TaxTMI 
TaxTMI 
2025 (3) TMI 950
X X X X Extracts X X X X
X X X X Extracts X X X X
....Resources Pvt. Ltd, S.Vaikundarajan, Thiru.Gagandeep Singh Bedi, I.A.S. Secretary to Government, M/s.Southern Enterprises, rep. by Mr.Dhaya Devadas, M/s.Indian Garnet Sand Company, Private Limited and rep. by Mr.Dhaya Devadas, M/s Grace Minerals, rep. by Mr.Dhaya Devadas, Commissioner of Customs and Central Excise, Regional Commissioner of Customs and Central Excise Chennai, Chairman, V O Chidambaranar Port Trust, The Member Secretary Tamil Nadu, Principal Secretary, Government of Tamil Nadu, M/s.Indian Rare Earths Limited, Tamil Nadu Minerals Limited, Southern Region Mines and Mineral Based Workers Welfare Association, M/s.V.V.Mineral Skilled Employees Association, Rep. by its Secretary, Honourable Mr. Justice S.M.Subramaniam And Honourable Mr. Justice M.Jothiraman For the Petitioners : Dr.V.Suresh Amicus Curiae And Mr.P.M.Subramanian Senior Counsel For Mrs.N.K.Kanthimathi For the Respondents R2 & R4 : Mr.R.Rajesh Vivekanandhan Deputy Solicitor General of India For the R3 : Mr.K.Gunasekar Senior Panel Counsel For the R5 to R7, R23 & R31 : Mr.Aravind P.Datar Senior Counsel Assisted by Mr.B.Vijay Additional Government Pleader For the R8 : Mr.V.Raghavachari Se....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ncurrents and sea level changes, mineral rock formations, drift of eroded material through ocean currents and subsequent deposit of minerals on shores. The processes resulting in the deposits of these rare minerals along the shore, stretch over several thousands of years and are continuously driven by sea/ocean erosion of rock formations in other parts of the world. The ocean currents transport the rare minerals from their origin to the shores here. The transportation is dependent upon the physical properties of the minerals themselves i.e., density, mass, etc. 4. In so far as the State of Tamil Nadu is concerned BSMs are peculiar to the three coastal districts of Tamil Nadu namely Thoothukudi, Tirunelveli and Kanniyakumari alone. Beach sand is rich in seven heavy minerals - ilmenite, leucoxene (brown ilmenite), rutile, zircon, sillimanite, garnet and monazite. They are processed to derive rare earth elements and titanium that are used in a variety of industries, including paints and cosmetics. 5. In Beach Sand Minerals (BSMs) ore, there occurs Monazite, a prescribed substance as per Atomic Energy Act, 1962. Monazite contains Thorium, Uranium and Rare Earth (RE) elements. Tho....
X X X X Extracts X X X X
X X X X Extracts X X X X
....h regard to the alleged illegal mining, transportation and other alleged activities". This order was challenged before the Hon'ble Supreme Court of India in S.L.P.No.10498 of 2019, which was disposed of on 04.07.2019 with a direction to this Court to dispose of various petitions, including this PIL, expeditiously. 12. It is also to be clarified that the argument put forth by mining companies that the PIL itself has become infructuous owing to the amendments brought about to the Mines and Minerals (Development and Regulation) Act, 1957 [hereinafter after referred to as 'MMDR Act'] and introduction of the Atomic Concession Rules, 2016, does not stand accepted, since this Suo Motu PIL is related to the issue of Illegal mining, transportation and sale of raw sand and BSMs during the period 2000-2001 till end of 2016 and related issues and irregularities committed during the said period, which ought to be decided. The illegalities / irregularities alleged during 2000-2001 till 2016 ought to be examined and cannot be brushed aside owing to the advent of amendments, which is post 2016 and shall have no bearing on the validity of this PIL. V. Significance of This PIL: ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....for mining Garnet, Ilmenite, Rutile, etc., in patta and coastal poramboke lands in the three coastal districts of Tirunelveli, Thoothukudi and Kanniyakumari under the provisions of Mines and Minerals (Development and Regulation) Act, 1957 and Mineral Concession Rules, 1960. The details are as follows: Sl.No. District No. of Mining Leases Granted to Private Lessees 1. Tirunelveli 52 2. Thoothukudi 6 3. Kanniyakumari 6 Total 64 17. Three Mining leases have been granted to M/s.IREL India Limited, for mining Garnet, Ilmenite, Rutile, Zircon, Sillimanite, Leucoxene and Monazite in patta and coastal poramboke lands in Kanniyakumari District. TAMIN have been granted with one mining lease for mining Garnet in Tirunelveli District. Sl.No. District No. of Mining Leases Granted to Government Undertakings 1. Tirunelveli 1 2. Kanniyakumari 3 Total 4 18. Mining leases granted to private lessees in the three districts are as follows: Sl.No. Name of the Lessee No. of Leases Granted 1. V.V.Mineral 34 2. Transworld Garnet India Pvt. Ltd. 16 3. Beach Minerals Sands Com....
X X X X Extracts X X X X
X X X X Extracts X X X X
....nment and Forests, Geology and Mining in connection with the illicit mining of beach minerals by various lessees. Mr. Gagandeep Singh Bedi Committee's Report on Illegal Beach Sand Mining by Private Mining Companies: 24. Based on the report of the District Collector, the Government of Tamil Nadu formed a Special team headed by Mr. Gagandeep Singh Bedi, IAS, Secretary, Revenue department vide G.O.Ms.No.156, Industries (MMD1) Department dated 08.08.2013 to inspect and verify in terms of Section 24 of MMDR Act, 1957, whether there is illicit mining by the six lessees of minerals - Garnet, illmenite and Rutile in Thoothukudi district. This team also consisted of officers from the departments of Revenue, Environment and Forest and Geology and Mining. 25. The Special Team headed by Mr. Gagandeep Singh Bedi, IAS, evolved a comprehensive methodology to conduct the field study through a process of triangulation so as to ensure objectivity and avoidance of bias. 26. The Enquiry Team under Mr.Bedi was divided into various teams who inspected the mining leasehold areas. The Reports of these teams were then randomly allotted to another team for super-checking and boththese report....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... sand had been illegally mined and transported from the non-leased out areas in Kanniyakumari District. Ban on Mining and Transportation of BSMs Pending Inspection: 31. As per the directive of the Government, to aid the inspection of the Committee under section 24 of the MMDR Act, the District Collectors of the aforementioned districts passed orders to stop the mining operations and transport permits to private lessees from the month September, 2013. But this ban also paved way for more allegations to crop up that the mining companies were illicitly allowed to carry on their mining operations even when the ban was in force. Litigations Began Cropping Up on the Issue of Illegal Beach Sand Mining: 32. Soon thereafter a number of cases including Writ Petitions and PIL came to be filed by different parties including the present Respondents making charges, claims and counter claims. The Division Bench of this Court came to consider the various writ petitions filed and delivered a common order dated 12.12.2013 in W.P.(MD).No.1233 of 2012, etc., and Batch. The critical observations of the Division Bench of this Court in its Order dated 12.12.2013 is as reproduced below: ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....reas of the state, are of public importance. We are also highly concerned about such issues as they also highlight the urgent need to protect and preserve the natural environment by preventing over exploitation of the natural resources of the country. There is no doubt that the governments concerned have to be vigilant in taking appropriate steps to strike a fine balance between proper utilisation of the available resources and the preservation of such resources for posterity. We are also clear that such a balance can necessary scientific data provided by persons, who are experts in be achieved only on the basis of the their respective fields. 34. In such circumstances, in view of the fact that a committee of experts, under the Chairmanship of Mr. Gangandeep Singh Bedi, Secretary, Revenue Department, has been constituted by the State Government to examine, investigate and to file a report, after physical verification of the mining sites in question, we find it appropriate to permit the petitioner in the writ petitions, including those who are wanting to implead themselves in the writ petitions, to submit their representations to Mr.Gagandeep Singh Bedi, the Chairman of the....
X X X X Extracts X X X X
X X X X Extracts X X X X
....16717 and 19641 of 2014 being M/s.Transworld Garnet India Pvt. Ltd. and M/s.V.V.Mineral respectively) and appointed Mr. Justice V.K. Sharma, a former Judge of the High Court of Madras as the Chairperson of the Special Committee for inspection of petitioners lease hold areas. The Court held the G.O's to be valid to all other quarries except the Petitioner's. 34. This Order by the learned Single Judge has come up for challenge vide Writ Appeals in W.A.Nos.1168 and 1169 of 2015 filed by the State Government and W.A.Nos. 1220 and 1221 of 2015 by Respondents 24 to 26, in the present case. These above mentioned Writ Appeals are connected with this Suo Motu PIL and is heard together before this Bench. Events Leading to the Initiation of Suo Motu PIL: 35. Meanwhile, based on the news item published in the Economic Times in the month of February 2015, a Joint Inspection was carried out by the Director, Regional Office, Ministry of Environment Forest and Climate Change of India along with Assistant Conservator of Forests, Department of Environment, Assistant Directors of Geology and Mining of Tirunelveli, Thoothukudi and Kanniyakumari Districts and Officials from the Tamil N....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... mining and transportation of beach sand minerals held on 09.11.2016 at Collectorate, Tirunelveli. It was found by the District Level Committee that all the private lessees in Tirunelveli District were indulged in unlawful mining, transportation of beach sand minerals for the period from 2008-2009 to 2012-2013. Transport permits issued to the lessees for beach sand minerals for the period from 2000-2001 to 2013- 2014 were compared with the quantum of such minerals permitted for production in the approved mining plan / scheme of mining and it was found that a huge quantum of beach sand minerals unlawfully transported by the private lessees. 41. As the entire quantum of beach sand minerals kept with the private lessees, both processed and unprocessed were arrived as illegal storage. It was resolved by the District Committee to request the Assistant Commissioner, Customs, Thoothukudi to produce certificate of legally mined minerals obtained from the District Collector concerned before allowing export of minerals and to insist on transport permits along with bulk permit. The Chairman, Port Trust of Cochin, Vizagapattinam and new Mangalore were addressed by the District Collector, Ti....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ls Directorate (AMD) and other departments concerned for estimation of the stock of minerals kept in the processing plants, storage yards, bonded warehouse and other places. 45. Hence, following orders of the Court, a Committee of Central and State government officials was constituted headed by Mr.Satyabrata Sahoo, I.A.S., vide G.O.Ms.No.41, Industries (MMD.1) Department dated 07.04.2017. Inspections were carried out at all processing plants, godowns and other storage areas of the mining lessees in the 3 districts. All stocks of the mining companies were sealed in godowns, stockyards, factories and premises of the companies with effect from April, 2018. 46. A comprehensive report of the special team was submitted to the Government on 18.04.2018 and the same was filed before this Court on 24.04.2018. It consists of main report and several volumes of data from the AMD/AERB of Government of India and various inspection teams. The Monazite content in various stocks as found by Atomic Minerals Directorate (AMD) has also been analysed. The actual stock of BSMs kept with the private plant owners in the 3 districts, as estimated by Sahoo's Committee was to the tune of 1.50 Crore ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....quivalent much above the notified reference value. Hence, exporting and trading of all beach minerals need specific supervision especially at port levels from where they are exported. Proper regulation of export of minerals containing monazite / monazite equivalents will be appropriate in view of the radioactive content of the minerals which in turn might have a bearing on the National Security, if the products fall into wrong hands. Reassessment Report: 54. Based on the request made by the District Collectors of Tirunelveli and Thoothukudi and based on the recommendations of the Commissioner of Geology and Mining, orders have been issued vide G.O.Ms.No.246, Industries (MMD.1) Department, dated 20.09.2021 authorising the District Collectors of Tirunelveli, Thoothukudi and Kanniyakumari under MMDR Act, 1957 to re-assess the beach sand minerals stored and sealed at various places by the Special Team Headed by Thiru Satyabrata Sahoo, I.A.S. The BSM stocks were ascertained and sealed at the conclusion of the inspections conducted in 2018 on the directions of this Court, by Joint- Inspection teams of Central and State agencies headed by Mr.Satyabrata Sahoo, I.A.S. 55. The "Reas....
X X X X Extracts X X X X
X X X X Extracts X X X X
....espondent no. 4) have not disputed the findings of fact in the three Amicus Curiae Reports with respect to illegal mining and transportation of BSMs by the mining companies. In particular the AMD has not disputed the findings of the Amicus Curiae in the second Report about presence of monazite in processed mineral stocks kept by the mining companies in their godowns. This apart, the State Government has very clearly and emphatically accepted the findings of fact in the Amicus report on scale of illegal mining, transportation and export, as also the Royalty Report filed before this Court. Regarding Allegation of Bias and Prejudice Raised against Amicus Curiae: 59. The Amicus Curiae was appointed by the Court on 28.01.2016, after the Court converted the original Writ Petition into a Suo Motu PIL in view of the serious allegations of massive illegal mining of beach sand minerals in three coastal districts of Kanniyakumari, Thoothukudi and Tirunelveli Districts. 60. It is to be noted that the objections are filed by the 22^nd respondent Mr.S.Vaikundarajan on 19.12.2024 during final arguments of the present Suo Motu PIL petition and connected proceedings. The respondents 8 and ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....elt out before this Court. After hearing the counsel for R8, and the Amicus this court passed the following order on 20.09.2016: "A Memo has been filed by the Learned Amicus out of the communication emanating from the counsel for Respondent No. 8 and 22. The Learned Counsel for the said Respondents states that the object was only to bring certain facts to the notice of the Learned Amicus, for him to take a call on the same." "We have perused the Memo; we see no reason why the Learned Amicus cannot continue in this matter, merely because he happened to be the Secretary of an Association and Editor of a Bulletin, in which the author published a report, where there was general reference to the illegal sand mining in Tamil Nadu in four lines." 64. Apart from these two occasions when Respondents 8, 9 and 22 accused Amicus of bias, the same parties, viz., R8 - M/s.V.V.Mineral and R9 - M/s.Transworld Garnet India Private Limited filed W.M.P.No.24173 of 2017 and W.M.P.No.24174 of 2017 making the very same allegations, which was dismissed as withdrawn on 03.10.2017 itself. 65. While so, despite knowing that the same allegations were considered and rejected by this co....
X X X X Extracts X X X X
X X X X Extracts X X X X
....companies at the time of Sahoo Committee enquiry should be held to be illegally mined. The Second Report specifically pointed out that many stocks of processed minerals (with THM > 90%) belonging to different companies were found by DAE - AMD to have monazite concentration beyond the threshold value of "> 0.25% Monazite Equivalent" indicating that significant quantity of monazite can be extracted from these stocks. Third Report of Amicus Curiae: 70. In this Report, the 'Royalty Settlement Proceedings' approved by the District Collectors of Thoothukudi, Tirunelveli and Kanniyakumari districts in respect of royalty collected and due to be paid by different mining companies for each annual year from 200-2001 till 2015-2016 were studied. Fourth Report of Amicus Curiae: 71. The fourth report of Amicus curiae summarises the key findings from the reassessment report filed on 27.11.2023 by the 6th Respondent. It reports about large scale illegal removal of 16.04 Lakhs MT of beach sand minerals by different mining companies during 2018-2022. This report of Amicus Curiae dealt with the study of two key issues: (1) The high quantum of illegal mining and transporta....
X X X X Extracts X X X X
X X X X Extracts X X X X
....the Central Government as well as Atomic Energy Department. The 8^th Respondent stated that they have a valid mining plan duly approved by Atomic Minerals Directorate for Exploration (AMD) and the Indian Bureau of Mines (IBM) which had approved the scheme of mining also. It was also stated that they have a valid Environmental Clearance from Ministry of Environment and Forest (MoEF&CC) for all its mining leases and that the production also is within the limit of EC as well as approved mining/scheme of mining and they also stated that they have a valid consent under Air Act and Water Act. 76. It was contended that the Amicus Curiae did not highlight any violations of the India Rare Earths Limited (IREL), but instead pointed out imaginary violations against the 8^th Respondent's mining lease. The 8^th Respondent further leveled allegations of serious mining violations against IREL. It was further contented that the Amicus Curiae did not apply the reverse calculation method for the IREL and that he did not prepare chart citing violations by IREL. 77. It was contented that the Amicus failed to act impartially and that though Amicus discussed about the Bedi report in his volume of ....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... 8^th Respondents to produce minerals from existing accumulated tailings available with 8^th Respondent. 83. It was contented that the case of Common Cause vs. Union of India and Others^ (2017 (9) SCC 499), is not applicable to the 8^th Respondent. The 8^th Respondent relied on paragraph 129 of the judgment, as follows: "129. The simple reason for not accepting this interpretation is that Rule 2(ii-a) of the MCR was inserted by a Notification dated 26-7-2012 while we are concerned with an earlier period. That apart, as mentioned above, the holder of a mining lease is required to adhere to the terms of the mining scheme, the mining plan and the mining lease as well as the statutes such as the EPA, the FCA, the Water (Prevention and Control of Pollution) Act, 1974 and the Air (Prevention and Control of Pollution) Act, 1981. If any mining operation is conducted in violation of any of these requirements, then that mining operation is illegal or unlawful. Any extraction of a mineral through an illegal or unlawful mining operation would become illegally or unlawfully extracted mineral." On relying in this paragraph, the 8^th Respondent averred that they have necessary appr....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ervation and Development Rules, 1988 (MCDR, 1988), the Controller General or the authorized officer may require the holder of a mining lease to make such modification in the mining plan or impose such conditions as he may be consider necessary by an order in writing, if such modification or imposition of conditions are considered necessary. Accordingly, 8^th Respondent has obtained modified mining plan also for certain lease areas. 90. It was averred that the Government of India, IBM issued separate manual for preparation and approval of mining plans after prior inspection. So without verification no mining plan will be approved and hence the Amicus allegation about mining plan has no basis. 91. The 8^th Respondent averred that none of the Act and Rules for payment of royalty or mining operation has been violated by the 8^th respondent. It was submitted that the entire 3rd report of the Amicus is without any statutory violation and that this report regarding royalty and his enclosures 15A and 15B has no legal value. 92. Regarding Monazite the 8^th Respondent contends that the percentage of occurrence of monazite in BSMs is a natural phenomenon and claims that they have req....
X X X X Extracts X X X X
X X X X Extracts X X X X
....t of Tamil Nadu vide G.O.Ms.No.318 dated 25.11.2021 terminated the lease of this respondent prematurely stating that Government of India has amended the Atomic Mineral Concession Rules, 2016. 97. It was averred that the amendment is nothing but a clear case of colorable legislation in order to favour Government companies, who are all competitors to the petitioner company. There is no reasonable classification and object sought to be achieved by the specific amendment. Further there is no rational nexus. The beach sand minerals may have minor radioactivity which cannot be separated and that all are handled by both Government and private companies. 98. It was submitted that the ratio laid down in Common cause judgment (Supra) which deals about static miserable reserve does not apply to the case of BSMs. It was further submitted that the MMDR Act is not a control Act but a development oriented Act. 99. It was averred that the repeated criticism of mining of BSM would cause environmental issue is a gross generalization without any regard to factual aspects. BSM are unique and they are the only mineral which are replenishable in nature. The replenishment was also recognised by ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....at time. Further submission of Scheme of Mining, the reserves has to be reestablished by way of additional exploration, considering the depth factor. The lessee has to carry out the mining operations in accordance with the approved mining plan/scheme of mining which includes approved quantity in the mining plan. Contrary to this, attracts the violation of Rule 13(1) of Mineral Conservation and Development Rules, 1988, i.e. deviation in the approved mining plan. 104. It was further submitted that the mining plan or scheme of mining is being approved with proposals of production for five years period. The lessee should extract the mineral within the permissible limits and get permits for that quantity only. Any demand for excess quantities of mineral that can only be extracted with proper prior approvals. The modifications also for the remaining period of the approved mining plan/scheme of mining. The lessee cannot extract the mineral as per the whims and fancies and later approach the Indian Bureau of Mines extending the approval of mining plan/scheme of mining from the date of approval i.e. Prospective not retrospective. Submissions on Behalf of the 2^nd Respondent: 105. T....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ny private party, the same is without the sanction of the Central government and amounts to violation of Act and Rules. 110. It was contended that the Respondents 8 and 22 have stated that they have not carried out any estimate for monazite as they are not permitted to handle the same and hence no information has been furnished on the estimated reserves of Monazite. However, they have furnished the total quantity of monazite rich tailings for the period from 2007 to 2016 as 80, 725.05 M.T. The respondents further have stated that they have never personally assessed the Monazite content in the feed material but provided the data based on the AMD's (Atomic Minerals Directorate for Exploration and Research - a Unit of the second respondent) report of the second respondent and furnished the percentage of monazite content with respect to each of their mine numbering 34 specifically given in the tabular format (Page Nos.9 to 13 of their letter dated 04.12.2016). Further in page number 14, they have furnished the total ROM (Run of Mine) collected from each of their mine numbering 34 (Page Nos.14 to 16). 111. Based on the above data furnished by the respondents 8 and 22, approxim....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... sand has been processed than what has been declared by respondent 8 and 22. Even if a higher grade of monazite is considered, say 0.1% (2 times) in raw sand mined, taking in to account the possible enrichment process by beach washings, about 3.50 to 4 crore tonnes of raw sand is required for the collection of 38, 608 tonnes of monazite as against the 98, 88, 100 tonnes of raw sand declared by respondent 8 and 22. In view of the above, the possibility of excessive mining of raw sand against the declared quantities and grades cannot be ruled out. It was averred that based on deliberations, Department of Atomic Energy (DAE) was in agreement and supported the proposition of the Tamil Nadu Government that semi processed material and monazite tailings need to be eventually handed over to DAE. 113. It was submitted that during processing of the raw sand, monazite, which is radioactive in nature, gets distributed and progressively concentrated in various process streams and becomes potential source of radiation exposure. Therefore, for radiological safety considerations, AERB issued guidelines for safe management of monazite tailings under Atomic Energy (Radiation Protection) Rul....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... Mines (IBM) through approved Mining Plan. 117. It was submitted that State Governments grant mineral concessions. The statutory provision under section 5(1) of the MMDR Act, 1957 with regard to grant of mining leases prior to 12th January, 2015 required obtaining previous approval of the Central Government for grant of mineral concessions for a mineral specified in the first schedule of the MMDR Act, 1957. For the purposes of MMDR Act, 1957, ilmenite, rutile, leucoxene, zircon, and monazite are specified as 'Part B Atomic Minerals' in the First Schedule to the MMDR Act, 1957. Garnet and Sillimanite are not specified in Part B of the First Schedule. Obtaining previous approval of the Central Government for grant of mining leases in respect of garnet and sillimanite is not required. 118. It was submitted that the issue of illegal mining is the subject matter of State Government. State Governments are in charge of law and order. State Governments have been empowered under section 23-C of MMDR Act, 1957 to curb illegal mining by framing Rules for preventing illegal mining, transportation and storage of minerals. The revisionary jurisdiction of the Central Government is a....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... were scrupulously followed. As directed by the Court, representations were received and notices were given to concerned parties. To ensure the principles of natural justice, all concerned were given an opportunity to put forth their contention in writing to the special team. The claims and counter claims were examined in detail and conscious decision was taken based on merits and based on unassailable and impeccable evidences gathered from fields. The same were substantiated and strengthened by field report/photographs/ survey maps. The report pertaining to Thoothukudi District was filed before this Court on 20.09.2016 and two other reports pertaining to Tirunelveli and Kanniyakumari Districts were filed before this Court on 11.01.2017. All the three reports revealed that a total quantity of 1, 01, 14, 239 MT of raw sand (1.01 Crore MT) had been illegally mined and transported over an extent of 234.55.0 Hectares of non leased out areas in three districts. 123. Further, with regard to the Amicus Curiae's report it was submitted that the Learned Amicus Curiae's report is based on the data collected from the District Collector of Tirunelveli, Thoothukudi and Kanniyakumari on t....
X X X X Extracts X X X X
X X X X Extracts X X X X
....n in this matter: (1) Whether the constitution of the Expert Committee headed by Mr.Gagandeep Singh Bedi, I.A.S., vide G.O.Ms.No.156, Industries Department dated 08.08.2013 and G.O.Ms.No.173, Industries Department dated 17.09.2013, by the State Government in exercise of powers conferred under Section 24 of MMDR Act, to inspect and file a report in regard to illicit mining of BSMs, is valid in law. (2) Whether the reports and findings of the Special Team headed by Mr.Gagandeep Singh Bedi, I.A.S., is valid in law? (3) Whether the reports and findings of the Special Team headed by Mr.Satyabrata Sahoo, I.A.S., is valid in law? (4) Whether the methodology adopted by the learned Amicus Curiae about illegal mining of BSMs is fair, objective and rational? (i) Three-way method of calculating illegal mining is correct or not? (ii) Reverse calculation of calculating quantum of ROM required to produce 80, 725.05 MT of Monazite-rich tailings is correct or not? (5) Whether the methodology adopted by the Amicus in calculating the Cost of minerals and Royalty on ad valorem basis for the quantum of minerals unlawfully/illegally mined an....
X X X X Extracts X X X X
X X X X Extracts X X X X
....re categorised below into four core sections, with further sub-classifications, to enable an in-depth analysis: S.No. CONTENTS CONTENTS IX. DISCUSSIONS 81 (A) Illegal Mining, Storage, Transportation and Export of BSMs 81 (1) Extent and Quantum of Illegal Beach Sand Mining 81 1.1 What Constitutes Illegal Mining 81 1.2 What Constitutes Illegal Mining 82 1.3 What Constitutes Illegal Mining 85 1.4 Operations Carried Out in Violation of Mining Plans 86 1.5 Challenge to the Constitution of Bedi's Committee 88 1.6 Allegations of Bias against Mr.Gagandeep Singh Bedi I.A.S 89 1.7 Powers of Inspection Under Section 24 of MMRD ACT 93 1.5 Challenge to the Constitution of Bedi's Committee 88 1.6 Allegations of Bias against Mr.Gagandeep Singh Bedi I.A.S 89 ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....Enriched Tailings 147 2.1 Handling Licences Mandatory for Handling Monazite Tailings 148 2.2 Presence of Monazite Enriched Tailings in the Leased Out Mines 151 2.3 Accounting for Monazite Enriched Tailings 152 2.4 Discrepancy in Raw Sand actually declared and the Actual Fact as disclosed from Monazite Tailings 153 2.5 Reverse Calculation Method 154 2.6 Total Quantity of Monazite that can be extracted from stocks available with M/s.V.V.Mineral which are > 0.25% Monazite Equivalent 160 2.7 Monazite Tailings Yard 165 2.8 Mismatch in Figures of Monazite Tailings submitted by the Respondent Companies 166 2.9 Stocks belonging to Mining Companies have Monzite Concentration beyond the threshold value 167 (3) Whether State Government is Empowered to add Monazite and other Atomic Minerals to the Existing Mining Leases ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....Illegal Mining: 130. The Hon'ble Supreme Court of India in Common Cause's case cited supra, observed as follows: "130. It is not, as suggested by Learned Counsel, that illegal mining is confined only to mining operations outside a leased area. Such an activity is obviously illegal or unlawful mining. Illegal mining takes within its fold excess extraction of a mineral over the permissible limit even within the mining lease area which is held under lawful authority, if that excess extraction is contrary to the mining scheme, the mining plan, the mining lease or a statutory requirement. Even otherwise, it is not possible for us to accept the narrow interpretation sought to be canvassed by Learned Counsel for the mining lease holders particularly since we are dealing with a natural resource which is intended for the benefit of everyone and not only for the benefit of mining lease holders." 131. It was further clarified that mining in excess of permissible limits under the mining plan will certainly amount to illegal or unlawful mining or mining without authority of law. 1.2 Consequences of Illegal Mining: 132. Section 21(5) of the MMDR Act, 1957 provides th....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ral Concession Rules, 1960, defines 'Associated Minerals' as "Temenite, Monazite, Zircon, Rutile; Leucoxene, Garnet and Sillimanite". Leucoxene was added to this list of associated minerals in 2000. 137. Part B of Schedule I of the MMDR Act specifies the minerals that are classified as Atomic Minerals. Out of the 7 BSM Minerals (Garnet, Sillimanite, Rutile, Ilmenite, Zitcon, Leucoxene and Monazite), Rutile, Ilmenite, Zircon, Leucoxene and Monazite are atomic minerals while Garnet and Sillimanite are not. Therefore for the mining of Garnet and Sillimanite alone, the relevant authority to approve the Mining Plan is the Indian Bureau of Mines (IBM) while for Rutile, Ilmenite, Zircon, Leucoxene and Monazite, which are classified as Atomic minerals as they have radioactivity, the authority to approve the Mining Plan is the Atomic Minerals Directorate (AMD). 138. However, with effect from 11.07.2016, an amendment has been made to Part B of the I Schedule of the MMDR Act, and a 12^th entry was added to it. This entry reads as follows - "Beach Sand Minerals, that is, economic heavy minerals found in the teri or beach sands, which include, Imenite, Rutile, Leucoxene, ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ere mined, but also, the intervening non-leased lands had also been mined. There is no field boundary between sub-divisions and also between Survey Field Numbers. It seems that for record purpose alone, leases have been split up and applied for separately to avoid getting clearance from the Ministry of Environment and Forest Department, Government of India. 143. The Amicus Curiae report also deliberates on the issue of approval of mining plans in cases where claims of replenishment of reserves of beach sand are of a very high order. The extent and quantum of illegal mining done is humongous and the bandwidth to commit this illegality and the resources both monetary and human, employed to dodge the legal mechanisms is staggering. The AC report further states instances where mining lessees in the absence of scheme of mining had continued to mine and transport minerals unlawfully. This can be found from the data provided by the AMD. So even after the expiry of extended period of lease, no scheme of mining was submitted to the AMD for seeking approval. Further, as per Bedi report illicit mining for an extent of 89.67 Acres was reported in Government poromboke and Hindu Religious and....
X X X X Extracts X X X X
X X X X Extracts X X X X
....e year 2002 issued a report to the department of Geology and Mining observing generally that mining lease should not be granted in coastal area as there was a possibility of law and order problem and the lessees quarrying in Government poromboke lands. 147. Moreover, as the then Collector of Kanniyakumari District, illicit sand lorries and trucks were seized by the revenue officials under his instruction. These actions per se cannot pave way to cement the argument of bias against Chairperson of the committee. 148. An analysis of these allegations showcases that he had only acted in the course of performance of his official function and does not indicate a personal or pecuniary bias on his part. Hence to throw away the entire enquiry proceedings on these irrelevant allegations that too raised much belatedly does not find any merit. Moreover the respondents herein had initially submitted representations and their contentions before the committee without any objection, it was only at a later stage that suddenly this argument of bias was raised at the time of filing of the Writ petition in 2014. This raises several questions as to the genuinity in the submissions of respondents i....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ing compliance of the principles of natural justice. 153. It is also pertinent to note that the Committee consists of 230 Government officials from across various departments and is not a single man committee. Further, it is not an adjudicatory committee, but an inspection committee, whose duty is refrained to conducting inspection and verification of reports on illegal beach sand mining along the coast. Hence, the final decision making authority is the Government. Thereby to insinuate charges of bias against the Committee that too long after the commencement of the inquiry is highly unwarranted and irrelevant considering the nature of proceedings in hand. 1.7 Powers of Inspection Under Section 24 OF MMDR Act: 154. The Bedi Committee had undertaken the inspection under section 24 of the MMDR Act. The powers under Section 24 is clear in its terms and devoid of any ambiguity. The private Respondents/Lessees contended that no prior notice was issued to them before conducting inspections. But the wordings in Section 24 of MMDR Act nowhere prescribes any issuance of notice prior to inspection. The section clearly states that for the purpose of ascertaining the position of the w....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... revenue department and the Core members have further verified the observations through extensive site visits. 1.8 Methodology Adopted by the Committees to Inspect and Verify the Extent and Quantum of Illegal Mining: 159. The methodology adopted by Bedi Committee has been said to involve multiple level of checks. The Committee comprised of officials from different departments and a comprehensive methodology to conduct the field study through a process of triangulation to ensure objectivity and impartiality is said to have been conducted. The Special team under Mr. Bedi was divided into various sub teams. Each of these sub teams also known as Check Team would visit the site and conduct a comprehensive study of the mining area, then a detailed report of the findings is submitted. Thereafter another random sub team is selected to do a Super check of the mining site and present their report of findings. Few other members of the Core team would then visit the site and record their findings and then would be reconciled with the findings of the Check and Super check teams. 160. Through this triangulation method there is three layer inspection and cross checks to ensure a fool pro....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... Committee as explained in the report submitted by them and the procedure adopted by them on scrutiny, appears fair and there has been elaborate surveys by teams of officers from different department with careful checks and super checks of the lease sites and further cross checks were also conducted. Furthermore, the State Government had accepted the report submitted by Mr.Bedi. 165. Also the Amicus Curiae appointed by this Court had made an independent study without relying on the reports of the Bedi Committee. He has relied on primary data analysis whereby data on the BSM mining from the years 1998-1999 was provided to him on the directions of this court. A pro forma table carrying the basic information on mining lease by various official agencies was created. The approach adopted by the Amicus was to create a Comprehensive table including varied information about mining leases in three district provided by the IBM, AMD, Department of Geology and Mining, Customs department and District officials. The information collected from different agencies was then put into one single Consolidated, Comprehensive Chart which contained all the relevant information about each mine in a sing....
X X X X Extracts X X X X
X X X X Extracts X X X X
....e shown any mistake or discrepancies in the methodology adopted by the Amicus or the calculations leading to the quantum of unlawful/illegal mining and transportation of ROM and BSMs. The objections, if at all very generic and do not repudiate the methodology or the findings. 172. A Three-way method of computing the quantum of illegally mined and transported raw sand (ROM) and BSMs was formulated. These were (1) Quantity transported in excess of quantity of raw sand / BSM permitted to be produced as per approved mining plan/ Scheme of Mining (2) BSM transported is not an approved mineral in the mining plan. Be noted. (3) Transportation of raw sand / BSMs during period when there is no valid Scheme of mining. 173. It can be noted that quantum of ROM/BSMs quantified for all mining lessees is based on objective, rational and replicable methodology. The above method of identifying what constitutes illegal mining was explained by the Hon'ble Supreme Court in Common Cause's case cited supra, as follows: "129. ................ The holder of a mining lease is required to adhere to the terms of the mining scheme, the mining plan and....
X X X X Extracts X X X X
X X X X Extracts X X X X
....INING IN KANNIYAKUMARI DISTRICT Sl.No. Name of the Village Extent of Illicit Mining (Acres) Quantity of Illicitly Mined Mineral (MT) 1 Lease-1, Azhagappapuram 0.75 8, 110 2 Lease-2, Azhagappapuram 2.42 39, 116 3 Lease-3, Kanniyakumari 0.88 7, 190 Total 4.05 54, 446 176. As regards Thoothukudi District, the Special Committee's final summary of findings are as follows: (1) Out of the 6 mines inspected, illicit mining was noticed in 3. (2) For the remaining 3 sites there are instances of lessees getting transport permits without doing mining so as to use these elsewhere and possibly in areas of illicit mining. (3) Illicit mining has been noticed by the Team over a total area of 163.146 acres to an extent of 10, 29, 995 MT. 177. Thus, cumulatively the Special Committee reported illicit mining of BSM in the three districts amounting to the following quantity: (1) Tirunelveli District 90, 29, 838 MTs (2) Kanniyakumari District 54, 446 MTs (3) Thoothukdui 10, 29, 955 MTs Total 1, 00, 14, 239 MTs 1.10 Extent of Illegal Mining of Garnet: 178. Further informati....
X X X X Extracts X X X X
X X X X Extracts X X X X
....re to the extent of 85, 58, 734 MT. Thus there is a massive difference to the tune of 69, 89, 946 Mts between quantum of BSMs assessed by Special Team and the quantum of BSMs declared as stocks by the lessees. 181. The Second Amicus Curiae Report concluded that the stocks held by various lessees / mining companies after the imposition of the ban in August / September, 2013 cannot be based on processing of balance of raw sand remaining with the companies at the time of the ban. Therefore, the 2^nd Amicus Report concluded that the stocks held by different mining companies at the time of Sahoo Committee enquiry should be held to be illegally mined. Subsequently, there were again reports of illegal mining and transportation of BSMs from the sealed premises and a reassessment of the BSM stocks stored at various places in the three districts originally assessed by the Sahoo team was ordered. The reassessment was carried out by the District Collectors of Thoothukudi, Tirunelveli and Kanniyakumari and vide letters dated 08.12.2022, 01.12.2022 and 21.01.2023, their respective reports were forwarded to the State Government. 1.12 Difference in the Stocks Kept in the Three Districts: ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....of a mine, any person authorised by the Central Government or the State Government, by general order, may enter and inspect the mining site. The powers of the State to take action on complaints of illegal mining and transportation cannot be questioned. The Respondent companies instead of giving replies to the nature and substance of findings against them are only on the point of very formation of committee to conduct inspection. 186. It is hard to overlook all these findings in the committee reports submitted before this Court. At this point it is also pertinent to note that the State Government has accepted the findings on illegal mining and transportation in the reports filed by all the above committees and it is also a relevant point that the findings of all these reports are in conformity with each other. The common thread that runs through these reports connects on a singular point that establishes a conclusion of illegal mining having taken place across the lease sites of the Respondent mining companies in the three coastal districts of Tirunelveli, Thoothukudi and Kanniyakumari. The allegations of massive illicit mining across these districts have found the support in the....
X X X X Extracts X X X X
X X X X Extracts X X X X
....24) 10 SCC 1). Considered the principles relating to premature termination of prospecting licence by the Union and State Governments as public trustees of mineral resources. 192. Paragraphs 64, 65 and 142 of the judgment in Mineral Area Development Authority's case cited supra reiterates the principles as under: "64. The principle that the Union and State Governments act as public trustees of mineral resources has been incorporated in the MMDR Act. Section 4-A empowers the Central Government to prematurely terminate a prospecting licence, exploration licence, or mining lease, after consultation with the State Government in the interests of: (i) the regulation of mines and mineral development; (ii) preservation of the natural environment; (iii) control of floods; (iv) prevention of pollution; (v) avoiding danger to public health or communications; (vi) ensuring the safety of buildings, monuments or other structures; (vii) conservation of mineral resources; and (viii) maintaining safety in the mines or for such other purposes^ (State of Haryana v.Ram Kishan, (1988) 3 SCC 416, para 7. This Court ob....
X X X X Extracts X X X X
X X X X Extracts X X X X
....by rule or to subject to governing principles^ (U.P. Coop. Cane Unions Federations v. West U.P. Sugar Mills Assn., (2004) 5 SCC 430, para 20; Balmer Lawrie & Co. Ltd v. Partha Sarathi Sen Roy, (2013) 8 SCC 345, para 24 : (2013) 3 SCC (Civ) 804 : (2014) 1 SCC (L&S) 114); [and (iv) issue directions^ (Subramanian Swamy v. State of T.N., (2014) 5 SCC 75, para 67 : (2014) 3 SCC (Civ) 134). Thus, the expression "regulation" appearing in List I Entry 54 and List II Entry 23 must also receive a wide meaning, in keeping with the principle that the words used in the legislative entries must be interpreted broadly." Hence, the premature termination of mining leases by the State Government is in consonance with the provisions of the MMDR Act and the Rules framed thereunder. (2) Illegal Processing: 193. The raw sand that has been mined is brought to the preconcentration plant and this pre-concentrated sand is then separated depending upon their different physical properties. Therefore, there are multiple processing plants that are often utilized to obtain the various atomic minerals from the beach sand mined. 194. The processing plants depending upon their location....
X X X X Extracts X X X X
X X X X Extracts X X X X
....t of beach sand occurring in the backdrop of allegations that mining companies have been using the excuse of mining replenishments to cover up massive illegal mining of BSMs. 198. Ironically the mining plans approved by the IBM / AMD have not taken note of this and have permitted enhanced quantities of minerals to be mined by approving modified mining plans on account of the replenishment of minerals in the inter tidal Zone. 199. The 1991 CRZ has been replaced by 2011 CRZ Notification . The provisions with regard to BSM mining remains the same except that the protection to sand dunes has been made more stringent. 200. Para 2 of the 1991 Notification lists out the Prohibited Activities within the CRZ. Para 2(ix) prohibits "mining of sands, rocks and other substrata minerals in CRZ areas except; (a) those rare minerals not available outside the CRZ areas and; (b) exploration of Oil and Natural Gas". Rule 2(xiii) prohibits "dressing or altering of sand dunes, hills, natural features including landscape changes for beautification, recreational and other such purpose except as permissible under this Notification". The proposals for activities within the CRZ area are examined by....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ent of India). (6) Illicit mining reported in CRZ-1 and Inter Tidal Zone. (7) Temporary and Permanent structures, Bore wells, Open wells, Cement pipelines (to draw sea water), desalination plant, Office sheds, Labourers' Sheds, etc., were constructed by some lessees (as pointed out in detail for each Lease) right in CRZ-I area and Inter Tidal zone, which is strictly prohibited activity as per CRZ Notification and other related Acts and Regulations. 2.4 Sand Dunes: 205. As per the Coastal Regulation Zone Notification Guidelines as well as most of the mining plans approved by the authorities concerned, altering and dressing of sand dunes is prohibited. In 27 out of 52 leases in Tirunelveli District, the lessees have mined and removed the sand dunes. The sand dunes which are to be kept intact have been mined and removed. Similar issue is spotted in Thoothukudi and Kanniyakumari. There has been violation under Rule 22A of the MCR, 1960. 2.5 Role of Tamil Nadu Pollution Control Board (TNPCB): 206. The Tamil Nadu Pollution Control Board (TNPCB) issues Consent to establish/Consent to operate to the mining projects after receipt of EC issued under EIA noti....
X X X X Extracts X X X X
X X X X Extracts X X X X
....) the Government has to ensure that mineral concessions are granted in a fair and transparent manner (Mineral Area Development Authority (Supra)). 210. When the State holds a resource that is freely available for the use of public, it provides for a high degree of judicial scrutiny on any action of the Government (Intellectuals Forum, Tirupathi vs. State of AP, (2006) 3 SCC 549, para 76). It is, thus, the duty of the Government to provide complete protection to the natural resources as a trustee of the public at large. Moreover, even a policy to give free sand as welfare measure cannot justify unregulated mining unmindful of impact on environment. If in the course of mining, damage is caused, the same must be recovered from such violators. Else, authorities cannot avoid their duty under the environmental law to restore the damage which is a duty to future generations^ (Anumolu Gandhi vs. State of A.P, 2019 SCC Online NGT 1712). 2.7 Polluter Pays Principle: 211. Further, the concept of Polluter Pays Principle was discussed by the Hon'ble Supreme Court of India in Bajri Lease LoI Holder Welfare Society vs. The State of Rajasthan and Others ((2022) 16 SCC 581). The releva....
X X X X Extracts X X X X
X X X X Extracts X X X X
....rovided by the State Government highlight the magnitude of the problem as about 2411 FIRs have been registered in relation to illegal mining in the State of Rajasthan, between 16-11-2017 and 30-1-2020. When this Court has restrained 82 mining lease/quarry holders from carrying on mining of sand and bajri unless a scientific replenishment study is completed and EC is issued by the MoEFCC, the State of Rajasthan ought not to have issued mining leases in favour of the khatedars. It is clear from the report of CEC that the majority of the khatedari leases are within 100 metres from the riverbed. 18. The 2020 Sand Mining Guidelines prescribe that mining plan for mining leases on khatedari lands shall only be approved if there is a possibility of replenishment of the mineral or when there is no possibility of riverbed mining within 5 km of the patta land/khatedari land. Agreeing with CEC's conclusions on the issue of mining leases in khatedari lands facilitating legalisation of transportation and sale of illegally extracted sand, we approve the recommendation of CEC that all khatedari leases which are located within 5 km from the riverbed and those leases where lease conditi....
X X X X Extracts X X X X
X X X X Extracts X X X X
....very of rent, royalty or tax. The penalty recommended by CEC for illegal sand mining is in addition to the penalty that can be imposed by the State Government in terms of Section 21(5) of the Act. However, the basis for imposition of exemplary penalty of Rs 10 lakhs per vehicle and Rs 5 lakhs per cubic metre of sand has not been stated by CEC in its report. CEC is directed to follow the directions given by NGT in respect of imposition of penalty/determining scale of compensation for illegal mining and the provisions of the 2020 Sand Mining Guidelines and determine the penalty/compensation afresh and submit a report to this Court within a period of eight weeks from today." (3) Illegal Transport: 212. The Amicus Curiae report on study of primary documents and records pertaining to transport permits clearly discerns the circumstances which constitute 'Unlawful transport'. i. Transporting quantities in excess of approved quantities; ii. Transporting minerals not approved to be mined or transported for a specific lease and; iii. Transporting minerals during years/periods when there was no approved 'scheme of mining'. 213. Of the total quantum of 1, 51....
X X X X Extracts X X X X
X X X X Extracts X X X X
....issuance of transport permits of major minerals like Garnet, Ilmenite, Rutile etc. So effectively as of 17.9.2013, all lessees ceased to operate their mines and to transport minerals or raw sand". 218. As per the contentions of the 6th Respondent, in the month of May 2016, the 9th Respondent had declared that 6, 98, 887 MT of Garnet were exported by them during the period from 2000-2001 to 2015-2016. Whereas, they had obtained transport permits for a quantity of 1, 85, 150 MT of Garnet only from 2000-2001 to 2007-2008. Therefore it was estimated by the learned Amicus that a total quantity of 5, 13, 737 MT of Garnet had been illegally mined and transported by the 9th Respondent without obtaining transport permits. 219. When the issuance of transport permits were stopped from August, 2013 onwards, the Assistant Commissioner of Customs, Thoothukudi vide his letter dated 05.10.2016 informed the District Collector, Thoothukudi/Tirunelveli that a total quantity of 3, 96, 081 MT of beach sand minerals were exported by R10 from 08.08.2013 to 10.01.2016 through Thoothukudi Port. Therefore, the entire quantity of 3, 96, 081 MT of beach sand minerals exported by R10 without transport pe....
X X X X Extracts X X X X
X X X X Extracts X X X X
....rus lorry with Registration No.TN-58 AK 3313, a JCB vehicle, a Fork Lift and two motor bikes were found in the godown. After enquiry, it was confirmed that the BMC godown was trespassed and 35 M.T of Garnet were to be smuggled in the Taurus lorry. Therefore all the vehicles used for causing illegal transport of Garnet stored in the Mullakadu - II Village were seized by the Assistant Director of Geology and Mining (i/c), Thoothukudi under Section 21(4) of the MMDR Act, 1957 and handed over to Muthiapuram Police Station. Based on the complaint made by the Assistant Geologist, FIR No.11/2022 has registered in Muthiapuram Police Station under Section 380, 447 and 511 of IPC and under Section 21(4) of MMDR Act, 1957. 224. The District Collector, Thoothukudi has reported that another BMC godown was inspected on 09.01.2022 by the Taluk level Task force committee and found that the entire stocks kept in the godown had been illegally transported. FIR was registered based on this complaint. The District Collector, Thoothukudi has further reported that three more complaints were made against the Respondent lessees for disconnecting electricity supply given to the CCTV cameras fitted by the....
X X X X Extracts X X X X
X X X X Extracts X X X X
....st be probed extensively to ensure that our National security is not compromised. 228. Though the Respondent companies are dismissing this contention as unfounded and speculative, the fact that the component Thorium is derived from Monazite and is considered as a crucial element and deemed as the nuclear fuel of the future needs to be considered. Though internationally Uranium based Reactors are developed, there has been attention given to Thorium based reactors too. 229. India is recognised as the third largest repository of thorium deposits in the world, only after Brazil and Turkey. In India itself Monazite is the main rare earth mineral from which Thorium is derived and Tamilnadu is one of the main repositories of Monazite-thorium. 230. Hence, the data gathered by the Sahoo Committee and the reports of unlawful transportation of Monazite and further statement on the presence of Monazite above the threshold value in the processed stocks of the mining companies which are stored to be exported ought to be probed in depth. Keeping the seriousness of the issue in hand and the security of our great Nation being the top priority, the Competent agencies must thoroughly investi....
X X X X Extracts X X X X
X X X X Extracts X X X X
....y of 38, 77, 391 M.T of stock available with the 8^th Respondent as assessed by the Sahoo Committee is illegally mined, transported and stored contravening the provisions of Section 4(1) and 4(1A) of the MMDR Act, 1957 and it will attract the penal provisions of Section 21 of MMDR Act, 1957. 233. Further, the 8^th Respondent has not provided the actual quantum of Garnet, Ilmenite, Rutile, Zircon, Sillimanite, Leucoxene sold / exported by them from 2000-2001 to 2016-2017 to the Government so far. Apart from that the 8^th Respondent has not submitted the actual quantum of beach sand minerals sold/exported and the actual sale value realised before this Court also. Therefore, the amount estimated by the learned Amicus Curiae is reflecting only a portion of the huge loss caused to the State Exchequer by the illegal activities of the 8^th Respondent. It was further averred that none of the other lessees have submitted details of actual quantum of BSMs sold or exported by them and the actual sale value realised for the period from 2000-2001 to 2016-2017 to the 6th Respondent. 4.3 Action Required: 234. The competent authorities under MMDR Act, MCR, 1960, the Tamil Nadu Prevention ....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... are extracted below: "High concentrations of industrially important heavy minerals in the beach and dune sands of Tamil Nadu in the southeastern part of India have been known since the early part of the 20^th century. Indeed, the chance discovery of monazite in the beach sands of Manavalakurichi near Kanyakumari in Tamil Nadu by Herr Schomberg in 1908, heralded the beginning of exploration for the placer sand in India. Since then, several heavy mineral deposits, containing principally ilmenite, sillimanite, garnet, ruille, zircon and monazite have been identified in Tamil Nadu, largely due to the efforts of the Atomic Minerals Directorate for Exploration and Research (AMD) of the Department of Atomic Energy in the post - Independence period." 238. This study goes on to explain the heavy mineral deposits and data regarding the concentrations of monazite in the coastal beach sand and Teri sands along the coast of three Districts of Tirunelveli, Thoothukudi and Kanniyakumari. 1.1 Monazite - Prescribed Substance: 239. The Atomic Energy Act, 1962 was enacted to control the development of atomic energy and matters connected therewith and to provide for the development,....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... under the guidelines framed by the Atomic Energy Regulatory Board (AERB) individual processors of beach sand have to separate and safely keep the monazite content of such sand. No individual or entity is permitted to process monazite in any manner without a licence from DAE. Monazite is important for our Country's nuclear requirements and due to the said reasons only, private players are not allowed to process Monazite. 244. The Transportation of the Monazite enriched tailings, which is a radioactive material, through public domain, it requires a separate approval for transportation of radioactive material under Sub clause (iii) of third proviso to Rule 3(3) of Atomic Energy (Radiation Protection) Rules, 2004, which states that "approval for package design for transportation of radioactive minerals" is required. This safety licence is said to have been issued to the 8^th Respondent. Permission for transport is issued for Monazite enriched tailings and not Monazite, as none of the non-DAE units are permitted for production of Monazite as product. 245. No private players, including 8^th Respondent are allowed to crack Monazite, taking into consideration that to remove Mona....
X X X X Extracts X X X X
X X X X Extracts X X X X
....h Sand Minerals to private players', it was mandatory for all the private players to hand over the monazite tailing's (and also remaining heavy minerals containing other prescribed substances like Ilmenite, Zircon, Rutile etc.) to IREL, a Government of India Undertaking under the administrative control of DAE. After the said Policy, all private players were allowed to mine and win the prescribed substances except Monazite. The Monazite tailings have to be stacked and preserved by the private players as per the guidelines and directives issued by DAE in this regard. 251. When it comes to obtaining handling licences for handling Monazite tailings, the private players ought to get handling licence under the following legislations: a) The Atomic Energy (Working of the Mines, Minerals and Handling of Prescribed Substances) Rules, 1984. b) Atomic Energy (Radiation Protection) Rules 2004 read with Notification No.30/1/2002- ER/Vol.II/2875, dated 12.10.2006. c) Atomic Energy (Safe Disposal of Radioactive Wastes) Rules 1987. 252. The Atomic Energy (Working of the Mines, Minerals and Handling of Prescribed Substances) Rules, 1984 stipulates that, when....
X X X X Extracts X X X X
X X X X Extracts X X X X
....3, 608 MT of Monazite at an average grade of 17.47%. The report reveals that Kuttam site of M/s.Beach Minerals Sands Company is having 0.6% Monazite equivalent. The report reveals that Arasoor site of M/s.Beach Minerals Sand Company is having 0.46% Monazite equivalent and reveals that the Mappillaioorani site of M/s.Miracle Sands and Chemicals has Monazite tailings at two places, having 7.8% monazite equivalent. This trench has 75 MT material, which translates to 5.85 MT Monazite. The other site is open heap having dimensions of 8m length, 2m width and 2m height, having 5.5% Monazite equivalent. This dump has 160 metric tonnes material which translates to 8.80 MT Monozite. The report reveals that Monazite tailings are stored at two locations at Mela Arasaradi site of M/s.Miracle Sands and Chemicals one site having 5.0% and 16.0% monazite equivalent and another having 3.90% and 4.80 monazite equivalent. 258. Subsequently a Super check inspection was conducted in designated areas reported to have monazite enriched tailings stored in Tirunelveli and Thoothukudi districts, along with officials of Atomic Minerals Directorate, Indian Bureau of Mines, Atomic Energy Regulatory Board, Ge....
X X X X Extracts X X X X
X X X X Extracts X X X X
..... 2.5 Reverse Calculation Method: 264. The 2^nd Respondent / DAE reported "Gross Mismatch" between Total Quantum of raw sand purportedly transported by 8^th Respondent/ M/s.V.V.Mineral between 2001-2016 and raw sand required to produce 80, 725.05 Mts of Monazite rich tailings. A unique method - reverse calculation was used by the Amicus to determine Quantity of raw sand (ROM) required to produce Quantum of Monazite tailings declared by 8^th Respondent/ M/s.V.V.Mineral. 265. To conduct further study a memo was filed by the Amicus on 21.11.2016, this Court had passed directions to the respondents, especially R8 and R22 to provide to R2, DAE details about quantity of monazite tailings stored and related matters. Based on the information provided by R8 and R22, R2 has filed before this court an affidavit dated 05.01.2017 providing the following information: Period Total ROM Mined - Mts Approximately quantity of Monazite (Mts) computed by R-2 2007 - 2016 988, 88, 100 5876.6 Period Quantitty of Monazite rich tailings stored Total quantity of Monazite (MT) Computed by R-2 2007-2016 80, 725.05 23, 461.7 266. The 2nd Respondent, in t....
X X X X Extracts X X X X
X X X X Extracts X X X X
....d amounting to 4.88 crores and 4.93 crores of raw sand each. 268. The above calculation is an attempt to approximately calculate the total quantity of raw sand required based on the specifications given by R-2. The calculations are made on the assumption that some amount of monazite will be lost in the preliminary washing and pre-concentration stage and during mineral separation stage. 269. The above calculation indicates that approximately 4.69 Crores to 4.93 Crore MTs of raw sand will be required to produce the 23, 461 MTs of Monazite or 80, 725.06 MTs of monazite enriched tailings. 270. It requires to be noted that the total quantity of ROM transported as shown by the data provided by the District Mining Departments amounts only to 1.51 Crores in respect of all lessees for the period 2000-2001 till 2013-2014. 21. In contrast the above figure of 4.69 to 4.93 Crores of ROM is required in respect of mining operations of only one lessee, viz., R8, M/s.V.V.Mineral, and that too for the period 2007-2016. This huge discrepancy is significant. 271. Hence, it can be deduced that while the computation of monazite from the total amount of ROM transported during the period is a ....
X X X X Extracts X X X X
X X X X Extracts X X X X
...., 88, 100 tonnes raw sand declared by Respondents 8 and 22. In view of the above, the possibility of excessive mining of raw sand against the declared quantities and grades cannot be ruled out. Hence there can be an effective conclusion drawn from the Sahoo committee report, Amicus Curiae report and the submissions of DAE that there has been illegal mining of raw sand over and above the permissible limits. 276. The Sahoo Committee report and the Amicus Curiae report reveal similar contradictions in the quantity of raw sand mined as declared by the private mining companies namely Respondents herein and the actual raw sand mined as disclosed from monazite tailings. Though the Respondent mining companies oppose the reverse calculation method adopted by the committees, it is beyond understanding as to how such a huge mismatch between declared raw sand mined and actual raw sand, as disclosed from Monazite tailings can happen. This mismatch cannot be completely brushed aside. 2.6 Total Quantity of Monazite that can be Extracted from Stocks Available with M/s.V.V.Mineral which are > 0.25% Monazite Equivalent: 277. If one has to calculate the total quantity of Monazite contained i....
X X X X Extracts X X X X
X X X X Extracts X X X X
....the committee of having stocks of 9441 MT, whereas, the Committee estimated amount to 64, 40, 028.93 MT. Hence, there is a huge discrepancy between quantity declared and quantity found. 281. The Report of the Special Team in respect of stocks of raw sand and minerals processed by M/s.Transworld Garnet has reported that as against a declared quantity of 17, 75, 761 MT of stock, the quantity estimated by the Second Level Teams is 16, 30, 724.5 MTs. It is necessary to point out that Transworld Garnet India Pvt. Ltd. has been granted 14 mining leases for mining garnet in Tirunelveli district and 2 mining leases for mining garnet in Thoothukudi district. They do not have any mining lease for mining Ilmenite and other BSMs. 282. While so, one of the samples relating to Processed Mineral, viz., TTK 15, relating to sample taken in Kootudankadu village in Thoothukudi district, found THM concentration of 98.472% in a stock of 6140.86 MT quantity. It is reported that this processed mineral is a finished product kept in bags for sale. In this sample, Garnet concentration was found to be 91.95% amounting to 5646.76 MTs of garnet. Very interestingly, this same sample also contains 6.5% of ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....to about 0.10 MT. 288. Using the same formula adopted for calculating the total amount of ROM necessary for producing 23, 462 MT of Monazite in the case of M/s.V.V. Mineral, it is found that a total quantity of 63, 61, 952 MT of raw sand (ROM) will be required to produce the said 3, 780 MTs of Monazite that can be extracted from stocks presently available with the Company. As can be inferred from the above discussion, the company viz., Beach Mineral Sand Company, must have had to illegally mine a huge quantity of raw sand to produce the stocks Processed / Semi-processed minerals that they now possess. 2.8 Mismatch in Figures of Monozite Tailings Submitted by the Respondent Companies: 289. Very importantly, the Report by the Special Team concludes on the issue of monazite tailings yard of M/s.Beach Sand Companies as follows: "g. The authorities at AERB need to be look into the fact as to why monazite equivalent of such low concentration (e.g.0.72% at Kuttam and 0.39% at Arasoor) need to be kept in these specific sites. Has this concentration of the monazite equivalent changed over the years because of any pilferage? Were they being properly inspected in a timely ma....
X X X X Extracts X X X X
X X X X Extracts X X X X
....rent companies have contained significant quantities of monazite tailings mixed up as part of the stocks sold, is an issue that requires to be investigated by agencies competent, since it requires a multi disciplinary probe. This is a matter not just of commercial transactions but also involving National and International security. (3) Whether State Government is Empowered to Add Monazite and Other Atomic Minerals to the Existing Mining Leases Without Prior Approval of the Central Government? 295. This question is of utmost significance in the present matter. It is an undisputed fact that Monazite is a prescribed substance under the Atomic Energy Act and it is clear that private parties are prohibited from mining, processing, selling or exporting the mineral. So the pertinent question that arises is that, how come the State Government approved the adding of monazite to the 16 existing leases of the 8^th Respondent without getting due permission from DAE as required under the law. The DAE has explicitly denied granting any permission to the State Government for inclusion of Monazite in the existing mining lease granted to any private party. So the State Government by granting ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....3.1 Is Approval Required for Grant of Mining Lease Pertaining to Other Atomic Minerals? 298. Proviso to Section 5(1) of the MMDR Act clearly states that: "5. Restrictions on the grant of mineral concession.- (1) A State Government shall not grant a mineral concession to any person unless such person- (a) is an Indian national, or company as defined in 10[clause (20) of section 2 of the Companies Act, 2013 (18 of 2013)]; and (b) satisfies such conditions as may be prescribed: Provided that in respect of any mineral specified in Part A and Part B of the First Schedule, no reconnaissance permit, prospecting licence or mining lease shall be granted except with the previous approval of the Central Government. Provided further that the previous approval of the Central Government shall not be required for grant of mineral concession in respect of the minerals specified in Part A of the First Schedule, where.- (i) an allocation order has been issued by the Central Government under section 11A; or (ii) a notification of reservation of area has been issued by the Central Government or the State Government under sub-se....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ion from the Central Government before granting mining lease to the lessee for mining atomic minerals. 3.2 Illegal Inclusion of Monazite and Other Heavy Minerals in Existing Mining Leases Without Prior Approval of the Government of India: 302. It is pertinent to note that the contentions of the DAE had listed out the formalities to be followed prior to grant of licence to mine atomic minerals. It is shocking that the State Government had not obtained the prior permission from the Central Government/DAE as required under the Act. 303. Though the titanium ores and its concentrates (Ilmenite, Rutile, Leucoxene and Zirconium, its alloys including zircon) were removed from the list of prescribed substances under the Atomic Energy Act, 1962 with effect from 01.01.2007, it still continued to be atomic minerals under the MMDR Act. Hence with effect from 01.01.2007, the State Government ought to obtain permission from Central Government/DAE for grant of mining lease for such minerals as mentioned above. 304. Further, Part B of the First Schedule to the MMDR Act lists the Atomic minerals. It is mandatory for the State Government to obtain permission from the Central Government be....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... Monazite to the lease thereby committing a grave illegality. This entire process of inclusion of such a prescribed substance without the sanction of the Central Government ought to be viewed seriously and the level in which the State Government had bent its machinery and the laws of the land to grant such an unlawful lease to the 8^th Respondent must be examined to unearth the presence of any political nexus, if any, and the connivance of the officials and the lessees must be probed in detail. 306. Since the policy decision of Central Government /DAE is to not allow private players to process monazite due to National Security reasons, only handling licence is granted for storing them separately in accordance with directives issued by AERB while granting handling licence under the Atomic Energy (Radiation Protection) Rules, 2004. 307. Therefore, when Monazite is listed as a prescribed substance and there is a clear embargo in mining, processing, transporting or exporting Monazite by private players, there arises a pertinent question as to how the State Government included the four atomic minerals including the prescribed substance- Monazite. When DAE has not given any permiss....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... by a mining lessee to the lessor for enjoyment of mineral rights and to compensate for the loss of value of minerals suffered by the owner of the minerals. It is the payment of tax to the Government for the (owner) mineral right for the privilege granted by him for mining and producing/dispatching of minerals. 310. As held in Mineral Development Authority case cited supra, the essential characteristics of royalty are that: (i) it is a consideration or payment made to the proprietor of minerals, either the Government or a private person; (ii) it flows from a statutory agreement (a mining lease) between the lessor and the lessee; (iii) it represents a return for the grant of a privilege (to the lessee) of removing or consuming the minerals; and (iv) it is generally determined on the basis of the quantity of the minerals removed. 1.1 Royalty- Legal Position: 311. Royalty was initially collected based on a fixed rate for BSM as specified in Second schedule of MMDR Act. In 1997, this Second schedule was amended by introducing calculation of royalty based on ad valorem value. "Ad valorem" means royalty is calculated as a percentage of the val....
X X X X Extracts X X X X
X X X X Extracts X X X X
....e is called run-of-mine (ROM), [which may or may not be useable in its primary state depending on the minerals and its grade] is processed within the leased area itself (i.e., processing happens at the mine site). Royalty Calculation: Royalty is charged on the processed mineral that is removed from the leased area. This means that after processing, the final product (Such as concentrates, refined minerals, or any other processed form) is subject to royalty, which is determined based on the processed mineral quantity and its value. Example: If a mine processes iron ore into concentrated iron within the lease area, the royalty will be calculated on the concentrated iron ore when it is removed from the site. Royalty for minerals processed outside the leased area: Scenario: When the run-of-mine mineral is removed from the leased area and taken to a processing plant outside the leased area for further processing. Royalty Calculation: (1) Royalty is charged on the unprocessed run-of-mine mineral (the raw ore) when it is removed from the leased area, not on the processed product. (2) The royalty calculation, in this case, is based on the quantity and value....
X X X X Extracts X X X X
X X X X Extracts X X X X
....on Minerals on Ad Valorem Basis: 317. Rule 64-D(i) (I) is as extracted below, "(1) Every mine owner, his agent, manager, employee, contractor or sub-lessee shall compute the amount of royalty on minerals where such royalty is charged on ad valorem basis as follows: (i) - 'for all non-atomic and non fuel minerals sold in the domestic market or consumed in captive plants or exported by the mine owners (other than bauxite and laterite despatched for use in alumina and metallurgical industries, copper, lead, zinc, tin, nickel, gold, silver and minerals specified under Atomic Energy Act), the State-wise sale prices for different minerals as published by Indian Bureau of Mines shall be the sale price for computation of royalty in respect of any mineral produced any time during a month in any mine in that State, and the royalty shall be computed as per the formula given below: Royalty = Sale price of mineral (grade wise and State-wise) published by IBM X Rate of royalty (in percentage) X Total quantity of mineral grade produced/ dispatched: Provided that if for a particular mineral, the information for a State for a particular month is not published ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ustry, as it helps align the interests of mine operators and the Government, contributing to the sustainable and equitable extraction of minerals. 320. In 2014, the royalty rate for BSM in the Second schedule was changed, whereby royalty rate for Garnet was changed from 3% sale price to 4% average sale price and rate of royalty for all other BSM were unchanged. In 2016, few major changes were brought about to the MMDR Act. A new item was added to Part B- 'Atomic Minerals' of the First schedule of the MMDR Act, 1957 which reads as follows: "12. Beach Sand Minerals i.e., Economic Heavy Minerals found in the teri or Beach Sand, which include ilmenite, rutile, leucoxene, garnet, monazite, zircon and sillimanite." 321. Around the same time, the MCR, 1960 was repealed and substituted with two new Rules, these are - (1) The Minerals (Other than Atomic and Hydro carbons Energy Minerals) Concession Rules, 2016 (w.e.f 04.03.2016). (2) The Atomic Minerals Concession Rules, 2016 (w.e.f 11.07.2016) (AMCR) It is to be pointed out that the provisions of Rule 23 (2) of the AMCR, 2016 provided for ad valorem royalty on all atomic minerals (after the 2016 amendmen....
X X X X Extracts X X X X
X X X X Extracts X X X X
....les 64-B and 64-D: 327. The key distinction between Rule 64-B and Rule 64-D is that, in the case of Rule 64-B, it is based on processing of minerals within or outside the leased area, whereas Rule 64-D deals with royalty calculation on sale price or metal content of minerals. In simpler terms, with respect to Rule 64-B, the focus is on the processing stage (processed or unprocessed), whereas Rule-64 D focusses on value of the minerals through sale price or metal content. 328. When the primary intent behind the grant of a mining lease is to extract minerals and either sell them locally or export them, it is naturally understood that the fixation of royalty should be based on the value of the minerals alone. It would be unfair to fix the royalty on ROM (raw sand) based on the ground that, as per Rule 64-B(2), since the ROM mineral is removed from the lease area and taken to a processing plant located outside the leased area, royalty should be fixed on the unprocessed ROM. This is a complete wrong application of the Rule. The royalty should be affixed to the value of the minerals removed. More so, when Section 9 read with Second schedule specifically states ad valorem value of t....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... calculated based on the sale price of each mineral. Hence, it is implicitly clear that Section 9(2) of MMDR Act and Second Schedule to the Act and Rule 64-D of MCR should be read together for computation of royalty on ad valorem basis for the minerals. Hence, it becomes crystal clear that the royalty rate for each of the six BSMs is fixed on an ad valorem basis. This fixation ranges from 2 to 4% of the sale price of each mineral. 333. It is also to be noted that the Department itself has computed royalty on ad valorem basis on all mining companies, including 8^th Respondent/ M/s.V.V. Minerals, under Rule 64-D until the period 2007 - 2008. However, in 2012, when District Officials of Tirunelveli District were computing the Royalty Payment for the period 2008-09, 2009-10, 2010-11 and 2011-12, they have selectively chosen to apply Rule 64-B and charged royalty on a flat rate of Rs.20 to 45 per MT of raw sand only in respect of 8^th R espondent/ M/s.V.V. Minerals, 9^th Respondent/ M/s.Transworld Garnet India Pvt Ltd and 13^th Respondent/Industrial Minerals India Private Ltd, all of whom were sister concerns of 8^th Respondent/ M/s.V.V. Minerals at the relevant point in time. In con....
X X X X Extracts X X X X
X X X X Extracts X X X X
....d in a huge loss of revenue to the State by way of very low royalty collections, when in fact, the company has sold huge quantities of BSMs through export during these years and thereby earned huge income in those periods. 2.1 Low Royalty Fixation by IBM: 337. It has been observed by the Bedi committee that the Domestic sale price of Tamil Nadu as published by IBM, is at much lower rate as compared to other States. 338. For Example, in August 2013, as per data published in the IBM, the sale price of Garnet was Rs.377 per MT for Tamil Nadu, but Rs.8, 833 per MT for Andhra Pradesh and Rs.5, 500 per MT for Odisha. But it is to be noted that the export price of Garnet is Rs.15, 000-Rs.18, 000 per MT and hence the lessees have benefited a lot due to this shocking undervaluation. When the issue of undervaluation was raised, the sale price was refixed in January 2014 at Rs. 5, 600 MT for Tamil Nadu. But the Government of Tamil Nadu has lost a chunk of its revenue due to this undervaluation. 339. Due to the low fixation of the sale price for royalty, the total royalty earnings for Garnet in Tamil Nadu were Rs.5.47 Crore in 2013-2014. Further, the total royalty earnings from var....
X X X X Extracts X X X X
X X X X Extracts X X X X
....2007-2008 was only 1, 765 MT. This data provided by M/s. V.V. Mineral at the time of Royalty Settlement of 1, 765 MT of BSM exported is shown to be as incorrect by their own declaration made to the Taluk Level Committee of Tirunelveli in June, 2016, in which they claim to have exported 8, 83, 865 MT of BSMs during the same period. Even if it may be argued that this figure includes exports from all the three districts, considering that 27 out of 34 mines of M/s. V.V. Mineral are located in Tirunelveli District, it can safely be assumed that a substantial proportion of the 8, 83, 865 MT of BSM exported in the three years came from Tirunelveli District. 344. What stands out in stark contrast, is that as against the claim of M/s.V.V. Mineral of having sold 2, 74, 835.91 MT of BSMs locally for the 3 years period 2005-06 to 2007-08, the comparative figure of local sales of BSMs for the same period as declared before the Taluk Level Committee in 2016 is 28, 885.66 MT only. 345. This comparison echoes huge difference in declaration made by the companies before two different authorities. It can be inferred clearly that the company attained undue monetary benefit, due to these false de....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... companies both for the pre-ban period 2000-01 to 2013-14 (upto September, 2013) and the post-ban period covering the years 2014, 2015 and 2016. Consolidated summary of Royalty and Cost of mineral due to be recovered from lessees: SI.NO Name of th Lessee/Plant owner Royalty and Cost of mineral due to be recovered for unlawful/Illegal transport of BSM (in Rs.) 1 M/s.V.V.Mineral (R8, R22) 35, 81, 11, 76, 202 2 M/s.Transworld Garnet India (P) Ltd., (R9) 4, 78, 34, 94, 227 3 M/s.Industrial Mineral India (P) Ltd., (R13) 82, 51, 69, 343 4 M/s.Beach Mineral Sands Company and their sister companies & M/s.Beach Mineral Company (P) Ltd., (R10, R16, R18, R19), (R17) 9, 21, 69, 81, 216 5 IOGS Group (M.Ramesh (R11) and K.Thangaraj (R12) 4, 92, 67, 36, 512 6 M/s.Industrial Mineral Company (R15) 2, 76, 08, 66, 333 Total 58, 32, 44, 23, 835 (Rupees Five Thousand Eight Hundred and Thirty Two Crores Forty Four Lakhs Twenty Three Thousand Eight Hundred and Thirty Five only). 3.1 Post Ban Period - Royalty Calculations: 352. It is the claim of all the various mining companies that the entire stock of BSMs compris....
X X X X Extracts X X X X
X X X X Extracts X X X X
....nal wealth and resources are put at risk. A thorough and detailed probe into the allegations of the Government officials involvement in this major scam is inevitable. 358. Any reasonable man cannot deny the involvement of officials in this illegal mining keeping the backdrop of the facts and findings in this case. The brazenness with which this illicit action was done shows the level of support found in the then Government administration during the period when illegalities was perpetrated. The political patronage to this huge scam cannot be ruled out. This Court has witnessed cases, where officials find shelter in unavoidable systemic delays and by the time the issue comes to the fore, the perpetrators walk away legally unscathed. The Officials involved in the scam, irrespective of the positions they hold in the system ought to be inquired and requisite action should be taken including disciplinary action and criminal prosecution or both as the case may be. 359. This exploitation of natural resources at the cost of people's life, health and National revenue is not a child's play. Already the environmental damage today is becoming a cause of international concern and adding to....
X X X X Extracts X X X X
X X X X Extracts X X X X
....December 2016 has categorically stated that this report has not been authorised by the Government and hence, it should not be taken on record. 364. The Government of Tamil Nadu has stated that it could not have been possible for the Joint Inspection team to have conducted a detailed study on illicit mining of Beach Sand Minerals in 4 days. It is stated that the Government does not accept this report, as they have already constituted a special team headed by Mr. Gagandeep Singh Bedi, IAS and the report has also been submitted to the Court. The counter has also pointed out that the findings of the Joint Inspection team that the mining lessees have obtained licences from AERB and mining has been carried out as per approved mining plans, is not supported by any documents. The Report has stated that all royalty has been paid and exports are within limits, without verifying the reconciled statement of State Government and without the export details. On the contrary, the Principal Secretary to the Government of Tamil Nadu has pointed that the District Level Committee constituted by the District Collector, Tirunelveli, as per G.O.Ms.No.179, Industries (MMD.1) Department, dated 27.07.201....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ing the report. When the findings and evidences on the face of it reveal the massive scale of illegal mining, it is impossible to even assume otherwise. The entire illegalities was committed right under the watch of the State Government officials and they failed to take any action and chose to stay silent. Some officials have gone a step further by denying any such illegal mining/transportation/storage to have taken place. 366. To deny any knowledge of a scam as huge as this, which is an organised crime and planned to the tee at all levels in terms of executions by bending and subverting the laws of the land is unheard of. This is deeply disturbing and alarming. Hence, the officials who have claimed that no allegations have taken place inspite of repeated complaints received by them and the officials, who have submitted reports with untrue and false findings claiming no illegal mining has taken place inspite of having knowledge about the same, should be brought to the book and enquired about their involvement in this scam. Any such nexus between the perpetrators and officials, who submitted reports with false findings denying illegal mining in the area, where offence was committ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....Considering the quantum of unlawfully mined minerals and the huge financial loss this entails, it is important that a extensive probe is instituted into this issue. 370. The Show Cause notices issued by IBM officials clearly reveals that, even as far back as in 2006 - 07 itself, they were fully aware of the brazen and open violation of the laws by the mining companies. As noted before, in some cases, the illegally transported raw sand production was sometimes 14 to 18 times more than the quantity permitted to be transported. Yet apart from giving token notices, the IBM officials did nothing to strictly enforce the law. 371. As rightly raised in the Amicus Curiae report, the moot question is, as to whether the inaction of the officials to enforce the law is sheer inaction and indifference or did it arose from collusion with mining companies. This aspect requires detailed investigation by the investigating agencies. 372. The Amicus Curiae report reveals that the inaction of the State Government officials, despite evidence of the numerous illegalities committed by the mining companies in general, and more particularly M/s.V.V.Mineral and other mining companies controlled by M....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ficial and also the mining companies in subverting the law to ensure that proper royalty assessments were not made on the exact quantum of BSMs sold by the mining companies each year, thereby resulting in major loss to the State revenue and unjust enrichment of the mining companies concerned. There is a key finding in the Amicus Curiae report that the officials of the District Geology and Mining department, as also the District Collectors of each of the three districts Tirunelveli, Thoothukudi and Kanniyakumari have not only acted in violation of the requirements of the provisions of Section 9 and Second Schedule of the MMDR Act, 1957 and provisions of Rule 64D MCR, 1960, but have actually colluded and connived with different mining companies to ensure beneficial fixation of royalty, thereby reducing the royalty amount that the companies need to pay to the Government each year of the assessment period, but also to ensure that the mining companies gained financially by defrauding and cheating the Government of just dues for the mineral sold by them. 378. This can be further deduced from the wrongful application of Rule 64B(2) of MCR, 1960 for calculation of royalty on ROM transpo....
X X X X Extracts X X X X
X X X X Extracts X X X X
....d any noncompliance with the provisions of MMDR Act and its corresponding Rules must be dealt with strict legal action. Any complaints on illegal mining received, ought to be dealt by the competent authorities and the ultimate accountability is on the District Collectors. 382. When officials fail to act on complaints and remain mute spectator to the wrong doings happening, it is not only unconstitutional, but erodes public confidence, thereby leading to systemic dissolution. Power has been constitutionally granted to the executive to act for the protection and benefit of the public and any omission to act is in itself unconstitutional. 383. Fixation of accountability is of primacy in the issue on hand. Sand mining has become uncontrollable and unless accountability is fixed, the officials tend to wriggle away from their responsibilities. It is surprising that this unfortunate illegality has been going on for decades irrespective of the change in governance. There appears to be a clear political nexus in this and the investigating agencies must investigate thoroughly to cull out the perpetrators. The illegal sand mining in the State of Tamil Nadu is operating in the form of a ....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... of shortfall of stocks of raw sand from sealed godowns. Further, additional fresh stock of illegally mined raw sand has also been reported in the inspection. This is after the ban of mining was effected way back in August, 2013. So this shows that till 2021-2022, the illegality was still carrying on. This shows the blatant disregard for the orders of this Court. 388. Corruption in mining has become a norm and has been standardised by the officials involved. A pattern can be drawn from these illicit sand mining operations. The triangular link is undeniable here between the political, executive and the mining lessees. It has become a systemic corruption. X. Conclusion: 389. This issue has been agitated for nearly a decade. The Respondents are trying to use the judicial process to wriggle away from the consequences arising out of their illegal actions. Committee after committee formed and re-agitating on the same point of issue will not pave any way to the ends to justice. In the eyes of this Court, the Bedi Committee, Sahoo Committee, Reassessment Committee and the learned Amicus Curiae have carried out a fair and impartial task in inspecting and evaluating the extent and q....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... records and reports before us reveals the large scale corruption and collusion across departments, officials and bureaucracy. A systemic implementation failure has paved way for the huge loss to the National and State exchequer, which ought to be remedied at the earliest. Stringent and strict actions are the need of the hour to curb the illegalities and irregularities proliferating from illegal beach sand mining. 394. The scale and magnitude of the lorries unlawfully transporting illegally mined raw sand and minerals across districts without any lawful obstruction in place, to stop this crime, is mind boggling and disheartening. Natural resources being exploited is one thing, but when done beyond legally permissible limit to benefit a handful of people at the expense of the National economic interest and affecting the Country's overall growth and at the cost of people's livelihood has shaken the conscience of this Court. These are issues which need to be dealt with at the earliest and the way in which our Judicial process has been used to thwart the law from taking the right course of action is discernible from the endless litigations filed across different courts. Litigating a....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ed above holds all the findings in Mr.Gagandeep Singh Bedi's Report, Mr.Satyabrata Sahoo's Report, Reassessment Report and the Amicus Curiae's Reports valid and sustainable in the eyes of law. (b) In the light of the elaborate discussions in W.A.No.1168 and 1169 of 2015, heard together along with the present suo motu PIL, the constitution of the expert committee headed by Mr.Gagandeep Singh Bedi, I.A.S vide G.O.Ms.No.156, Industries Department, dated 08.08.2013 and G.O.Ms.No.173, Industries Department, dated 17.09.2013 by the State Government in exercise of powers conferred under Section 24 of MMDR Act to inspect and file report in regard to illicit mining of BSM is upheld. (c) The reports and findings of the Special Team headed by Mr.Gagandeep Singh Bedi, I.A.S., pertaining to the illegal mining and transport of 1.01 Crore M.T of raw sand over an extent of 234.55.0 hectares of non-leased out areas in the three coastal districts is held valid and sustainable in the eye of law. (d) The report of the Special Team headed by Mr.Satyabrata Sahoo, I.A.S., and findings on the quantum of stocks kept with the private respondents to the tune of 1.50 Cro....
X X X X Extracts X X X X
X X X X Extracts X X X X
....nt for handing over of the entire stocks held by the mining companies to IREL India Limited is granted. Hence the entire stocks of raw sand, processed or semi-processed BSMs held by the Lessees/ Mining companies, which are sealed in godowns, factories, stockyards and premises of the mining companies is directed to be handed over to IREL India Limited forthwith. (o) The actions of the State Government on inclusion of not only Monazite but also other atomic minerals like Leucoxene, Zircon and Sillimanite to the existing mining leases of the private respondent companies without the prior permission of the Central Government is held invalid. (p) The Public Notice No.50 of 2016 dated 23.11.2016 issued by the Customs department to verify the source of BSMs and for production of requisite certificate from the District Collectors certifying legal source of minerals to permit export under section 50 of the Customs Act, 1962 is held valid. (q) The royalty accounts as settled by the District Collectors of Tirunelveli, Thoothukudi and Kanniyakumari computing the royalty for the quantum of raw sand transport by arbitrarily applying Rule 64-B(2), MCR in favour of M/s.V....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... directed to register criminal cases and launch investigations. Also any pending cases relating to the issues discussed in this judgment registered by the Tamil Nadu Police is directed to be transferred to the CBI for enabling effective investigation. All related case files shall be handed over to the CBI within a period of four weeks. (w)The Director, CBI shall constitute required number of Special Investigation Teams, consisting of officials with expertise and High integrity to conduct the investigations into this scam. Further, The Director, CBI is directed to monitor the investigation of the SITs to be constituted. (x) The key issues that needs to be investigated includes: (1) The modus operandi of the illegal beach sand mining Mafia. (2) The role of officials including the omissions and commissions of all the officials from the senior most official in the Chain of command responsible for this huge economic loss to the State exchequer. (3) The Corruption and connivance of the officials with the mining companies indulged in illegal beach sand mining, transportation, storage and export must be probed across all departments which are ac....