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Gujarat High Court Directs To Grant Quarry Lease Permission and Execute Mining Lease Agreement in Pursuance of LOI

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The Court pursues a case whereby the Petitioner had in his favour LOI to grant of quarry lease and the Court observed that it was for the Government to issue an Order for grant of quarry lease to him.


The Petitioner in the present petition filed under Article 226 of the Constitution of India, had prayed to direct the Respondent authorities to grant quarry lease permission and execute mining lease agreement under the LOI dated 30.05.2017 issued by the Respondent no.3 in favour of Petitioner concerning the private non-agricultural land in question.

Submissions before the Court

Petitioner’s Submissions

Learned Advocate for the Petitioner submitted that the Petitioner had successfully got permission to conduct mining activities as per the Mines and Minerals (Regulation and Development) Act, 1957 and Gujarat Minor Mineral Concessions Rules, 2017. According to it, LOI had been executed on 30.05.2017. Under the LOI, two conditions were necessary i.e., environmental clearance and approved mining plan from competent authorities. It was submitted that peculiar situation had arisen due to decision of the NGT with regard to constituting a Committee, which would be responsible for issuing necessary sanction and henceforth, as time limit prescribed under the rules for two years was to expire, the present petitions were filed.

Learned Advocate drew attention towards the relevant Rule no. 29, wherein subrule (3) provided for the Government to issue an Order for grant of quarry lease to the holder of LOI upon following certain conditions prescribed within two years from the date of commencement of the rules. It was submitted that the Rules had come into effect on 24.05.2017 and therefore, two years were to expire on 23.05.2019. However, on account of the present condition, the matter didn’t progress beyond the LOI and no Order for grant of quarry lease was passed. It was submitted that there was no fault of the Petitioner, and hence he would stand to lose grant of quarry lease, which was already decided in his favour by the State Government.

Learned Advocate for the Petitioner also drew the attention of this Court towards the decision of this Court in Civil Application No.1 of 2018, where an identical situation had arisen. The Division Bench of this Court had directed the respondent authorities to execute the mining lease upon the Petitioner by following certain conditions. Further, the decision of this Court in Special Civil Application No.7 of 2017 was also referred to, wherein the identical set of circumstances, the Court had proceeded to issue the direction to execute the lease deed on certain conditions as prescribed for.

It was submitted that the Petitioner was ready and willing to abide by all the conditions and give an undertaking before this Court that till the necessary formalities would not be concluded, the Petitioner won’t enter into any mining activities.

Respondent’s Submissions

The learned Assistant Government Pleader appearing for the Respondent authorities had opposed the present petition and submitted that the LOI was executed after observing the requirements and on account of the peculiar situation due to the timeline mentioned in Rule 29(3) of the Rules 2017, the State had undertaken necessary steps. It was submitted that if this Court was to consider the case of the Petitioner based on the similar Orders passed by the Coordinate Bench of this Court, then necessary conditions must be imposed.

Court’s Observations

The Court considered the aforesaid facts and circumstances and having satisfied that the Petitioner had in its favour LOI to grant of quarry lease and was also before the commencement of Rules 2017. It was for the Government to issue an order for grant of quarry lease. It would be after such order that the Petitioner will have to undertake necessary formalities and provide necessary clearances from the Authorities. Upon failure to pass an order for grant of quarry lease, it won’t be possible for the Petitioner to provide the necessary clearances, which would lead to forfeiture of their rights under the quarry lease.

Court’s Directions

Given the aforesaid, the Court directed that the Government shall pass an Order in writing within six weeks from the date of receipt of this order, for grant of quarry lease to the Petitioner according to the condition mentioned in the LOI with a further condition that the Petitioner shall file an undertaking before the District Collector, Kutch within next two weeks to the effect that the Petitioner shall not carry out any mining activity in the area in question till the environmental clearance and other conditions as mentioned in the Letter of Intent will be fulfilled, as provided under the Mines and Minerals (Development and Regulation) Amendment Act, 2015. The petition was thus allowed in the aforesaid terms.

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