2017 (1) TMI 1711 - SC - Indian Laws

Enhanced royalty rates of Rs. 100 per cubic meter for boulder, gravel and shingle apply retrospectively from April 2001

The SC held that enhanced royalty rates of Rs. 100 per cubic meter for boulder, gravel and shingle used for making chips would apply retrospectively from ... Principles of Statutory Interpretation - Valuation of Royalty - adjustments of the amounts already deposited - rate fixed by the Notification dated 24.03.2001 w.e.f. 26.12.2001 - HELD THAT:- Any legislation or instrument having the force of law, if clarificatory, declaratory or explanatory in nature and purport, in order to supply an obvious omission or to clear up doubts qua any prior law, retrospective operation thereof is generally intended. Applying this test, in absence of any indication to the contrary, either in the parent Act or the Rules or the Notifications involved, we are thus of the unhesitant opinion that on a conjoint reading of Rule 26 and the two Notifications, the enhanced rate of royalty at ₹ 100/- per cubic meter for boulder, gravel and shingle, which are used or are capable of being used for making chips would be realizable w.e.f. 01.04.2001 and axiomatically thus, the Respondents are liable to discharge the demand, therefor, as raised in terms thereof. The High Court had clearly erred in interpreting the relevant legal provisions and the Notification dated 26.12.2001 in particular in holding that the enhanced rates, as fixed by the Notification dated 24.03.2001, would be payable for the minerals involved, as extracted from the two areas, mentioned in the Notification dated 26.12.2001 on and from that date. Appeal allowed - decided in favor of appellant. Issues Involved:1. Application and interpretation of Notification dated 26.12.2001.2. Retrospective application of royalty rates.3. Validity and enforcement of the Notification dated 24.03.2001.4. Clarificatory nature of the Notification dated 26.12.2001.5. Compliance with Rule 26 of the Bihar Minor Mineral Concession Rules, 1972.Issue-wise Detailed Analysis:1. Application and Interpretation of Notification dated 26.12.2001:The Supreme Court examined the Notification dated 26.12.2001, which identified specific areas where boulder, gravel, and shingle, capable of being made into stone chips, would attract a royalty of Rs. 100 per cubic meter as per the Notification dated 24.03.2001. The Court clarified that this notification was not altering the description of the minerals but merely identifying the areas from which these minerals, if extracted, would attract the specified royalty rate.2. Retrospective Application of Royalty Rates:The Court addressed the contention that the Notification dated 26.12.2001 could not be applied retrospectively to enforce the royalty rates from 24.03.2001. It was argued that the Rules, being a delegated legislation, did not authorize retrospective application. However, the Court concluded that the Notification dated 26.12.2001 was clarificatory and thus could be applied retrospectively.3. Validity and Enforcement of the Notification dated 24.03.2001:The Notification dated 24.03.2001, which prescribed the royalty rate of Rs. 100 per cubic meter for certain minerals, was not challenged by the Respondents. The Court noted that the Respondents had accepted this notification and complied partially by making part payments against the demand notices issued based on this notification.4. Clarificatory Nature of the Notification dated 26.12.2001:The Court emphasized that the Notification dated 26.12.2001 was clarificatory in nature, intending to specify the areas where the enhanced royalty rates would apply. Citing precedents, the Court stated that clarificatory or declaratory statutes are generally intended to have retrospective operation to clear up doubts or supply omissions in previous laws.5. Compliance with Rule 26 of the Bihar Minor Mineral Concession Rules, 1972:Rule 26 outlines the framework for charging royalty rates and allows the State Government to amend these rates via notification. The Court found that the Notifications dated 24.03.2001 and 26.12.2001 were consistent with Rule 26, which permits the State Government to enhance or reduce royalty rates effective from the date of publication in the official gazette. The Court interpreted these notifications to mean that the enhanced royalty rates were applicable from 01.04.2001, as initially intended.Conclusion:The Supreme Court concluded that the enhanced royalty rates of Rs. 100 per cubic meter for boulder, gravel, and shingle, as specified in the Notification dated 24.03.2001, were applicable from 01.04.2001. The Notification dated 26.12.2001 was deemed clarificatory and thus had retrospective effect. The High Court's judgment, which limited the application of the enhanced rates to post-26.12.2001, was set aside. The appeals were allowed, and the Respondents were held liable to pay the enhanced royalty rates from 01.04.2001.