Court quashes penalty for unauthorized excavation, stresses end use crucial in liability determination.

The High Court quashed the penalty notice issued for excavation of ordinary earth without requisite permission, stating that the excavation did not fall within the purposes specified in the relevant Notification. The court emphasized that the end use of the excavated earth is crucial in determining liability. The petition was allowed, the notice was set aside, and no costs were awarded.

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Issues Involved:
1. Legality of the penalty notice issued for excavation of minor minerals without requisite permission.
2. Applicability of the Mines and Minerals (Development and Regulation) Act, 1957 and the Maharashtra Minor Mineral Extraction (Development and Regulation) Rules, 2013.
3. Determination of liability to pay royalty under the Maharashtra Land Revenue Code, 1966.
4. Interpretation of the term "minor mineral" and its application to the excavation of ordinary earth.

Detailed Analysis:

1. Legality of the Penalty Notice:
The main challenge in this petition is against a notice dated December 4, 2017, issued by the Tehsildar, Dahanu, proposing a penalty of Rs. 34,80,744 for the excavation of ordinary earth without obtaining requisite permission. The petitioners argued that the action of the respondents is arbitrary, illegal, and unsustainable.

2. Applicability of the Mines and Minerals (Development and Regulation) Act, 1957, and the Maharashtra Minor Mineral Extraction (Development and Regulation) Rules, 2013:
The petitioners contended that the action of the respondents contravenes the provisions of the Mines and Minerals (Development and Regulation) Act, 1957, and the Maharashtra Minor Mineral Extraction (Development and Regulation) Rules, 2013. The respondents, however, argued that the excavation of ordinary earth falls within the ambit of the said Act, 1957, and thus the petitioners are liable to pay the royalty.

3. Determination of Liability to Pay Royalty:
The petitioners argued that mere extraction of earth does not invite the levy of royalty. The use of the ordinary earth for the purposes expressly mentioned in the Notification issued under the said Act, 1957, is determinative. The Supreme Court in Promoters and Builders Association of Pune Vs. The State of Maharashtra & Ors. (2015) 12 SCC 736 held that the mere extraction of earth does not constitute a mining activity unless it is used for purposes specified in the Notification.

4. Interpretation of "Minor Mineral":
The term "minor mineral" includes ordinary earth used for filling and levelling purposes in construction activities as per the Notification issued by the Central Government on February 3, 2000. The Supreme Court clarified that excavation of ordinary earth for uses not contemplated in the Notification does not amount to a mining activity. The liability under Section 48(7) of the Maharashtra Land Revenue Code, 1966, depends on the end use of the excavated earth.

Conclusion:
The High Court quashed the impugned notice and actions initiated by the Tehsildar, Dahanu, as the excavation of ordinary earth by the petitioners did not fall within the purposes specified in the Notification. The court emphasized that the mere fact of excavation does not justify a blanket determination of liability; the end use of the excavated earth is crucial. The petition was allowed, and the notice dated December 4, 2017, was set aside with no order as to costs. Rule was made absolute in the aforesaid terms.

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