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PETITIONER: D.K. TRIVEDI AND SONS AND ORS. ETC. ETC.

       Vs.

RESPONDENT: STATE OF GUJARAT AND ORS. ETC. ETC.

DATE OF JUDGMENT05/03/1986

BENCH: MADON, D.P. BENCH: MADON, D.P. TULZAPURKAR, V.D.

CITATION:  1986 AIR 1323            1986 SCR  (1) 479  1986 SCC  Supl.   20     1986 SCALE  (1)1133  CITATOR INFO :  F          1986 SC1620  (1)  R          1988 SC1621  (2)

ACT:      Mines and  Minerals (Regulation  and Development)  Act, 1957 (Act.  No.67 of 1957), Section 15(1), Constitutionality of -  Whether the  State Government  has the  power to  make rules under  section 15  to enable  them to charge dead rent and royalty during the subsistence of such leases - Validity of Notifications/circular  issued by  the Gujarat Government under section  15 amending  the Gujarat Minor Mineral Rules, 1966 and  dated 29.11.74, 29.10.75, 4.6.76, 26.3.79, 12.2.81 and 18.6.81  - Validity  of Rule  21B of  the Gujarat  Minor Mineral Rules, 1966.

HEADNOTE:      The Writ  Petitioners and  appellants, were  persons to whom the  State of  Gujarat had  granted quarry  leases  and mining leases  in respect  of minor  minerals such  as black trap,  lime   stones,  murrum,  bentonite,  rubble,  marble, sandstone,  quartzite,   etc.  In  exercise  of  the  powers conferred  by   section  15   of  the   Mines  and  Minerals (Regulation and  Development) Act,  1957, the  Government of Gujarat made the Gujarat Minor Mineral Rules, 1966. The said Rules came  into force  on April  1, 1966. All the leases in the  matters  before  the  Court  were  given  in  the  form prescribed by  the said  Rules, Schedule I to the said Rules specified  the  rates  at  which  royalty  was  payable  and Schedule II  specified the  rates at  which  dead  rent  was payable. By  the 1974 Notification the Government of Gujarat made the  Gujarat Minor  Mineral (Fourth  Amendment)  Rules, 1974 whereby  Schedule I was substituted and Schedule II was amended with  effect from  December 1,  1974. Under  the new Schedule I  and the amended Schedule II the rates of royalty and dead  rent in  respect of  certain minor  minerals  were enhanced. In view of several representations made to it, the Government of  Gujarat decided  not to  implement  the  1974 Notification and  to refund  the amount  of royalty, if any, collected at  the rates prescribed by the 1974 Notification. By the  1975 Notification the Government of Gujarat made the Gujarat 480

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Minor Mineral  (Second Amendment)  Rules, 1975, whereby Rule 21 of  the said  Rules and  Schedule I were substituted with effect from  November  1,  1975.  By  the  said  substituted Schedule I  the rates of royalty in respect of several items were enhanced.      The Appellant  in C.A.  706/81, Ambalal Manibhai Patel, being aggrieved  by the said 1975 Notification, filed a Writ Petition  in  the  Gujarat  High  Court  (Sp.C.Ap.  66/78  ) challenging the  enhancement in  the rate of royalty to Rs.3 per metric  tonne in  respect of  black trap and hard Murrum specified in  Item 4 of the said substituted Schedule I. The Writ Petition having been dismissed, the appellant filed LPA No.61/78 which  was heard  along with several writ petitions raising the  same questions.  The main  contention raised in those matters was that under the proviso to section 15(3) of the 1957  Act, the  rate of  royalty in respect of any minor mineral could  not be  enhanced by the State Government more than once  during any period of four years and that the rate of royalty  on  black  trap  and  hard  murrum  having  been increased  by   the  1974  Notification,  it  could  not  be increased again  in 1975. A subsidiary contention raised was that the  State Government had no power to classify building stones into  black trap  and hard murrum because by doing so what the  State Government  had done in effect and substance was to  declare black trap and hard murrum as minor minerals and that  it was only the Central Government which possessed the  power  to  declare  any  mineral  not  covered  by  the definition of  the expression "minor minerals" in clause (e) of section  3 of  the 1957  Act to  be a minor mineral. Both these contentions  were rejected  by a Division Bench of the Gujarat High  Court by  its judgment  dated 16/17  September 1980 holding  that the  1974  Notification  had  not  become operative and,  therefore, in  issuing the 1975 Notification the State Government had not violated the proviso to section 15(3), and that building stones having been already included in the  definition of  "minor minerals", there was no bar to the  State   Government  classifying   them  into  different varieties for  the  purpose  of  recovering  royalty.  Civil Appeal 706/81  is by  Special Leave of the Court against the said judgment.      During the  pendency of the said Court proceedings, the Government of Gujarat made the Gujarat Minor Mineral (Second Amendment) Rules, 1976, substituting Schedule II to the said 481 Rules, changing  the rates  of dead rent for specified Minor Minerals and  reclassifying the  said nomenclature  as  "for quarry leases for any minor mineral" and "for quarry Parwana for any minor mineral."      Pursuant to  a policy  decision dated  March  26,  1979 announced on  the floors  of the Legislature by the Minister for Mines,  the Gujarat  Government by the 1979 Notification made the Gujarat Minor Minerals (Amendment) Rules, 1979 with effect from  April 1, 1979. By this amendment a new Rule 21B was inserted in the said Rules, Rule 22 was amended, Chapter IV of  the said  Rules which  dealt with  grant of quarrying permits in  respect of  lands in  which minerals belonged to the Government was deleted, Form was amended, Forms I, J and K were  deleted, and Schedules I and II were substituted. By the substituted Schedule I, the rate of royalty on all minor mineral was  specified as ten paise per metric tonne. By the substituted Schedule II the rate of dead rent per hectare or part thereof  in respect  of quarry  leases was  enhanced to Rs.1,200 in  certain cases,  Rs.1,500 in  some other  cases, Rs.2,000 in one case and Rs.3,000 in the remaining cases. So far  as   quarry  parwanas  were  concerned,  the  rate  was

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specified as  one-tenth of  the rate  for quarry  leases per parwana.      Ambalal Manilal  Patel again  filed  a  writ  petition, Sp.C.Ap.138 of  1978, in  the Gujarat High Court challenging the enhancement  in the  rate of  dead rent made by the 1976 Notification. The Writ Petition was dismissed leading to the filing of  a Letters  Patent Appeal. The said Letters Patent Appeal and  25 other  writ  petition  challenging  the  1979 Notification  were   allowed  by  the  Division  Bench.  The Division Bench  held that  the  conditions  in  a  lease  in respect  of   minor  minerals   relating  to  the  financial liability of  a lessee  derived their  authority  from  sub- section  (3)  of  section  15  of  the  Mines  and  Minerals (Regulation and  Development) Act,  1957, while  conditions, other than those relating to a lessee’s financial liability, regulating the grant of a lease derived their authority from [Sub-section from]  sub-section (1)  of section 15, that the State Government  had no  power to  enhance the rate of dead rent during  the subsistence  of a lease, and that Rule 21-B of  the   Gujarat  Minor   Mineral  Rules,   1966  and  1979 Notification were  ultra vires section 15 and sub-clause (g) of clause  (1)  of  Article  19  of  the  Constitution.  The Division 482 Bench accordingly  issued a  writ of  mandamus  against  the State Government  directing it  to desist from enforcing the said Rule 21-B and the 1979 Notification. The Division Bench also made  the same  declaration  in  respect  of  the  1976 Notification  and   issued  the  same  mandamus  in  respect thereof. The said judgment of the Division Bench is reported as Smt.  Sonbai Pethalji v. State of Gujrat & Anr., reported in XXI  (2) (1980)  2 Gujarat L.R. 530. The State of Gujarat accepted the  said judgment  and did  not come  in appeal to this Court.  Certain lessees  of mining  and quarry  leases, however, approached  this Court  by way  of Appeals and Writ Petitions challenging  the correctness  of the  judgment  in Smt. Sonbai’s case.      In view of the said judgment, the Government of Gujarat issued a  circular addressed  to  all  Collectors,  District Development Officers  and the  Director, Geology and Mining, Ahmedabad, being  Circular No.  M.C.R.2190 (166)  CHH  dated February 12,  1981, stating  that in  view of  the aforesaid judgment of  the Division  Bench the  position prior thereto would prevail  and that  Chapter IV  of the said Rules which was deleted by the 1976 Notification would stand revived and would be applied. The Government thereafter made the Gujarat Minor Minerals  (Amendment) Rules, 1981, by issuing the 1981 Notification which  came into force on June 20, 1981. By the 1981  Notification  Rule  21-B  was  deleted,  Rule  22  was amended,  Chapter   IV  and  certain  Forms  were  inserted, Schedule I to the said Rules was substituted and Schedule II thereto deleted. Several lessees of mining and quarry leases filed writ  petitions in  the Gujarat High Court challenging the validity of the 1981 Notification and the said Circular. These writ  petitions were  rejected on  the ground  that as connected proceedings  were pending in the Supreme Court, it was open  to the  petitioners to  move this Court if they so desired. Accordingly,  the said  petitioners as  also others filed writ  petitions in this Court challenging the validity of the  1981 Notification  and the  said Circular as also in some cases  Appeals against  the order  rejecting  the  writ petitions. Dismissing CA.  Nos. 1525-26  of 1982,  WP Nos.7103-7128  of 1981 and  WP Nos.  4208-17 of  1983, allowing  in part  only CA.Nos. 706  and 1324/81,  WP. Nos.  6419-22/82 and  WP Nos.

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4912-4924 and  5167-5182 of  1983 and  allowing CA Nos. 1489 and 1675/81  WP Nos.1656,  2108, 4097  and 7697  of 1981, WP Nos. 762, 874-942, 483 946-968, 1616-17,  4455-73, 4479-84,  5589-5605,  5895-5969, 5971 to  6005, 6309,  6463-79 and 10114 to 10112 of 1982 and 3393 to 4003, 8813-8820 and 9539 to 9549 of 1983, the Court, ^      HELD :  1.1 Sub-section  (1) of section 15 of the Mines and Minerals  (Regulation  and  Development)  Act,  1957  is constitutional and valid and the rule-making power conferred thereunder upon  the State  Government does  not  amount  to excessive delegation  of legislative power to the executive. [523 G]      1.2  To  take  into  account  legislative  history  and practice  when  considering  the  validity  of  a  statutory provision or  while  interpreting  a  legislative  entry  is "well-established" principle  of construction  of  statutes. [528 B-C]      State of Bombay v. Narothamdas Jethabai and Anr. [1951] S.C.R. 51;  State of  Madras  v.  Gaunnan  Dunkerley  &  Co. (Madras) Ltd., [1959] S.C.R. 379 referred to.      1.3 The  1957 Act  is made  in exercise  of the  powers conferred by Entry 54 in the Union List which speaks both of regulation of mines and minerals development and Entry 23 in the State List is subject to Entry 54. The rule-making power conferred by  section 15(1)  was for regulating the grant of prospecting licences  and mining  leases  and  for  purposes connected therewith  prior to  the Amendment Act of 1972 and thereafter is  for regulating  the grant  of quarry  leases, mining leases  and other  mineral concessions  in respect of minor minerals  and for  purposes connected  therewith.  The phraseology of  section 15(1) is the same as that of section 13(1) which  confers  rule-making  power  upon  the  Central Government with this difference that by the Amendment Act of 1972 the  expression "quarry  leases, mining leases or other mineral concessions"  has been  substituted in section 15(1) for the words "prospecting licences and mining leases" while the expression  "prospecting licences  and mining leases" in section 13(1) remains unchanged. [524 B-C; 525 B-E]      The word "minerals" wherever used in the 1957 act would include minor  minerals unless  minor minerals are expressly excluded or  the context  otherwise requires. Although under section 14, section 13 is one of the sections which does not apply to minor minerals, the language of section 13(1) is in 484 pari materia  with the  language of  section 15(1).  Each of these  provisions  confers  the  power  to  make  rules  for "regulating". Thus,  the power to regulate by rules given by sections 13(1)  and 15(1)  is a power to control, govern and direct by rules the grant of prospecting licences and mining leases in  respect of minerals other than minor minerals and for purposes  connected therewith  in the  case  of  section 13(1) and  the grant  of quarry  leases, mining  leases  and other mineral  concessions in  respect of minor minerals and for purposes  connected therewith  in the  case  of  section 15(1) and to subject such grant to restrictions and to adapt them to  the circumstances  of the case and the surroundings with reference to which such power is exercised. me power to regulate conferred  by sections  13(1) and 15(1) is not only with respect  to the  grant of licences and leases mentioned in those  sub-sections but is also with respect to "purposes connected therewith",  that is, purposes connected with such grant.  Entry   54  in   the  Union   List  uses   the  word "regulation". m  e makers  of the Constitution were not only

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aware of  the legislative  history of the topic of mines and minerals but  were also  aware how  the Dominion Legislature had interpreted  Entry 36 in the Federal Legislative List in enacting the 1948 Act. When the 1957 Act came to be enacted, Parliament knew  that different  State Governments  had,  in pursuance of  the  provisions  of  Rule  4  of  the  Mineral Concession Rules,  1949, made rules for regulating the grant of leases  in respect  of minor  minerals and  other matters connected  therewith   and  for  this  reason  it  expressly provided in  sub-section (2)  of section  15 of the 1957 Act that the  rules in force immediately before the commencement of that  Act would  continue in  force until  superseded  by rules made  under sub-section  (1) of section 15. Regulating the grant  of mining leases in respect of minor minerals and other connected  matters was, therefore, not something which was done  for the  first time by the 1957 Act but followed a well-recognised and  accepted legislative practice. In fact, even so  far as  minerals other  than  minor  minerals  were concerned, what  Parliament did, as pointed out earlier, was to transfer  to the  1957 Act  certain provisions  which had until then  been dealt  with under  the rule-making power of the Central  Government in  order to  restrict the  scope of subordinate legislation. [526 D,E,H; 527 A-H; 528 A-B]      2.1 There  are sufficient  guidelines provided  in  the 1957 Art  for the  exercise of  the rule-making Power of the State 485 Governments under  section 15(1)  of  the  1957  Act.  These guidelines are  to be  found in  the object  for which  such power is  conferred, namely,  "for regulating  the grant  of quarry leases, mining leases or other mineral concessions in respect  of   minor  minerals  and  for  purposes  connected therewith"; the  meaning of  the word "regulating; the scope of  the  phrase  "for  purposes  connected  therewith";  the illustrative matters  set out  in sub-section (2) of section 13; and  the restrictions  and other  matters  contained  in sections 4  to 12  of the  1957 Act.  [528 C-D; 530 G-H; 531 A-B]      2.2 It  is well  settled that  where a  statute confers particular powers  without prejudice  to the generality of a general power  already conferred,  the particular powers are only illustrative of the general power and do not in any way restrict the general power. [528 D-El      King Emperor v. Sibnath Banerjee and Ors., (1944-45) 72 I.A. 241;  Om Prakash  and Ors.  v. Union of India and Ors., [1970] 3  S.C.C. 942,  944-5; Shiv Kirpal Singh v. V.V. Giri [1971] 2 S.C.R. 197, 224-5 referred to.      2.3 The  fact that provision similar to sub-section (2) of section  13, does not find a place in section 15 does not make any difference. What sub-section (2) of section 13 does it to  give illustrations of the matters in respect of which the Central  Government can  make rules  for "regulating the grant of  prospecting licences  and mining leases in respect of minerals  and  for  purposes  connected  therewith".  The opening clause  of sub-section(2) of section 13, namely, "In particular, and  without prejudice  to the generality of the foregoing power",  makes it clear that the topics set out in that sub-section  are already  included in the general power conferred  by  sub-section  (1)  but  are  being  listed  to particularize them  and to  focus  attention  on  them.  The particular  matters   in  respect   of  which   the  Central Government can  make rules  under sub-section (2) of section 13 are,  therefore, also matters with respect to which under sub-section (1)  of section 15 the State Government can make rules for  "regulating the  grant of  quarry leases,  mining

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leases or  other mineral  concessions in  respect  of  minor minerals and for purposes connected therewith." When section 14  directs  that  "The  provisions  of  sections  4  to  13 (inclusive) shall  not apply to quarry leases, mining leases or other mineral concessions in 486 respect of  minor minerals",  what is  intended is  that the matters contained  in those sections, so far as they concern minor minerals,  will  not  be  controlled  by  the  Central Government  but   by  the   concerned  State  Government  by exercising its  rule-making  power  as  a  delegate  of  the Central Government. Sections  4   to  12  form  a  group  of sections  under   the  heading   "General  restrictions   on undertaking  prospecting   and   mining   operations".   The exclusion of  the application  of these  sections  to  minor minerals means  that these  restrictions will  not apply  to minor minerals  but that it is left to the State Governments to prescribe  such restrictions  as they  think fit by rules made under section 15(1). [529 D-H; 530 A-B]      Sections 13,  14 and  1-5 have  to be read together. In providing that  section 13  will not apply to quarry leases, mining leases  or other  mineral concessions  in respect  of minor minerals  what was  done was  to take  away  from  the Central Government  the power  to make  rules in  respect of minor minerals  and to  confer that  power by  section 15(1) upon the  State Governments.  The ambit  of the  power under section 13  and under  section 15 is, however, the same, the only difference  being that  in one  case it  is the Central Government which  exercises the power in respect of minerals other than  minor minerals while in the other case it is the State Governments  which do so in respect of minor minerals. Sub-section (2)  of section  13 which is illustrative of the general power conferred by section 13(1) contains sufficient guidelines for  the State  Governments to  follow in framing the rules  under section  15(1), and  in the  same way,  the State Governments  have before  them  the  restrictions  and other matters provided for in sections 4 to 12 while framing their own rules under section 15(1). [530 C-G]      3.1 The  power to make rules conferred by section 15(1) includes the  power to  make rules  charging dead  rent  and royalty. [531 B-C]      3.2 Rent is an integral part of the concept of a lease. It is the consideration moving from the lessee to the lessor for demise  of the  property to  him.  Section  105  of  the Transfer of  Property Act, 1982, contains the definitions of the terms "lease", "lessor", "lessee", "premium" and "rent". Royalty connotes  the payment  made  for  the  materials  or minerals won from the land. [534 C-D] 487      H.R.S. Murthy v. Collector of Chittour and Anr., [1964] 6 S.C.R. 666, 673 referred to.      3.3 In  a mining lease the consideration usually moving from the  lessee to  the lessor  is the  rent for  the  area leased (often called "surface rent"), dead rent and royalty. Since a  mining lease  confers upon the lessee the right not merely to  enjoy the property as under an ordinary lea e but also to  extract minerals  from the  land and to appropriate them for  his own  use or  benefit, in addition to the usual rent for  the area  demised, the lessee is required to pay a certain  amount   in  respect   of  the  minerals  extracted proportionate to  the quantity so extracted. Such payment is called "royalty".  It may,  however, be that the mine is not worked properly  so as  not to  yield enough  return to  the lessor in  the shape  of royalty. In order to ensure for the lessor a  regular income, whether the mine is worked or not,

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a fixed  amount is provided to be paid to him by the lessee. This is called "dead rent". [534 G-H; 535 A-B]      "Dead rent"  is calculated  on the  basis of  the  area leased while  royalty  is  calculated  on  the  quantity  of minerals extracted  or removed.  m us,  while dead rent is a fixed return to the lessor, royalty is a return which varies with the  quantity of  minerals extracted  or removed. Since dead rent  and royalty  are both  a return  to the lessor in respect of the area leased, looked at from one point of view teat rent  can be described as the minimum guaranteed amount of royalty payable to the lessor but calculated on the basis of the  area leased  ant not  on the  quantity  of  minerals extracted  or   removed.  Stipulations   providing  for  the lessee’s liability  to  pay  surface  rent,  dead  rent  and royalty to the lessor are the usual covenants to be found in a mining lease. [535 B-E]      The grant  of a mining lease would thus provide for the consideration for  such grant  in the shape of surface rent, teat  rent   and  royalty.  The  power  to  make  rules  for regulating  the  grant  of  such  leases  would,  therefore, include the  power to  fix the  confederation parable br the lessee to  the lessor  in the  shape  of  ordinary  rent  or surface rent, dead rent and royalty. If this were not so, it would lead  to the  absurd result  that when  the Government grants a  mining lease, lt is granted gratis to a person who wants to  extract minerals  and profit  from them. Rules for regulating the grant of mining 488 leases cannot  be confined merely to rules providing for the form in  which applications  for such leases are to be made, the factors to be taken into account in granting or refusing such applications and other cognate matters. Such rules must necessarily  include   provisions  with   respect   to   the consideration for the grant. [535 E-H]      The Legislature  and the  rule making  authorities have also throughout  understood  the  power  to  make  rules  in respect of mining leases and minerals as including the power to charge  dead rent  and royalty.  Rule 41  of the  Mineral Concession Rules,  1949, made  by the  Central Government in exercise of  the powers  conferred by  section 5 of the 1948 Act prescribed  the conditions  which were to be included in every mining lease. The said Rule 41 provided for payment of royalty on  minerals at  the rate  specified  in  the  First Schedule to the said Rules in force on the date of the grant of the lease as also to pay royalty at such revised rates as may be  notified from  time to  time. It  also provided  for payment of  surface rent and further provided for payment of dead rent  with a  proviso that the lessee was liable to pay dead rent  or royalty,  whichever was  higher in amount, but not both.  Rules made by the State Governments in respect of minor minerals  also provided  for payment of these charges. Under clause (1) of section 13(2) of the 1957 Act, the rules to be  made by  the Central  Government can provide "for the fixing and the collection of dead rent, fines, fees or other charges and  the collection  of royalties".  Although clause (i) of  section 13(2) speaks of fixing and collection in the case of  dead rent  and  only  collection  in  the  case  of royalties, the reason is not that the power to fix rhyolites was not  thought to  be a  comprehended in the general rule- making power  of the Central Government under section 13(1). The reason  was that a separate provision in that behalf was made by section 9 with respect to mining leases granted both before the  commencement of  the 1957  Act as also after the commencement of  the 1957  Act. Another  reason for doing so was to  specify  the  rates  for  royalties  in  respect  of

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different minerals  other than  minor minerals in the Second Schedule to  the 1957  Act in order to restrict the scope of subordinate legislation  as pointed  out in the Statement of Objects and  Reasons to the Legislative Bill No. 83 of 1972. [536 B; E-G; 537 E-H; 538 A]      4.1 The  sole repository  of the  power  of  the  State Government to make rules and amendments thereto, including 489 amendments enhancing  the rates of royalty and dead rent, is sub-section (1) of section 15. [564 D-E]      4.2 Sub-section  (3) of section 15 does not confer upon the State  Governments the  power  to  make  rules  charging royalty or  to enhance  the rate  of royalty so charged from time to time. [541 A-B]      4.3 A  proper reading  of subsection  (3) of section 15 shows that  it does  not confer  any power  upon  the  State Governments to  make rules  with respect to royalty. Royalty is payable  by the  holder of a quarry lease or mining lease or other  mineral concession  granted under rules made under sub-section (1)  of section 15. What sub-section (3) does is to make  such holder  liable to  pay royalty  in respect  of minor minerals  removed or consumed not only by him but also by his  agent, managers, employee, contractor or sub-lessee. It thus  casts a vicarious liability upon such holder to pay royalty in  respect  of  the  acts  of  persons  other  than himself. The  very I  fact that  under  subsection  (3)  the liability of  such holder  is to  pay royalty  "at the  rate prescribed for  the time  being in  the rules  framed by the State Government  in respect  of minor  minerals" shows that the prescribing  of the  rate of royalty in respect of minor minerals is  to be  done under  the rule-making power of the State Governments which is to be found in sub-section (1) of section 15.  Yet another purpose of enacting sub-section (3) is to  be found  in the  proviso to  that sub-section  which prohibits the  State Government  from enhancing  the rate of royalty in  respect of  any minor mineral for more than once during any period of four years. [539 D-G]      Section  9A  was  inserted  in  the  1957  Act  by  the Amendment  Act   of  1972  but  lt  was  not  inserted  with retrospective effect.  It was,  therefore,  not  there  when section  15(1)  was  placed  upon  the  statute  book  while enacting the  1957 Act.  Section 9A  was enacted with a two- fold purpose.  It casts  a liability  upon the  holder of  a mining  lease,   whether  granted   before  or   after   the commencement of  the 1972  Act, that  is, either  before  or after September  12, 1972,  to pay  to the  State Government teat rent  at the  rates specified for the time being in the Third Schedule  to the  1957 Act  "notwithstanding  anything contained in the instrument of lease or in any other law for the time  being in  force." The purpose of inserting section 9A in the 490 1957 Act,  as stated in the Statement of Objects ant Reasons to Legislative  Bill No.83 of 1972, was to make a "provision of a  statutory basis for calculation of dead rent". Section 9A also  provides that  the liability of the lessee would be to pay  either royalty  or dead  rent whichever  is greater, thus embodying  in the Act what was contained in the proviso to clause  (c) of  Rule 27  of the  Minor Mineral Concession Rules, 1960.  Section 9A  was inserted  also with  a view to prohibit the  Central Government  from enhancing the rate of dead rent more than once during any period of four years. By the Amendment  Act of 1972 section 9 was also a ended. While under  the   original  sub-section  (1)  of  section  9  the liability of  the holder  of a  mining lease was only to pay

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royalty in  respect of any mineral removed by him, after the amendment he is made liable to pay royalty in respect of any mineral "removed  or  consumed  by  him  or  by  his  agent, manager,  employee,   contractor  of   sub-lessee".  By  the Amendment Act of 1972 the power to the Central Government to amend by  notification the  Second Schedule  which specifies the rate  of royalty  was  also  curtailed  by  inserting  a proviso to section 9(3) in order to provide that the Central Government shall  not enhance the rate of royalty in respect of any  mineral more  than once  during any  period of  four years. The  amendments made  by the  Amendment Act  of  1972 have, therefore,  no relevance for ascertaining the scope of the rule-making power of the State Governments under section 15(1). [540 A-G]      Smt. Sonbai Pethalji v. State of Gujrat & Anr., XXI (2) 1980 (2) Guj. L.R. 530 reversed.      M.V. Subba  Rao v.  State of  Andhra Pradesh  and Anr., A.I.R. 1978 AP 453 overruled.      Laddu Mal and Ors. v. The State of Bihar & Ors., A.I.R. 1965 Patna  491; Banku  Bihari Saha  v. State  Government of Madhya Pradesh  and Ors.,  A.I.R. 1969  M.P. 210; Dr. Shanti Saroop Sharma and Anr. v. State of Punjab & Ors., A.I.R. 1969 Punj.  & Har.  79; M/s. Amar Singh Modi Lal v. State of Haryana and  Ors., A.I.R. 1972 Punj. & Har. 356; M/s. Brimco Bricks, Bharatpur  v. State  of Rajasthan  And Anr.,  A.I.R. 1972 Raj. 145 distinguished. 491      Sheo Varan Singh v. State of U.P., A.I.R. 1980 All. 92; Bal Mukund Arora etc. v. State of Rajasthan and Ors., A.I.R. 1981 Raj. 95 approved.      5.1  The  power  to  make  rules  under  section  15(1) includes the power to amend the rules so made, including the power to  amend the  rules so  as to  enhance the  rates  of royalty and dead rent. [541 D-E]      5.2 Rules under section 15(1), though made by the State Governments, are  rules made  under a  Central Act  and  the provisions of  the General  Clauses Act, 1897, apply to such rules. Under section 21 of the General Clauses Act, where by any Central  Act, a  power to  make rules is conferred, then that power  includes a power, exercisable in the like manner and subject  to the  like sanction and conditions if any, to add to,  amend, vary or rescind any rules so made. The power to amend  the rules  is therefore,  comprehended within  the power to  make rules  and as  section 15(1) confers upon the State Governments  the power  to make  rules  providing  for payment of  dead rent  and royalty, it also confers upon the State Governments  the power  to amend  those rules so as to alter the  rates of  royalty and  dead rent  so  prescribed, either by  enhancing or  reducing such  rates. The source of the power to enhance the rate of royalty is not contained in sub-section (3)  of section 15. The purpose of inserting the said sub-section in section 15 with retrospective effect was an entirely different one. [541 C-F]      5.3 A  State Government  is entitled to amend the rules under section  15(1) enhancing the rates of royalty and dead rent even  as regards  leases subsisting at the date of such amendment. [542 A-B]      5.4 Sub-section  (3) of  section 15 does not confer any power to  amend the  rules made under section 15(1), for the power to amend the rules is comprehended within the power to make the  rules conferred  by sub-section (1) of section 15. The construction  sought to  be placed upon the word "grant" in section  15(1) is misplaced. While granting a lease it is open to  the grantor to prescribe conditions which are to be observed during  the period of the grant ant also to provide

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for the  forefeiture of  the lease on breach of any of those conditions. If  the grant  of a  lease were not to prescribe such 492 conditions, the  lesses would  with impunity commit breaches of the conditions of the lease. Ordinary leases of immovable property at times provide for periodic increases of rent and there is  no reason why such increases should not be made in a mining or quarry lease or other mineral concession granted under a  regulatory statute  intended for the benefit of the public and  even less  reason why  such a statute should not confer power  to make  rules providing  for increases in the rate of  dead rent  during the  subsistence of the lease. In any event,  the power  to make  rules under section 15(1) is also for  purposes connected  with the  grant of  mining and quarry  leases   and  other   mineral  concessions  and  the expression "and  for purposes connected therewith" read with the word "grant" would include the power to enhance the rate of test rent during the subsistence of the lease. [542 B-F]      5.5 A  quarry lease,  mining  lease  or  other  mineral concession in  respect of  a minor mineral does not stand on the same  footing as  an ordinary contract. These leases and concessions are granted by the State Governments pursuant to rules made  under the statutory power conferred upon them by a  regulatory   Act.  Minerals  are  part  of  the  material resources which  constitute a nation’s natural wealth and if the nation  is to advance industrially and if its economy is to be  benefitted by the proper development and exploitation of these resources, them cannot be permitted to be frittered away and  exhausted within  a few  years  by  indiscriminate exploitation without  any  regard  to  public  and  national interest. It was for achieving the object set out above that both the  1948 Act  and the  1957 Act were enacted. The long title of  the 1957  Act  is  "An  Act  to  provide  for  the regulation of  mines and  the development  of minerals under the control of the Union." The 1948 Act contained a preamble which stated "Whereas it is expedient in the public interest to provide  for the regulation of mines and minerals and for the  development  of  minerals  to  the  extant  hereinafter specified." The  makers of  the Constitution  recognised the importance to  the nation  of the  regulation of  mines  and mineral development  and, therefore, enacted Entry 54 of the Union List  and Entry  23 of the State List. In the exercise of the  power conferred  by Entry  54, Parliament has made a declaration in  section 2  of  the  1957  Act  that  "lt  is expedient in  the public interest that the Union should take under its control the regulation of mines and the 493 development of minerals to the extent hereinafter provided." The  presumption   is  that  an  authority  clothed  with  a statutory power  will exercise such power reasonably, and if in the public interest and for the efficacious regulation of mines  and   quarries  of  minor  minerals  and  the  proper development of  such minerals,  a State  Government  as  the delegate of  the Union  Government thinks  fit to  amend the rules to  as to  enhance the rate of dead rent, it cannot be said that it is prevented from doing so by the principles of the ordinary  law of  contracts. It  may be  that in certain cases by  enhancing the  rate of  dead rent  the holders  of leases in  respect of certain types of minor minerals may be adversely affected  but private interest cannot be permitted to override  public interest.  Conservation of  minerals and their proper  exploitation result  in securing  the  maximum benefit to  the community  and  lt  is  open  to  the  State Governments to enhance the rate of dead rent so as to ensure

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the proper  conservation and  development of  minor minerals even though  it may  effect a  lessee’s  liability  under  a subsisting lease. [543 B-H; 544 A-C]      State of Tamil Nadu v. Hind Stone Etc., [1981] 2 S.C.R. 742 @ 751 relied on.      5.6 Where  a statute  confers discretionary powers upon the executive  or an  administrative authority, the validity or constitutionality  of such  power cannot be judged on the assumption that  the executive or such authority will act in an arbitrary  manner  in  the  exercise  of  the  discretion conferred upon  lt. If  the executive  or the administrative authority acts  in an  arbitrary manner, its action would be bad in  law and  liable to  be struck down by the courts but the possibility  of abuse  of power or arbitrary exercise of power cannot  invalidate the statute conferring the power or the power which has been conferred by lt. [544 C-E]      6.1 A  State Government  is not  required  to  give  an opportunity of  a hearing  or of  making a representation to the lessee  who would  be affected  by any amendments of the rules before making such amendments. [544 G-H]      6.2 The  enhancement in  the rates  of royalty and dead rent is made in the exercise of the statutory power to amend the rules framed under section 15(1). There is no such 494 principle of  law that  before such  a  statutory  power  is exercised, persons  who may  be affected  thereby should  be heard. Whether  any opportunity  is to  be given  to persons affected to  make representations  to the  Government  would depend upon  the form  in which  the rule  making  power  is conferred. It  is for the legislative body which confers the rule making  power to  decide in what from such power should be conferred.  In some acts it is provided that the draft of the rules proposed to be made as also any proposed amendment thereto should  be published in the Official Gazette so that members of the public may have an opportunity of making such representations or  raising such  objections as  they  think fit. Some  other Acts  provide for  rules to  be laid before parliament or  the Legislature  for its  approval and  to be effective only  after such  approval is given or to continue in force  with  such  modifications  as  Parliament  or  the Legislature may  make, and  if the  approval is not given to cease to  have any effect. It was, therefore, for Parliament to decide  whether rules and notifications made by the State Governments  under  section  15(1)  should  be  laid  before Parliament or  the Legislature  of the  state  or  not.  It, however, thought  it fit  to do  so with respect to minerals other than  minor minerals since these minerals are of vital importance to  the country’s  industry and  economy, but did not think  lt fit  to do  so in  the case  of minor minerals because it  did not consider them to be of equal importance. An amendment  of the  rules made  under section  15(l), even though lt  may have  the effect  of enhancing  the rates  of royalty or  dead rent does not, therefore, become bad in law because  no   opportunity  of   being  heard   or  making  a representation  is   given   to   persons   who   would   be prejudicially  affected  thereby.  Section  15(l)  does  not contain any provision for giving any ouch opportunity and no such provision  can be  imported into that sub-section. [545 B-H]      7. A  Quarry lease  is a mining lease. Under clause (c) of section  3 "mining  lease"  inter  alia  means  "a  lease granted for  the purpose  of undertaking mining operations". Under clause  (d)  of  section  3,  the  expression  "mining operations" means "any operations undertaken for the purpose of winning any mineral". Quarrying minerals is, therefore, a

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mining operation  in as  much as it consists of an operation undertaken for  the purpose of winning particular classes of minerals. Clause (vi) of Rule 2 of the Gujarat Rules defines "quarry lease" as 495 meaning "a  kind of  mining lease  in  respect  of  a  minor mineral granted  under  these  rules."  Quarry  leases  are, therefore, included in the term "mining leases". [546 C-F]      8.1 BY  reason of  the  prohibition  contained  in  the proviso to section 15(3), a State cannot enhance the rate of royalty in  respect of  any minor  mineral  more  than  once during any  period of four years. A State Government is also not entitled to enhance the rate of dead rent more than once during any  period of  four years. Such a construction would be in  consonance with  practice, both past and present. The proviso to  section 9(3)  prohibits the  Central  Government from enhancing the rate of royalty in respect of any mineral other than  a minor mineral more than once during any period of four years. The proviso  to section  9A(2) also prohibits the Central  Government from  enhancing  the  dead  rent  in respect of any area more than once during any period of four years. [548 A-C]      8.2 During any period of four years, however, the State Government can  enhance both dead rent and royalty, but only once. [548 F]      Although in  one sense  dead rent  may partake  of  the nature of royal q, there is a substantial difference between both. me  bases for  calculating royalty  and dead  rent are different and they are dealt with in different provisions of 1957 Act  (namely, sections  9 and  9A) so  far as  minerals other than  minor minerals  are concerned  and in  the Rules made by  the State Governments under section 15(1) so far as minor minerals are concerned. [548 E-F]      8.3 me  period of  four years  for this purpose must be and can only be reckoned from the date of coming in to force of the rules and lt is open to a State Government to enhance the rate of royalty or dead rent at any time once during the period of four years from the coming into force of the rules and after  each period  of four  years expires  at any  time during each  succeeding period  of four  years. The  Gujarat Rules came  into force  on April  1, 1966. Therefore, in the case of  the Gujarat  Rules the  first period  of four years would be  1.4.1966 to  31.3.1970, the second period would be 1.4.1970 to 31.3.1974, the third period would be 1.4.1974 to 31.3.1978, the fourth period would be 1.4.1978 to 31.3.1982, the fifth 496 period would be 1.4.1982 to 31.3.1986 and so on thereafter. Thus, during  any of  these periods  of four years both dead rent and  royalty can  be  enhanced  by  the  Government  of Gujarat but only once during each such period. [549 A-D]      9. Building  stones being  minor  minerals,  the  State Government has  the power  to classify  then into  different varieties and  to charge  a different  rate  of  royalty  in respect of  each such  variety. AS building stones have been defined as  being minor minerals, the rule-making power with respect thereto vests in the State Governments under section 15(1). The  1957 Act  does not  enjoin State  Governments to charge a uniform rate of royalty in respect of all varieties of  building   stones  nor   does  it   prohibit  them  from classifying building  stones into  different  varieties  and charging royal q thereon at separate rates. [557 A-C]      10.1 Notification No. GU-74/121(A)/MCR-2173(49)7268/CHH dated November  29, 1974,  whereby the Government of Gujarat made the  Gujarat Minor  Mineral (Fourth  Amendment)  Rules,

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1974, was  validly issued  and became  operative with effect from December  1, 1974.  The enhancement  in  the  rates  of royalty by  the 1974 Notification was in the third period of four years  reckoned from  the date  of coming into force of the Gujarat  Rules, namely,  from April  1, 1966. This third period was  from April  1, 1974 to March 31, 1978. The rates of  royalty   having  been   enhanced  once   by  the   1974 Notification, they  could not  be enhanced again during this period ant  could only  be enhanced  during  the  subsequent period which commenced from April 1, 1978. [556 D-E]      10.2 Notification  No.  GU-75/117-MCR-2173(49)/6431/CHH dated October  29, 1975,  whereby the  Government of Gujarat made the  Gujarat Minor  Mineral (Second  Amendment)  Rules, 1975, to the extent that it enhanced the rates of royalty in respect of  certain minor minerals was void as offending the prohibition contained  in the proviso to section 15(3). [556 F-G]      10.3 The  Explanation to Rule 21 provided that "For the purpose  of  this  rule  Schedule  I  means  Schedule  I  as substituted by  the Gujarat Minor Minerals (Third Amendment) Rules, 1966".  Thus, the  reference to Schedule I in Rule 21 was to Schedule I as substituted by the Notification dated 497 November  25,   1966.  That  Schedule  was,  however,  again substituted by  the 1974  Notification. The  effect of  such substitution was  to repeal  the  1966  Schedule  I  and  do substitute it by a new Schedule I. Under section 8(1) of the General Clauses Act, 1897, Where the said Act or any Central Act or  Regulation made  after the  commencement of the said Act, repeals  and re-enacts,  with or  without notification, any provision  of a former enactment, then references in any other enactment  or in  any instrument  to the  provision so repealed are,  unless a  different intention  appears, to be construed as  references to  the  provision  so  re-enacted. Though section  8(1) of  the General Clauses Act does not in express terms  refer to  rules made  under an  Act, the same principle of  construction would, apply in the case of rules made under  an Act. Thus, after the coming into force of the 1974 Notification,  the Explanation  to Rule 21 must be read as "For the purpose of this rule Schedule I means Schedule I as  substituted   by  the   Gujarat  Minor  Mineral  (Fourth Amendment) Rules, 1974" and references to Schedule I in Rule 21 must  be construed  as references  to Schedule  I  as  so substituted  and   not  as   references  to  Schedule  I  as substituted by  the Gujarat Minor Minerals (Third Amendment) Rules, 1966. [554 H; 555 A-E]      Rule  21   was  not  substituted  for  the  purpose  of conferring upon  the State  Government the  power to enhance the rates  of  royalty  specified  in  Schedule  I.  It  was substituted for a wholly different purpose, namely, to bring the said  Rule in  conformity with sub-section (3) Which was inserted with  retrospective effect  in section  15  by  the Amendment Act  of 1972. Its object was to make the holder of a mining  lease or  any other  mineral concession liable for payment of  royalty not  only in  respect of  minor minerals removed  or  consumed  by  him  but  also  by  his  manager, employee, contractor or sub-lessee. Rule 21 did not have any relevance or bearing on the scope or exercise of that power. In fact,  sub-clause (a) of clause (i) of Rule 22 and clause (3) of  Part V  of the Schedule to Form (namely, the From of Quarrying Lease)  appended to  the Gujarat  Rules  expressly provided a  condition that  the lessee  is  to  pay  to  the Government royalty at the rates for the time being specified in and  in force  under Schedule  I to  the  Gujarat  Rules. Further, clause  12 of  Part IX  of the Schedule to From ’D’

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stipulates that the quarrying 498 lease is  to be ’subject to the Gujarat Minor Mineral Rules, 1966 as amended from time to time." [555 F-H; 556 A-D]      10.4  Notification   No.  GU-76/39/MCR-2175(68)4675-CHH dated April  6, 1976, whereby the Government of Gujarat made the Gujarat  Minor Mineral  (Second Amendment)  Rules, 1976, was void  as it  enhanced the  rates of  dead rent  for  the second time  during the same period of four years in as much as this  amendment falls  within the  third period  of  four years commencing  from 1.4.74 to 31.3.78 during which by the 1974 amendment  the rates  of dead  rent  had  already  been enhanced with effect from 1.12.74. [557 D-F]      10.5 Notification No. GU-79/118/MCR-2178(127)-167 dated March 26,  1979, Whereby  the Government of Gujarat made the Gujarat Minor  Minerals (Amendment)  Rules, 1979,  was valid and was  not  ultra  vires  either  section  15  or  Article 19(1)(g) of  the Constitution.  The enhancement in the rates of dead  rent made  by the 1979 Notification does not amount to any unreasonable restrictions on the right of the holders of the  quarry leases  to carry  on their trade or business. The   rates of  dead rent  specified cannot  be looked at in isolation, but  in con  junction with  the drastic reduction ate in  the rates  of royalty  and so  read there is nothing unreasonable in them. [557 F-G; 558 A]      Smt. Sonabai  Pathalji v. State of Gujarat and Anr., XX (2) 1980 (2) Guj. L.R. 530 reversed.      The enhancement  in the  rates of dead rent made by the 1979 Notification was during the fourth period of four years which commenced  on April  1, 1978  ant ended  on March  31, 1982. The  1979 Notification,  therefore did not violate the bar against enhancing the rates of dead  rent more than once during any period of four years also. 559 B-C      10.6 The  rates of  royalty and  dead rent specified by the  Notification  dated  November  29,  1974,  namely,  the Gujarat  Minor   Mineral  (Fourth  Amendment)  Rules,  1974, continued to be operative and in force until the coming into force of  the Notification dated March 26, 1979, on April 1, 1979. [560 A-Bl 499      10.7 The  directions contained  in the Circular No. MCR 2180(166)  CHH   dated  February  12,  1981  issued  by  the Government of  Gujarat were  invalid and inoperative because the 1979  Notification as  also  Rule  22B  were  valid  and operative and  the State  Government could not by a circular letter charge  and collect  royalty at  rates different from the rate  specified in  the 1979 Notification. [561 G-H; 562 A-B]      10.8 Notification  No.GU-81/75/MCR  2181/(168)-4536-CHH dated June  18, 1981, whereby the Government of Gujarat made the Gujarat  Minor Mineral  (Amendment) Rule, 1981, is valid and constitutional  and does not offend Article 19(1) (g) of the Constitution. [562 E-F]      10.9 It is true that by the 1981 Notification the rates of  royalty   have  been   enhanced  manifold.   During  the particular period  of four  years, namely, the fourth period commencing on  April 1,  1978, and ending on March 31, 1982, the rates  of royalty  had not been enhanced but drastically reduced by  the 1979  Notification while  the rates  of dead rent  had   been   considerably   enhanced   by   the   1979 Notification. The  enhancement in  the rates of royalty made by  the   1981  Notification   was,  therefore,   the  first enhancement made  during the fourth period of four years. If the rates  of royalty  so enhanced  are looked  at alone, it would appear  that they  are unreasonable,  but taking  into

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account the  fact that  dead rent  is not  payable after the cooing into  force of the 1981 Notification, the position is completely altered and it cannot be said that enhancement in the rates  of royalty  is unreasonable.  Though by  the 1981 Notification the  rates of  royalty in  respect  of  certain minor  minerals   have  been  enhanced,  by  no  stretch  of imagination can  such enhancement be said to be excessive or unreasonable  when   compared  with  the  rates  of  royalty specified in the 1974 Notification. [562 Y-G; 563 A-D]

JUDGMENT:      ORIGINAL JURISDICTION : Writ Petitions Nos: 1656, 2108, 4097, 7103,  7104-7128, 7697 of 1981, 762, 874-942, 946-968, 1616-17, 4455-4473,  4479-4484, 5589-5605,  5895-5969, 5971- 6005, 6309, 6419-6422, 6463-6479, 10104-10122 of 1982, 3993- 4003, 4208-4217,  4912-4924, 5167-5182, 8813-8820, 9539-9549 of 1983. 500 WITH      Civil Appeals Nos: 706, 1489, 1675, 1934 of 1981, 1525- 1526 of 1982.      MADON, J. This group of Writ Petitions under Article 32 of the  Constitution and  Appeals by  certificate granted by the High  Court of Gujarat and by Special Leave granted this Court raises  questions relating to the constitutionality of section 15(1)  of the  Mines and  Minerals  (Regulation  and Development) Act,  1957 (Act  No. 67  of 1957), the power of the State  Governments to  make rules under the said section 15 to enable them to charge dead rent and royalty in respect of leases  of minor  minerals granted by them and to enhance the rates of dead rent and royalty during the subsistence of such leases,  the validity of Rule 21-B of the Gujarat Minor Mineral Rules,  1966, and of certain notifications issued by the Government of Gujarat under the said section 15 amending the said  Rules so  as to  enhance the  rates of royalty and dead rent  in respect  of leases  of minor  minerals.  These Notifications are :      (1). GU-74/121(A)/MCR-2173(49)7268/CHH  dated  November 29,   1974   (hereinafter   referred   to   as   "the   1974 Notification"),      (2) GU-75/117-MCR-2173(49)/6431/CHH  dated October  29, 1975 (hereinafter referred to as "the 1975 Notification"),      (3) GU-76/39/MCR-2175(68)  4675-CHH dated April 6, 1976 (hereinafter referred to as "the 1976 Notification").      (4)  GU-79/118/MCR-2178(127)-167-CHH  dated  March  26, 1979 (hereinafter referred to as "the Notification"), and      (5). GU-81/75/MCR  2181/(168)-4536-CHH dated  June  18, 1981 (hereinafter referred to as "the 1981 Notification"). The question  of the validity of a circular, namely Circular No. M.C.R. 2180 (166) CHH dated February 12, 1981, issued by the Deputy  Secretary,  Industries,  Mines  and  Electricity Department,  Government   of   Gujarat,   also   falls   for consideration in these Writ Petitions and Appeals.      It  is  unnecessary  in  order  to  decide  these  Writ Petitions and Appeals to relate the facts of each individual 501 matter. It  will suffice  if we state broadly how these Writ Petitions and  Appeals have  come to  be filed.  The parties before us,  other than the State of Gujarat and governmental authorities, are  persons to  whom the  State of Gujarat has granted quarry  leases and mining leases in respect of minor minerals such  as black  trap, limestone, murrum, bentonite, rubble, marble,  sandstone, quartzite,  etc. In  exercise of

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the powers conferred by section 15 of the Mines and Minerals (Regulation and  Development) Act,  1957, the  Government of Gujarat made the Gujarat Minor Mineral Rules, 1966. The said Rules came  into force  on April  1, 1966. All the leases in the matters  before us  were given in the form prescribed by the said  Rules. Schedule  I to the said Rules specified the rates at which royalty was payable and Schedule II specified the rates  at which  dead rent  was  payable.  By  the  1974 Notification the  Government of  Gujarat  made  the  Gujarat Minor  Mineral   (Fourth  Amendment)  Rules,  1974,  whereby Schedule I  was substituted and Schedule II was amended with effect from  December 1,  1974. Under the new Schedule I and the amended  Schedule II  the rates of royalty and dead rent in respect  of certain minor minerals were enhanced. In view of several  representations made  to it,  the Government  of Gujarat decided  not to  implement the 1974 Notification and to refund  the amount  of royalty,  if any, collected at the rates prescribed  by the  1974  Notification.  By  the  1975 Notification the  Government of  Gujarat  made  the  Gujarat Minor Mineral  (Second Amendment)  Rules, 1975, whereby Rule 21 of  the said  Rules and  Schedule I were substituted with effect from  November  1,  1975.  By  the  said  substituted Schedule I  the rates of royalty in respect of several items were enhanced.      We may  pause here  to mention  that the  Appellant  in Civil Appeal  No. 706 of 1981, Ambalal Manibhai Patel, filed a writ  petition in  the Gujarat  High Court,  being Special Civil  Application   No.  66   of  1978,   challenging   the enhancement in the rate of royalty to Rs. 3 per metric tonne in respect  of black  trap and hard murrum specified in Item No. 4  of the  said substituted  Schedule I.  The said  writ petition was rejected by a learned Single Judge of that High Court. The  Letters Patent  Appeal against  the order of the learned Single  Judge, being Letters Patent Appeal No. 61 of 1978, was  heard along  with several  writ petitions raising the same  questions. The  main contention  raised  in  those matters was that under the proviso 502 to section  15(3) of  the 1957  Act, the  rate of royalty in respect of  any minor  mineral could  not be enhanced by the State Government  more than  once during  any period of four years and  that the  rate of  royalty on black trap and hard murrum having  been increased  by the  1974 Notification, it could  not   be  increased   again  in  1975.  A  subsidiary contention raised was that the State Government had no power to classify  building stones into black trap and hard murrum because by  doing so  what the  State Government had done in effect and  substance was  to declare  black trap  and  hard murrum as  minor minerals  and that  it was only the Central Government which  possessed the power to declare any mineral not covered  by the  definition  of  the  expression  "minor minerals" in clause (c) of section 3 of the 1957 Act to be a minor mineral.  Both these  contentions were  rejected by  a Division Bench  of the  Gujarat  High  Court  consisting  of Thakkar and Mankad, JJ., by its judgment dated September 16- 17, 1980. The Division Bench held that the 1974 Notification had not become operative and, therefore, in lssuing the 1975 Notification the  State  Government  had  not  violated  the proviso to  section 15(3),  and that  building stones having been already included in the definition of "minor minerals", there was  no bar  to the  State Government classifying them into different  varieties  for  the  purpose  of  recovering royalty. Appeals  have been  filed in this Court challenging the correctness  of the above judgment. The State of Gujarat has, however, not filed any appeal against this judgment.

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    By the 1976 Notification the Government of Gujarat made the Gujarat  Minor Mineral  (Second Amendment)  Rules, 1976, substituting Schedule  II to  the said  Rules.  Schedule  II prior to the said substitution was as follows :           "                SCHEDULE II                  Rates of Dead Rent           [See Rule 22 (i)(b)]           1. For specified Minor minerals.           For every 100 sq. meters or part           thereof, upto 5 hectares                Rs. 0.35P.           For each additional 1 hectare or part           there of, exceeding 5 hectares          Rs. 50.00 503           2. For other minor minerals           For every 100 sq. meters or part           thereof upto 5 hectares                 Rs. 0.20P.           For each additional hectare or           part thereof exceeding 5 hectares.      Rs. 35.00 By the  1976 notification  Items 1 and 2 in Schedule II were substituted to read as follows :           "(1) for  quarry leases  for any minor mineral for           every  hectare   or  part  thereof:  Rs.500  (Five           hundred)           (2) for  quarry parwana  for any minor mineral for           every parwana: Rs. 100 (One hundred)."      On March  26,  1979,  the  Minster  for  Mines  made  a statement  in   the  Legislative   Assembly  announcing  the decision to  implement from April 1, 1979, the new policy of dead rent  framed by  the Government.  According to the said statement, the  policy was aimed at breaking the hold of big lease-holders of minor minerals who, by finding loopholes in the said  Rules, had acquired leases for the same mineral in different districts  and had  established a  monopoly in the market and  had made  a fortune  by exploiting labourers and evading payment of royalty. According to the said statement, such lease-holders quarried just enough minerals and created artificial shortages  in order  to control  the  market  and maintain high  levels of profits, and some lease-holders had acquired control  of areas  far in excess of the capacity of their  crushers   and  did   not  allow   entry   to   other industrialists. He  further stated that under the said Rules lessees of minor minerals had to pay royalty on the basis of monthly  returns  but  as  true  monthly  returns  were  not submitted, evasion to the extent of five to ten per cent was taking place  in the  payment of  royalty. Pursuant  to this policy decision  the 1979  Notification was  issued  by  the Government  of   Gujarat.  By   the  1979  Notification  the Government  of  Gujarat  made  the  Gujarat  Minor  Minerals (Amendment) Rules,  1979, with effect from April 1, 1979. By this amendment  a new  Rule 21-B  was inserted  in the  said Rules, Rule  22 was  amended, Chapter  IV of  the said Rules which dealt 504 with grant of quarrying permits in respect of lands in which minerals belonged  to the  Government was  deleted, Form was amended, Forms  I, J  and K were deleted, and Schedule I and II were substituted. By the substituted Schedule I, the rate of royalty  on all minor minerals was specified as ten paise per metric tonne. By the substituted Schedule II the rate of dead rent  per hectare  or part thereof in respect of quarry leases was  enhanced to Rs.1,200 in certain cases, Rs. 1,500 in some  other cases, Rs. 2,000 in one case and Rs. 3,000 in the  remaining   cases.  So  far  as  quarry  parwanas  were concerned, the  rate was  specified as one-tenth of the rate for quarry leases per parwana.

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     A  writ petition was filed by the said Ambalal Manilal Patel  in  the  Gujarat  High  Court,  being  Special  Civil Application No.  138 of 1978, challenging the enhancement in the rate  of dead  rent made  by the 1976 Notification. This writ petition  was dismissed  by a  learned Single  Judge of that High  Court on  February 16,  1978. The  Letters Patent Appeal filed  against the  judgment and order of the learned Single Judge  was heard  by a  Division Bench  of that  High Court along with twenty-five writ petitions which challenged the 1979  Notification. The  said Letters  Patent Appeal and writ petitions  were allowed  by a Division Bench consisting of Sheth  and Nanavati, JJ. The Division Bench held that the conditions in  a lease in respect of minor minerals relating to  the  financial  liability  of  a  lessee  derived  their authority from  sub-section (3)  of section  15 of the Mines and Minerals  (Regulation and  Development) Act, 1957, while conditions,  other   than  those   relating  to  a  lessee’s financial liability, regulating the grant of a lease derived their authority,  from sub-section  (1) of  section 15, that the State  Government had  no power  to enhance  the rate of dead rent  during the  subsistence of a lease, and that Rule 21-B of  the Gujarat Minor Mineral Rules, 1966, and the 1979 Notification were  ultra vires section 15 and sub-clause (g) of clause  (1)  of  Article  19  of  the  Constitution.  The Division Bench accordingly issued a writ of mandamus against the State  Government directing  it to desist from enforcing the said  Rule 21-B  and the 1979 Notification. The Division Bench also  made the same declaration in respect of the 1976 Notification  and   issued  the  same  mandamus  in  respect thereof. The said judgment of the Division Bench is reported as Smt.  Sonbai Pethalji  v. State  of Gujarat & Anr. BI (2) 1980 (2) Guj. L.R. 530. 505      The Government  of Gujarat  accepted the  said judgment and did not come in appeal to this Court. Certain lessees of mining and  quarry leases,  however,  have  approached  this Court by  way of  Appeals and Writ Petitions challenging the correctness of  the judgment in SOL. Sonabai’s Case. In view of the  said judgment,  the Government  of Gujarat  issued a circular addressed  to all  Collectors, District Development Officers and  the Director,  Geology and  Mining, Ahmedabad, being Circular  No. M.C.R. 2180 (166) CHH dated February 12, 1981, stating  that in view of the aforesaid judgment of the Division Bench  the position prior thereto would prevail and that Chapter  IV of  the said Rules which was deleted by the 1976 Notification  would stand revived and would be applied. The Government  thereafter made  the Gujarat  Minor  Mineral (Amendment) Rules,  1981, by  issuing the  1981 Notification which came  into  force  on  June  20,  1981.  By  the  1981 Notification Rule  21-B was  deleted, Rule  22 was  amended, Chapter IV  and certain  Forms were  inserted, Schedule I to the said  Rules was  substituted  and  Schedule  II  thereto deleted. Several  lessees of  mining and quarry leases filed writ petitions  in the  Gujarat High  Court challenging  the validity of  the 1981  Notification and  the said  Circular. These writ  petitions were  rejected on  the ground  that as connected proceedings  were pending  in this  Court, it  was open to  the petitioners  to move  this  Court  if  they  so desired. Accordingly,  the said  petitioners as  also others have filed  Writ Petitions  in this  Court  challenging  the validity of  the 1981  Notification and the said Circular as also in  some cases  Appeals against the order rejecting the writ petitions.      The  parties   before   us   -   whether   Petitioners, Appellants,  or  Respondents  -  fall  in  different  groups

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according to  how their interests are affected by one or the other of  the impugned  Notifications. They have, therefore, advanced different  sets of  submissions at  the hearing  of these Writ  Petitions and  Appeals. The  reason for  this is obvious. For  extracting or  excavating certain  classes  of minor minerals  a larger  surface area  is required than for extracting or  excavating other  classes of  minor minerals. Thus for  clay and  earth a  larger surface area is required than for  bentonite because  in the case of bentonite mining is required  to be  deeper. The  result is  that lessees  of larger surface areas are affected more when the rate of dead rent is  enhanced while the lessees of smaller surface areas are affected more when the rate of royalty is enhanced. 506      In order  to understand  the  controversy  between  the parties and the rival submissions advanced at the Bar, it is necessary to  trace briefly  the legislative  history of the enactments providing  for the  regulation of  mines and  the control and  development of  minerals in  India and  then to refer to  the relevant  statutory provisions  in that behalf extracting such  of them  as are  necessary.  There  was  no statute dealing with these matters prior to the enactment of the Mines  and Minerals  (Regulation and  Development)  Act, 1948 (Act  No. LIII  of 1948)  but  they  were  governed  by executive rules.  Rules for the grant of mineral concessions in British  India were  for  the  first  time  made  by  the Department of Revenue and Agriculture (Geology and Minerals) by a  resolution dated  December 13,  1894. These rules were revised in  1899. Neither  the 1894 Rules nor the 1899 Rules made any  mention of  minor minerals.  In 1913 revised rules were made  by Resolution  No. 7552-7581-121  dated September 15, 1913.  These rules  were intended to provide guidance to officials of the Government in granting prospecting licences and mining  leases. Unlike  the previous  rules, these rules for the  first time, made a reference to minor minerals, the extraction of  which was  to be  regulated by  such separate rules as the Local Governments might prescribe in accordance with local  circumstances and  requirements.  No  exhaustive definition of  minor minerals  was given,  but they included slate, building stone, limestone and clay.      Under  the   Government  of   India  Act,   1935,   the legislative field  of regulation of mines and development of minerals was divided between the Central Legislature and the Provincial Legislatures.  Entry 36  in List I of the Seventh Schedule to  that Act (namely, the Federal Legislative List) provided as follows           "36. Regulation of mines and oilfields and mineral           development to  which such  regulation and develop           ment under  Federal control is declared by Federal           law to be expedient in the public interest." Entry 23  in List  II in  the Seventh  Schedule to  that Act (namely.  the   provincial  Legislative  List)  provided  as follows:           "23. Regulation of mines and oilfields and mineral           development subject to the provisions of List I 507           with respect  to regulation  and development under           Federal control." The word  "Federal" in  the above entries was substituted by the word  "Dominion" by the India (Provisional Constitution) Order, 1947.      No legislation  was, however,  enacted in  pursuance of the above  power until  after Independence,  but in 1939 the Government of  India made  the Mining  Concessions (Central) Rules, 1939,  or regulating  grants of  prospecting licences

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and mining  leases in  Chief  Commissioner’s  Provinces  and British Baluchistan.  Rule 6 of the 1939 Rules provided that these Rules  were not  to apply  to minor  minerals such  as slate, building stone, limestone and clay, the extraction of which was  to be  regulated by  such separate  rules as  the Chief Commissioner  might prescribe.  Thus,  the  provisions relating to minor minerals in the 1939 Rules were similar to those in  the 1913  Rules and the list of minor minerals was also identical  under these  two sets  of rules. Some of the Provincial Governments,  such as  the Governments  of Assam, Bihar, Bombay  and the  United Provinces,  also framed their own rules for grant of mineral concessions.      The need  for Central regulation of mines and oilfields and mineral  development began  to be  increasingly felt and became highlighted  during the  Second World  War  with  the result that  certain key minerals had to be controlled under the Defence  of India  Act, 1939.  It was  recognized that a planned  and  uniform  policy  of  mineral  development  was essential  to   economic  and   industrial  progress.  After Independence  the   Government  of  India  set  out  in  its Industrial Policy  Resolution of  April 6,  1948, the policy which it  proposed to  pursue in  the industrial  field. The Industrial Policy  Resolution included  minerals amongst the industries whose  location had  to be  governed by  economic factors of  all-India import  or which required considerable investment  or   a  high   degree  of  technical  skill  and consequently had to be the subject of Central regulation and control. Accordingly, in pursuance of the power conferred by Entry 36  in the Federal Legislative List the Legislature of the Dominion  of India  enacted on  September 8,  1948,  the Mines and  Minerals (Regulation  and Development)  Act, 1948 (hereinafter referred to as "the 1948 Act"). The object 508 of the  1948 Act  was to  regulate mines  and oilfields  and mineral  development   on  the  lines  contemplated  in  the Industrial Policy  Resolution of  April  6,  1948  (see  the Statement of  Objects and  Reasons to  the Legislative  Bill which when enacted became the Mines and Minerals (Regulation and Development)  Act, 1948,  published in  the  Gazette  of India, 1948, Part V, page 60l. The 1948 Act was brought into force  on  October  25,  1949,  by  Notification  No.  M.II. 155(24)-I dated October 8, 1949, published in the Gazette of India, Extraordinary, 1949, at page 2075.      Clause (c)  of section 3 of the 1948 Act defined "miner als" as  including "natural gas and petroleum". Section 5(1) conferred power upon the Central Government to make rules to regulate the  grant of  mining leases or for prohibiting the grant of  such leases  in respect  of any  mineral or in any area. Under  clause (d)  of section 5(2), in particular, and without prejudice  to the  generality of the power conferred by section 5(1), such rules could provide for "the fixing of the maximum  and minimum  rent payable  by a lessee, whether the mine  is worked  or not."  Section 6(1)  conferred power upon  the   Central  Government   to  make   rules  for  the conservation and  development of  minerals. Under clause (i) of section 6(2), in particular, and without prejudice to the generality of  The power  conferred by  section  6(1),  such rules  could   provide  for  "the  levy  and  collection  of royalties, fees  or  taxes  in  respect  of  minerals  mined quarried, excavated  or collected". Section 7 conferred upon the Central  Government the  power to  make  rules  for  the purpose of modifying or altering the terms and conditions of any mining  lease granted  prior to  the commencement of the 1948 Act  so as  to bring  such lease in conformity with the rules made  under section  5 and  6. Under  section lO,  all

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rules made  under the  1948 Act  were to be laid, as soon as may be  after they were made, before the Central Legislature and after  the commencement  of the  Constitution of  India, before the House of the People.      In exercise  of the power conferred by section 5 of the 1948 Act  the Central Government made the Mineral Concession Rules,  1949,   for  regulating  the  grant  of  prospecting licences and mining leases for minerals other than petroleum and natural  gas. The  said Rules came into force on October 25, 1949, namely, the date on which the 1948 Act was brought into 509 force. Rule  4 of the said Rules expressly provided that the said  Rules   "shall  not   apply  to  minor  minerals,  the extraction of  which shall be regulated by such rules as the Provincial Government may prescribe." After the commencement of the  Constitution, by Notification No. M.II-155(92) dated October 29,  1951, the  word "Provincial" was substituted by the  word  "State".  clause  (ii)  of  Rule  3  defined  the expression "minor  mineral".  The  said  definition  in  its finally amended form was as follows :           "(ii)  ’minor   mineral’  means   building  stone,           boulder, shingle,  gravel, Chalcedony pebbles used           for ball  mill purposes only, limeshell kankar and           limestone used  for lime  burning, murrum,  brick-           earth, Fuller’s  earth, Bentonite,  ordinary clay,           ordinary sand  used for  non-industrial  purposes,           road metal,  reh-matti, slate  and shale when used           for building material. Although the  said Rules did not apply to minor minerals, in view of  certain arguments  advanced at  the Bar it would be useful to  look at the material provisions of Rule 41 of the said Rules  as  finally  amended.  Rule  41  prescribed  the conditions which  every mining  lease was  to  include.  The provisions of the said Rule 41 material for our purpose were as follows:           "41. Conditions -           (1) Every mining lease shall include the following           conditions;-           (i) The  lessee  shall  pay  royalty  on  minerals           despatched from  the  leased  areas  at  the  rate           specified in  the First Schedule to these rules as           in force on the date of the grant of the lease;           Provided that  the  lessee  pay  royalty  at  such           revised rate as may be notified from time to time;           Provided further  that the  rate of  royalty shall           not be revised more than once in two years, nor it           shall be  in excess  of twenty percent of the sale           value of the mineral at the pit’s mouth. 510            (i-A)  Where the  lessee is  a  Government  or  a           Quasi-Government  organisation,   the   rate   o-f           royalty shall  be fixed  by the Central Government           by negotiation between the lessor and the lessee.           x         x         x         x           (iii) The  lessee shall  also pay, for every year,           except the  first year  of the  lease, such yearly           dead rent within the limits specified in the Third           Schedule to  these Rules,  as may  be fixed by the           State Government  in the  lease; and  if the lease           permits the  working of  more than  one mineral in           the same  area, the  State Government  may  charge           separate dead rent in respect of each mineral:           Provided that  the lessee  shall be  liable to pay           the  dead-rent  or  royalty  in  respect  of  each

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         mineral, whichever  be higher  in amount,  but not           both.           (iv) The  lessee shall  also pay,  for the surface           area used  by him  for the  purposes of  the mine,           surface rent  at such rate, not exceeding the land           revenue and  cesses assessable on the land, as may           be specified by the State Government in the lease.           x         x         x         x Thus, even  after the  enactment of  the 1948  Act  and  the framing  of   the  Mineral  Concession  Rules,  1949,  minor minerals continued to be governed by rules made by the State Governments.      Until the coming into force of the State Reorganisation Act, 1956, on November 1, 1956, the territories of the State of Bombay  included the  territories now forming part of the State of  Gujarat except  Saurashtra which  was a Part State and Kutch  which was  a Part  State. Under  section 8 of the States Reorganisatlon  Act,  the  territories  of  the  then existing States  of Saurashtra  and Kutch became part of the territories of the State of Bombay.      It will be useful to refer to the rules in force in the State of  Bombay as  at the  date of  the reorganization  of states. 511      By order No. IND/Q/58/2500 dated November 18, 1949, the Government of  Saurashtra  made  regulations  governing  the operation  of  various  kinds  of  quarries  in  Saurashtra. Schedule I to the said Order contained rules in that behalf. Rule (7) provided as follows:           "(7) A  surface rent  and  dead  rent  or  minimum           Royalty at  the rate  specified in schedules V and           VI shall  be recovered  on  all  quarry  materials           permitted or  licensed to  be quarried and removed           under Rule (2)." The Saurashtra Rules applied to white clay, stones and other minerals specified in Schedule V to the said Order.      By Notification No. MNL-1154-M dated December 28, 1954, the Government  of Bombay in exercise of the power conferred by Rule  4 of  the Mineral  Concession Rules, 1949, made the Bombay Minor Mineral Extraction Rules, 1955, which came into force on  June 1,  1955.  Clause  (iv)  of  Rule  2  defined "Quarrying lease". The said definition was as follows :           "(iv) ’quarrying  lease’ means  a lease  to  mine,           quarry, bore,  dig and  search for,  win, work and           carry away any minor mineral specified therein". Rule 18  prescribed the  conditions  which  every  quarrying lease was  to include.  The relevant  provisions of the said Rule 18 were as follows :           "18. Conditions. -           (1)  Every   quarrying  lease  shall  include  the           following conditions :-           (i) The lessee shall pay royalty on minor minerals           despatched from  the  leased  area  at  the  rates           specified in Schedule I to these Rules :           Provided that  such rates  shall be  liable to  be           revised once in every 5 years. 512           (ii) The  lessee shall  also pay for every year of           the lease  such yearly dead rent within the limits           specified in  Schedule II to these Rules as may be           fixed by  the Collector  in the  lease; and if the           lease permits the working of more than one mineral           in the  same area,  the Collector may fix separate           dead rent in respect of each mineral :           Provided that  the lessee  shall be  liable to pay

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         the dead  rent or royalty in respect of each minor           mineral, whichever  be higher  in amount,  but not           both.           (iii) The  lessee shall  also pay, for the surface           area used  by him  for the purposes of the quarry,           surface rent  at such rate, not exceeding the land           revenue and  cesses assessable on the land, as may           be fixed  by the  Collector and  specified in  the           lease.           x               x              x              x."      Under the Government of India Act, 1935, "petroleum and other liquids  and substances  declared by Federal law to be dangerously  inflammable,  so  far  as  regards  possession, storage and  transport" formed  a separate legislative topic being Entry  32  in  the  Federal  Legislative  List,  while oilfields and  mineral oils  fell under Entry 36 in the said List along  with mines  and mineral  development. Under  the Constitution of India, however, the old Entry 36 was divided into two and the regulation and development of oilfields and mineral oil  resources became  a separate  legislative topic along with  petroleum  and  petroleum  products,  and  other liquids and  substances  declared by Parliament by law to be dangerously inflammable. The relevant legislative Entries in the Constitution of India are Entries 53 and 54 in List I in the Seventh  Schedule to  the Constitution of India, namely, the Union List. These two Entries read as follows :           "53. Regulation  and development  of oilfields and           mineral oil  resources;  petroleum  and  petroleum           products; other liquids and substances declared by           Parliament by law to be dangerously inflammable. 513           54. Regulation of mines and mineral development to           the  extent   to   which   such   regulation   and           development under  the control  of  the  Union  is           declared by  Parliament by  law to be expedient in           the public interest. Entry  23  in  List  II  in  the  Seventh  Schedule  to  the Constitution, namely,  the State  List, corresponds to Entry 23 in  the Provincial  Legislative List in the Government of India Act, 1935, and is as follows :           "23. Regulation  of mines  and mineral development           subject to  the provisions  of List I with respect           to regulation and development under the control of           the Union."      In 1957  Parliament decided  that  the  regulation  and development  of   mines  and   minerals  should  feature  by themselves in a separate Act. Accordingly Parliament enacted on December 28, 1957, the Mines and Minerals (Regulation and Development) Act,  1957 (Act  No. 67  of 1957),  hereinafter referred to  as "the  1957 Act".  Section 32 of the 1957 Act amended the  1948 Act  in the manner set out in Schedule III to the  1957 Act  so as  to remove  from the  1948  Act  all references to  mines and  minerals  and  to  confine  it  to oilfields and  mineral oil resources. The short title of the 1948 Act was also amended to read "The Oilfields (Regulation and Development)  Act, 1948", and its long title was amended to read  "An Act  to provide for the regulation of oilfields and for  the development of mineral oil resources". The 1957 Act was  brought into force on June 1, 1958, by Notification No. G.S.R.  432 dated May 29, 1958, published in the Gazette of India,  Extraordinary, 1958,  Part II, sec. 3(i), at page 225.      A number  of provisions  which till then had been dealt with under  the rule-making powers of the Central Government were transferred  to the  1957 Act  in order to restrict the

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scope of subsidiary legislation. Thus, instead of leaving lt to the  rules made  by the  Central Government to define the term "minor  mineral",  the  definition  of  that  term  was embodied in the 1957 Act. Amongst the other provisions which fell within  the scope  of the  rule-making  powers  of  the Central Government  and were  made part of the 1957 Act were the Provisions for the 514 maximum period  for which  a prospecting licence or a mining lease was to be granted and the power to prescribe the rates of royalty  for  various  minerals  (see  the  Statement  of Objects and  Reasons to the Legislative Bill No. 49 of 1957, which when  enacted became  the 1957  Act, published  in the Gazette of  India, Extraordinary,  dated July 29, 1957, Part II, sec.2,  at page  392). The  1957 Act  was  amended  with retrospective effect  by the  Mines and Minerals (Regulation and Developments  Amendment Act,  1958 (Act No. 15 of 1958). This Amendment  Act dealt  with mining  leases in respect of coal granted  before October  29, 1949, and does not concern us. The 1957 Act was again amended by the Mines and Minerals (Regulation and Development) Amendment Act, 1972 (Act No. 56 of 1972),  which came  into force on September 12, 1972. The Amendment Act  of 1972  was enacted  mainly to carry out the recommendations made  by the Mineral Advisory Board. Amongst the principal  changes affected  in  the  1957  Act  by  the Amendment Act  of 1972  were the  imposition of a ceiling on the individual  holdings of  prospecting licences and mining leases; the  imposition of  a specific obligation on holders of mining  leases in  respect  of  payment  of  royalty  for minerals removed  by their agents, sub-lessees or employees; providing a  statutory basis  for calculation  of dead rent; and the  application of Minor Mineral Rules to quarry leases (see the Statement of Objects and Reasons to the Legislative Bill No. 83 of 1972, which when enacted became the Amendment Act  of   1972,  published   in  the   Gazette   of   India, Extraordinary, dated  August 21,  1972, Part  II, sec. 2, at page 828).      We will not turn to the relevant provisions of the 1957 Act. Section  2 of  the 1957 Act contains a declaration that it is expedient in the public interest that the Union should take under  its control  the regulation  of  mines  and  the development of  minerals to  the extent provided in the 1957 Act. Certain  definitions given  in section  3 are important and may be reproduced. These definitions are those contained in clauses  (a) and  (c) to (e) of the said section 3. These clauses provide as follows :           "3. Definitions. -           In  this   Act,  unless   the  context   otherwise           requires, 515           (a)  ’minerals’   includes  all   minerals  except           mineral oils;           x               x              x              x           (c) ’mining  lease’ means  a lease granted for the           purpose  of  undertaking  mining  operations,  and           includes a sub-lease granted for such purpose;           (d)  ’mining   operations’  means  any  operations           undertaken for the purpose of winning any mineral;           (c)  ’minor   minerals’  means   building  stones,           gravel, ordinary  clay, ordinary  sand other  than           sand used  for prescribed  purposes, and any other           mineral  which  the  Central  Government  may,  by           notification in  the Official  Gazette, declare to           be a minor mineral". It is  pertinent to note that the term "minor minerals" came

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to be  defined in a statute for the first time by clause (e) of section  3 of  the 1957  Act. In  addition to  the  minor minerals mentioned in the said clause (e), boulder; shingle; chalcedony  pebbles   used  for  ball  mill  purposes  only; limeshell,  kankar   and  limestone   used  in   kilns   for manufacture of  lime  used  as  building  material;  murrum; brick-earth; Fuller’s  earth; bentonite;  road  metal;  reh- matti; slate  and shale  when used  for  building  material; marble; stone  used for making household utensils; quartzite and sandstone  when used  for purposes  of building  or  for making road  metal and  household utensils;  and  slatpetre, have  been   declared  to   be  minor  minerals  by  various notifications  issued   by  the  Central  Government.  Under section 4A  which was inserted by the Amendment Act of 1972, where in  the interest  of regulation  of mines  and mineral development it  is thought expedient to grant a mining lease in favour  of a  Government company  or corporation owned or controlled  by  the  Government  and  for  that  purpose  to terminate prematurely a mining lease in respect of a mineral other  than   a  minor   mineral,  it  is  for  the  Central Government, after consultation with the State Government, to form the  opinion with  respect to such expediency, while it is for  the State  Government, after  consultation with  the Central Government, to form the opinion with respect to such expediency in the case of a mining lease 516 in respect  of any  minor mineral.  Section 5 prescribes the restrictions on the grant of prospecting licences and mining leases. Section  6 prescribes  the maximum  area for which a prospecting licence  or mining lease can be granted. Section 7 prescribes  the period for which a prospecting licence can be granted  or renewed  and section  8 prescribes the period for which  a mining lease can be granted or renewed. Section 9 is  important and requires to be reproduced in extenso. It reads as follows :           "9. Royalties in respect of mining leases.-           (1) The  holder of  a mining  lease granted before           the    commencement    of    this    Act    shall,           notwithstanding   anything    contained   in   the           instrument of lease or in any law in force at such           commencement,  pay   royalty  in  respect  of  any           mineral removed  or consumed  by  him  or  by  his           agent, manager, employee, contractor or sub-lessee           from the  leased area  after such commencement, at           the rate  for the  time  being  specified  in  the           Second Schedule in respect of that mineral.           (2) The  holder of  a mining  lease granted  on or           after the  commencement  of  this  Act  shall  pay           royalty in  respect  of  any  mineral  removed  or           consumed  by   him  or   by  his  agent,  manager,           employee, contractor or sub-lessee from the leased           area at  the rate  for the time being specified in           the Second Schedule in respect of that mineral.           (2A) The holder of a mining lease, whether granted           before or  after the commencement of the Mines and           Minerals (Regulation  and  Development)  Amendment           Act, 1972,  shall not be liable to pay any royalty           in respect  of any  coal  consumed  by  a  workman           engaged  in   a  colliery   provided   that   such           consumption by  the workman  does not  exceed one-           third of a tonne per month.           (3) The Central Government may, by notification in           the Official  Gazette, amend the Second Schedule e           so as  to enhance  or reduce  the  rate  at  which           royalty

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517           shall be  payable in  respect of  any mineral with           effect from  such date  as may  specified  in  the           notification :           Provided that  the Central  Government  shall  not           enhance the  rate of  royalty in  respect  of  any           mineral more  than once  during any period of four           years. The words  "mineral removed or consumed by him or his agent, manager,   employee,    contractor   or   sub-lessee"   were substituted in sub-sections (1) and (2) by the Amendment Act of 1972  for the words "mineral removed by him". Sub-section (2A) was  inserted in  section 9  by the same Amendment Act. The proviso  to  sub-section  (3)  was  substituted  by  the Amendment Act of 1972 for the original proviso which read as follows :           "Provided that the Central Government shall not-           (a) fix  the rate  of royalty  in respect  of  any           mineral so  as to  exceed twenty  per cent  of the           sale price of the mineral at the pit’s head, or           (b) enhance  the rate of royalty in respect of any           mineral more  than once  during any period of four           Years . Section 9-A  was inserted  in the  1957 Act by the Amendment Act of 1972. It reads as follows :           9A. Dead rent to be paid by the lessee. -           (1) The  holder of a mining lease, whether granted           before or  after the commencement of the Mines and           Minerals (Regulation  and  Development)  Amendment           Act,   1972,   shall,   notwithstanding   anything           contained in  the instrument  of lease  or in  any           other law  for the time being in force, pay to the           State Government,  every year,  dead rent  at such           rate as  may be  specified, for the time being, in           the Third  Schedule, for all the areas included in           the instrument of lease : 518           Provided that  where the  holder  of  such  mining           lease becomes  liable, under  section  9,  to  pay           royalty for any mineral removed or consumed by him           or by  his agent, manager, employee, contractor or           sub-lessee from  the  leased  area,  he  shall  be           liable to pay either such royalty or the dead rent           in respect of that area, whichever is greater.           (2) The Central Government may, by notification in           the Official  Gazette, amend the Third Schedule so           as to enhance or reduce the rate at which the dead           rent shall  be payable  in  respect  of  any  area           covered by  a mining lease and such enhancement or           reduction shall  take effect from such date as may           be specified in the notification :           Provided that  the Central  Government  shall  not           enhance the  rate of  the dead  rent in respect of           any such  area more than once during any period of           four Years. Sections 10  to 12  prescribe the  procedure  for  obtaining prospecting licences and mining leases in respect of land in which the minerals vest in the Government. Under section 10, such applications  are to  be made  to the  concerned  State Government and the State Government is to grant or refuse to grant such  licence or lease having regard to the provisions of the  1957 Act  and any  rules made  thereunder. Under the Mineral Concession  Rules,  1949,  the  procedure  was  very similar with  differences which  are not  material  for  our purpose. Sections  13 to  16 form  a group of sections under

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the heading  "Rules for  regulating the grant of prospecting licences and  mining leases". Section 13 confers rule-making power upon  the Central  Government. The relevant provisions of that section are as follows :           "13. Power  of Central Government to make rules in           respect of minerals. -           (1) The Central Government may, by notification in           the Official  Gazette, make  rules for  regulation           the  grant  of  prospecting  licences  and  mining           leases in  respect of  minerals and  for  purposes           connected therewith. 519           (2) In  particular, and  without prejudice  to the           generality of  the foregoing power, such rules may           provide for  all or  any of the following matters,           namely :-           x               x              x              x           (i) the fixing and collection of dead rent} fines,           fees  or  other  charges  and  the  collection  of           royalties in respect of -           (i) prospecting licences,           (ii) mining leases,           (iii)  minerals   mined,  quarried,  excavated  or           collected;           x               x              x              x           (r) any  other matter  which is  to be, or may be,           prescribed under this Act." Sections 14 and 15 provide as follows :           "14. Sections  4 to  13  not  to  apply  to  minor           minerals. -           The provisions  of sections  4 to  13  (inclusive)           shall not apply to quarry leases, mining leases or           other mineral  concessions  in  respect  of  minor           minerals.           15. Power  of State  Government to  make rules  in           respect of minor minerals. -           (1) The  State Government  may, by notification in           the Official  Gazette, make  rules for  regulating           the grant of quarry leases, mining leases or other           mineral concessions  in respect  of minor minerals           and for purposes connected therewith.           (2) Until  rules are  made under  sub-section (1),           any rules  made by  a State  Government regulating           the grant of quarry leases, mining leases or other 520           mineral concessions  in respect  of minor minerals           which  are   in  force   immediately  before   the           commencement of this Act shall continue in force.           (3) The  holder of  a mining  lease or  any  other           mineral concession  granted under  any  rule  made           under sub-section (1) shall pay royalty in respect           of minor minerals removed or consumed by him or by           his  agent,   manager,  employee,   contractor  or           sublessee at  the rate  prescribed  for  the  time           being in  the rules framed by the State Government           in respect of minor minerals :           Provided  that  the  State  Government  shall  not           enhance the  rate of  royalty in  respect  of  any           minor mineral for more than once during any period           of four years. In section  14 and in sub-sections (1) and (2) of section 15 the words  "quarry leases,  mining leases  or other  mineral concessions" were  substituted by  the Amendment Act of 1972 for the words "prospecting licences and mining leases". Sub- section (3)  was inserted  in section  15 with retrospective

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effect by  the same  Amendment Act.  Section 19  provides as follows :           "19. Prospecting  licences and mining leases to be           void if in contravention of Act. -           Any prospecting  licence or  mining lease granted,           renewed  or   acquired  in  contravention  of  the           provisions of this Act or any rules or orders made           thereunder shall be void and of no effect.           Explanation. -  Where a  person has  acquired more           than one  prospecting licence  or mining  lease in           any State  and the  aggregate area covered by such           licences or  leases, as  the case  may be, exceeds           the maximum area permissible under section 6, only           that  prospecting  licence  or  mining  lease  the           acquisition of  which has resulted in such maximum           area being exceeded shall be deemed to be void." 521 Under section  20 the  provisions of  the 1957  Act and  the rules  made   thereunder  apply   to  the   renewal  of  any prospecting licence  or mining  lease whether granted before or after  the commencement  of the  1957 Act.  Under section 28(1),  rules   and  notifications   made  by   the  Central Government are  to be  laid  before  Parliament  and  to  be subject to any modification which may be made by Parliament, and if  not approved,  are thereafter  to be  of no  effect. Under section  29 all  rules made or purporting to have been made under the 1948 Act in so far as they related to matters for which  provision was  made in  the 1957 Act and were not inconsistent therewith  are to  be deemed  to have been made under the 1957 Act and to continue in force until superseded by any rules made under the 1957 Act.      In exercise of the power conferred by section 13 of the 1957 Act, the Central Government, by Notification No. G.S.R. 1398 dated  November 11,  1960, published  in the Gazette of India dated  November 26,  1960, Part II, sec. 3(i), at page 1832, made  the Mineral  Concession Rules,  1960. Rule 27 of the said Rules sets out the conditions to which every mining lease is  to be  subject. The relevant provisions of Rule 27 are as follows :           "27. Conditions. - (1) Every mining lease shall be           subject  to  the  following  conditions  and  such           conditions shall  be incorporated  in every mining           lease -           x               x              x              x           (c) the  lessee shall  pay, for every year, except           the first  year of the lease such yearly dead rent           within the  limits specified in Schedule IV as may           be fixed from time to time by the State Government           and if  the lease permits the working of more than           one mineral in the sale area, the State Government           shall not  charge separate dead rent in respect of           each mineral :           Provided that  the lessee  shall be  liable to pay           the dead  rent  of  royalty  in  respect  of  each           mineral whichever  be higher  in  amount  but  not           both; 522           (d) the  lessee shall  also, pay  for the  surface           area  used  by  him  for  the  purpose  of  mining           operations, surface  rent and  water rate  at such           rate not  exceeding the  land revenue,  water  and           cesses assessable on the land, as may be specified           by the State Government in the lease;           x               x              x              x           (5) If  the lessee makes any default in payment of

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         royalty as  required by  section 9  or  commits  a           breach of  any of  the conditions other than those           referred to  in sub-rule (4), the State Government           shall give  notice to  the lessee requiring him to           pay the  royalty or remedy the breach, as the case           may be,  within sixty  days from  the date  of the           notice and  if the  royalty is  not  paid  or  the           breach is  not remedied  within such  period,  the           State Government  may, without  prejudice  to  any           proceeding  that   may  be   taken  against   him,           determine the  lease and forfeit the whole or part           of the security deposit.      In exercise  of the power conferred by section 15(1) of the 1957  Act various  State Governments  have made rules in respect of  minor minerals.  Although these  rules vary from State to  State, there are certain broad features present in all of them. The majority of States provide for two types of mineral concessions,  namely a  lease on  tenure basis and a permit to  extract a  specified quantity of a minor mineral. In all the States the rules provide for the grant of a lease for a  particular term  of years  varying from  one year  to twenty  years.  These  leases  are  variously  described  in different State  rules as  "mining lease", "quarrying lease" and "quarry  lease" and  are similar in nature to the mining leases granted  under the Mineral Concession Rules, 1960. In most of  the State  rules there is a provision for the grant of a  permit to  excavate a  specified quantity  of a  minor mineral from  a specified  area within  a  prescribed  time. These permits  are referred  to in  different State rules as "permit", "quarrying  permit", "mining  permit" and  "short- term permit".  In some  of the  State rules  there is also a provision for  the grant of a prospecting licence. All State rules which provide for payment of royalty 523 and dead  rent contain  a provision that either dead rent or royalty, whichever  is higher in amount, but not both, would be payable.  In addition,  most State  rules also  contain a provision for  the payment of surface rent. In certain State rules, for  instance, those  of the Andhra Pradesh and Tamil Nadu, royalty  is called  "seigniorage fee" (See the "Digest of Minor  Mineral Laws  of India"  issued  in  1974  by  the Controller, Indian Bureau of Mines, Nagpur, pp. 5-8).      With effect  on or  from May  1, 1960,  by  the  Bombay Reorganisation Act,  1960, certain  territories comprised in the State  of Bombay  were formed  into  a  separate  State, namely, the  State of  Gujarat, and  the  territories  which remained with the State of Bombay were renamed as the "State of Maharashtra".  The State of Gujarat, however, did not, in the exercise  of the power conferred by section 15(1) of the 1957 Act,  make any  rules for minor minerals until 1966 and until such  rules were  made, the rules in force immediately before the  commencement of  the 1957 Act continued to apply in the  State of  Gujarat by  virtue of  the  provisions  of section 15(2).  By Notification No. GU 125-MCR 2164/5089/CHH dated March  18, 1966,  the Government  of Gujarat  made the Gujarat Minor  Mineral Rules, 1966, for regulating the grant of mining  leases in  respect  of  minor  minerals  and  for purposes  connected   therewith.   These   Rules   will   be hereinafter referred  to as  "the Gujarat Rules". me Gujarat Rules came  into force  on April  1, 1966.  Rule 41  of  the Gujarat Rules  repealed the  Bombay Minor Mineral Extraction Rules, 1955, and all other rules in force in any part of the State of Gujarat immediately before the coming into force of the Gujarat Rules. We will point out the relevant provisions of the Gujarat Rules when we come to discuss the question of

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the validity  of Rule  21-B of  the Gujarat  Rules  and  the impugned  Notifications  and  the  impugned  Circular  dated February 12, 1981.      The first  contention which  was raised  before us  was that section  15(1) of  the 1957  Act 18 unconstitutional as suffering  from   the  vice   of  excessive   delegation  of legislative power  to the  executive. It  was submitted that the rule-making  power conferred  upon the State Governments by section  15(1) was  an uncanalized power as no guidelines were prescribed  for its  exercise and  thus it  enabled the State Governments  to act arbitrarily and as they liked with respect to leases of minor 524 minerals. We  find that  this contention  is  based  upon  a fallacy  inasmuch   as  it   is  founded  upon  reading  the provisions  of   section  15(1)  in  isolation  and  without reference to  the other  provisions of  the 1957 Act and its legislative history.      The  1957  Act  is  made  in  exercise  of  the  powers conferred by  Entry 54  in the Union List. The said Entry 54 and Entry  23 in  the State List fell to be interpreted by a Constitution Bench  of this Court in Baijnath Kedia v. State of Bihar & Ors. [1970] 2 S.C.R. 100. In that case this Court held that  Entry  54  in  the  Union  List  speaks  both  of regulation of  mines and mineral development and Entry 23 in the State  List is subject to Entry 54. Under Entry 54 it is open to  Parliament to  declare that  it is expedient in the public interest  that the  control in  these matters  should vest in  the Central  Government.  To  what  extent  such  a declaration can  go is  for Parliament to determine and this must be  commensurate with  public interest  but  once  such declaration is  made and  the extent  of such regulation and development laid  down the subject of the legislation to the extent  so  laid  down  becomes  an  exclusive  subject  for legislation by  Parliament. Any  legislation  by  the  State after  such   declaration  which   touches  upon  the  field disclosed  in   the   declaration   would   necessarily   be unconstitutional because  that field  is extracted  from the legislative competence  of the  State Legislature.  In  that case the  Court further  pointed  out  that  the  expression "under the  control of  the Union"  occurring in Entry 54 in the Union  List and  Entry 23 in the State List did not mean "control of the Union Government" because the Union consists of three limbs, namely, Parliament, the Union Government and the Union  Judiciary, and  the control of the Union which is to be  exercised under the said two Entries is the one to be exercised by  Parliament, namely,  the legislative  organ of the Union,  which is,  therefore, the  control by the Union. The Court  further held  that the  Union had  taken all  the power in  respect, of  minor  minerals  to  itself  and  had authorized the  State Governments  to  make  rules  for  the regulation of  leases and  thus by  the declaration  made in section 2  and the  enactment of section 15 the whole of the field  relating   to  minor   minerals   came   within   the jurisdiction of  Parliament and  there was  no scope left to the State  Legislatures to  make any  enactment with respect thereto. The court also held that by giving the power 525 to the  State Governments to make rules, the  control of the Union was not negatived but, on the contrary, it established that the  Union was  exercising  the  control.  One  of  the contentions raised  in that  case was  that section  15  was unconstitutional as the delegation of legislative power made by it  to the  rule-making  authority  was  excessive.  This contention was,  however, not  decided by  the Court  as the

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appeals in that case were allowed on other points.      The rule-making  power conferred  by section 15 (1) was for regulating  the grant of prospecting licences and mining leases and  for purposes  connected therewith  prior to  the Amendment Act  of 1972  and thereafter is for regulating the grant of  quarry leases,  mining leases  and  other  mineral concessions in  respect of  minor minerals  and for purposes connected therewith. The phraseology of section 15(1) is the same as  that of  section 13(1)  which  confers  rule-making power upon  the Central Government with this difference that by the  Amendment Act of 1972 the expression "quarry leases, mining  leases   or  other  mineral  concessions"  has  been substituted in  section 15(1)  for  the  words  "prospecting licences   and   mining   leases"   while   the   expression "prospecting licences  and mining  leases" in  section 13(1) remains unchanged.      The term "minerals" is defined by clause (a) of section 3 as  including "all  minerals except  mineral  oils".  This definition would  thus  include  minerals  which  are  minor minerals as  also minerals  other than  minor minerals.  The term "minor  minerals" is,  however, separately  defined  by clause (e)  because the  power  to  make  rules  in  respect thereof is  vested by section 15(1) in the State Governments while the power to make rules with respect to minerals other than minor minerals is vested in the Central Government. The word "minerals"  in different  sections of  the 1957  Act is used with  the meaning  assigned to  it  by  clause  (a)  of section 3, that is, as denoting "all minerals except mineral oils", unless  the context requires otherwise, and where the Act wishes  to make a distinction between minor minerals and minerals other  than minor  minerals, it  does so expressly. For instance,  sub-section  (1)  of  section  4A  speaks  of "premature termination  of a  mining lease in respect of any mineral, other  than a minor mineral" and sub-section (2) of section 4A  speaks of  "premature termination  of  a  mining lease in respect of any 526 minor mineral".  To take another illustration, under section 19 any  prospecting licence or mining lease granted, renewed or acquired  in contravention  of the provisions of the 1957 Act or any rules or orders made thereunder is to be void and of no  effect. This  section would  apply to  a  prospecting licence or  a mining lease both in respect of minor minerals and minerals  other than minor minerals. Were it not so, the result would be startling for while a prospecting licence or a mining  lease in  respect of  minerals  other  than  minor minerals would  be void  and  of  no  effect  if  it  is  in contravention of the provisions of the 1957 Act or any rules or orders  made thereunder,  in the  case of  a  prospecting licence or  a mining lease in respect of minor minerals such licence or  lease would  not  be  void  even  if  it  is  in contravention of the provisions of the 1957 Act or any rules or orders  made thereunder. The Explanation to section 19 is an illustration  of a  case where  the  context  excludes  a prospecting licence  or a  mining lease  in respect of minor minerals and this is by reason of the reference contained in that Explanation  to section  6 because by the express terms of section  14, section  6 does not apply to minor minerals. mus, the word "minerals" wherever used in the 1957 Act would include minor  minerals unless  minor minerals are expressly excluded or the context otherwise requires.      Bearing this in mind, we now turn to examine the nature of  the   rule-making  power   conferred  upon   the   State Governments by  section 15(1).  Although under  section  14, section 13  is one  of the  sections which does not apply to

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minor minerals,  the language  of section  13(1) is  in pari materia with  the language  of section  15(1). Each of these provisions confers the power to make rules for "regulating". The  Shorter   Oxford  English  Dictionary,  Third  Edition, defines the  word "regulate" as meaning "to control, govern, or direct  by rule or regulations; to subject to guidance or restrictions; to  adapt to  circumstances or  surroundings". Thus, the power to regulate by rules given by sections 13(1) and 15(1)  is a power to control, govern and direct by rules and grant  of prospecting  licences  and  mining  leases  in respect of  minerals  other  than  minor  minerals  and  for purposes connected  therewith in  the case  of section 13(1) and the  grant of  quarry leases,  mining leases  and  other mineral concessions  in respect  of minor  minerals and  for purposes connected  there with  in the case of section 15(1) and to  subject such grant to restrictions and to adapt them to 527 the circumstances  of the  case and  the  surroundings  with reference to  such power  is exercised.  It is  pertinent to bear in  mind  that  the  power  to  regulate  conferred  by sections 13(1)  and 15(1)  is not  only with  respect to the grant of licences and leases mentioned in those sub-sections but is  also with respect to "purposes connected therewith", that is, purposes connected with such grant.      Entry 54  in the Union List uses the word "regulation". "Regulation"  is  defined  in  the  Shorter  Oxford  English Dictionary, Third Edition as meaning "the act of regulating, or the  state of  being regulated".  Entry 54 reproduces the language of  Entry 36 in the Federal Legislative List in the Government of  India Act,  1935, with  the omission  of  the words "and  oilfields". When  the Constitution  came  to  be enacted, the  framers of  the Constitution  knew that  since early days  mines and minerals were being regulated by rules made by  Local governments.  they also  knew that  under the corresponding Entry  36 in the Federal Legislative List, the 1948 Act  had been  enacted and  was on the statute book and that the  1948 Act conferred wide rule-making power upon the Central Government  to regulate  the grant  of mining leases and for  the conservation  and development  of minerals.  It also knew that in the exercise of such rule-making power the Central Government  had made  the Mineral  Concession Rules, 1949, and that by Rule 4 of the said Rules the extraction of minor minerals  was left to be regulated by rules to be made by the  Provincial Governments.  Thus,  the  makers  of  the Constitution were  not only aware of the legislative history of the  topic of  mines and minerals but were also aware how the Dominion  Legislature had  interpreted Entry  36 in  the Federal Legislative  Listing enacting the 1948 Act. When the 1957 Act  came to be enacted, Parliament knew that different State Governments  had, in  pursuance of  the provisions  of Rule 4 of the Mineral Concession Rules, 1949, made rules for regulating the  grant of leases in respect of minor minerals and other matters connected therewith and for this reason it expressly provided  in sub-section  (2) of section 15 of the 1957 Act  that the  rules in  force immediately  before  the commencement of  that Act  would  continue  in  force  until superseded by  rules made  under sub-section  (1) of section 15. Regulating  the grant  of mining  leases in  respect  of minor minerals  and other  connected matters was, therefore, not something which was done for the first time by the 1957 528 Act but  followed a  well-recognized and  accept legislative practice. In  fact, even so far as minerals other than minor minerals were concerned, what Parliament did, as pointed out

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earlier, was  to transfer to the 1957 Act certain provisions which had  until then  been dealt with under the rule-making power of  the Central  Government in  order to  restrict the scope of  subordinate  legislation.  To  take  into  account legislative  history   and  practice  when  considering  the validity of  a statutory  provision or  while interpreting a legislative  entry   is  a   well-established  principle  of construction of  statutes :  see,  for  instance,  State  of Bombay v.  Narothamdas Jethabhai  and Anr.  [1951] S.C.R. 51 and State  of Madras v. Gannon Dunkerley & Co. (Madras) Ltd. [1959] S.C.R. 379.      There  is  no  substance  in  the  contention  that  no guidelines are  provided in the 1957 Act for the exercise of the rule-making power of the State Governments under section 15(1). As  mentioned  earlier,  section  15(1)  is  in  pari materia with  section 13(1).  Section 13,  however, contains sub-section (2)  which sets  out the particular matters with respect to  which the  Central Government may make rules "In particular, and  without prejudice  to the generality of the foregoing power",  that is,  the rule-making power conferred by sub-section  (1). It is well settled that where a statute confers  particular   powers  without   prejudice   to   the generality  of   a  general  power  already  conferred,  the particular powers are only illustrative of the general power and do  not in any way restrict the general power. Section 2 of the  Defence of  India Act, 1939, as amended by section 2 of the  Defence of  India (Amendment)  Act, 1940,  conferred upon the  Central Government the power to make such rules as appeared to  it "to  be necessary  or expedient for securing the  defence  of  British  Indias  the  public  safety,  the maintenance of  public order or the efficient prosecution of war, or  for maintaining  supplies and services essential to the life  of the  community". Sub-section  (2) of  section 2 conferred upon  the Central  Government the power to provide by  rules  or  to  empower  any  authority  to  make  orders providing for  various matters  set out  in  the  said  sub- section. This  power was  expressed by  the opening words of the said  sub-section (2)  to be  "without prejudice  to the generality of  the powers  conferred by sub-section (1)". In King Emperor  v. Sibnath  Banerji Ors.,  [1944-1945] 72 I.A. 241, the  Judicial Committee  of the  Privy Council held (at pages 258-9) : 529           "In the  opinion of  their Lordships, the function           of subs-s.  2 is  merely an  illustrative one; the           rule-making power  is conferred  by sub-s.  1, and           the rules  which are  referred to  in the  opening           sentence of  sub-s. 2  are  the  rules  which  are           authorized by,  and  made  under,  sub-s.  1;  the           provisions of sub-s. 2 are not restrictive of sub-           s. 1, as, indeed, is expressly stated by the words           ’without prejudice to the generality of the powers           conferred by sub-s. 1 ’ ." The above  proposition of law has been approved and accepted by this  Court in  Om Prakash and Ors. v. Union of India and Ors., [1970]  3 S.C.C.  942,944-5 and  Shiv Kirpal  Singh v. Shri V.V.Giri [1971] 2 S.C.R. 224-5.      A provision  similar to  sub-section (2) of section 13, however, does  not find place in section 15. In our opinion, this makes no difference. What sub-section (2) of section 13 does is  to give  illustrations of the matters in respect of which the  Central Government can make rules for "regulating the grant  of prospecting  licences  and  mining  leases  in respect of  minerals and  for purposes connected therewith". The opening clause of sub-section (2) of section 13, namely,

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"In particular,  and without  prejudice to the generality of the foregoing power", makes it clear that the topics set out in that  sub-section are  already included  in  the  general power conferred  by sub-section  (1) but are being listed to particularize them  and to  focus attention  on  them.  m  e particular  matters   in  respect   of  which   the  Central Government can  make rules  under sub-section (2) of section 13 are,  therefore, also matters with respect to which under sub-section(l) of  section 15 the State Governments can make rules for  "regulating the  grant of  quarry leases,  mining leases or  other mineral  concessions in  respect  of  minor minerals and for purposes connected therewith". When section 14  directs  that  "The  provisions  of  sections  4  to  13 (inclusive) shall  not apply to quarry leases, mining leases or other  mineral concessions in respect of minor minerals", what is  intended is  that the  matters contained  in  those sections, so far as they concern minor minerals, will not be controlled by  the Central  Government but  by the concerned State Government  by exercising  its rule-making  power as a delegate of the Central Government. Sections 4 to 12 form a 530 group of sections under the heading "General restrictions on undertaking  prospecting   and   mining   operations".   The exclusion of  the application  of these  sections  to  minor minerals means  that these  restrictions will  not apply  to minor minerals  but that it is left to the State Governments to prescribe  such restrictions  as they  think fit by rules made under  section 15(1).  The reason  for  treating  minor minerals differently from minerals other than minor minerals is obvious.  As seen  from the  definition of minor minerals given in  clause (e)  of section  3, they are minerals which are mostly  used in local areas and for local purposes while minerals other  than minor  minerals  are  those  which  are necessary for industrial development on a national scale and for the economy of the country. That is why matters relating to minor  minerals have been left by Parliament to the State Governments while  reserving matters  relating  to  minerals other  than   minor  minerals  to  the  Central  Government. Sections 13,  14 and  15 fall in the group of sections which is headed  "Rules for  regulating the  grant of  prospecting licences and mining leases". These three sections have to be read together.  In providing  that section 13 will not apply to quarry leases, mining leases or other mineral concessions in respect  of minor minerals what was done was to take away from the  Central Government  the power  to  make  rules  in respect of  minor minerals  and  to  confer  that  power  by section 15(1)  upon the  State Governments. The ambit of the power under section 13 and under section 15 is, however, the same, the  only difference  being that in one case it is the Central Government  which exercises  the power in respect of minerals other  than minor  minerals while in the other case it is  the State Governments which do so in respect of minor minerals.  Sub-section   (2)  of   section   13   which   is illustrative of the general power conferred by section 13(1) contains sufficient  guidelines for the State Governments to follow in  framing the rules under section 15(1), and in the same  way,  the  State  Governments  have  before  them  the restrictions and other matters provided for in sections 4 to 12 while framing their own rules under section 15(1).      The guidelines  for the  exercise  of  the  rule-making power under  section 15(1)  are, thus,  to be  found in  the object for  which such  power  is  conferred  (namely,  "for regulating the  grant of  quarry leases,  mining  leases  or other mineral  concessions in  respect of minor minerals and for purposes connected

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531 therewith)", the meaning of the word "regulating", the scope of  the   phrase   "for   purposes   connected   therewith," illustrative matters  set out  in sub-section (2) of section 13, and  in the  restrictions and other matters contained in sections 4 to 12.      The next  question to be considered is whether the rule making power  of the  State Governments  under section 15(1) includes a  power to  charge dead  rent and  royalty. Before embarking upon  a consideration of this question, it will be useful to know the meaning of the expression "dead rent" and "royalty" and  their connotation.  Wharton’s "Law  Lexicon", Fourteenth Edition, at page 359, defines "dead rent" as:           "Dead Rent  A rent  payable on  a mining  lease in           addition to  a royalty,  so called  because it  is           payable whether the mine is being worked or not." The  definition  of  "dead  rent"  given  in.  Black’s  "Law Dictionary", Fifth Edition, at page 359, is as follows:           "Dead Rent.  in English  law, a  rent payable on a           mining Lease  in addition  to a royalty, so called           because it is payable although the mine may not be           worked. Jowitt’s "Dictionary  of English  Law", Second  Edition,  at page 555, defines "dead rent" as           "Dead Rent, a term sometimes used in mining leases           in contradistinction  to a  royalty, to  denote  a           fixed  rent   to  be  paid  whether  the  mine  is           productive or not. See RENT." The same Dictionary states under the heading "Rent", at page 1544 .           "When a  mine,  quarry,  brick-works,  or  similar           property is  leased, the  lessor usually  reserves           not only a fixed yearly rent but also a royalty or           galeage  rent,   consisting  of  royalties  (q.v.)           varying with  the quantity  of  minerals,  bricks,           etc., produced  during each year. In this case the           fixed rent is called a dead rent." 532      "Royalty" is defined in Jowitt’s "Dictionary of English Law", Second Edition, at page 1595, inter alia, as :           "Royalty, a  payment reserved  by the grantor of a           patent, lease  of a  mine or  similar  right,  and           payable proportionately  to the  use made  of  the           right by  the grantee.  It is usually a payment of           money, but  may be  a payment in kind, that is, of           part of  the produce of the exercise of the right.           See Rent. "Royalty" is  defined in  Wharton’s "Law Lexicon" Fourteenth Edition, at page 839, as :           "Royalty, payment  to a  patentee by  agreement on           every article  made according to his patent; or to           an author by a publisher on every copy of his book           sold; or to the owner of minerals for the right of           working the  same on  every ton  or  other  weight           raised. The  definition   of  "royalty"   given  in   Black’s   "Law Dictionary", Fifth Edition, at page 1195, is as follows :           "Royalty. Compensation  for the  use of  property,           usually copyrighted material or natural resources,           expressed as  a percentage  of receipts from using           the property or as an account per unit produced. A           payment which  is made to an author or composer by           an  assignee,  licensee  or  copyright  holder  in           respect of each copy of his work which is sold, or           to an  inventor in  respect of  each article  sold

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         under the  patent. Royalty  is share of product or           profit reserved by owner for permitting another to           use the  property. In  its broadest  aspect, it is           share of  profit reserved  by owner for permitting           another the use of property....           In mining  and oil  operations,  a  share  of  the           product  or  profit  paid  to  the  owner  of  the           property..... 533 In H.R.S. Murthy v. Collector of Chittor and Anr.., [1964] 6 S.C.R. 666,  673 this  Court said  that  "royalty"  normally connotes the  payment made for the materials or minerals won from the land.      In Halsbury’s  "Laws of England", Fourth Edition in the volume which  deals with  "Mines,  Minerals  and  Quarries", namely, volume 31, it is stated in paragraph 224 as follows:           "224. Rents  and royalties.  An  agreement  for  a           lease usually contains stipulations as to the dead           rents and other rents and royalties to be reserved           by,  and   the  covenants  and  provisions  to  be           inserted in, the lease..... " The topics  of dead  rent and  royalties are  dealt with  in Halsbury’s "Laws  of England"  in the  same volume under the sub-heading  "Consideration",   the   main   heading   being "Property demised;  Consideration". Paragraph 235 deals with "dead rent" and paragraph 236 with "royalties". m e relevant passages are as follows :           "235. Dead  rent. It  is usual in mining leases to           reserve both  a fixed annual rent (otherwise known           as a  ’dead  rent’,  ’minimum  rent’  or  ’certain           rent’) and  royalties varying  with the  amount of           minerals worked.  The object  of the fixed rent is           to ensure  that the lessee will work the mine; but           it is  sometimes  ineffective  for  that  purpose.           Another function  of the fixed rent is to ensure a           definite minimum  income to  the lessor in respect           of the demise.                If a  fixed rent  is reserved,  it is payable           until the  expiration of  the term even though the           mine is  not worked,  or is  exhausted during  the           currency of  the term, or is not worth working, or           is difficult  or unprofitable  to  work  owing  to           faults or  accidents, or  even if the demised seam           proves to be non-existent.           "236. Royalties.  A royalty, in the sense in which           the word is used in connection with mining leases,           is a payment to the lessor proportionate to the 534           amount of  the demised  mineral  worked  within  a           specific period." In paragraph  238 of  the same volume of Halsbury’s "Laws of England" it is stated :           "238. Covenant to pay rent and royalties.           Nearly every  mining lease  contains a covenant by           the lessee  for payment  of the specified rent and           royalties.      Rent is  an integral part of the concept of a lease. It is the  consideration moving  from the  lessee to the lessor for demise  of the  property to  him.  Section  105  of  the Transfer of  Property Act, 1982, contains the definitions of the terms  "lease", "lessor", "lessee", "premium" and "rent" and is as n follows :           "105,  Lease   defined.  A   lease  of  immoveable           property is  a transfer  of a  right to enjoy such           property, made  for a  certain  time,  express  or

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         implied, or  in perpetuity,  in consideration of a           price paid  or promised,  or of  money, a share of           crops, service  or any other thing of value, to be           rendered periodically or on specified occasions to           the transferor  by the transferee, who accepts the           transfer on such terms.           Lessor, lessee, premium and rent defined.           The  transferor   is  called   the   lessor,   the           transferee is  called the  lessee,  the  price  is           called the  premium, and the money, share, service           or other  thing to  be so  rendered is  called the           rent."      In a mining lease the consideration usually moving from the lessee  to the  lessor is  the rent  for the area leased (often called  surface rent),  dead rent  and royalty. Since the mining  lease confers  upon the  lessee  the  right  not merely to  enjoy the property as under an ordinary lease but also to  extract minerals  from the  land and to appropriate them for  his own  use or  benefit, in addition to the usual rent for the area 535 demised, the  lessee is  required to pay a certain amount in respect of  the  minerals  extracted  proportionate  to  the quantity so  extracted. Such payment is called "royalty". It may, however,  be that the mine is not worked properly so as not to  yield enough  return to  the lessor  in the shape of royalty. In order to ensure for the lessor a regular income, whether the  mine is  worked  or  not,  a  fixed  amount  is provided to  be paid  to him  by the  lessee. This is called "dead rent".      "Dead rent"  is calculated  on the  basis of  the  area leased while  royalty  is  calculated  on  the  quantity  of minerals extracted  or removed.  Thus, while  dead rent is a fixed return to the lessor, royalty is a return which varies with the  quantity of  minerals extracted  or removed. Since dead rent  and royalty  are both  a return  to the lessor in respect of the area leased, looked at from one point of view dead rent  can be described at the minimum guaranteed amount of royalty payable to the lessor but calculated on the basis of the  area leased  and not  on the  quantity  of  minerals extracted or  removed. In fact, clause (ix) of Rule 3 of the Rajasthan Minor  Mineral  Concession  Rules,  1977,  defines "dead rent"  as meaning  "the minimum  guaranteed amount  of royalty per  year payable  as per rules or agreement under a mining  lease".  Stipulations  providing  for  the  lessee’s liability to  pay surface rent, dead rent and royalty to the lessor are  the usual  covenants to  be found  in  a  mining lease.      The grant  of a mining lease would thus provide for the consideration for  such grant  in the shape of surface rent, dead  rent   and  royalty.  The  power  to  make  rules  for regulating  the  grant  of  such  leases  would,  therefore, include the  power to  fix the  consideration payable by the lessee to  the lessor  in the  shape  of  ordinary  rent  or Surface rent, dead rent and royalty. If this were not so, it would lead  to the  absurd result  that when  the Government grants a  mining lease, it is granted gratis to a person who wants to  extract minerals  and profit  from them. Rules for regulating the  grant of  mining leases  cannot be  confined merely to rules providing for the form in which applications for such leases are to be made, the factors to be taken into account in  granting or refusing such applications and other cognate  matters.   Such  rules   must  necessarily  include provisions with respect to the consideration 536

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for the  grant. Under  section 15(1),  therefore, the  State Governments have  the power  to  make  rules  providing  for payment of surface rent, dead rent and royalty by the lessee to the Government.      The Legislature  and the  rule-making authorities  have also throughout  understood  the  power  to  make  rules  in respect of mining leases and minerals as including the power to charge  dead rent  and royalty.  Section 5(1) of the 1948 Act conferred  powers upon  the Central  Government to  make rules "for  regulating the  grant of mining leases". Section 6(1) of  that Act  conferred upon the Central Government the power to make rules "for the conservation and development of minerals". Both  section 5 and 6 contained a sub-section (2) which set  out the different matters in respect of which the Central Government  could make  rules and  both  these  sub- sections opened  with the clause "In particular, and without prejudice to the generality of the foregoing power". As seen earlier, the particular matters so set out were illustrative of the  general power conferred by the earlier sub-sections. Under clause  (d) of  section 5(2),  the rules to be made by the Central  Government could provide for "the fixing of the maximum and  minimum rent  payable by  a lessee, whether the mine is worked or not." This clause thus provided for a dead rent. Under clause (i) of section 6(2), the rules to be made by the  Central Government  could provide  for "the levy and collection  of  royalties,  fees  or  taxes  in  respect  of minerals mined,  quarried, excavated  or collected". Rule 41 of the  Mineral concession  Rules, 1949, made by the Central Government in  exercise of the powers conferred by section 5 of the  1948 Act  prescribed the conditions which were to be included in  every mining  lessee. The said Rule 41 provided for payment  of royalty on minerals at the rate specified in the First Schedule to the said Rules in force on the date of the grant  of the  lease as  also to  pay  royalty  at  such revised rates  as may be notified from time to time. It also provided for  payment of  surface rent  and further provided for payment  of dead rent with a proviso that the lessee was liable to  pay dead rent or royalty, whichever was higher in amount, but not both. Rules made by the State Governments in respect of minor minerals also provided for payment of these charges. As  seen earlier,  Rule (7) of the Saurashtra Rules provided  for   payment  of  surface  rent  and  dead  rent. Similarly, Rule 18 of the Bombay Minor 537 Mineral Extraction Rules, 1955, provided for the lessee of a quarry lease  to pay  royalty  at  the  rates  specified  in Schedule I  to the said Rules, such rates being liable to be revised once  in every  five years, as also surface rent and yearly dead  rent and also provided that the lessee shall be liable to  pay the  dead rent  or royalty in respect of each minor mineral,  whichever be higher in amount, but not both. Section 7  of  the  1948  Act  conferred  upon  the  Central Government the  power to  make  rules  for  the  purpose  of modifying or altering the terms and conditions of any mining lease granted  prior to  the commencement of the 1948 Act so as to  bring it  into conformity  with the  rules made under sections 5  and 6.  In pursuance  of this power, the Central Government made  the Mining  Lease (Modification  of  Terms) Rules, 1956,  by Notification No.S.R.O. 2062 dated September 4, 1956,  published in the Gazette of India, dated September 15, 1956,  Part II,  section 3,  at pages 1548-54. Rule 2 of the said Rules defined certain terms.As originally made Rule 2  contained  clause  (g)  which  provided  that  "’Royalty’ includes ’Dead  Rent"’. Sub-rules (7), (8) and (9) of Rule 6 of the  said Rules  provided for modification in such leases

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of the  rate of  royalty which  by reason  of the definition given in  clause (g)  of Rule  2 included  the rate  of dead rent. After the coming into force of the 1957 Act on June 1, 1958, clause (g) of Rule 2 and sub-rules (7), (8) and (9) of Rule 6  were omitted  from the  said Rules  in view  of  the provisions with respect to such leases contained in the 1957 Act.      So far  as the  1957 Act is concerned, under clause (i) of section  13(2) the  rules  to  be  made  by  the  Central Government can provide "for the fixing and the collection of dead rent,  fines, fees  or other charges and the collection of royalties".  Although clause  (i) of section 13(2) speaks of fixing  and collection  in the case of dead rent and only collection in  the case of royalties, the reason is not that the  power   to  fix   royalties  was   not  thought  to  be comprehended in the general rule-making power of the Central Government under  section  13(1).  The  reason  was  that  a separate provision in that behalf was made by section 9 with respect  to   mining  leases   granted   both   before   the commencement of  the 1957 Act as also after the commencement of the  1957 Act. Another reason for doing so was to specify the rates  for royalties  in respect  of different  minerals other than minor minerals in the Second Schedule to 538 the 1957  Act in  order to restrict the scope of subordinate legislation as  pointed out  in the Statement of Objects and Reasons to  the Legislative  Bill No.  83 of  1972. As  seen earlier, Rule  27 of  the Mineral  Concession  Rules,  1960, provides that  every mining  lease is to contain a provision requiring the lessee to pay surface rent and dead rent and a further provision  that the  lessee shall  be liable  to pay dead rent  or royalty  in respect of each mineral, whichever be higher  in amount,  but not both. It is pertinent to note that these  provisions were  included in the said Rules when they were first made and thus existed in the said Rules much prior to  the insertion of section 9A in the 1957 Act by the Amendment Act  of 1972,  casting a liability upon the lessee to pay dead rent.       The Gujarat High Court in Smt. Sonbal’s Case held that the intention  of Parliament  in enacting  section 15(1) was not to clothe the State Governments with power to impose any financial liability  upon the  lessee but  only to give them the power  to prescribe  conditions for regulating the grant of  leases  other  than  conditions  relating  to  financial liability  and   that  the  power  to  prescribe  conditions relating to financial liability of a lessee were to be found only in sub-section (3) of section 15. In order to ascertain this intention  attributed by  it to Parliament, the Gujarat High Court relied upon the provisions of section 9A and sub- section (33  of section  15. The  same view was taken by the Andhra Pradesh  High Court  in M.V.  Subba Rao  v. State  of Andhra Pradesh and another, A.I.R. 1978 A.P. 453.      We find  that the  reliance placed  by the Gujarat High Court in  Smt. Sonbai’s  Case,  which  is  one  of  the  two judgments of  that High  Court challenged before us, and the Andhra Pradesh  High Court  in M.V. Subba Rao’s Case on sub- section (3)  of section  15  and  section  9A  in  order  to ascertain the  intention of  Parliament is misplaced. Though sub-section  (3)   was   inserted   in   section   15   with retrospective effect  by the Amendment Act of 1972, until it was so  inserted it was not before the courts when they came to construe  the scope of the rule-making power of the State Governments under section 15(1) and even without sub-section (3) being  before the  courts, various High Courts have held that the State Governments’ power to charge royalty is to be

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found in  the rule-making  power conferred by section 15(1). The Patna High Court in 539 Laddu Mal  and Ors.  v. The  State of Bihar and Ors., A.I.R. 1965 Patna  491, the  Madhya Pradesh  High  Court  in  Banku Bihari Saha  v. State Government of Madhya Pradesh and Ors., A.I.R. 1969  M.P. 210,  the Punjab and Haryana High Court in Dr. Shanti  Saroop Sharma  and Anr.  v. State  of Punjab and Ors., A.I.R.  1969 Pun.  & Har.  79 and M/s. Amar Singh Modi Lal v.  State of  Haryana and Ors., A.I.R. 1972 Punj. & Har. 356 and  the Rajasthan  High Court  in M/s.  Brimco  Bricks, Bharatpur v.  State of  Rajasthan and Anr., A.I.R. 1972 Ra;. 145 have  all taken this view. These were all cases prior to the Amendment Act of 1972 when sub-section (3) of section 15 was not then on the statute book. After the enactment of the Amendment Act  of 1972,  the Allahabad  High Court  in  Sheo Varan Singh  v. State  of U.P.,  A.I.R. 1980 All 92 has held that the  power of  the State  Governments to Charge royalty and dead  rent is  to be  found only  in section  15(1). The Rajasthan High  Court in  Bal Mukund  Arora etc. v. State of Rajasthan and  Ors., A.I.R.  1981 Raj. 95 has also taken the same view  disagreeing with  the view  taken by  the  Andhra Pradesh High Court in M.V. Subba Rao’s Case.      A proper reading of sub-section (3) of section 15 shows that it does not confer any power upon the State Governments to make rules with respect to royalty. Royalty is payable by the holder  of a  quarry lease  or  mining  lease  or  other mineral concession  granted  under  rules  made  under  sub- section (1)  of section  15. What sub-section (3) does is to make such  holder liable  to pay royalty in respect of minor minerals removed or consumed not only by him but also by his agent, manager,  employee, contractor or sub-lessee. It thus casts a  vicarious liability upon such holder to pay royalty in respect  of the  acts of  persons other than himself. The very fact  that under  sub-section (3) the liability of such holder is  to pay  royalty "at  the rate  prescribed for the time being  in the  rules framed  by the State Government in respect of minor minerals" shows that the prescribing of the rate of  royalty in  respect of minor minerals is to be done under the  rule-making power  of the State Governments which is to be found in sub-section (1) of section 15. Yet another purpose of  enacting sub-section  (3) is  to be found in the proviso  to  that  sub-section  which  prohibits  the  State Government from  enhancing the rate of royalty in respect of any minor  mineral for  more than  once during any period of four years.  If the  reliance placed  by the Gujarat and the Andhra Pradesh High Courts on sub-section (3) of 540 section 15 in order to ascertain the intention of Parliament was misplaced,  their reliance upon section 9A was even more misplaced. Section  9A was  inserted in  the 1957 Act by the Amendment  Act   of  1972  but  it  was  not  inserted  with retrospective effect.  It was,  therefore,  not  there  when section  15(1)  was  placed  upon  the  statute  book  while enacting the  1957 Act.  Section 9A  was enacted with a two- fold purpose.  It cast  a liability  upon the  holder  of  a mining  lease   whether  granted   before   or   after   the commencement of  the 1972  Act, that  is, either  before  or after September  12, 1972,  to pay  to the  State Government dead rent  at the  rates specified for the time being in the Third Schedule  to the  1957 Act  "notwithstanding  anything contained in the instrument of lease or in any other law for the time  being in  force." The purpose of inserting section 9A in  the 1957  Act, as  stated in the Statement of Objects and Reasons  to Legislative Bill No. 83 of 1972, was to make

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a "provision  of a  statutory basis  for calculation of dead rent". Section  9A also  provides that  the liability of the lessee would be to pay either royalty or dead rent whichever is greater,  thus embodying in the Act what was contained in the proviso  to clause  (c) of  Rule 27 of the Minor Mineral Concession Rules,  1960. Section 9A was inserted also with a view to  prohibit the  Central Government from enhancing the rate of  dead rent  more than once during any period of four years. It  is pertinent to note that by the Amendment Act of 1972 section  9 was  also amended.  While under the original sub-section (1)  of section 9 the liability of the holder of a mining  leave was  only to  pay royalty  in respect of any mineral removed  by him,  after the  amendment  he  is  made liable to  pay royalty in respect of any mineral "removed or consumed  by   him  or  by  his  agent,  manager,  employee, contractor of  sub-lessee". By the Amendment Act of 1972 the power of the Central Government to amend by notification the Second Schedule which specifies the rate of royalty was also curtailed by inserting a proviso to section 9(3) in order to provide that  the Central  Government shall  not enhance the rate of  royalty in  respect of  any mineral  more than once during any  period of four years. The amendments made by the Amendment Act  of 1972  have, therefore,  no  relevance  for ascertaining the scope of the rule-making power of the State Governments under section 15(1).       We  therefore, hold that the view taken by the Gujarat High Court in Smt. Sonbai’s Case and by the Andhra Pradesh 541 High Court  in M.V.  Subba Rao’s Case was wrong and requires to be overruled.      The next contention was that though under section 15(1) the State  Governments may  have the  power  to  make  rules providing for  payment of royalty and dead rent, sub-section (3) showed  that such  power did  not extend to amending the rules so as to enhance the rate of dead rent. The submission in this  behalf was  that the  power to  enhance the rate of royalty by  amending the rules was expressly provided for in sub-section (3)  by the  use  of  the  words  "at  the  rate prescribed for  the time  being in  the rules  framed by the State Government in respect of minor minerals" but there was no such  provision in  section 15 with respect to dead rent. We are unable to accept this submission. Rules under section 15(1), though  made by the State Governments, are rules made under a  Central Act  and  the  provisions  of  the  General Clauses Act,  1897, apply to such rules. Under section 21 of the General  Clauses Act,  where by any Central Act, a power to make  rules is  conferred, then  that  power  includes  a power, exercisable  in the  like manner  and subject  to the like sanction  and conditions if any, to add to, amend, vary or rescind  any rules  so made. The power to amend the rules is, therefore,  comprehended within  the power to make rules and as  section 15(1) confers upon the State Governments the power to  make rules  providing for payment of dead rent and royalty, it  also confers  upon the  State  Governments  the power to  amend those  rules so  as to  alter the  rates  of royalty and  dead rent so prescribed, either by enhancing or reducing such  rates. The source of the power to enhance the rate of  royalty is  not contained  in  sub-section  (3)  of section 15  as submitted at the Bar. As pointed out earlier, the purpose  of inserting the said sub-section in section 15 with retrospective effect was an entirely different one.      It was  then contended  that the  very language of sub- section (1)  of section 15 shows that it does not confer any power upon  the State  Governments to  enhance the  rate  of royalty or  dead rent because the rules which are to be made

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under that  sub-section are  for  regulating  the  grant  of quarry leases,  mining leases  and other mineral concessions in respect of minor minerals and, therefore, the rules under that sub-section  can be  made only with respect to the time when 542 such leases  or concessions are granted and not with respect to any  point of  time subsequent thereto and there being no provision similar  to sub-section  (3) of  section  15  with respect to dead rent, any rule providing for increase in the rate of dead rent during the subsistence of a lease would be ultra  vires  section  15.  This  submission  is  devoid  of substance.  As  pointed  out  earlier,  sub-section  (3)  of section 15 does not confer any power to amend the rules made under section  15(1), for  the power  to amend  the rules is comprehended within the power to make the rules conferred by sub-section (1) of section 15. The construction sought to be placed upon the word "grant" in section 15(1) also cannot be accepted. While  granting a  lease it is open to the grantor to prescribe  conditions which are to be observed during the period of  the grant and also to provide for the forefeiture of the  lease on  breach of  any of those conditions. If the grant of  a lease were not to prescribe such conditions, the lessee could with impunity commit breaches of the conditions of the lease. Ordinary leases of immovable property at times provide for  periodic increases  of rent  and  there  is  no reason why  such increases should not be made in a mining or quarry lease  or other  mineral concession  granted under  a regulatory statute  intended for  the benefit  of the public and even  less reason  why such  a statute should not confer power to  make rules  providing for increases in the rate of dead rent during the subsistence of the lease. In any event, the power  to make  rules under  section 15(1)  is also  for purposes connected  with the  grant  of  mining  and  quarry leases and other mineral concessions and the expression "and for purposes connected therewith" read with the word "grant" would include  the power  to enhance  the rate  of dead rent during the subsistence of the lease.      In  support   of  the  above  contention  it  was  also submitted that  in the  absence of  a provision like the one contained in  section 15(3) the power to enhance the rate of dead rent  cannot be  so exercised  as to  affect subsisting leases and  that unless  this construction  were placed upon sub-section (1),  the power  conferred by  that  sub-section would be  bad in  law as  being an  arbitrary power.  It was submitted that  a mining  lease is  the result of a contract entered into  between two  parties and  dead rent is part of the consideration for the grant of the lease, and just as in the case of a contract of sale of 543 goods, it  cannot be left to the sweet will of the seller to charge what  price he  liked, in the same way in the case of leases and  concessions  granted  under  section  15(1),  it cannot be  left to  the State Governments to amend the rules so as  to charge  whatever dead  rent they like and whenever they like  during the  subsistence of  the lease. We find no substance in  either of  these submissions.  A quarry lease, mining lease  or other  mineral concession  in respect  of a minor mineral  does not  stand on  the same  footing  as  an ordinary contract.  These leases and concessions are granted by the  State Governments  pursuant to  rules made under the statutory power  conferred upon  them by  a regulatory  Act. Minerals are part of the material resources which constitute a nation’s  natural wealth  and if  the nation is to advance industrially and  if its  economy is to be benefitted by the

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proper development and exploitation of these resources, they cannot be  permitted to  be  frittered  away  and  exhausted within a  few years  by indiscriminate  exploitation without any regard  to public  and national  interest. The same view was expressed  by the  Court in  State of Tamil Nadu v. Hind Stone Etc.,  [1981] 2.S.C.R.  742, 751. It was for achieving the object set out above that both the 1948 Act and the 1957 Act were  enacted. The long title of the 1957 Act is "An Act to provide  for the  regulation of mines and the development of minerals  under the  control of  the Union." The 1948 Act contained a  preamble which  stated "WHEREAS it is expedient in the  public interest  to provide  for the  regulation  of mines and  minerals and  for the  development of minerals to the  extent   hereinafter  specified".  The  makers  of  the Constitution recognized  the importance to the nation of the regulation of  mines and mineral development and, therefore, enacted Entry 54 of the Union List and Entry 23 of the State List. In  the exercise  of the  power conferred by Entry 54, Parliament has  made a  declaration in section 2 of the 1957 Act that  "it is  expedient in  the public interest that the Union should  take under its control the regulation of mines and the  development of  minerals to  the extent hereinafter provided". The presumption is that an authority clothed with a statutory  power will  exercise such power reasonably, and if in the public interest and for the efficacious regulation of mines  and quarries  of minor  minerals  and  the  proper development of  such minerals,  a State  Government  as  the delegate of  the Union  Government thinks  fit to  amend the rules so  as to  enhance the rate of dead rent, it cannot be said that it 544 is prevented from doing so by the principles of the ordinary law of  contracts. It  may  be  that  in  certain  cases  by enhancing the  rate of  dead rent  the holders  of leases in respect of  certain types of minor minerals may be adversely affected  but   private  interest  cannot  be  permitted  to override public interest. Conservation of minerals and their proper exploitation  result in  securing the maximum benefit to the  community and it is open to the State Governments to enhance the  rate of  dead rent  so as  to ensure the proper conservation and  development of  minor minerals even though it may affect a lessee’s liability under a subsisting lease.      Where a  statute confers  discretionary powers upon the executive or  an administrative  authority, the  validity or constitutionality of  such power  cannot be  judged  on  the assumption that  the executive or such authority will act in an arbitrary  manner  in  the  exercise  of  the  discretion conferred upon  it. If  the executive  or the administrative authority acts  in an  arbitrary manner, its action would be bad in  law and  liable to  be struck down by the courts but the possibility  of abuse  of power or arbitrary exercise of power cannot  invalidate the statute conferring the power or the power which has been conferred by it.      The next  submission was  that the rates of royalty and dead rent  cannot be enhanced unilaterally without giving an opportunity of  being heard  to the  lessees  who  would  be adversely affected  thereby. This  submission  found  favour with the  Gujarat High  Court in  Smt. sonbai’s Case. It was sought to be supported by a reference to section 9(3), 9A(2) and 28.  Under section  9(3) the  Central Government can, by notification published  in the  Official Gazette,  amend the second Schedule  to the  1957 Act so as to enhance or reduce the rate  at which  royalty is  payable and  similarly under section 9A(2)  the Central  Government can,  by notification published in  the Official Gazette, amend the Third Schedule

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to the 1957 Act so as to enhance or reduce the rate at which dead rent  is payable.  Under section  28,  every  rule  and notification made  by the  Central Government  is to be laid before Parliament  and if  not approved,  it is  to be of no effect. There is no such provision with respect to a rule or notification amending  a rule made by a State Government. It was,  therefore,  submitted  that  in  the  absence  of  any provision for legislative approval 545 with respect to the rules made by the State Governments or a notification  amending  such  rules,  it  is  all  the  more necessary  that  an  opportunity  should  be  given  to  the concerned lessees  to raise their objections to any proposed enhancement. The  argument that  the lessees  who  would  be affected by  an enhancement  in the  rate of royalty or dead rent should be heard before making such enhancement is based upon a total misunderstanding of the rule-making process and the power  to make  rules. The  enhancement in  the rates of royalty and  dead rent  is made in the exercise of the power to amend  the rules  framed under  section 15(1). It is thus made in  the exercise  of statutory  power. There is no such principle of  law that  before such  a  statutory  power  is exercised, persons  who may  be affected  thereby should  be heard. Whether  any opportunity  is to  be given  to persons affected to  make representations  to the  Government  would depend upon  the form  in which  the  rule-making  power  is conferred. It  is for the legislative body which confers the rule-making power  to decide  in what form such power should be conferred.  In some Acts it is provided that the draft of the rules proposed to be made as also any proposed amendment thereto should  be published in the Official Gazette so that members of the public may have an opportunity of making such representations or  raising such  objections as  they  think fit. Some  other Acts  provide for  rules to  be laid before Parliament or  the Legislature  for its  approval and  to be effective only  after such  approval is given or to continue in force  with  such  modifications  as  Parliament  or  the Legislature may  make, and  if the  approval is not given to cease to  have any effect. It was, therefore, for Parliament to decide  whether rules and notifications made by the State Governments  under  section  15(1)  should  be  laid  before Parliament or  the Legislature  of the  State  or  not.  It, however, thought  it fit  to do  so with respect to minerals other than  minor minerals since these minerals are of vital importance to  the country’s  industry and  economy, but did not think  it fit  to do  so in  the case  of minor minerals because it  did not consider them to be of equal importance. An amendment  of the  rules made  under section  15(1), even though it  may have  the effect  of enhancing  the rates  of royalty or  dead rent does not, therefore, become bad in law because  no   opportunity  of   being  heard   or  making  a representation  is   given   to   persons   who   would   be prejudicially  affected  thereby.  Section  15(1)  does  not contain any provision for giving any such opportunity and no such provision can be imported into that sub-section. 546      Another submission  which was made was that sub-section (3) of  section 15  speaks of  a "mining  lease or any other mineral concession"  while sub-section  (1)  of  section  15 speaks of  "quarry leases,  mining leases  or other  mineral concessions" and,  therefore, the  power to fix from time to time the  rate of  royalty under  sub-section (3)  can  only apply to  mining leases  and other minor mineral concessions and not to quarry leases. This submission was based upon the contention that  the power  to charge  royalty or enhance or

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reduce its  rates from  time to  time is to be found in sub- section (3)  and not  in sub-section (1). As this contention itself is  erroneous as  pointed out  above, the  submission based upon it must also fall. Under clause (c) of section 3, "mining lease"  inter alia  means "a  lease granted  for the purpose of  undertaking mining operations". Under clause (d) of section  3, the expression "mining operations" means "any operations  undertaken   for  the  purpose  of  winning  any mineral". "Quarry"  is define  in the Shorter Oxford English Dictionary, Third  Edition, as  "an  excavation  from  which stone for  building, etc. is obtained for cutting, blasting, or the  like"  and  "to  quarry"  is  defined  in  the  same Dictionary as  meaning  "to  obtain  (stone,  etc.)  by  the processes  employed   in  a   quarry".  The  Concise  Oxford Dictionary, Sixth  Edition, defines  "to quarry" as "Extract (stone) from  quarry". Quarrying  minerals is,  therefore, a mining operation  inasmuch as  it consists  of an  operation undertaken for  the purpose of winning particular classes of minerals. Clause (vi) of Rule 2 of the Gujarat Rules defines "quarry lease" as meaning "a kind of mining lease in respect of a minor mineral granted under these rules." Quarry leases are, therefore, included in the term "mining leases".      Yet another contention raised was that the intention of Parliament as shown by the proviso to section 15(3) was that the lessees  of mining  and quarry  leases and other mineral concessions should  have a  sense  of  security  that  their financial liability will not be enhanced in rapid succession so as  to cast  an unbearable  burden upon  them and make it unprofitable for them to work the quarry or the mine. It was further submitted  that though  under the proviso to section 15(3), the  rate of  royalty in  respect of  a minor mineral cannot be  enhanced more than once during any period of four years,  there  was  no  such  restriction  with  respect  to enhancing the rate of 547 dead rent  and the  State  Governments  cannot  nullify  the prohibition contained  in the  proviso to  section 15(3)  by repeatedly and  frequently enhancing  the rate  of dead rent and that  the absence  of such  a restrictive provision with respect to  dead rent shows that it was not the intention of Parliament to  confer power  upon the  State  Government  to enhance the  rate of  dead rent  so as  to affect subsisting leases. Although  at the  first blush  there seems  to be  a considerable force  in this submission, on a closer scrutiny the true position would appear to be otherwise.      As pointed  out earlier, since dead rent is the minimum guaranteed amount  of royalty  and partakes of the nature of royalty,  what,   therefore,   applies   to   royalty   must necessarily apply  or should be made applicable to dead rent also. The  proviso to  section 9(3)  prohibits  the  Central Government from  enhancing the rate of royalty in respect of any mineral other than a minor mineral more than once during any period  of four years. The proviso to section 9A(2) also prohibits the  Central Government  from enhancing  the  dead rent in respect of any area more than once during any period of four  years. Halsbury’s  Laws of England, Fourth Edition, Volume 31,  paragraph 236,  points  out  that  "usually  the royalties are  made to merge in the fixed rent by means of a provision that  the lessee,  without any additional payment, may work,  in each  period for which a payment of fixed rent is made,  so much of the minerals as would, at the royalties reserved, produce  a sum  equal to the fixed rent." The same purpose is  achieved by  the proviso to section 9A(1) and in the Mineral Concession Rules, 1960, by the proviso to clause (c) of  Rule 27  under which the lessee is liable to pay the

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dead rent  or royalty  in respect of each mineral, whichever be higher  in amount, but not both. In all State rules which provide for  payment of both dead rent and royalty, there is a provision  that only  dead rent  or royalty,  whichever is higher in  amount, is  to be  paid, but not both. Rules made under the  1948 Act,  as for example, Rule 41 of the Mineral Concession Rules,  1949, and  Rule 18  of the Bombay Mineral Extraction Rules,  1955, also contained a similar provision. Thus, the  practice followed  throughout in  exercising  the power to  make rules  regulating the  grant of mining leases has been  to provide  that  either  dead  rent  or  royalty, whichever is higher in amount, should be paid by the lessee, but not both. 548      A construction  placed upon  section 15(1) which leaves the State  Governments free to enhance the rate of dead rent as and  when they  like while  the proviso  to section 15(3) prohibits them  from enhancing the rate of royalty more than once  during   a  period  of  four  years  would  amount  to nullifying the object for which the proviso to section 15(3) was enacted.  The same  restrictions  as  contained  in  the proviso to  section 15(3)  must, therefore,  apply  to  dead rent. Such  a  construction  would  be  in  consonance  with practice, both past and present. Thus construed there cannot be  anything   objectionable  in  the  power  of  the  State Governments to  enhance dead  rent. We accordingly hold that the State  Governments cannot  enhance the rate of dead rent more than once during a period of four years.      As an  extension of  the above submission, it was urged that royalty  and dead  rent were  one  and  the  same  and, therefore, either  royalty  or  dead  rent  alone  could  be enhanced once  during any period of four years but not both. According to  this argument,  if during  any period  of four years royalty  is enhanced,  dead rent  cannot  be  enhanced during that  period but  can only  be enhanced  in the  next period of  four years.  Although in  one sense dead rent may partake of  the nature  of royalty,  there is  a substantial difference between  both. The  bases for calculating royalty and dead  rent are  different and  they are  dealt  with  in different provisions of the 1957 Act (namely, sections 9 and 9A) so  far  as  minerals  other  than  minor  minerals  are concerned and  in the  rules made  by the  State Governments under section  15(1) so far as minor minerals are concerned. It is, therefore, not possible to accept the above argument. According to  us, during  any one period of four years, dead rent and royalty both can be enhanced but only once.      As the  Gujarat Rules  have been  amended from  time to time by  the impugned  Notifications so  as  to  enhance  or reduce the  rate of  royalty or  dead rent  or both,  it  is necessary at  this stage before turning to the Gujarat Rules to consider  what the  expression "during any period of four years" occurring  in the  proviso to section 15(3) means. It is pertinent  to note that the words used in the proviso are "shall not  enhance the  rate of  royalty. ..  for more then once during  any period  of four  years." This  is a  wholly different thing from saying that 549 where the  rate of  royalty has  been enhanced once it shall not be  enhanced again  for a  period of  four years  or, in other words,  until a  period of four years from the date of such enhancement  has expired.  The period of four years for this purpose  must be and can only be reckoned from the date of coming  into force of the rules and it is open to a State Government to  enhance the  rate of  royalty or dead rent at any time  once during  the period  of four  years  from  the

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coming into force of the rules and after each period of four years expires  at any  time during each succeeding period of four years.  The Gujarat  Rules came  into force on April 1, 1966. Therefore,  in the case of the Gujarat Rules the first period of  four years  would be  1.4.1966 to  31.3.1970, the second period  would be  1.4.1970 to  31.3.1974,  the  third period would  be 1.4.1974  to 31.3.1978,  the fourth  period would be  1.4.1978 to  31.3.1982, the  fifth period would be 1.4.1982 to 31.3.1986 and so on thereafter. Thus, during any of these  periods of  four years  both dead rent and royalty can be  enhanced by  the Government of Gujarat but only once during each such period.      In the  light of  what we  have held  above we will now examine the  Gujarat Rules  and the validity of the impugned amendments thereto.  The Gujarat  Rules  were  made  by  the Government  of   Gujarat  by  Notification  No.  GU  125-MCR 2164/5089 CHH  dated March  18, 1966.  They extended  to the whole of  the State  of Gujarat and came into force on April 1, 1966.  Clause (vi)  defines the  term "Quarry  lease"  as meaning "a  kind of  mining lease  in  respect  of  a  minor mineral granted  under these  rules". Clause  (viii) defines the term  "Schedule" as  meaning "a Schedule appended to the rules". Chapter  II of the Gujarat Rules deals with grant of quarry leases in respect of lands in which the minerals vest in Government. Schedule I to the Gujarat Rules specifies the rates of royalty on different minor minerals and Schedule II the rates  of dead  rent. By  Notification dated  August 25, 1969, a  new chapter, namely, Chapter III-A, was inserted in the Gujarat  Rules providing for grant of parwana in respect of lands in which minerals belong to Government. Clause (vi- A) which  was inserted  in Rule  2 by  the same Notification defines "Quarrying  parwana" as meaning "a quarrying parwana granted under  these rules  to extract  and remove any minor mineral from land not exceeding a specified area." 550      Rule 21 deals with rates of royalty. As originally made it provided as follows :           "21. Rates of royalty. -           Royalty  shall   be  leviable  on  minor  minerals           quarried from  the leased area specified in column           1  of   Schedule  I   at  the  rates  respectively           specified against  them in  column 2  of the  said           Schedule." By Notification  dated September 22, 1966, the said rule was renumbered as  sub-rule (1)  and a new sub-rule was inserted in Rule 21 as sub-rule (2). Sub-rule (2) provided as follows :           "(2) The  Government may,  by notification  in the           Official  Gazette,  amend  Schedule  I  so  as  to           enhance or  reduce the rate at which royalty shall           be payable in respect of any minor mineral :           Provided that  the rate  in respect  of any  minor           mineral shall not be enhanced before the expiry of           a period  of three  years from the commencement of           these rules  or, before  the expiry of a period of           three years  from the  date with effect from which           the rate in respect of that minor mineral may have           been last altered." By Notification  dated November  25, 1966, the Government of Gujarat made  the Gujarat  Minor Mineral  (Third  Amendment) Rules,  1966.   By  this  Notification  an  Explanation  was inserted to Rule 21 which was as follows :           "Explanation. -  For  the  purpose  of  this  rule           Schedule I  means Schedule I as substituted by the           Gujarat Minor  Minerals (Third  Amendment)  Rules,

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         1966." By the  same Notification  Schedule I was substituted. Under the substituted  Schedule I  the rates of royalty in respect of some  minor minerals  remained the same but in respect of other minor  minerals they  were reduced.  Accordingly, Rule 21-A  was  inserted  in  the  Gujarat  Rules  providing  for remission of  any excess  amount of royalty collected at the rates specified in 551 the original Schedule I and further providing that where the royalty had not been paid, collected or recovered, it was to be paid,  collected or  recovered at  the rates specified in the substituted Schedule I.      Rule 22  contains the general conditions to be included in every  quarry lease.  The relevant  provisions of Rule 22 are as follows :           "22. General Conditions of lease. -           Every  quarry   lease  shall  be  subject  to  the           following conditions  and such conditions shall be           included in every quarry lease :-           (i)(a) The lessee shall, during the subsistence of           the lease,  pay to  Government  royalty  on  minor           minerals quarried  from the  leased  area  at  the           rates for  the time  being specified in Schedule I           at such times and in such manner as the Government           may prescribe.           (b) The  lessee shall  also pay  to Government for           every year  of the  lease  the  yearly  dead  rent           specified in  Schedule II and if the lease permits           the working  of more than one minor mineral in the           same area, the Director may fix separate dead rent           in respect of each mineral :           Provided that  the lessee  shall be  liable to pay           the dead  rent  or  royalty  in  respect  of  each           mineral whichever is higher, but not both.           (ii) the  lessee shall  also pay to Government for           the surface area leased to him surface rent at the           rate prescribed by Government".      By Notification dated July 6, 1974, the word "Director" (that is,  the Director  of Geology & Mining, Gujarat State) was substituted by the words "competent officer". Under Rule 11(5), a  deed of  lease is to be executed in Form D or in a form as  near thereto  as the circumstances of each case may require. Form D appended to the Gujarat Rules inter alia 552 provides for  payment by a lessee to the State Government of "the several rents and royalties mentioned in Part V" of the Schedule to  the said  Form. Part  V of  the  said  Schedule provides as follows :                            PART V           Rents and Royalties Reserved by this lease           1. To  pay  dead  rent  or  royalty  whichever  is           greater.-           The lessee/lessees  shall not  be liable to pay in           respect of  any yearly  period, both the dead rent           reserved by Clause 2 of this Part and also the sum           of the  royalties reserved  by Clause  3  of  this           Part, but  shall pay  only whichever  of the  said           sums is greater.           2. Rate and mode of payment of dead rent. -           Subject to the provision of Clause 1 of this Part,           as  from  the  day  of  .........19...............           during  the   subsistence  of   this   lease   the           lessee/lessees shall  pay to  the State Government           annual  dead  rent  at  the  following  rates  per

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         hectare of  the lands  described in Part I of this           Schedule. (Here  insert the  amount payable  under           Rule 22(iii) of the said Rules).           3. Rate and mode of payment of royalty. -           Subject to  the provisions  of Clause  1  of  this           Part,  the   lessee/lessees  shall,   during   the           subsistence of  this lease,  pay to  Government at           such times  and in  such manner  as the Government           may prescribe  royalty in  respect  of  any  minor           minerals removed  by him/them from the leased area           at the  rates for  the time  being in  force under           Schedule I to the Gujarat Mineral Rules, 1966.           4. Payment of surface rent. - 553           The lessee  shall pay rent to the State Government           for all  parts of  the surface  area leased to him           for the  purpose of  quarrying surface rent at the           rate prescribed by Government.           Here  insert  the  total  amount  payable  at  the           beginning  of  the  year  (i.e.  on  the  date  of           execution of lease deed in every year)." Clause (3)  of Part VI of the said Schedule confers upon the State Government the power to enter upon the leased premises and distrain  all or  any of  the  mineral  or  beneficiated processed/dressed products  or movable property there and to sell the same or so much as is necessary to recover the rent or royalties  due and  all costs  and expenses  in case  the royalty or  rent or  both reserved  and made  payable by the lessee is not paid within sixty days after the date fixed in the lease  for the payment thereof. Under clause (3) of Part IX of  the said  Schedule, if  a lessee or his transferee or assignee  commits  any  breach  of  any  of  the  conditions specified inter alia in clauses (i), (ii), (iii) and (iv) of Rule 22  of the  Gujarat Rules,  the competent officer is to give notice  in writing  to the  lessee or his transferee or assignee, as  the case  may be,  asking him  to  remedy  the breach within  sixty days from the date of the notice and if the breach  is not remedied within such period, to determine the lease.  By Notification  dated August  25, 1969,  clause (12) was inserted in Part IX of the Schedule to Form D. This clause provides as follows :           "12. This  quarrying lease shall be subject to the           Gujarat Minor  Mineral Rules, 1966 as amended from           time to time."      By the 1974 Notification the Government of Gujarat made the Gujarat  Minor Mineral  (Fourth Amendment)  Rules, 1974, which came  into force with effect from December 1, 1974. By the 1974  Notification, Schedule  I  to  the  Gujarat  Rules prescribing  the   rates  of  royalty  was  substituted  and Schedule II  which prescribing  the rates  of dead  rent was amended. By  the substituted Schedule I the rates of royalty on several  minor minerals were enhanced while in respect of a few  they remained  the same. By the amendment of Schedule II the rates of dead rent were enhanced. 554      By the  1975 Notification,  the Government  of  Gujarat made the  Gujarat Minor  Mineral (Second  Amendment)  Rules, 1975, which came into force on November 1, 1975. By the 1975 Notification the  rates of  royalty specified  in Schedule I were again  altered so as to enhance the rates in respect of some minor  minerals. The 1975 Notification also substituted Rule 21. The substituted Rule 21 is as follows :           "21. Rate of Royalty. -           The holder  of a mining lease or any other mineral           concession granted  under these  rules  shall  pay

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         royalty in respect of minor minerals, specified in           column 1 of Schedule I, removed or consumed by him           or by  his agent, manager, employee, contractor or           sub-lessee from  the  leased  area  at  the  rates           respectively specified against them in column 2 of           the said schedule." As mentioned  earlier, the  Gujarat High  Court  in  Letters Patent Appeal No. 61 of 1978 - Ambalal Manibhai Patel v. The State of Gujarat and Anr. and other connected writ petitions held that  the 1974  Notification had  not become  operative and, therefore,  the 1975  Notification did  not violate the provisions of  the proviso to Rule 15(3) and was valid. This judgment is  the subject-matter of appeal before us in Civil Appeals Nos. 706 and 1934 of 1981.      In  order   to  reach  the  conclusion  that  the  1974 Notification was  inoperative, the  Gujarat High  Court held that for altering the rates of royalty specified in Schedule I, two steps were required, namely, (1) the amendment of the Explanation to Rule 21, and (2) the amendment of Schedule I, and that  by amending only Schedule I by substituting it but leaving the  Explanation to  Rule 21  intact,  the  intended amendment did not come into effect and that it was only when Rule 21  was amended and a new Schedule I substituted by the 1975 Notification  that a  proper amendment  in the rates of royalty was  effected and, therefore, what was operative was the 1975  Notification. We  are unable  to accept either the above conclusions  reached by  the Gujarat High Court or the reasoning upon  which  these  conclusions  were  based.  The Explanation to  Rule 21  provided that  "For the  purpose of this 555 rule Schedule  I means  Schedule I  as  substituted  by  the Gujarat Minor Minerals (Third Amendment) Rules, 1966." Thus, the reference  to Schedule I in Rule 21 was to Schedule I as substituted by  the Notification  dated November  25,  1966. That Schedule  was, however,  again substituted  by the 1974 Notification. The  effect of such substitution was to repeal the 1966  Schedule I  and to substitute it by a new Schedule I. Under  section 8(1)  of the  General Clauses  Act,  1897, where the  said Act  or any  Central Act  or Regulation made after the  commencement of  the said  Act, repeals  and  re- enacts, with  or without  modification, any  provision of  a former enactment,  then references in any other enactment or in any instrument to the provision so repealed are, unless a different intention  appears, to  be constured as references to the  provision so  re-enacted. Though section 8(1) of the General Clauses Act does not in express terms refer to rules made under an Act, the same principle of construction would, in our  opinion, apply  in the  case of  rules made under an Act.  Thus,   after  the  coming  into  force  of  the  1974 Notification, the  Explanation to  Rule 21  must be  read as "For the purpose of this rule Schedule I means Schedule I as substituted by  the Gujarat Minor Mineral (Fourth Amendment) Rules, 1974" and references to Schedule I in Rule 21 must be construed as  references to Schedule I as so substituted and not as  references to  Schedule  I  as  substituted  by  the Gujarat Minor Minerals (Third Amendment) Rules, 1966.      The emphasis  placed by the Gujarat High Court upon the substitution of Rule 21 by the 1975 Notification in order to arrive at  the conclusion  that the  1974  Notification  was invalid and  inoperative and the 1975 Notification was valid was entirely  misconceived. Rule  21 was not substituted for the purpose  of conferring  upon the  State  Government  the power to  enhance the rates of royalty specified in Schedule I. It  was  substituted  for  a  wholly  different  purpose,

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namely, to  bring the  said Rule  in  conformity  with  sub- section (3)  which was inserted with retrospective effect in section 15  by the  Amendment Act of 1972. Its object was to make the  holder of  a mining  lease or  any  other  mineral concession liable for payment of royalty not only in respect of minor minerals removed or consumed by him but also by his manager,  employee,   contractor  or  sub-lessee.  The  sole repository of  the power  of the  State Governments to amend the rules,  including rules specifying the rates of royalty, is sub-section (1) of section 556 15. Rule  21 did  not have  any relevance  or bearing on the scope or  exercise of that power. In fact, sub-clause (a) of clause (i)  of Rule  22 and  clause (3)  of Part  V  of  the Schedule to  Form D  (namely, the  Form of  Quarrying Lease) appended to the Gujarat Rules expressly provided a condition that the  lessee is  to pay to the Government royalty at the rates for  the time  being specified  in and  in force under Schedule I  to the Gujarat Rules. Strangely enough, the High Court relied  upon clause  (3) of  Part V of the Schedule to Form D to the Gujarat Rules while repelling the challenge to the  1975   Notification  on   the  ground  that  the  State Government had no power to alter the rates of royalty during the subsistence  of a lease but altogether omitted to notice the said  clause while dealing with the question whether the 1974 Notification  had become  operative or  not.  The  High Court also  omitted to  notice clause  12 of  Part IX of the Schedule to  Form D  under which  a quarrying lease is to be "subject to  the  Gujarat  Minor  Mineral  Rules,  1966,  as amended from time to time".      We, therefore,  hold that  the  1974  Notification  was valid  in   law  and  the  amendments  made  thereby  became operative with  effect from  December  1,  1974.  Under  the proviso to  section 15(3), the State Government had no power to enhance  the rate  of royalty  in respect  of  any  minor mineral more  than once during any period of four years. The enhancement in the rates of royalty by the 1974 Notification was in the third period of four years reckoned from the date of coming  into force  of the  Gujarat Rules,  namely,  from April 1,  1966. This third period was from April 1, 1974, to March 31,  1978. The  rates of  royalty having been enhanced once by  the 1974  Notification, they  could not be enhanced again during  this period  and could only be enhanced during the subsequent  period which  commenced from  April 1, 1978. The 1975  Notification, however,  once again enhanced during the same  period the  rates of royalty in respect of several minor minerals  and to the extent that the 1975 Notification enhanced the  rates of  royalty in  respect of  those  minor minerals, it was invalid as violating the proviso to section 15(3). The  judgment under  appeal of the Gujarat High Court to the  extent that  it holds to the contrary is, therefore, erroneous and requires to be reversed and set aside.      Yet another  contention which  was raised before us was that under  the definition  of  "minor  minerals"  given  in clause 557 (e) of  section 3  of the  1957 Act,  "building stones"  are minor minerals and, therefore, under section 15(1) the State Government can  levy royalty only on building stones as such and cannot  classify them  into different  varieties for the purpose of  recovering royalty  upon them  at varying rates. This argument  was also  advanced before  the  Gujarat  High Court and  was rejected  by it.  We fail  to understand  the point which  is sought  to be  made. As building stones have been defined  as being minor minerals, the rule-making power

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with respect  thereto vests  in the  State Governments under section  15(1).   The  1957   Act  does   not  enjoin  State Governments to  charge a  uniform rate of royalty in respect of all  varieties of  building stones  nor does  it prohibit them  from   classifying  building   stones  into  different varieties and  charging royalty  thereon at  separate rates. This part  of the  judgment under appeal of the Gujarat High Court must, therefore, be upheld.      By the 1976 Notification the Government of Gujarat made the Gujarat  Minor Mineral  (Second Amendment)  Rules, 1976, which came  into force  with effect  from April 6, 1976. The 1976 Notification  substituted Schedule  II to  the  Gujarat Rules so  as to  enhance the  rates of  dead rent.  We  have already held  that the rates of dead rent cannot be enhanced by the  State Government more than once during any period of four years.  During this  particular period  of four  years, namely, the  third period  commencing on  April 1, 1974, and ending on March 31, 1978, the rates of dead rent had already been enhanced with effect from December 1, 1974, by the 1974 Notification. The  second enhancement  made during  the same period by  the 1976  Notification was not permissible in law and the  1976 Notification  must, therefore,  be held  to be invalid.      By the 1979 Notification the Government of Gujarat made the Gujarat  Minor Minerals  (Amendment) Rules,  1979, which came into  force with  effect from  April 1,  1979. The 1979 Notification inserted  a new  rule  in  the  Gujarat  Rules, namely, Rule 21-B. The said Rule 21-B is as follows :           "21-B. Rate of dead rent. -           The holder  of a mining lease of any other mineral           concession granted  under these  rules  shall  pay           yearly dead rent in respect of minor minerals 558           specified in  column I, for the areas mentioned in           column 2,  at  the  rates  respectively  specified           against them in column 3 of Schedule II". It further  substituted in  sub-clause (b)  of clause (i) of Rule 22  the words  "as may  be specified from time to time" for the  word "specified".  It further substituted in clause (2) of  Part V  of the  Schedule to  Form D  appended to the Gujarat Rules  the words  "at the  rate as  may be specified from time to time" for the words "at the rate mentioned". It also substituted  Schedule I  to the  Gujarat Rules so as to reduce the  rate of  royalty on  all minor  minerals to  ten paisa per  metric tonne.  It also substituted Schedule II so as to  enhance the rates of dead rent. In Smt. Sonbai’s Case the Gujarat High Court held the 1979 Notification to be void as being  ultra vires section 15 of the 1957 Act and Article 19(1)(g) of  the Constitution. We have already discussed the correctness of  that judgment  and have  held that under the rule-making power  conferred upon them by section 15(1), the State Government  can make  rules charging dead rent as also can amend  the rules to enhance the rates of dead rent so as to effect  even subsisting  leases and have pointed out that the judgment of the Gujarat High Court in Smt. Sonbai’s case is not  correct. The reasons given by the Gujarat High Court for coming  to the  conclusion that  the  1979  Notification violated  Article  19(1)(g)  were  very  much  the  same  as prompted it  to hold  that the  State Government  could  not enhance the  rates of  dead rent during the subsistence of a lease. Those  reasons are erroneous. We do not find that the enhancement in  the rates  of dead  rent made  by  the  1979 Notification amount  to any unreasonable restrictions on the right of  the holders  of quarry  leases to  carry on  their trade or  business. The  rates of dead rent specified in the

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1979 Notification  cannot be looked at in isolation but must be read  in conjunction  with the  drastic reduction made in the  rates   of  royalty   and  so  read  there  is  nothing unreasonable in  them. We,  therefore, hold  that  the  1979 Notification  was  valid  in  law  and  constitutional.  The Gujarat High  Court in Smt. Sonbai’s case also held that the 1976 Notification  was ultra  vires section  15 and  Article 19(1)(g) of  the Constitution for the same reasons as in the case of the 1979 Notification. These reasons are not correct and cannot  be sustained.  We have,  however, held  that the 1976 Notification is invalid on an 559 entirely different  ground, namely,  because it enhanced the rates of  dead rent  for the  second time  during  the  same period of four years.      The previous  enhancement in the rates of dead rent was made by  the 1974  Notification during  the third  period of four years,  the enhancement  in the rates of dead rent made by the  1976  Notification  during  the  same  period  being invalid. The  enhancement in  the rates of dead rent made by the 1979  Notification was  during the fourth period of four years which  commenced on  April 1,  1978 and ended on March 31, 1982.  The 1979 Notification, therefore, did not violate the bar  against enhancing  the rates of dead rent more than once during any period of four years.      As a  consequence of  the judgment  of the Gujarat High Court in Smt. Sonbai’s case the Government of Gujarat issued the impugned  Circular dated  February 12, 1981. In the said Circular it  was stated  that as  the 1979  Notification had been declared  ultra vires by the High Court, the Government was advised  that royalty  could be  charged from  April  1, 1979, at  the rates  which were  in force  on the eve of the publication of  the 1979  Notification. By the said Circular instructions  were   issued  to   all  Collectors,  District Development Officers  and the  Director, Geology and Mining, Ahmedabad, to  collect royalty  on minor  minerals  quarried from April  1, 1979,  on  this  basis  and  in  making  such recovery to  adjust the  amounts paid  by the  holder of the lease by way of dead rent. Accordingly, royalty was demanded and collected  from the  lessees on  the basis  of the rates specified in  the 1975  Notification, the  validity of which had been upheld by the Gujarat High Court.      The validity  of the  said Circular  and the directions given thereunder have been challenged on the ground that the Gujarat High Court had merely held that the State Government had no  power to  charge dead  rent or  to enhance its rates under section  15 of the 1957 Act and, therefore, it was not justified in  striking down  the  entire  1979  Notification including that  part of  it which  related  to  royalty  but should have struck down only that part which dealt with dead rent. The  said Circular  was also  challenged on the ground that Schedule  I as  substituted by  the  1975  Notification having been  substituted by  a new  Schedule I  by the  1979 Notification, such 560 substitutions amounted to a repeal of Schedule I as notified by the 1975 Notification and a re-enactment of Schedule I by the 1979  Notification.  As  we  have  held  that  the  1979 Notification is  valid and  constitutional, these  questions have become  academic and  do not require to be decided, but the second  challenge to  the validity  of the said Circular falls  to   be  decided   by  us   with  respect   to  other Notifications.  As   seen  above,   the  1974   Notification substituted Schedule  I and  amended Schedule  II. The  1975 Notification which  again substituted  Schedule I  has  been

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held by  us to be invalid to the extent that it enhanced the rates of  royalty in  respect of some of the minor minerals. The 1976  Notification which enhanced the rates of dead rent specified in  Schedule II  has also  been held  by us  to be invalid.  The   question  is  whether  by  reason  of  these Notifications being  invalid, the  rates of royalty and dead rent specified in the 1974 Notification revived. A number of authorities  were   cited  before   us  in  support  of  the contention that  when an  Act or  a statutory  provision  is struck down by the Court, the Act or the statutory provision which had  been  repealed  by  such  Act  or  the  statutory provision does not revive. It is unnecessary to refer to all the decisions  of this  Court on  this subject  for all  the previous decisions have been reviewed by this Court in State of Maharashtra  etc.  v.  The  Central  Provinces  Provinces Manganese Ore  Co. Ltd.,  [1971] 1 S.C.R. 1002. In that case the Central  Provinces and  Berar Sales Tax (Amendment) Act, 1949, subsitituted Explanation II in clause (g) of section 2 of the  Central Provinces  and Berar Sales Tax Act, 1947. As such  substitution   did  not  receive  the  assent  of  the Governor-General under  section 107  of  the  Government  of India Act,  1935, it  was void. The assessees contended that as the  original Explanation  II was validly repealed by the Amending Act  of 1949  and as  no valid  substitution of the repealed provision had taken place, only the repeal survived with the  result that neither the old Explanation II nor the substituted Explanation II was in operation. This contention was rejected  by this Court. This Court held (at pages 1009- 1010) :           "We do  not think  that  the  word  ‘substitution’           necessarily  or   always  cannotes  two  severable           steps, that  is to  say, one of repeal and another           of a fresh enactment even if it implies two steps.           Indeed, the natural meaning of the word 561           ’substitution’ is  to indicate  that  the  process           cannot be  split up  into two pieces like this. If           the process  described as ’substitution’ fails, it           is totally  ineffective so as to leave intact what           was sought to be displaced. That seems to us to be           the ordinary  and natural  meaning  of  the  words           ’shall be substituted’. This part could not become           effective  without  the  assent  of  the  Governor           General.   The   State   Governor’s   assent   was           insufficient. It  could not be inferred that, what           was intended  was that,  in case  the substitution           failed or  proved ineffective,  some  repeal,  not           mentioned at  all, was  brought about and remained           effective so as to create what may be described as           a vacuum  in the  statutory  law  on  the  subject           matter.  Primarily,   the  question   is  one   of           gathering the  intent from the use of words in the           enacting  provision  seen  in  the  light  of  the           procedure gone  through.  Here,  no  intention  to           repeal, without  a substitution,  is deducible. In           other  words,   there  could   be  no   repeal  if           substitution failed.  The  two  were  a  part  and           parcel of  a single  indivisible process  and  not           bits of a disjointed operation." The position before us is the same. It was not the intention of the  Government of  Gujarat that even if the new schedule of royalty substituted by the 1975 Notification was void and inoperative,  Schedule   I  as   substituted  by   the  1974 Notification would  none the  less stand  repealed.  It  was equally not  the intention of the Government of Gujarat that

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even if the rates of dead rent substituted in Schedule II by the 1976  Notification were  void and inoperative, the rates of dead  rent as  substituted by the 1974 Notification would none the  less stand  repealed. If  the contention  in  this behalf were  correct, it  would lead to the startling result that on  and from  the date  of the coming into force of the 1975 Notification no royalty was payable in respect of minor minerals and  that on  and from  the date of the coming into force of  the 1976  Notification no dead rent was payable in respect of  any leased  area. The  rates in  Schedule I  and Schedule II  were intended  to be  substituted by new rates. The intention  was not  to repeal  them in any event. If the substitutions effected  by the  1975 and  1976 Notifications were 562 invalid, such  substitutions were  equally invalid to repeal the  1974   Notification.  The   result  is  that  the  1974 Notification continued  to be  operative both as regards the rates of  royalty and the rates of dead rent until they were validly substituted  with effect  from April  1, 1979 by the 1979 Notification.      Though the  Government of  Gujarat cannot be blamed for issuing the  said Circular,  for it  had to  deal  with  the problem posed  by the  judgment of the Gujarat High Court in Smt.Sonbai’s case,  the said  Circular was none the less not valid in law because the 1979 Notification as also Rule 22-B were valid  and operative and the State Government could not by a  circular letter  charge and  collect royalty  at rates different from  the rate specified in the 1979 Notification. The  directions   contained  in   the  said  Circular  were, therefore, invalid.      As a further consequence of the judgment of the Gujarat High Court  in Smt.  Sonbai’s case the Government of Gujarat made the  Gujarat Minor  Mineral (Amendment) Rules, 1981, by issuing the  1981 Notification.  The Gujarat  Minor  Mineral (Amendment) Rules,  1981, came  into force on June 20, 1981. As a result of the amendments made by the 1981 Notification, Schedule I  was substituted  and Schedule  II deleted. Thus, with effect  from June 20, 1981, only royalty became payable and not dead rent.      It was contended that the rates of royalty specified in the 1981  Notification were so excessive and arbitrary as to be   totally   unreasonable   and,   therefore,   the   1981 Notification violated  Article 19(1)(g)  of the Constitution because  it   placed  unreasonable   restrictions   on   the Fundamental Right  of the  holders of quarry leases to carry on their  trade and  business. We  find no substance in this contention. It  is true  that by  the 1981  Notification the rates of  royalty have  been enhanced  manifold. During  the particular period  of your  years, namely, the fourth period commencing on  April, 1, 1978, and ending on March 31, 1982, the rates  of royalty  had not been enhanced but drastically reduced by  the 1979  Notification while  the rates  of dead rent  had   been   considerably   enhanced   by   the   1979 Notification. The  enhancement in  the rates of royalty made by  the   1981  Notification   was,  therefore,   the  first enhancement made during the fourth period of four years. If 563 the rates  of royalty  so enhanced  are looked  at alone, it would appear  that they  are unreasonable,  but when we take into account  the fact  that dead  rent is not payable after the coming into force of the 1981 Notification, the position is completely altered and it cannot be said that enhancement in the  rates of royalty is unreasonable. The fallacy in the above contention  lies in  comparing the  rates  of  royalty

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specified in  the 1981 Notification with the uniform rate of ten  paise   per  metric   tonne  specified   in  the   1979 Notification. If  we compare  the rates of royalty specified in the  1981 Notification  with those  specified in the 1974 Notification and  we  bear  in  mind  that  under  the  1974 Notification dead  rent was  also  payable  under  the  1974 Notification, we  find that  in  some  cases  the  rates  of royalty are  reduced, for  example, the  rate of  royalty in respect of dressed and carved marble and slabs of marble was Rs.55 per  metric tonne in the 1974 Notification while under the 1981  Notification blocks  and slabs  of marble above 15 cms. in  size is  only Rs.35 per metric tonne. Though by the 1981 Notification the rates of royalty in respect of certain minor  minerals   have  been   enhanced  by  no  stretch  of imagination can  such enhancement be said to be excessive or unreasonable  when   compared  with  the  rates  of  royalty specified in  the 1974  Notification. This  contention must, therefore, be rejected.      To summarize our conclusions :      (1) Sub-section  (1) of  section 15  of the  Mines  and Minerals  (Regulation   and  Development)   Act,  1957,   is constitutional and valid and the rule-making power conferred thereunder upon  the State  Governments does  not amount  to excessive delegation of legislative power to the executive.      (2) There  are sufficient  guidelines provided  in  the 1957 Act  for the  exercise of  the rule-making power of the State Governments under section 15(1) of the 1957 Act. These guidelines are  to be  found in  the object  for which  such power is  conferred, namely,  "for regulating  the grant  of quarry leases, mining leases or other mineral concessions in respect  of   minor  minerals  and  for  purposes  connected therewith; the  meaning of  the word ’regulating’; the scope of  the  phrase  "for  purposes  connected  therewith";  the illustrative matters  set out  in sub-section (2) of section 13; and  the restrictions  and other  matters  contained  in sections 4 to 12 of the 1957 Act. 564      (3) The  power to make rules conferred by section 15(1) includes the  power to  make rules  charging dead  rent  and royalty.      (4)  The  power  to  make  rules  under  section  15(1) includes the power to amend the rules so made, including the power to  amend the  rules so  as to  enhance the  rates  of royalty and dead rent.      (5) A  State Government  is entitled to amend the rules under section  15(1) enhancing the rates of royalty and dead rent even  as regards  leases subsisting at the date of such amendment.      (6) Sub-section  (3) of section 15 does not confer upon the State  Governments the  power  to  make  rules  charging royalty or  to enhance  the rate  of royalty so charged from time to time.      (7) The  sole repository  of the  power  of  the  State Governments to  make rules and amendments thereto, including amendments enhancing  the rates of royalty and dead rent, is sub-section (1) of section 15.      (8) A  State Government  is not  required  to  give  an opportunity of  a hearing  or of  making a representation to the lessees  who would  be affected by any amendments of the rules before making such amendments.      (9) A quarry lease is a mining lease.      (10) By  reason of  the prohibition  contained  in  the proviso to  section 15(3)  a State Government cannot enhance the rate  of royalty  in respect  of any  minor mineral more than once during any period of four years.

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    (11) A State Government is also not entitled to enhance the rate  of dead  rent more  than once during any period of four years.      (12)  During   any  period  of  four  years  the  State Government can  enhance both dead rent and royalty, but only once. 565      (13) The  period of  four  years  for  the  purpose  of enhancing the  rates of  dead rent  and  royalty  is  to  be reckoned from  the date  of coming  into force  of the rules made by the particular State Government.      (14) Building  stones being  minor minerals,  the State Government has  the power  to classify  them into  different varieties and  to charge  a different  rate  of  royalty  in respect of each such variety.      (15) Notification No. GU-74/121(A)/MCR-2173(49)7268/CHH dated November  29, 1974,  whereby the Government of Gujarat made the  Gujarat Minor  Mineral (Fourth  Amendment)  Rules, 1974, was  validly issued  and became  operative with effect from December 1, 1974.      (16) Notification  No.  GU-75/117-MCR-2173(49)/6431/CHH dated October  29, 1975,  whereby the  Government of Gujarat made the  Gujarat Minor  Mineral (Second  Amendment)  Rules, 1975, to the extent that it enhanced the rates of royalty in respect of  certain minor minerals was void as offending the prohibition contained in the proviso to section 15(3).      (17) The  Judgment of the Gujarat High Court in Letters Patent Appeal  No.61 of 1978 - Ambalal Manibhai Patel v. The State of  Gujarat and  Anr., and connected writ petitions is wrong to  the extent  that it  holds that  the  Notification dated November  29, 1974,  was invalid  and inoperative  and that the  Notification dated October 29, 1975, was valid and operative and  that part  of the  said  judgment  is  hereby reversed.      (18)  Notification   No.  GU-76/39/MCR-2175(68)4675-CHH dated April  6, 1976, whereby the Government of Gujarat made the Gujarat Minor Mineral (Second Amendment) Rules, 1976 was void as  it enhanced  the rates  of dead rent for the second time during the same period of four years.      (19) Notification  No.GU/79/118/MCR-2178(127)-167 dated March 26,  1979, whereby  the Government of Gujarat made the Gujarat Minor  Minerals (Amendment)  Rules, 1979,  was valid and was  not  ultra  vires  either  section  15  or  Article 19(1)(g) of the Constitution. 566      (20) The  case of  Smt. Sonbai  Pathalji  v.  State  of Gujarat &  Anr., was  wrongly decided  by the  Gujarat  High Court and the judgment in that case is hereby reversed.      (21) The  case of  M.V. Subba  Rao v.  State of  Andhra Pradesh &  Anr., was  wrongly decided  by the Andhra Pradesh High Court and that decision is hereby overruled.      (22) The  rates of  royalty and  dead rent specified by the  Notification  dated  November  29,  1974,  namely,  the Gujarat  Minor   Mineral  (Fourth  Amendment)  Rules,  1974, continued to be operative and in force until the coming into force of  the Notification dated March 26, 1979, on April 1, 1979.      (23) The  directions  contained  in  the  Circular  No. M.C.R. 2180(166)  CHH dated February 12, 1981, issued by the Government of Gujarat were invalid and inoperative.      (24) Notification  No. GU-81/75/MCR-2181/(168)-4536-CHH dated June  18, 1981, whereby the Government of Gujarat made the Gujarat  Minor Mineral  (Amendment) Rule, 1981, is valid and constitutional  and does  not offend Article 19(1)(g) of the Constitution.

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    In the light of the above conclusions reached by us, we will now deal with each individual matter.      Civil Appeals  Nos. 706  and 1934  of 1981 are directed against the  judgment of  the Division  Bench of the Gujarat High Court  delivered on  September 16-17,  1980, in Letters Patent Appeal No. 61 of 1978 - Ambalal Manibhai Patel v. The State of  Gujarat & Anr. and connected writ petitions. These appeals are  accordingly partly  allowed  and  the  judgment appealed against  is reversed  to the  extent that  it holds that the  enhancement in  the rates  of royalty  made by the Notification  dated  November  29,  1974,  was  invalid  and inoperative and the enhancement in the rates of royalty made by the  Notification dated  October 29,  1975, was valid and operative. The  said judgment  is confirmed  in so far as it holds that  the State  Government has  the power to classify building  stones   into  different   varieties  and  levy  a different rate  of royalty  in respect of each such variety. It is  also confirmed  in so  far as it holds that the State Government has the power to enhance 567 the  rates  of  royalty.  The  orders  dismissing  the  writ petitions under  Article 226  of the  Constitution of  India filed by the Appellants in these Appeals in the Gujarat High Court are  set aside and the said writ petitions are allowed in part and it is declared that the enhancement in the rates of royalty made by the Notification dated November 29, 1974, was valid  and became operative with effect from December 1, 1974, and  that the enhancement in the rates of royalty made by the  Notification dated October 29, 1975, was invalid. We also restrain  the State  of Gujarat  and its  officers from recovering any  amount by way of royalty and at the enhanced rates specified  in the Notification dated October 29, 1975, or from  retaining any  such amount, if recovered, in excess of the  amount which would by payable in accordance with the Notification dated  November 29, 1974, and we further direct the State  of Gujarat  to refund  to the Appellants in these Appeals any  such excess  amount subject  to the  directions given hereinafter with respect to payment and refund.      Civil Appeals  Nos. 1489  and 1675 of 1981 are directed against the orders passed by the learned Single Judge of the Gujarat High Court dismissing in view of the judgment of the Division Bench  of the  Gujarat High  Court in  Smt.  Sonbai Pathalji v.  State of  Gujarat &  Anr., the  writ  petitions filed by  the Appellants  in these  Appeals challenging  the validity of  the directions  contained in  the Circular  No. M.C.R.2180(166) CHH  dated February  12, 1981,  and  for  an order restraining the State of Gujarat and its officers from acting upon  the said  Circular and  the Notification  dated October 29,  1975, and  directing the  State of  Gujarat  to implement  the   Notification  dated   March  26,  1979.  We accordingly allow  both these  appeals, reverse the judgment of the  Gujarat High  Court in Smt. Sonbai Pathalji v. State of Gujarat  & Anr.,  set aside  the orders  of  the  learned Single Judge appealed against, restrain the State of Gujarat and its  officers from  acting upon the directions contained in the said Circular dated February 12, 1981, and direct the State of  Gujarat  to  collect  royalty  and  dead  rent  in accordance with  the Notification  dated March 26, 1979, for the period  commencing on  April 1,  1979 and ending on June 19, 1981.      Writ Petitions  Nos. 1656, 2108, 4097 and 7697 of 1981, 762, 874  to 942,  946 to  968, 1616 and 1617, 4455 to 4473, 4479 568 to 4484,  5589 to  5605, 5895  to 5969,  5971 to 6005, 6309,

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6463 to  6479 and  10104 to  10122 of 1982 and 3993 to 4003, 8813 to  8820 and 9539 to 9549 of 1983 seek the same reliefs as the  Appellants in  Civil Appeals  Nos. 1489  and 1675 of 1981 had  done in  their writ petitions filed in the Gujarat High  Court  under  Article  226  of  the  Constitution.  We accordingly allow  the above Writ Petitions and restrain the State of  Gujarat and  its officers  from  acting  upon  the directions contained in the Circular No. M.C.R. 2180(166)CHH dated February  12, 1981, and direct the State of Gujarat to collect  royalty  and  dead  rent  in  accordance  with  the Notification dated March 26, 1979, for the period commencing on April 1, 1979, and ending on June 19, 1981.      Writ Petition  Nos. 7103  and 7104  to 7128 of 1981 and 4208 to  4217 of  1983 challenge  the  constitutionality  of section  15  of  the  Mines  and  Minerals  (Regulation  and Development) Act, 1957, and the validity of Notification No. GU-81/75/MCR  2181/(168)-4536-CHH   dated  June   18,  1981, whereby the  Government of  Gujarat made  the Gujarat  Minor Mineral (Amendment)  Rules, 1981.  All these  writ petitions are accordingly dismissed.      Writ Petitions  Nos. 6419  to 6422  of 1982 and 4912 to 4924 and  5167 to 5182 of 1983 challenge the validity of the directions contained in the Circular dated February 12, 1981 as also  the Notification  dated June  18, 1981.  These Writ Petitions are  allowed so far as the Circular dated February 12, 1981 is concerned, and accordingly we restrain the State of Gujarat  and its officers from acting upon the directions contained in  the said  Circular and  direct  the  State  of Gujarat to  collect royalty and dead rent in accordance with the  Notification  dated  March  26,  1979  for  the  period commencing on April 1, 1979 and ending on June 19, 1981. The Writ Petitions  are dismissed so far as the challenge to the Notification dated June 18, 1981 is concerned.      Civil Appeal  Nos. 1525  and 1526  of 1982 are directed against the  order of  the Gujarat High Court dismissing the writ petitions  filed  by  the  Appellants  challenging  the constitutionality of  section 15  of the  Mines and Minerals (Regulation and  Development) Act, 1957, and the validity of Notification No.GU-81/75/MCR2181/(168)-4536-CHH  dated  June 18, 1981,  and directing  the  Appellants  to  approach  the Supreme 569 court as similar matters were pending there. In our opinion, the course adopted by the High Court was not correct. If the High Court  thought that  the point raised by the Appellants was the  same as was pending in this Court, it ought to have stayed the  hearing of  the writ  petitions until this Court disposed of  the other  matters. As  we have,  however, held section 15  and the amendments made by the said Notification dated June  18, 1981,  to be  valid and constitutional, both these appeals are, therefore, dismissed.      All interim  orders passed in all the above matters are hereby vacated.  If as  a result  of this  Judgment and  the interim orders  passed by  this Court,  any  amount  becomes payable by any lessee of any mining lease of quarry lease to the State  of Gujarat,  the same  will be paid by him to the State of  Gujarat after  giving such  lessee credit  for the amount already  paid in  respect of  the same period as also any excess  amount paid in respect of any other period. Such payment will  be made  by such lessee within six months from today. Correspondingly,  if any amount becomes refundable by the State  of Gujarat  to any  lessee of any mining lease or quarry lease,  the State  of Gujarat will refund the same to such lessee  after adjusting  against the  amount refundable the amount  actually recoverable in law and recovered by the

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State of Gujarat from such lessee. Such payment will be made by the State of Gujarat within six months from today.      The parties  will bear and pay their own costs of these Writ Petitions and Appeals. S.R. 570