would be futile was rejected, and the termination order was invalid for breach of natural justice. Given the long pendency and difficulty of restoring the original position, compensation was treated as the appropriate further relief, with damages to be determined by arbitration and confined to the specified limited period.

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Issues: (i) Whether, before prematurely terminating a mining lease under section 4A of the Mines and Minerals (Regulation and Development) Act, 1957, the lessee was entitled to a prior hearing; (ii) what relief should follow from the invalid termination order.

Issue (i): Whether, before prematurely terminating a mining lease under section 4A of the Mines and Minerals (Regulation and Development) Act, 1957, the lessee was entitled to a prior hearing.

Analysis: The earlier decision in the related matter was treated as directly governing the point. Section 4A, as it then stood, was read as not excluding the requirement of notice or hearing. The later amendment introducing an express hearing provision was taken as supporting the conclusion that the legislature contemplated observance of natural justice before termination. The argument that a hearing would be futile because the decision was policy-driven was rejected.

Conclusion: The lessee was entitled to a prior hearing, and the termination order was invalid for breach of natural justice.

Issue (ii): What relief should follow from the invalid termination order.

Analysis: In view of the long pendency of the writ petition and the practical difficulty of restoring the original position, the Court considered compensation the appropriate further relief. To avoid fresh litigation, the question of damages was directed to be determined expeditiously through arbitration, with the compensation claim confined to a limited period from the date of termination or expiry of the original leases, whichever was earlier.

Conclusion: The petitioner was granted relief in the form of arbitration for determination of compensation and damages, subject to the stated temporal limit.

Final Conclusion: The termination order was set aside for violation of natural justice, and the petitioner obtained partial substantive relief through a reference for quantification of compensation.

Ratio Decidendi: Unless a statute clearly excludes it, a power to prematurely terminate a valuable lease affecting civil rights will be construed to require observance of natural justice before the order is made.

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