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CASE NO.: Appeal (civil)  5451 of 2005

PETITIONER: Central Coalfields Ltd.                              

RESPONDENT: State of Jharkhand & Ors.                              

DATE OF JUDGMENT: 01/09/2005

BENCH: C.K. Thakker & P.K. Balasubramanyan

JUDGMENT: J U D G M E N T (Arising out of S.L.P (c) No. 6374 of 2002) WITH   CIVIL APPEAL NOS. 5454.and 5452./2005  (Arising out of SLP (c) Nos. 6422 & 6465 of 2002)

C.K. Thakker, J.         

       Special leave granted.

       The present appeals arise out of common judgment and  order  passed  by the High Court of Jharkhand, Ranchi on  January 25, 2002 in Letters Patent Appeal Nos. 462, 472 and 473  of 2001.  By the said order, the Division Bench of the High Court  dismissed intra court appeals filed by the appellant herein  confirming the orders passed by the learned Single Judge.   

       To appreciate the controversies raised in the present group  of appeals, few facts in the first matter (Central Coal Fields  Limited v. State of Jharkhand & Others) may be noted.

       The appellant Central Coal Field Limited (’Company’ for  short) is a Government Company within the meaning of Section  617 of the Companies Act 1956 having its registered office at  Darbhanga, Ranchi.  It is one of the subsidiary companies of  Coal India Limited.  The Company owns various coal mines in  Districts Hazaribagh, Giridih, Palamou and Ranchi.  The  Company is carrying on business in extracting, selling and  distributing coal.  It is the case of the Company that for the  purpose of mining activities, it acquired land through Central  Government for mining purposes under the Coal Bearing Areas  (Acquisition and Development) Act, 1957.  It is also asserted by  the Company that it acquired rights over colliery and mining area  by virtue of Coal Mines (Nationalisation) Act, 1973.  According  to the Company, Section 3 of the said Act provides that on the  appointed day, the right, title and interest of the owners in  relation to coal mines specified in the Schedule "shall stand  transferred to and shall vest absolutely in the Central  Government free from all encumbrances".  In view of the  aforesaid provision as also Section 10 of Coal Bearing Areas  (Acquisition and Development) Act, 1957, the land as well as the  rights over the land stood vested in the Central Government and  the State Government thereafter had no right, title or interest in  the land or rights over such land and no proceedings for recovery  of rent could be effected nor any charge could be levied by the  State Government from the appellant.   In spite of clear legal  position, Certificate Proceedings against the appellant for

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realization of surface rent for mining areas in possession of the  Company were initiated by the Certificate Officer (Mines),  Dhanbad.  The Company, therefore, objected to those  proceedings by filing objections on June 12, 1991, inter alia  contending that the proceedings were against Sections 9 and 9A  of the Mines and Minerals (Regulation and Development) Act,  1957.  It was also contended that the Bihar & Orissa Public  Demands Recovery Act, 1914 would not apply to the case and  proceedings were, therefore, required to be dropped.  Ignoring  valid objections of the Company, an interim order was passed by  the Certificate Officer directing the appellant-Company to pay an  amount of Rs.78,16,712/-.  According to the appellant-Company,  even the Central Government was of the view that the State  Government had no such power which is clear from the letter  dated February 12, 1999,  addressed by the Director of Mines and  Coal, Government of India to the Chief Secretary, Government  of Bihar, Patna.  The appellant-Company stated that the interim  order dated February 2, 1999 was passed without considering the  objections filed by it and without giving an opportunity of being  heard.  A petition was, therefore, filed being CWJC No. 651 of  1999 (R).  The learned Single Judge allowed the petition by an  order dated September 20, 1999, set aside the order of the  Certificate Officer and directed him to dispose of the objections  filed by the Company by passing an appropriate order in  accordance with law.  The Certificate Officer, however, rejected  the objections and held the Company liable to pay rent and  accordingly an order was passed on June 08, 2000.   

       Being aggrieved by the said order, the appellant preferred a  Writ Petition being CWJC No. 2535 of 2000.  The learned Single  Judge, after hearing the parties, dismissed the petition observing  that it was not disputed that order had already been passed by the  Certificate Officer against which the appellant-Company could  file an appeal as provided under the Bihar & Orissa Public  Demands Recovery Act, 1914.  The Court also observed that the  Appellate Authority would consider the question as to delay in  filing the appeal, which had occurred as the appellant-Company  had approached the High Court.

       The Company filed Letters Patent Appeal against the order  passed by the learned Single Judge.  It was argued on behalf of  the Company that the learned Single Judge was not right in  dismissing the appeal on the ground of availability of alternative  remedy particularly when the point was concluded by a decision  of Division Bench in Managing Director, National Coal  Development Corporation Limited v. State of Bihar & Others,  AIR 1984 Patna 280.   Dismissing the appeal and upholding the  order of learned Single Judge, the Division Bench observed that  Section 60 of the Bihar & Orissa Public Demands Recovery Act,  1914 went to suggest that the right of appeal was "unfettered"  and the jurisdiction of the appellate forum "plenary and  unbound".  Whether the appellant was or was not liable to pay  surface rent or lease money could be decided by the Appellate  Authority.  The Authority could also consider the basic question  as to maintainability of Certificate Proceedings, but it could not  be said that the learned Single Judge had committed an error of  law in dismissing the petition on the ground of availability of  alternative remedy.  Regarding the decision of the Division  Bench in National Coal Development Corporation, the Court  observed that the contention as to availability of alternative  remedy was not raised in that case.  Accordingly, the Letters  Patent Appeal was also dismissed.  The appellant has challenged  the said order.

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       We have heard learned counsel for the parties.

       The learned counsel for the appellant strenuously urged that  the demand made by the State Government for payment of  surface rent in a coal bearing mining area and initiation of  proceedings for taking coercive steps for recovery of such rent  were not sustainable in the light of the provisions of Coal  Bearing Areas (Acquisition and Development) Act, 1957 as also  the Coal Mines (Nationalisation) Act, 1973.  It was also  contended  that in view of the decision of the Division Bench in  National Coal Development Corporation holding that the State  Government had no authority to demand surface rent, the High  Court ought not to have dismissed the petitions/letters patent  appeals on the ground of alternative remedy.  In any case, when  the question of jurisdiction had been raised, the High Court ought  to have decided it, as it would go to the root of the proceedings.   It was, therefore, submitted that the impugned orders are required  to be set aside by remanding the matters to the High Court to be  decided in accordance with law.           The learned counsel appearing for the State Government,  on the other hand, supported the orders passed by the High Court.   He submitted that the points which have been  argued before this  Court were urged before the High Court and the High Court held  that in the light of statutory provisions, the appellant was bound  to avail of the alternative remedy.  Regarding earlier decision of  the Division Bench, the High Court rightly observed that the  point as to availability of an alternative remedy was never raised.    No fault, therefore, can be found against the impugned orders  and the appeals deserve to be dismissed.   

       Having heard the learned counsel for the parties, in our  opinion, the appeals deserve to be disposed of by making certain  observations.  It is no doubt true that according to the appellant-  Company the Certificate Proceedings could not have been  initiated under the Bihar & Orissa Public Demands Recovery  Act, 1914, in view of the provisions of Coal Bearing Areas  (Acquisition and Development) Act, 1957, Mines and Minerals  (Regulation and Development) Act, 1957 and also the Coking  Coal Mines (Nationalisation) Act, 1972.  But it also cannot be  overlooked that the action has been taken under the Bihar &  Orissa Public Demands Recovery Act. 1914 and the appellant- Company was directed to make payment.  The said order is  subject to appeal under Section 60 of the said Act.  A reading of  the order dated November 17, 1999 passed by the Certificate  Officer makes it clear that before taking the action, an opinion of  the Advocate General of the State of Bihar was sought by the  respondent.  Referring to the provisions of Coking Coal Mines  (Nationalisation) Act, 1972, the Advocate General opined that  such amount could be claimed by the State Government from the  appellant-Company.   Reference was made to Sections 6 and 7 of  the said Act and it was observed that the State Government had  power to make demand of rent from the appellant-Company.  In  view of the above position, it cannot be said that the learned  Single Judge as well as the Division Bench had committed an  error of law in dismissing the petitions and appeals by allowing  the appellant to avail of an alternative remedy of filing appeals.   Those orders, therefore, do not suffer from any infirmity.  As  observed by the Division Bench, the powers of the Appellate  Authority under the Bihar & Orissa Public Demands Recovery  Act, 1914 are very wide and the appellant may raise all  contentions including the contention as to the jurisdiction of the  State Government and/or its officers in initiating Certificate  Proceedings against the Company.  Regarding the earlier  decision in National Coal Development Corporation, the High  Court was right in observing that the contention regarding

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alternative remedy was neither raised nor considered nor a  finding had been recorded thereon.  In view of the said fact also  it would be appropriate if the appellant-Company is granted  liberty to approach the Appellate Authority by filing appeals  under the Bihar & Orissa Public Demands Recovery Act, 1914.         Since the appellant-Company had filed petitions, intra court  appeals and the appeals in this Court, it would be in the interest  of justice and we direct, that if appeals under the Bihar & Orissa  Public Demands Recovery Act, 1914 are filed within a period of  two months from today, the Appellate Authority will entertain  them without raising any objection as to limitation.  The  Appellate Authority will hear the parties and decide the appeals  in accordance with law as expeditiously as possible preferably  within three months from filing of the appeals without being  influenced in any manner by the observations made by the  learned Single Judge, the Division Bench or by us in the present  appeals.  We may clarify that we are disposing of the appeals  upholding the preliminary objection of the State Government  regarding availability of alternative remedy of appeals and we  may not be understood to have expressed any opinion one way or  the other on merits and all contentions of all parties are kept  open.            For the foregoing reasons, the appeals are disposed of.  In  the facts and circumstances of the case, however, there shall be  no order as to costs.