HC pulls up mining firms over royalty

The Delhi High Court has pulled up mining companies for making fortunes out of the country's mineral resources without paying "sufficient" royalty to the state and said it would examine the matter as industrial growth could not be allowed at the cost of public money.

The court's observation came while adjudicating a dispute between steel giant Tata Steel and Jayaswals Neco Ltd over mining lease in Bastar district of Chhattisgarh.

"We would like to examine how much you pay for the valuable minerals. You are getting it almost free of cost. It cannot be allowed at the cost of life of the countrymen. The industrial growth cannot be allowed at the cost of government exchequer," a bench comprising Justice TS Thakur and Veena Birbal said.

"It's a public property and you are using it for your own benefit. Why is the rush? We have serious doubts about your motive. This is a very valuable deposit of iron ore worth of hundreds of crore," the court said while directing the state government to file details of royalty received from the mining companies.

The bench was hearing a petition filed by Tata Steel challenging the Mines Tribunal's order that had virtually granted the lease to his rival Jayaswals Neco Ltd.

The steel giant contended that the order was passed without giving it an opportunity to present its case. It also said that granting lease to Jayaswals Neco was against the law.

"We are an affected party...The area in question pertaining is the same area for which we it had also applied," Tata Steel counsel contended.

The Bench after hearing the contention stayed the tribunal's order and directed Jayaswals to file its response by January 16 when the matter would be taken up for further hearing.

The Chhattisgarh government, in a separate petition, also challenged the tribunal order setting aside the state's decision to reject the mining lease application of Jayaswals.

"The order is perverse, illegal and has been passed in a mechanical manner without any application of mind," the state counsel said, adding that Jayaswals' application was rejected after it refused to comply with the terms and conditions.

The state government had rejected Jayaswals as well as Tata's application for the mineral lease of the area.

Jayaswals had approached the tribunal against the decision.

The tribunal through its order set aside the decision and virtually granted mining lease to Jayaswals.