Supreme Court clarifies interim mining permissions in Bihar: State of Bihar vs. Pawan Kumar (2022)

LEGAL ISSUE: Clarification on interim arrangements for mining permissions during the pendency of environmental clearances.

CASE TYPE: Environmental Law, Mining Law

Case Name: The State of Bihar and Others vs. Pawan Kumar and Others

[Judgment Date]: 18 January 2022

Date of the Judgment: 18 January 2022

Citation: (2022) INSC 40

Judges: Justice L. Nageswara Rao and Justice B.R. Gavai.

Can mining activities continue while environmental clearances are pending? The Supreme Court of India addressed this critical question while hearing a batch of Interlocutory Applications (IAs) arising from a previous order concerning mining in Bihar. The court clarified the scope of its earlier directions, emphasizing that interim permissions for mining were a temporary measure and did not grant any vested rights to previous contractors. This judgment underscores the importance of adhering to environmental regulations while balancing economic needs.

Case Background

The case originated from an order by the National Green Tribunal (NGT) regarding illegal mining activities in Bihar. The State of Bihar appealed this order, and the Supreme Court issued directions on 10th November 2021 to regulate mining while ensuring environmental protection. The court mandated the preparation of District Survey Reports (DSRs) and stipulated that mining could continue through the Bihar State Mining Corporation (the Corporation) using contractors, until further orders. Several parties who had previously been granted mining rights filed applications, challenging the new arrangements. They argued that their existing contracts or extensions should be honored. The Supreme Court addressed these claims in its order dated 18th January 2022.

Timeline:

Course of Proceedings

The National Green Tribunal (NGT) had initially passed an order to curb illegal mining in Bihar. The State of Bihar challenged this order in the Supreme Court. On 10th November 2021, the Supreme Court modified the NGT’s directions, allowing mining to continue under the supervision of the Bihar State Mining Corporation (the Corporation) while new District Survey Reports (DSRs) were prepared. Subsequently, several Interlocutory Applications (IAs) were filed by parties who had previously held mining contracts or extensions, challenging the new arrangements. These IAs were consolidated and addressed in the present judgment.

Legal Framework

The judgment primarily revolves around the interpretation and implementation of the Supreme Court’s order dated 10th November 2021. This order aimed to balance the need to curb illegal mining with the necessity to permit legal mining activities. The court emphasized the importance of preparing detailed District Survey Reports (DSRs) to ensure environmentally sustainable mining practices. The court also allowed the State Government to carry out mining activities through the Bihar State Mining Corporation, which could employ contractors.

The key aspect of the legal framework was the interim nature of the permission granted by the Supreme Court. The court’s intent was to allow mining to continue temporarily while ensuring that proper environmental assessments and clearances were put in place. This was to prevent both the loss of revenue to the public exchequer and the environmental damage caused by illegal mining.

Arguments

The applicants in the various IAs raised several arguments, which can be summarized as follows:

• Applicants in I.A. Nos. 154740-154741 of 2021 (Kishanganj District):
  • They were successful bidders in the auction for Kishanganj District and had been issued a Letter of Intent (LoI) dated 21st January 2020.
  • The cancellation of their LoI and the issuance of a fresh NIT was illegal.
  • Their offer was much higher than what the Corporation received, and hence, they should be allowed to carry out mining activities.
• Applicants in I.A. Nos. 153531-153532 of 2021 (Banka District):
  • They were successful bidders for Banka District for the period 2015-2019 and had been granted extensions up to 31st March 2022.
  • The issuance of a new NIT for Banka District was illegal, and they should be allowed to continue mining until 31st March 2022.
  • The amount offered by them was higher than what the Corporation would receive under the new NIT.
• Applicant in I.A. No. 165173 of 2021 (Jamui District):
  • They were successful bidders for Jamui District in 2019.
  • The new NIT dated 15th November 2021 was prejudicial to their interests.
  • They should be appointed as contractors or granted a right to match the highest bid with a right of first refusal.
• Applicants in I.A. Nos. 160138, 160139, and 160142 of 2021 (Nawada District):
  • They were successful bidders for Nawada District for the period 2015-2019 and had been granted extensions up to 31st March 2022.
  • They should be allowed to continue mining until 31st March 2022.
• Applicant in I.A. No. 163177 of 2021:
  • The mining activities carried out by the Corporation were without environmental clearance.
  • The NITs issued were silent on environmental aspects and amounted to contempt of the Supreme Court’s order.

The State of Bihar, represented by its counsel, argued that the NITs were issued for a limited period, in line with the Supreme Court’s order of 10th November 2021. The State also submitted that the process of preparing DSRs and obtaining environmental clearances was underway. They assured the Court that the Corporation was ensuring that no environmental damage was caused by the mining activities.

Issues Framed by the Supreme Court

The Supreme Court did not explicitly frame issues in a separate section. However, the core issues addressed by the Court were:

1. Whether the applicants who were previously successful bidders or had extensions of their mining contracts, had a vested right to continue mining activities.
2. Whether the mining activities carried out by the Corporation were in compliance with environmental regulations and the Supreme Court’s previous order.
3. Whether the NITs issued by the Corporation were valid and in line with the Supreme Court’s directions.

Treatment of the Issue by the Court:

Authorities

The Supreme Court did not cite any specific case laws or legal provisions in this order. The primary authority was the Supreme Court’s own order dated 10th November 2021, which modified the directions of the National Green Tribunal (NGT). The court’s reasoning was based on the interpretation of its own previous order and the need to balance environmental protection with economic considerations.

Judgment

The Court considered the following authorities:

• Order dated 10th November 2021 of the Supreme Court of India: The Court relied on its own previous order to clarify that the permission granted for mining was an interim measure and did not create any vested rights for previous contractors.

The Court’s reasoning was primarily based on the need to balance environmental concerns with the practical realities of mining operations and the need to prevent illegal mining. The Court emphasized that its previous order was a temporary arrangement to allow mining to continue while the necessary environmental clearances and DSRs were being prepared.

What weighed in the mind of the Court?

The Supreme Court’s decision was primarily influenced by the need to maintain a balance between environmental protection and the practical necessities of mining operations. The Court recognized that a complete ban on mining could lead to illegal activities and loss of revenue, while also acknowledging the importance of environmental safeguards. The Court’s emphasis on the interim nature of its previous order highlights its intent to ensure that mining activities are conducted responsibly and sustainably.

The Court’s reasoning was based more on the interpretation of its previous order and the legal principles of interim arrangements rather than the specific facts of each case.

The Court explicitly stated:

“We had noticed that unless the detailed DSRs are prepared by the Sub-Divisional Committees by undertaking site visits and using the modern technology and unless the same are examined by SEAC and SEIAA, it will not be appropriate to carry out the mining activities.”

“However, we had also noticed that if there is a ban on mining activities, apart from it leading to illegal sand mining, criminalization and clashes between the sand mafias, it would also cause huge loss to the public exchequer.”

“It could thus be seen that this was only a stop gap arrangement.”

The Court did not consider any alternative interpretations of its order. The decision was unanimous, with both judges concurring on the reasoning and conclusions.

Key Takeaways

• Interim arrangements for mining permissions are temporary and do not grant any vested rights to previous contractors.
• Environmental concerns must be addressed even during interim mining operations.
• The State Government and the Corporation must strictly adhere to the directions issued by the Supreme Court.
• The Supreme Court’s priority is to balance environmental protection with the need to prevent illegal mining and loss to the public exchequer.

Directions

The Supreme Court directed the State of Bihar to ensure that while carrying out mining activities, all environmental concerns are taken care of and no damage is caused to the environment.

Development of Law

The judgment clarifies that interim orders by the Supreme Court, especially in matters concerning environmental regulation, are not to be interpreted as granting permanent rights or exemptions. The ratio decidendi of the case is that interim permissions are temporary measures and do not confer vested rights, and environmental safeguards must be strictly followed even during such interim periods.

Conclusion

The Supreme Court’s order of 18th January 2022 clarified that its previous directions regarding mining in Bihar were intended as a temporary measure to balance environmental protection and economic needs. The Court rejected the claims of previous contractors for vested rights, emphasizing the interim nature of the permissions granted. The State of Bihar was directed to ensure that all environmental concerns are addressed while mining activities are carried out. This judgment underscores the importance of adhering to environmental regulations and the temporary nature of interim arrangements in such matters.

Category:

• Environmental Law
  • Mining Law
  • Environmental Clearances
  • National Green Tribunal
• Supreme Court Orders
  • Interim Orders
• Mining Regulations
  • District Survey Reports
  • Bihar State Mining Corporation
• Environmental Law
  • Environmental Protection Act, 1986

FAQ

Q: What was the main issue in the State of Bihar vs. Pawan Kumar case?

A: The main issue was whether previous mining contractors had a right to continue their operations based on old contracts or extensions, despite new regulations and interim orders from the Supreme Court.

Q: Did the Supreme Court allow previous contractors to continue mining?

A: No, the Supreme Court rejected the claims of previous contractors, stating that the interim permissions were temporary and did not grant any vested rights.

Q: What is a District Survey Report (DSR)?

A: A District Survey Report (DSR) is a detailed report prepared by the Sub-Divisional Committees that assesses the environmental impact of mining activities in a specific district.

Q: What did the Supreme Court say about environmental concerns?

A: The Supreme Court directed the State of Bihar to ensure that all environmental concerns are addressed and no damage is caused to the environment while carrying out mining activities.

Q: Why did the Supreme Court allow mining to continue temporarily?

A: The Supreme Court allowed mining to continue temporarily to prevent illegal mining, loss of revenue to the public exchequer, and to ensure that sand is available for construction activities.

Q: What is the significance of the Supreme Court’s order?

A: The order clarifies that interim permissions are temporary measures and do not confer vested rights, and environmental safeguards must be strictly followed even during such interim periods.