Contend no juridiction, breach of their rights; HC hearing on August 20.
Nine mining companies, including India’s largest iron ore exporter, Sesa Goa, have filed separate petitions and another half dozen are in various stages of approaching the court next week to challenge the Karnataka government’s abrupt decision to ban export of the steel-making raw material from the state.
The petitioners have made both the state government and central government as respondents in the case. There are five respondents on behalf of the state government. While the Union Ministry of Mines as well as the commerce ministry are made respondents on behalf of the central government. The high court has asked the respondents to submit their counter affidavit by August 16. By August 18, the petitioners will have to file rejoinders, if any, before the matter is heard on August 20.
A bench of Chief Justice J S Khehar and Manjula Chellur directed the government to file its objections to the petition filed in the Bangalore high court by August 16 and asked the petitioners to file their rejoinders by August 18, while adjourning the matter to August 20.
In orders issued on July 26 and 28, the state government had imposed a total ban on the movement of iron ore for both exports and domestic use. As a result, ore exports from the state have halted entirely. The government has also put restrictions on issue of mineral dispatch permits for even domestic use by steel mills.
The petitioners, all exporters of ore, have contended the ban order was arbitrary, unconstitutional and without jurisdiction. Contending that export of iron ore is their constitutional right, the petitioners have said the ban did not serve any purpose and affects their livelihood.
The government gives illegal mining as justification for its action, while mining outfits allege the former’s failure to act against its own party (BJP) members involved in such illegal mining. Either way, the country is losing crores of rupees on export revenue.
“Minerals are a central subject. Therefore, the state government of Karnataka has no jurisdiction to intervene in a central government subject,” said a miner, on condition of anonymity.
CM’S NEW POLICY
State chief minister B S Yeddyurappa had recently said iron ore should be preserved in the state for use in the proposed steel plant by ArcelorMittal. The world’s largest steel producer, led by India-born tycoon L N Mittal, is in the process of setting up a six million-tonne unit in the state, at an estimated investment of Rs 30,000 crore.
About 70-80 mining companies, a majority of these designated as export-oriented units, have reduced their output by up to 60 per cent since the state government banned the issue of transport licences to ore exporters. The state is endowed with approximately 9.03 billion tonnes, 40 per cent of India’s estimated total haematite and magnetic ore resources.
The nine companies that have filed suits are Sesa Goa, V S Lad & Sons, Mineral Enterprises Ltd, Zeenat Transport Co, K Praveenchandra, Bharat Mines and Minerals, H R Ranganagoud, Hothur Traders and Gaurisiddeshwar Minerals. The first eight companies account for close to 60 per cent of ore output in the state, of 40 million tonnes. Of this, 30 million tonnes is exported; 90 per cent of that is low-grade ore (less than 60 per cent iron content), exported to China.
“Since the state’s total consumption stands today hardly at 10 million tonnes, the rest of the quantity has to be exported. Going forward also, miners would not like to set up forward integration projects like benefication and pellet plants to process low-grade ore,” said another petitioner. “Iron ore mining activity will be stopped fully in the months to come if the ban is not lifted,” said D V Pichamuthu, Director of FIMI South.
