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CASE NO.: Appeal (civil) 5089  of  1997 Appeal (civil)  5090     of  1997 Appeal (civil)  5091     of  1997 Appeal (civil)  5092     of  1997

PETITIONER: THE QUARRY OWNERS ASSOCIATION

       Vs.

RESPONDENT: THE STATE OF BIHAR & ORS.

DATE OF JUDGMENT:       29/08/2000

BENCH: A.P.Misra, N.S.Hegde

JUDGMENT:

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     MISRA, J.

     The  issues  in  these appeals, apparently  impress  a common  picturisation of usual nature but they are raised in an  interesting  way while challenging the fixation  of  the rate  of royalty for the minor minerals under Section 15  of the  Mines  and Minerals (Regulation and  Development)  Act, 1957  (hereinafter referred to as the Act).  The  question for  consideration  is, the ambit of delegation of power  by the  Parliament to the State Government under Section 15  of the  said  Act.   Can  it be said  that  the  delegation  is unbridled  without  any  check  if  it  travels  beyond  the guideline  as  spelt  by  this Court in  the  case  of  D.K. Trivedi  &  Sons  and Ors.  Vs.  State of Gujarat  and  Ors. 1986  (Supp.)  SCC  20?   In the present  case  neither  the validity of delegation under Section 15 nor it being without any guideline is under challenge but both appellants and the respondents  State  stress  two  different  orbits  for  the guideline,  the appellants constrict it to be within what is spelt in the D.K.  Trivedi case (supra) while the respondent stresses  it not to be confined to that case.  The  impugned notifications  dated  17th August, 1991 and 28th  September, 1994  issued  by  the State of Bihar enhancing the  rate  of royalty  have to be tested as in which of the two orbits  it falls.   If  it  falls  within   the  restricted  orbit,  as submitted by the appellants, it may be ultra vires but would be  valid  if  it falls within the other orbit.   Mr.   F.S. Nariman,  learned  senior counsel, submits that extents  and limitations of the power of the delegatee have to be read as laid down by this Court in D.K.  Trivedi case (supra), where the  validity of this very delegation of power to the  State Government   was  under  challenge.    Based  on  this   the submission  is,  Item 54 of the Second Schedule of  the  Act controls  and  guides  the   State  Government  (hereinafter referred  to  as the State), for fixing or  enhancing  the rate of royalty which has to be within the reasonable bounds

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of  12% of the sale price at the pits mouth.  Admittedly in the present case it is far beyond this, hence the submission is  that the impugned notifications are liable to be  struck down.   On the other hand, submission for the respondents  - the  State  of Bihar by learned senior counsel  Mr.   Rakesh Dwivedi  is  that  D.K.    Trivedis  case  (Supra)  neither restricts  nor limits the power of enhancement of royalty to Item  54,  Schedule II of the Act nor it exhaustively  dealt with all other sources of guidelines which was not necessary in that case, which can be gathered from other provisions of the  Act, the objects and reasons, the scheme of the Act and the nature of material etc..

     Before   entering  into  this   legal  tangle,  it  is necessary  to  turn  to  some  of  the  essential  facts  to appreciate more fully the controversies.  The present appeal is  directed  against  the  judgment and  order  dated  16th October,  1996 of the High Court, passed in a writ  petition by  which  the  petition of the appellants,  namely,  Quarry Owners  Association challenging the aforesaid  notifications dated  17th August, 1991 and 28th September, 1994, issued by the  State  including  challenge  to  the  recovery  of  the enhanced  royalty under it and for the refund of the  amount already paid was dismissed.

     The Preamble of the Act lays down:

     An  Act to provide for the development and regulation of mines and minerals under the control of the Union.

     Section  2 declares the expediency of Union to control the  regulation  of  mines  and development  of  minerals Section  3(a) defines minerals which includes all minerals except mineral oils.  Section 3(e) defines minor minerals. Section  4 refers to the prospecting or mining operations to be  undertaken only under a licence or lease.  Section 4A is for  termination  of prospecting licences or mining  leases, sub-section  (1)  is  for premature termination  other  than minor  minerals while sub-section (2) is for minor minerals. Section 5 imposes restrictions on the grant of such licences or leases.  Section 6 specifies the maximum area for which a licence  and  lease  may be granted, while Section  7  gives period  for  the  grant  and  renewal  of  such  prospective licences.   Section  8  deals with the  periods  for  mining leases.   Sub-sections (1) and (2) of Section 9 refer to the payment  of  royalty  at the rate specified  in  the  Second Schedule  whether  granted before coming into force of  this Act  or subsequently.  Sub-section (3), empowers the Central Government  to amend the Second Schedule so as to enhance or reduce  the  rate  of royalty payable.  Section  9A  obliges lessee  to  pay the dead rent.  Sections 10 to 12 deal  with the  procedure for obtaining prospective licence, or  mining leases  in respect of the land in which minerals vest in the Government.   Section 13 empowers the Central Government  to make  rules in respect of minerals.  Section 14 specifically excludes  Sections  5  to 13 from application  of  quarrying leases,  mining  leases  or other  minerals  concessions  in respect of minor minerals.  Section 15 empowers the State to make  rules  in  respect  of  minor  minerals.   Section  16 entrusts  power to modify mining leases granted before  25th October,  1949.   Section  17  gives special  power  to  the Central  Government  to  undertake   prospecting  or  mining operations  in  certain  lands.  Section 18  refers  to  the

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mineral  development.  Licences and mining leases under  the Act  to be void under Section 19 if made in contravention of the  Act, while Section 20 makes the Act and Rules to  apply to  all renewals.  Section 21 imposes penalties.  Section 22 refers to the cognizance of offences.  Section 23-C empowers the  State  to  make rules for  preventing  illegal  mining, transportation and storage of minerals.  Section 26 entrusts both  Central and the State to delegate its power under  the Act  on  officer  or  authority of  the  Central  or  State. Sub-section  (1)  of  Section 28 puts an obligation  on  the Central  Government  to  place its rules  and  notifications before the Parliament which is subject to its modifications, if  any.  Similarly, the State is obliged to place its Rules and  notifications  before each houses of State  Legislature under  sub-Section (3).  Section 29 makes existing rules  to continue so long they are not in consistent with the Act and Rules.  Section 30 empowers the Central Government to revise any  order  made by the State or any other  authority.   The First Schedule refers to the specified minerals, viz., Hydro carbons/energy  minerals  Atomic minerals and Metallic  and non-metallic minerals with reference to Sections 4(3), 5(1), 7(2) and 8(2) while the Second Schedule refer to the rate of royalty  in  all  States and Union  Territories  except  the States  of  Assam and West Bengal while the  Third  Schedule refers  to  the rate of Dead Rent.  Thus, the aforesaid  Act expressly  lays  down the rates of royalty of  the  minerals through  Schedule II read with Section 9.  It is significant that  Section 14 excludes Sections 5 to 13 specifically  for minor  minerals  which  includes  Section  9.   Section  15, entrusts  power on the State to lay down Rules in respect of the  minor minerals.  Original Section 15 as it stood at the time of D.K.  Trivedi (Supra), is quoted hereunder:

     Section  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 minerals  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 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 sub-lessee 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  minerals  for more than once during any period of four years.

     This  delegation  of power to the State withstood  its challenge  in  D.K.   Trivedi case  (Supra),  as  aforesaid. Later  this  section was amended on 10th February, 1987,  by introducing sub-section 1-A through Act No.37 of 1986.  This

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was in particular and without prejudice to the generality of power  conferred  by  sub-section  1 of  Section  15.   This sub-section 1-A is quoted hereunder:-

     (1-A):   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:-

     (a)  the  person  by  whom and the  manner  in  which, applications  for  quarry  leases, mining  leases  or  other mineral  concessions  may  be made and the fees to  be  paid therefor;

     (b)  the  time  within which, and the form  in  which, acknowledgement  of the receipt of any such applications may be sent;

     (c)   the  matters  which   may  be  considered  where applications in respect of the same land are received within the same day;

     (d)  the terms on which, and the conditions subject to which  and  the  authority by which  quarry  leases,  mining leases  or  other  mineral  concessions may  be  granted  or renewed;

     (e)  the procedure for obtaining quarry leases, mining leases or other mineral concessions;

     (f) the facilities to be afforded by holders of quarry leases,  mining  leases  or  other  mineral  concessions  to persons  deputed  by  the  Government  for  the  purpose  of undertaking  research  or  training in matters  relating  to mining operations;

     (g)  the fixing and collection of rent, royalty, fees, dead  rent, fines or other charges and the time within which and the manner in which these shall be payable;

     (h) the manner in which rights of third parties may be protected  (whether  by  way of payment of  compensation  or otherwise)  in  cases where any such party is  prejudicially affected by reason of any prospecting or mining operations;

     (i)  the  manner in which rehabilitation of flora  and other  vegetation,  such  as  trees,  shrubs  and  the  like destroyed  by  reason of any quarrying on mining  operations shall be made in the same area or in any other area selected by  the State Government (whether by way of reimbursement of the  cost  of  rehabilitation or otherwise)  by  the  person holding the quarrying or mining lease;

     (j)  the manner in which and the conditions subject to which,  a  quarry  lease,  mining  lease  or  other  mineral concession may be transferred;

     (k)  the  construction, maintenance and use of  roads, power   transmission  lines,   tramways,  railways,   aerial ropeways,  pipelines and the making of passage for water for mining  purposes on any land comprised in a quarry or mining lease or other mineral concession;

     (l)  the form of registers to be maintained under this Act;

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     (m)  the  reports  and statements to be  submitted  by holders  of  quarry  or  mining   leases  or  other  mineral concessions  and  the  authority to which such  reports  and statements shall be submitted;

     (n)  the  period within which and the manner in  which and  the authority to which applications for revision of any order passed by any authority under these rules may be made, the  fees  to  be  paid  therefor, and  the  powers  of  the revisional authority;  and

     (o)  any  other  matter  which is to  be,  or  may  be prescribed.

     The introduction of this sub-section 1-A including the Objects  and Reasons, is submitted further enlarges the area of the guidelines to the State.  Its Objects and Reasons are also quoted hereunder:-

     Statement  of  Objects  and Reasons:  The  Mines  and Minerals (Regulation and Development) Act, 1957 provides for the  regulation  of  mines and the development  of  minerals under the control of the Union.  Since the last amendment of the  Act in 1972, many problems have come to the force.  The adverse   effects  of  mining   operation  on  ecology   and environment  have  increasingly  come to  notice.   In  many cases, mining operations have been undertaken without proper prospecting  resulting  in unscientific mining.  Further,  a number  of  Committees have stressed the need  for  amending certain  provisions  of the Act with the object of  removing bottle-necks  and  promoting speedy development  of  mineral based  Industries.  State Governments and representatives of trade  and  industry have in formal forums like the  Mineral Advisory  Council as well as in other forums, expressed  the desirability  of  taking  a  fresh   look  at  the   various provisions  of  the  Act  with a view to  making  them  more effective and development oriented.

     2.   The suggestions made from time to time have  been considered  and  incorporated  in the present  Bill,  which, inter  alia, includes the following salient features, namely :-

     (i)   inclusion  of  11   more  minerals  of  national importance in the First Schedule to the Act;

     (ii) premature termination of prospecting licences and mining leases on ecological and other grounds:

     (iii)  dispensing  with the Certificate  of  Approval, Income-tax  Clearance  Certificate, etc.  for the  grant  of prospecting licences and mining leases;

     (iv)  prospecting of an area and preparation of mining plan as a pre-condition for the grant of a mining lease;

     (v)  rationalisation  of the period of mining  leases, and renewals thereof;

     (vi)  shorter periodicity for purposes of revision  of royalty and dead rent;  and

     (vii)   provision  for  increasing   the  quantum   of

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punishment to curb illegal mining activities.

     3.  The Bill seeks to provide for the above objects.

     It is also relevant to record here the rate of royalty fixed  by  the State for the minor minerals through  various notifications  in  various years.  Initially on  1st  April, 1975  the rate of royalty fixed was Rs.2.50 per cubic  meter that  is Rs.7.07 per 100 cubic ft., Rs.1.75 per cubic  meter that  is  Rs.4.95 for 100 cubic ft for Ballast and  Boulder. Next  on  3rd August, 1977 the rate of stone chips,  Ballast and  Boulder was increased to Rs.3/- per cubic meter that is Rs.8.49  per  100  cubic  ft  and  from  17th  August,  1991 (impugned)  the rate of royalty of stone chips, Ballast  and Boulder  was  increased to Rs.12/- per cubic meter  that  is Rs.33.96  per  100  cubic ft.  By  notification  dated  28th November,  1994  (impugned) the rate of royalty was  Rs.25/- per  cubic meter or Rs.70.75 per 100 cubic ft.  for Ballast, Boulder  and stone chips, which according to the  appellants is more than 15 times as originally provided and more than 5 times  in excess of the maximum rate of 12% of sale price at pits  mouth under Entry 54 of Schedule II.  It is also  not in  dispute  by the aforesaid Act, under Item 54 of List  I, VII Schedule of the Constitution of India, the regulation of mines  and  mineral  development  both of  major  and  minor minerals  came  under  the control of the  Union,  including fixation  of  the  rate of royalty.  The  challenge  to  the aforesaid  two  notifications are that the State  trespassed the  limit  of the guideline as laid and spelt out  in  D.K. Trivedis  case (Supra).  Further, if that guideline has not to be, then there is no other check and control or guideline of  the Union over the State Government.  In contrast  there is  check over the other delegatee, viz., Central Government where  under  Section  28(1) rules or  notifications  by  it including  enhancement  of royalty is to be laid before  the Parliament.   The High Court repealed the contention of  the appellants by holding:

     No  doubt  when  the  decision in the  case  of  D.K. Trivedi  and  sons (Supra) was given there were no  specific guidelines  in Section 15 of the Act.  However..Amendment Act  1986 (Act No.37 of 1986) which came into force on  10th February,  1987, guidelines have been provided in Section 15 itself.clause  (g)  of sub-section 1-A provided  that  the rules  may be framed by the State Government for fixing  and collecting  rent, royalty, fees etcThe guidelines provided for  framing  Rules in respect of minerals other than  minor minerals   do  not  remain   relevant  after  insertion   of sub-section 1-A in Section 15 of the Act.

     However,  submission for the appellants is sub-section 1-A only empowers the State Government but does not lay down any  guideline,  hence  it  cannot shield the  State  to  be providing  with  any guideline, for which State has only  to fall  under  Item  54  of  Schedule II  of  the  Act,  which records:-

     Item  54:   All  other materials  not  herein  before specified  =  Twelve  per cent of sale price  at  the  pits mouth.

     The  submission is, this is residuary item which cover all  other  minerals not specified in any of  the  preceding items  in  Schedule  II.   The   minor  minerals  not  being

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specified  in  any  of the items it would  fall  under  this entry.

     It  is also significant to record that minor  minerals are  used in the local areas for local purposes while  major minerals  are  used for the industrial development  for  the National  purpose.  The crux of the matter for consideration is,  whether  is it only Sections 4 to 12 which controls  or guides the State in fixing the royalty for the minor mineral and,  if  it is, whether Entry 54 of Schedule II places  any ceiling  of  12%  of the sale price at the pits  mouth  for fixing this royalty by the State?  In other words, does D.K. Trivedi  case (Supra) fore closes the issue of guideline  or is  it open to travel to other fields which guides the State for fixing the royalty.

     The  appellants  are an association of quarry  owners. They  were given permit/lease for the extraction of stone in respect of their respective places of operation in pursuance to  such permit/lease.  The State Government in exercise  of its  power under Section 15 of the aforesaid Act made  rules called   Bihar   Minor  Mineral   Concession   Rules   1972, (hereinafter  referred  to  as the Rules)  and  fixed  the royalties  from time to time.  Submission for the appellants is  since rate of royalty on building stone including  stone chips , Bolder, Road medal and ballast has been increased to more  than  100% , the appellants are unable to  pay,  hence challenge this enhancement.

     Mr.   F.S.   Nariman, learned senior counsel  for  the appellants submits, in order to judge the validity regarding excessive  delegation one has to identify the power which is sought  to  be delegated.  The power delegated to the  State Government  under Section 15 of the Act is the power to  fix and  collect royalty.  It cannot be disputed that royalty is a tax.  The question is, are there any guideline to vary the rate  of  royalty apart from D.K.  Trivedis  case  (Supra). The  submission  is, this decision settles the guideline  by placing  the  restrictions on State power through Section  9 read with Item No.54 of the Second Schedule of the Act.  The introduction  of  sub-section  1A in Section 15 of  the  Act makes  no  difference,  as it is only an  amplification  and illustration  of Section 15(1).  Further, sub-clause (g)  of Section  15(1A) only clothes the State with power to  change the rate of royalty but it cannot be construed as giving any guideline.   It  is only when legislature fixes any  maximum rate,  beyond  which delegatee cannot enhance the  rate,  it could  be  said  it - retained sufficient control  over  the delegatee.  The control of the Parliament in relation to the major  minerals for such enhancement is enshrined in Section 28(1) of the Act, State of M.P.  V.  Mahalakshmi 1995 (Supp) 1  SCC  642 upheld such a delegation.  The delegatee,  viz., Central Government was entrusted with the power to amend the Second  Schedule  which  fixes  royalty  but  obligates  the delegatee to lay such amendment before the Parliament.  This is absent in the case of minor minerals.

     Next  it is submitted, this Court in Baijnath  Kedias 1969 (3) SCC 838, held that the State legislature is denuded of  all its legislative power over the minor minerals  after the passing of the said Act, hence it looses its legislative control  for  fixing  the royalty.  The State only  acts  as delegatee  of the Parliament to enhance the rate of royalty. So  far, Section 28(3), which is for minor minerals,  merely provides  laying down procedure before the State legislature

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for  information  and not with any entrustment of  power  to alter  or modify the rate of royalty, hence Section 28(3) by itself  cannot save the plea of excessive delegation of  the legislative  power.   The language used in Section 28(3)  is different  from what is in Section 28(1), hence both  cannot be  equated.   There is nothing to show that, in  fact,  the impugned   notifications,  were  laid   before   the   State legislature.    So  far   Delegation  Legislation  Provision (Amendment)  Act of 1983, it refers to the rules made by the State Government under a parliamentary Act for laying before the  State  legislature  only with respect to  the  subjects under  concurrent List 3 of VII Schedule of the Constitution of  India  and  not  in respect  of  subjects  in  exclusive competence of the Parliament under List I.

     Learned  senior counsel Mr.  P.P.  Rao, also appearing for some of the appellants submits, power to fix the rate of tax  can be delegated provided the statute provides guidance for fixing such rate.  The guidance may be by fixing maximum rates  of tax or by providing consultation with the  people, i.e.,  subject to the approval by them as held in  Municipal Corporation  of  Delhi  V.  Birla Cotton 1968 (3)  SCR  251. Reasserting  the  principle  as  laid down in  the  case  of Mahalakshim  Fabrics (Supra), it is submitted Parliament has itself  laid down for the major minerals the rate of royalty in the Second Schedule of the Act and authorised the Central Government  to  revise the rates.  In doing so  the  Central Government  has  the guidance to keep in view  the  original rates.   The fixation of royalty should have a direct  nexus with  the  minerals  throughout  the country  on  a  uniform pattern.   Further, there is requirement that every rule  or notification  made by the Central Government is to be placed before   each   House  of   Parliament  subject  to   agreed modification  by  both Houses.  Thus, Section 28(1)  permits Parliament  to  veto  the  enhanced  rate  of  royalty.   In contrast  there  is no such guideline so far minor  minerals are  concerned, except what is contained in D.K.   Trivedis case  (Supra).   Based  on that it is  submitted  that  only provision  among  Sections  4  to 12 of the  Act,  which  is relevant  is  Section 9(2) read with Entry 54 of the  Second Schedule  of the Act which fixes the limit of royalty at 12% of the sale price at the pits mouth.  The very rationale of Entry  54  of List I of the Constitution is to regulate  the mines  and mineral development under the control of Union in the  public interest.  The preamble as well as Section 2  of the  Act speak about the expedience of Union control of both major  and  minor minerals.  Thus no part of the Act can  be construed  so  as  to take away the control  of  the  Union. Section  28(3)  cannot be read so as to divest the Union  of its  control  and vest the control in the  respective  State legislature.   In view of difference in the language between Sections 28(3) and 28(1), the same purport what is contained in  sub-section (1) cannot be brought into sub-section  (3). Further  the taxing statute must be interpreted as it  reads with  no  additions or subtractions of words and  where  two opinions  are  possible the one which benefits  an  assessee must be adopted.

     Learned  senior counsel Mr.  S.B.  Sanyal, in addition to  the  adoption  of the submissions by the  aforesaid  two learned counsels further submits that Section 28(3) which is brought  in through amendment cannot be construed to  confer authority   on   the  State   legislature  to   modify   any notifications  or rules framed by the State Government.  But laying  of  such  rule  or  notification  before  the  State

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legislature  is  only for the purpose of information.  In  a delegated  legislation  the  control and  authority  of  the Principal  to modify or cancel any act of the delegatee must remain.   Parliamentary  control over delegated  legislation should  be  living continuity as a constitutional  necessity which is not to be found in the present case.

     Repelling   the  submissions,   Mr.   Rakesh  Dwivedi, learned  senior  counsel, appearing for the State  of  Bihar submits,  in D.K.  Trivedis case (Supra) Section 15, as  it then  stood,  was questioned as suffering from the  vice  of excessive  delegation of its legislative power.  This  Court held  that  sub-section  (2)  of   Section  13  was   merely particularisation or illustration of the generality of power already contained in sub-section (1) and since Section 15(1) was  similar to Section 13(1), it could necessarily  contain illustrations of Section 13(2) and the provisions of Section 13(2)  being  in the same sub-chapter as Section  15,  would furnish  sufficient guidelines.  Reliance was also placed on the following observationsa made in that case:-

     The exclusion of the application of these sections to minor  minerals means that these restrictions will not apply to minor minerals but it is left to the state governments to prescribe  such restrictions as they think fit by rules made under Section 15(1).

     The  submission  is, Sections 4 to 12, as  they  stood then,  cannot  be  construed  as restricting  the  power  of delegatee over the minor minerals in view of Section 14.  In fact, they were referred by this Court as it being available to  the  State Government for taking note while framing  the rules.   They  are available not as restrictive or  limiting its power but for its adoption wherever necessary.  In fact, while  judging the validity of the notifications impugned in that case, this Court was not called upon nor did it examine whether  the State power to enhance royalty is restricted to Schedule  2 of Section 9 of the Act.  Further, the guideline is  also  to  be  found in the preamble,  the  Statement  of Objects  and  Reasons  and  other  provisions  of  the  Act. Sections  4A, 17 and 18 also provide the guideline.  Further after  the  amendment, the power of the  Central  Government under  Section  9(3) of the Act for the modification of  the rate  of  royalty for the major minerals is made very  wide. The   only  difference  being   that  under  Section   28(1) Parliament  has opportunity to modify the rate fixed by  the Central Government.  This was because the Central Government was  modifying  the  rates fixed by the  Parliament  itself. Secondly, major minerals are minerals of national importance hence  require uniform treatment at the national level.   In contrast, the minor minerals are mostly used locally and are of local importance and hence their treatment is left to the State  Government  at  the  provincial level.   This  is  in recognition  of  States  original power  to  determine  such royalty  under Entry 54 of List II of the Seventh  Schedule. This  is also in tune with the principle of federalism which requires local matters to be left for it being dealt with by the State Government.

     Further submission is, in order to find the guidelines the  nature of the subject matter is also to be  considered. The  product, namely, minor minerals is neither produced nor it  belong  to  the  appellants.  So it is  not  a  case  of imposition  of  tax simplicitor on the appellants but  such

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tax  in fact includes the price of the minerals which is the property  of  the  State.  In other words, it  includes  the price of the property which State parts with.  Thus, royalty is a unique kind of tax which is different from other taxes. Both  royalty/dead  rent are integral part of the  lease  as talked  about in Section 4 of the Act and Section 105 of the Transfer  of  Property Act, 1882.  Hence the  lessee  cannot insist  that  in spite of the minerals being parted  by  the State  the  mining should be made available cheaply so  that they  can derive profits, and even super profits.   Further, fixation  of  maximum limit for royalty under Section 15  is not  an absolute rule.  In fact, the rate fixed has not been demonstrated  to be confiscatory or arbitrary, for which the courts  are  there  and  if that be, it  could  be  quashed. Further  the  history of regulation of minerals  shows  that royalty  has  always  been fixed by  the  State  Government. Under Rule 4 of the Mineral Concession Rules, 1949 framed by the  Central  Government  under  the  1948  Act,  the  State Government  was given power to make rules with regard to the minor  minerals.   In fact, what was then delegated  to  the State  by  the Central Government has now been delegated  by the  Parliament itself.  Thus the status of State Government has  changed  from sub-delegatee to delegatee.  Next  it  is submitted,  it is true that phraseology of Section 28(3)  is differently  couched than what is in Section 28(1).  This is because  the Parliament is directing the rules to be  placed before  the State legislature.  This was done in view of the observations  by this Court in D.K.  Trivedis case (Supra). It is also submitted that placement of such notification and rules  under  Section  28(3) before  the  State  legislature cannot  be  said to be only a show piece but is  meaningful. He also submits since 1st April, 1975 the State of Bihar has increased  royalty  only four times and even now it has  not raised  royalty  since 28.9.1994, despite the lapse  of  six years.   Thus  raising of royalty only four times during  25 years  despite power to revise every three years shows  that the  Government has been more than reasonable in fixing  the royalty.

     In  order to scrutinise the submissions of the learned counsels  for the parties, it would be appropriate first  to focus  as  to what this Court said in D.K.   Trivedis  case (Supra).  The constitutionality of Section 15(1) of the said Act  was raised with reference to the delegation of power to the   State  Government   delegating  essential  legislative function,  including charging and enhancing the rate of dead rent   and  royalty  that  it  being  unbridled,   including challenge to the charging of the same during the subsistence of the existing leases, including the validity of Rule 21(b) of   the  Gujarat  Minor  Minerals   Rules,  1966  and   few notifications  issued by the State Government under  Section 15  in  respect  of  the   minor  minerals.   The   relevant notifications  were, one dated 29.11.1974 by which the State Government  made  Gujarat Minor Minerals (Fourth  Amendment) Rules, 1974 whereby Rule (1) was substituted and Schedule II was  amended w.e.f.  1.12.1974.  By this the rate of royalty and  dead rent in respect of some of the minor minerals were specified.   Through  the notification dated  29th  October, 1975  the State Government brought in Gujarat Minor Minerals (Second  Amendment) Rules, 1975, whereby Rule 21 of the said rules  and  Schedule  I was substituted  w.e.f.   1.11.1975, through  which  the  rate of royalty in respect  of  several items  were  enhanced.  The next notification was dated  6th April,  1976, by which the State Government made the Gujarat Minor  Minerals (Second Amendment) Rules, 1976 through which

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it  substituted Schedule II in the said rules, by which  the dead  rent  was enhanced.  The next notification  was  dated 26th  March,  1979, through which the State Government  made the Gujarat Minor Minerals (Amendment) Rules, 1979.  Through this  new Rule 21-B was inserted and Rule 22 was amended and Schedules  I  and  II   were  substituted.   By  substituted Schedule  I  the rate of royalty on all minor minerals  were specified  as  10  p.  per metric tonne and  by  substituted Schedule  II  the  rate  of dead rent per  hectare  or  part thereof  in  respect  of  quarry   leases  was  enhanced  to Rs.1200/-,  in  certain cases Rs.1500/- in some other  cases Rs.2,000/-  in  one  case and Rs.3,000/-  in  the  remaining cases.   The  contention raised before this Court was,  that Section  15(1) of the Act is unconstitutional as it  suffers from  the  vice  of excessive delegation  of  the  essential legislative power to the executive as it is unchannelised as there  are no guidelines, which gives free hand to the State Government to act arbitrary.  This submission for the lessee was rejected when this Court held:-

     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  other provisions of the 1957 Act and its legislative history.

     This  Court further held:  32.  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 Government under Section 15(1).

     33.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, 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 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  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

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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  Government while reserving matters  relating  to minerals   other   than  minor   minerals  to  the   Central Government.

     This  Court finally upheld the validity of sub-section (1)  of Section 15 by holding that power conferred upon  the State Governments does not amount to excessive delegation of any essential legislative power.  It further held, there are sufficient  guidelines for the exercise of rule-making power which  are to be found in the object for which such power is conferred,  namely,  for  regulating  the  grant  of  quarry leases,  mining leases or mineral concessions in respect  of minor minerals and for the purposes connected therewith.  It also  held  that  power to make rules  under  Section  15(1) includes  to  amend the rules so as to enhance the rates  of royalty  and  dead  rent.  Further there is a check  on  the State  Government  not to enhance the rate  of  royalty/dead rent  more than once during any period of four years in view of  proviso to Section 15(3).  It upheld notification  dated 29th  November,  1974,  but  held  notification  dated  29th October,  1975  as  void  as   it  offends  the  prohibition contained  in  the  proviso  to   Section  15(3).   It  also similarly  holds notification dated 6th April, 1976 as  void as  the same enhances the rates of dead rent for the  second time during the same period of four years.  It however holds notification dated 26th March, 1979 to be valid.

     Strong hammering has been done by the learned counsels for  the appellantss with reference to the observation  made by  this  Court  in D.K.Trivedis case (supra),  where  this Court  records  that  the  guidelines for  the  exercise  of rule-making power under Section 15(1) are to be found in the restrictions and other matters contained in Sections 4 to 12 of  the  Act.   Based  on  this,  submission  is  that  this restriction  could  only  be, what is contained in  Item  54 Schedule  II read with Section 9 of the Act.  The submission is,  Item  54  refers to all other mines and  minerals  not hereinbefore  specified which would include minor  minerals as  Section 3(a) defines Minerals very widely to mean  all minerals  except minerals oil.  Hence the restriction  which is  stated,  is  really the restriction not to  enhance  the royalty  beyond  the rate specified in Item 54  which  could only be upto 12% of sale price at the pits mouth.

     In   our  considered  opinion   such   a   restrictive interpretation  is  not to be found in the  D.K.   Trivedis case  (Supra).   In  that case, through the  aforesaid  1979 notification, rate of dead rent was enhanced by substituting the  then  existing Schedule II.  The then existing rate  of dead rent in Schedule II was:

     1.  For specified minor minerals

     For  every  100 sq.  metres or part thereof, up  to  5

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hectares ..  Re.  0.35

     For each additional hectare or part thereof, exceeding 5 hectares ..Rs.50.00

     2.  For other minor minerals

     For  every  100  sq.  metres or part  thereof  upto  5 hectares ..Re.  0.20

     For  each additional hectare or part thereof exceeding 5 hectares ..Rs.35.00

     This  was  substituted and the rate of dead  rent  per hectare  was  enhanced  to Rs.1200/-,  1500/-,  2,000/-  and 3,000/-  in  various cases.  Though the enhancement  through this notification of 1979 was enormous yet no submission was made,  nor  this  Court  adverted   or  recorded  that  this enhancement has to be restricted to 12% of the sale price at pits mouth in terms of Item 54 of Schedule II.  In fact, in spite  of  this  large enhancement,  1979  notification  was upheld.    The  question,  whether   any  such  increase  is arbitrary,  excessive  or violative of Article 14 is  to  be tested  on a different pedestal.  Any excessive exercise  or arbitrary  exercise  of  power  by   a  delegatee  could  be controlled  by  the courts and if there are any, the  courts would  not hesitate to strike it down.  Mere possibility  of an  abuse  of power or arbitrary act, cannot invalidate  any statute.   To  reach this, one has to make  foundation  with specific  plea with reference to the facts and figures based on  the  circumstances of each case.  In the  present  case, however,  we are testing the submissions of the  appellants, whether the said decision restricts the exercise of power by the  State  Government in enhancing the rate of  royalty  or dead rent to the rate as specified in Item 54 of Schedule II of the Act.  This submission is based on the misconstruction of the statute and relying only on a part of the observation what  is  recorded in para 34 of that decision.  This  Court further records in the same para 34 that the guidelines with reference to Section 15(1) are to be found in the object for which  such power is conferred, the illustrative matters set out  in sub-section (2) of Section 13 and in the restriction and  other matters contained in Section 4 to 12.  Para 34 of the said decision records:-

     34.    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 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 in the restrictions  and other matters contained in Sections 4 to 12.

     It  is relevant to refer here the preceding  paragraph 33  with  reference  to  Sections 4 to 12  were  this  Court records:

     Sections  4 to 12 forms a group of sections under the

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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  is left  to the State Government to prescribe such  restriction as they think fit by rules made under Section 15(1).

     Thus  this  Court not only did not tie down the  State Government  to  such restrictions, on the contrary  left  it open for it to prescribe such restrictions as it thinks fit.

     In  other words Sections 4 to 12, not being applicable to  the minor minerals, the figurative restrictions what  is contained  there could not be made applicable, but of course they  are available as a guide line to the State  Government to  take note of in other respects, while framing its rules. So,  they  are  available  not as  restrictive  or  limiting guidelines but are available otherwise for its consideration and  adoption, wherever it is necessary.  If submission  for the  appellants  is accepted, it would militate against  the express  mandate  of Parliament as contained in  Section  14 which  excludes  Sections  4 to 12 from its  application  to minor minerals.

     The  fallacy  of  this  submission that  the  rate  of royalty and dead rent, for the minor minerals, is to be what is  contained  in  Item  54  of Schedule  II,  is  based  on misconstruing  both the said judgment of this Court and  the provisions  of the Act.  The submission is, as Section  3(a) defines  minerals which would include minor mineral, hence Item 54 as it records:  all other minerals not hereinbefore specified   would  include  minor   minerals.   It  is   an interpretation in abstract without taking into consideration Section  14.  Section 14 specifically excludes Sections 5 to 13 (earlier it was Sections 4 to 13) from its application to minor  minerals.   Thus Second Schedule which refers to  the rate of royalty in view of Section 9 could only refer to the minerals  other  than  minor   minerals.   The  language  as recorded  in  Item  54, as aforesaid would only  mean  other residual  major minerals not specified hereinbefore  meaning that  what  is  not specified in Item Nos.  1 to  53.   This could  never  mean  to  include minor  minerals.   Thus  the residuary  mineral under Item 54 could only be the left over major  minerals.   Neither the residuary nor the  left  over major  mineral  could be equated with the minor mineral  nor there  is  any  material on record to draw  such  inference. When  this Court records :  guidelines for the exercise  of rule-making  power under Section 15(1) is to be found in the restrictions  and in the other matters contained in Sections 4  to 12.  The use of word restriction is in view of  the same  words  being  used  in the heading of  this  group  of Sections   4   to   12.    The  heading   states,   General restriction   on   undertaking,   prospecting  and   minor operations.  In other words, the restriction referred to in para  34 co- relates to this heading of general restrictions to be taken note while framing the rules.

     We  may  visualise  this  from  another  angle.   This reference of general restrictions as contained in Sections 4 to  12 for it being taken note would only means to  consider its broad principle and pattern while framing its own rules. It  cannot  be  doubted  that Sections 4 to  12  also  gives guidance  to  the State Government while acting as  delegate under  Section  15  while  fixing  rate  of  royalty.   This

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guidance  is to be found in Section 9 itself which refers to the  royalties.   Sub-section  (1) of  Section  9  provides, holder  of a mining lease granted before the commencement of this Act to pay royalty in respect of any mineral removed or consumed from the leased area at the rate for the time being specified  in the Second Schedule in respect of that mineral notwithstanding  anything  to the contrary contained in  the instrument  of lease and similarly sub-section (2) provides, after  the  commencement of this Act the holder of a  mining lease  shall pay royalty at the rate specified for the  time being  in  the Second Schedule in respect of any  particular mineral.  Each of the aforesaid considerations itself may be taken  note  by the State Government while framing  its  own rules  for the minor minerals.  In other words, it may apply rate  of royalty for the minor minerals at the same rate  as the  then  existing  rate, on the date this  Act  came  into force.   Schedule II with reference to Section 9 fixes  rate of  royalty for various minerals not being minor minerals is also  a  good  source of guideline.  There we  find  various methods  applied  for fixing or charging the royalty on  the various  minerals.  It demonstrate charging of royalties per tone,  per unit per cent, per tone of ore on prorata  basis, per cent of sale price at the pits mouth etc..  In the case of  gold, it is per one gram of gold per tonne of ore and on pro  rata basis on the basis of per 100 kg.  With  reference to  Uranium it is for dry ore with U3 O8 content of 0.05 per cent  with  pro rata increase/decrease @ Re.1.00 per  metric tonne of ore for 0.01 per cent.

     This  pattern of charging also reveals a good  guiding force  while fixing any royalty by the State Government  for the various minor minerals.

     This apart, the guidelines even in the D.K.  Trivedis case (Supra) does not confine itself to Sections 4 to 12 but further records, it 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 the  purposes  connected therewith) the meaning of the word regulating the scope of the   phrase   for  purpose    connected   therewith   the illustrative  matters  as  set  out in  sub-section  (2)  of Section  13.   We  find that Section 13 gives power  to  the Central  Government  to  make rules in respect  of  minerals other  than minor minerals, while Section 15 gives power  to the  State  Government  to make rules in  respect  of  minor minerals.   The  extent of exercise of power in  both  these sections  are  similar.   The only  difference  is,  Central Government  exercises power in respect of all other minerals other  than  minor  minerals,  while  the  State  Government exercises power for the minor minerals only.  Section 13(2), in particular, gives power to the Central Government to make rules in respect of matters enumerated therein.  Though they are already covered under Section 13 (1) but is more focused in  sub section (2).  There was no such similar  sub-section in Section 15 when D.K.  Trivedis case (Supra) was decided, though  later  it  was  brought   in  through  amendment  by incorporating  sub-section  1A  through Act  No.37  of  1986 w.e.f.   10th February, 1987.  This Court very clearly  held in that case:-

     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

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minerals  while in the other case it is the State Government 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).

     So,  this  Court held that sub-section (2) of  Section 13,  which is illustrative of the general power conferred by Section  13(1) itself contains sufficient guidelines for the State  Government  to frame its own rules under Section  15( 15(1).

     It  seems the Parliament in order to bring on  parity, made  similar  provision  for  the  minor  minerals  through insertion  of  Section 15(1-A) to equate it with Section  13 (2).   This sub-section (1-A) similarly as Section 13 (2) is also  illustrative of the general power conferred on Section 15  (1).  Thus as sub-section (2) of Section 13 was held  to be  the  guiding  force  to  the  State  Government  is  now applicable to this sub-section (1-A) through the infusion of various  sub-clauses  in sub-Section (1-A).  The  submission that  it is only power is equally applicable to  sub-section (2)  of Section 13.  Even sub-dividing the exercise of power through  various  sub-clauses,  both in Section 13  (2)  and sub-Section  (1-A) of Section 15 implicitly gives  guideline to  the  delegatee.  In fact, the Parliament itself  through various  amendments has been strengthening the guidelines to the State Government.  Not only sub-Section (1-A) of Section 15 but even Section 4A and Section 17A were inserted through the  same  amending  Act  No.37 of  1986.   Similarly,  sub- section  (3) was inserted in Section 28 by Act No.25 of 1994 and  Section 23- C was inserted by Act No.38 of 1999.   Even Section  14 was amended by the aforesaid Act No.37 of  1986. Earlier  Sections  4  to  13 were  excluded  for  the  minor minerals but through this amendment, the exclusion shrunk to Sections  5  to 13.  In other words, both Sections 4 and  4A were  made  applicable even to the minor minerals.   Further Section  4(1-A) which was inserted through Act No.38 of 1999 covers  transport  or storage of any mineral  in  accordance with   the  Act  and  Rules.    In  case   the   restrictive interpretation, as submitted for the appellant, to limit the States power within Entry 54 of Schedule II is accepted, it will  lead  to various incongruities.  Section 6  fixes  the maximum  area  of lease to be twenty-five square  kilometers under  sub-Section  (a)  and  ten  square  kilometers  under sub-section  (b).   Section 7 fixes 3 years for  prospecting licence  and Section 8 fixes maximum period of 30 years  for mining lease.  If the State Government has to take literally what  is  contained there then even for the  minor  Minerals State Government has to issue leases of such area for such a large  period.   This  would be impracticable,  in  view  of difference  in the nature of major and minor minerals.  Thus the  fixation  of  period, area of leases and  the  rate  of royalty for the major minerals is not equitable with that of the minor minerals.

     Half  hearted submission was also made by Mr.  Sanyal, one  of the learned senior counsel, that proviso to  Section 9(3)  limits the power of the Central Government to fix  the rate  of  royalty not exceeding 20% while there is  no  such limitation  on  the power of the State Governments.   It  is sufficient  to  record  here that this limitation  has  been lifted  by amending sub-section (3) of Section 9.  Now there

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is   no  such  limitation  on   the  power  of  the  Central Government.

     Now,  we  may proceed to examine  another  perceivable guideline  to the State Government.  It is significant, both Entry  54 List I of the Seventh Schedule of the Constitution and  Entry 23 List II refer to the Regulation of mines  and minerals  development.  This Entry has been reiterated both in  the Preamble and the Statement of Objects and Reasons of this   Act.    This  regulation  of  mines   and   minerals development  clearly  indicates  the guidelines  which  the Parliament  is  projecting.   Every word in  a  language  is impregnated  with  and  is  flexible  to  connote  different meaning,  when  used  in context.  That is why it  is  said, words  are  not static but dynamic and courts must adopt  it that  dynamic  meaning  which  uphold the  validity  of  any provision.   This  dynamism  is  the cause  of  saving  many statutes  of  it  being  declared  void,  it  dissolves  the onslaught  of any rigid and literal interpretation, it gives full  thrust  and  satisfaction to achieve  the  objectivity which  the  legislature  intended.  Whenever there  are  two possible  interpretations  its true meaning and  legislature intended  has to be gathered, from the Preamble, Statement of  Objects  and  Reasons and other provisions of  the  same statute.   In order to find true meaning of any or what  the legislature  intended  one  has  to   go  to  the  principle enunciated  in  the  Heydons  case,  which  laid  down  the following  principle as early in the sixteenth century.   76 E.R.   637  = (1584) 3 Co.  Rep.  7a 9.7;  (1) What was  the law  before making of the Act;  (2) What was the mischief or defect  for which the law did not provide;  (3) What is  the remedy  that  the  Act has provided;  and (4)  What  is  the reason   of  the  remedy.   The   Court  must   adopt   that construction  which suppresses the mischief and advances the remedy.   This  Court has followed this principle in  Bengal Immunity  Co.  Ltd.  Vs.  State of Bihar & Ors., AIR 1955 SC 661 (674);  The Commissioner of Income tax, Patiala Vs.  M/s Shahzada  Nand  &  Sons, AIR 1966 SC 1342  (1347);   Sanghvi Jeevraj   Ghewar  Chand  &   Ors.   Vs.   Secretary,  Madras Chillies,  Grains  and  Kirana   Mercants  Workers  Union  & Anr.,AIR   1969   SC  530  (533);    Union  of   India   Vs. Sankalachand  Himatlal Sheth & Anr., AIR 1977 SC 2328 (2358) and  K.P.   Varghese  Vs.  Income Tax Officer,  Ernakulam  & Anr., AIR 1981 SC 1922 (1929).

     Returning  to  the  present  case we  find  the  words regulation   of   mines  and   mineral   development   are incorporated both in the Preamble and Objects and Reasons of this  Act.  Before that we find Preamble of our Constitution in unequivocal words expresses for securing for our citizen, social,  economical  and political justice.  It is  in  this background  and in the context of the provisions of the  Act we  have to give meaning of the word regulation.  The word regulation may have different meaning in different context but  considering  it in relation to the economic and  social activities  including  the  development  and  excavation  of mines,   ecological  and   environmental  factors  including States  contribution in developing, manning and controlling such activities including parting with its wealth, viz., the minerals,  the fixation of the rate of royalties would  also be  included  within  its meaning.  This Court in  State  of Tamil  Nadu  Vs.  M/s Hind Stone and Ors.  1981 (2) SCC  205 held:-

     Word  regulation  has  not  got  that  rigidity  of

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meaning  as  never  to  take in  prohibition.   In  modern statutes  concerned  as  they are with economic  and  social activities,  regulation must of necessity, receive so wide an  interpretation  that  in  certain  situations,  it  must exclude  competition  to the public sector from the  private sector.   More  so in a welfare State.  Must depends on  the context  in which the expression is used in the statute  and the  object  sought  to  be  achieved  by  the  contemplated legislation.   Each case must be judged on its own facts and in  its own setting of time and circumstances and it may  be that in regard to some economic activities and at some state of  social  development,  prohibition with a view  to  State monopoly  is  the  only practical and reasonable  manner  of regulation.   The  Mines  and   Minerals  (Development   and Regulation) Act aims at the conservation and the prudent and discriminating  exploitation of minerals and prohibiting  of leases   in  certain  cases  is   part  of  the   regulation contemplated by Section 15 of the Act.

     So in regulating mineral development, the royalty/dead rent  is the inherent part of it.  State has thus before  it number  of  factors which would guide it to fix, enhance  or modify  the  royalty/dead  rent payable by  a  lessee.   The conservation and regulation of mines and mineral development includes  wide activity of the State including parting  with its  wealth,  are  all  relevant factors to  be  taken  into consideration   as   a  guiding   force  for   fixing   such royalty/dead  rent.   For interpretation of a  Statute  with reference  to  Preamble we may usefully refer the case  of Bhatnagar  & Co.  Ltd.  Vs.  Union of India & Ors., AIR 1957 SC  478 where Constitution Bench held:  In other words, in considering the question as to whether guidance was afforded to  the  delegate  in bringing into operation  the  material provisions  of  the  Act by laying down principles  in  that behalf,  the  Court  consid/bn  ered the  statement  of  the principles  contained in the preamble to the Act as well  as in  the material provisions of s.  3 itself.  This  decision shows  that  if we can find a reasonably clear statement  of policy  underlying  the provisions of the Act either in  the provisions  of the Act or in the preamble, then any part  of the  Act  cannot  be  attacked on the  ground  of  delegated legislation by suggesting that questions of policy have been left to the delegate.....

     With   reference  to  the   regulation   of   mineral development, with reference to the minor minerals the policy of  the Act is communicating loudly from its roof top,  that let it be done by the delegatees State who is fully aware of the  local  conditions as such mineral is also used for  the local  purposes  and  on  whom   this  larges  falls.   What delegatee  should do what it should not do is also enshrined in  the  Act.   Section  18 is also not  excluded  from  its application to the minor mineral development.  Under it duty is cast duty on the Central Government to take all necessary steps  for  the  conservation and  systemic  development  of minerals   in  India.   Its   sub-section  (2)  focuses  the periphery  within  which  it has to do and what not  to  do. This  itself  is a guidance which State may take  note  of while  framing its own rules.  Similarly Section 23-C  gives detail  guidance what State should provide to check illegal, mining, storage and transportation.

     We  have  said  Sections  4-A, 17, 18 and  23  C  also provides for the guidelines.  Sub-section (2) of Section 4-A

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empowers  the  State Government to premature  terminate  any prospecting  licence  or mining lease if it is expedient  in the interest of regulation of mines and mineral development, preservation  of  natural  environment, control  of  floods, prevention  of  population  or for avoiding  danger  to  the public  health  or  communication  or to  ensure  safety  of buildings,  monuments,  structures  or for  other  purposes. Under  sub-section (2) of Section 17, the Central Government undertakes  reconnaissance, prospecting or mining operations in  any  area not already covered by any licence  or  lease, after consultation with the State Government but sub-section (3)  obligates  it to pay the permit fee,  prospecting  fee, royalty,  surface  rent  or dead rent, at the same  rate  at which  it would have been payable by any other person  under this  Act.   This also is a check on the  State  Government, while fixing the rate of the royalty.  Similarly, Section 18 which  refers to the mineral development as aforesaid  casts an  obligation  on the Central Government to take  all  such steps  for  the conservation and systematic  development  of minerals  in India and for the protection of environment  by preventing  or  controlling any pollution for which  it  may make  rules  and sub-section (2), in  particular,  specifies large list on which such rules may be framed, which has been framed  (the  Mineral  Conservation and  Development  Rules, 1988),  which  would be binding on the Government  including the  State  Government.   In conserving  or  regulating  the development  of  any mineral resources, the price factor  is inherent.   Any  development requires, planning,  execution, management  and  with reference to the excavation of  mines, controlling  the  extent and manner of mining, to check  its wastage,  protecting  environment and controlling  pollution etc.   which  are  provided in this Act.  This  all  require expenditure  to  be  incurred  by  the  State  coupled  with considerations  for parting with the wealth of the State, as minerals  belongs to the State except on private land.  They are  all  guiding factors in fixing, modifying or  enhancing the  rate of royalty.  Thus development of mineral resources inherently refers to the price factor to be recovered by the owner.

     One  of  the  submission for the appellant  is,  since royalty  is a tax, delegation for its enhancement cannot  be left  unbridled on the delegatee and if two  interpretations are  possible,  the one which favours an assesee  should  be accepted.   It is true that this Court has held royalties on the minerals to be a tax in India Cement Ltd.  and Ors.  Vs. State  of Tamil Nadu and Ors.  1990(1) SCC 12, Orissa Cement Ltd.   Vs.  State of Orissa and Ors.  1991 Supp.(1) SCC 430, State  of  M.P.  Vs.  Mahalaxmi Fabric Mills Ltd.  and  Ors. 1995  Supp.   (1) SCC 642 and P.  Kannadasan  etc.   etc.Vs. State of Tamil Nadu & Ors.  etc.  etc.  1996(7) SC 16.

     In  considering  this  submission we have to  keep  in mind,  tax  on this royalty is distinct from other forms  of taxes.   This  is not like a tax on income, wealth, sale  or production of goods (excise) etc.  This royalty includes the price  for  the consideration of parting with the right  and privilege of the owner, namely, the State Government who own the mineral.  In other words, the royalty/dead rent, which a lessee  or  licensee pays, includes the price  the  minerals which  is the property of the State.  Both royalty and  dead rent  are  integral  part  of a lease.  Thus,  it  does  not constitutes  usual  tax as commonly understood but  includes return  for the consideration for parting with its property. In  view  of  this  special  nature  of  the  subject  under

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consideration,  namely, the minerals, it would be too  harsh to  insist  strict  interpretation  with  reference  to  the guidelines  to  a  delegatee who is also the  owner  of  its mineral.   In  the present case, we are not considering  any liability  of tax on the assessee but whether delegation  to the State by the Parliament with reference to minor minerals is unbridled.

     One  of the guidelines in the case of Mahalaxmi Fabric Mills  Ltd.   and Ors.  (Supra) was that the Parliament  had itself laid down with reference to major minerals, the rates of  royalty in the Second Schedule of the Act and authorised the  Central  Government  to revise the rates from  time  to time.   So far minor minerals, also we find sub-section  (2) of  Section  15  approves  the   rules  made  by  the  State Government,  regulating  the grant of quarry leases,  mining leases  or other mineral concessions in respect of mine  and mineral  prior to the enforcement of this Act and  similarly sub-section  (3)  approves  the rate  of  royalty/dead  rent prescribed  for its payment in respect of minor minerals for the  time  being in force, i.e., what existed prior  to  the coming  in  force of this Act.  Thus, even approval  of  the then  existing  rates  of  royalty  or  dead  rent  by   the Parliament  itself  is  similarly a guiding factor  for  any subsequent  modification  of  its   rate.   The  proviso  to sub-section   (3)   brings  an   additional  check  on   the enhancement  of rate of royalty/dead rent that it cannot  be enhanced  more  than once during any period of three  years. Prior to the Act No.37 of 1996 this period was of 4 years.

     We  have  to  keep  in  mind,  in  the  present  case, delegation  of power is on the State Government which is the highest  executive in the State, which is responsible to the State  Legislature.  In a Parliamentary democracy every  act of the State Government is accountable to its people through State Legislature which itself is an additional factor which keeps the State Government under check to act arbitrarily or unreasonably.   When  a  policy is clearly laid  down  in  a statute with reference to the minor mineral with main object of  the  Act for its conservation and  development,  coupled with  various  other  provisions  to  the  Act  guiding  it, checking  it  and  controlling it then how  such  delegation could be unbridled.  With reference to Municipal Corporation of  Delhi  Vs.   Birla Cotton, Spinning and  Weaving  Mills, Delhi, 1968 (3) SCR 251, the question of delegation of power to  the  Municipal Corporation and the State Government  was considered  in  which Avinder Singh and Ors.  Vs.  State  of Punjab  and Ors.  1979 (1) SCC 137 was considered and relied as under:

     In  the  Municipal  Corporation of  Delhi  case,  the proposition   that   where  the   power  conferred  on   the corporation  was  not unguided, although widely  worded,  it could  not  be said to amount to excessive  delegation,  was upheld.  Delegation coupled with a policy direction is good. Counsel  emphasised  that the court had made  a  significant distinction  between  the local body with limited  functions like a municipality and Government:

     The  needs of the State are unlimited and the purposes for  which the State exists are also unlimited.  The  result of  making  delegation of a tax like sales tax to the  State Government  means  a power to fix the tax without any  limit even  if the needs and purposes of the State are to be taken into   account.   On  the  other   hand,  in  the  case   of

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municipality, however large may be the amount required by it for  its purposes it cannot be unlimited, of the amount that a  municipality  can  spend is limited by the  purposes  for which  it is created.  A municipality cannot spend  anything for any purposes other than those specified in the Act which creates  it.   Therefore  in the case of a  municipal  body, however  large  may be its needs, there is a limit to  those needs  in view of the provisions of the Act creating it.  In such  circumstances  there  is a clear  distinction  between delegating  a power to fix rates of tax, like the sales tax, to  the  State  Government  and delegating a  power  to  fix certain local taxes for local needs to a municipal body.

     It  is  too  late  in  the day  to  contend  that  the jurisprudence  of  delegation of legislative power does  not sanction parting with the power to fix the rate of taxation, given  indication of the legislative policy with  sufficient clarity.   In  the case of a body like a  municipality  with functions  which  are unlimited and the requisite  resources also limited, the guideline contained in the expression for the purposes of the Act is sufficient, although in the case of  the  State or Central Government a mere indication  that taxation  may be raised for the purposes of the State may be giving  a carte blanche containing no indicium of policy  or purposeful limitation. {Empahsis supplied}

     With  reference to the question what is the policy of the legislature this very decision holds:

     We  are clearly of the view that there is fixation of the  policy of the legislation in the matter of taxation, as a  close  study of Section 90 reveals;  and  exceeding  that policy  will invalidate the action of the delegate.  What is that  policy?   The levy of the taxes shall be only for  the purposes  of  the  Act.   Diversion for  other  purposes  is illegal.    Exactions  beyond  the   requirements  for   the fulfilment  of  the  purposes of the Act are  also  invalid. Like in Section 90(1), Section 90(2) also contains the words of  limitation  for  the  purposes of this  Act  and  that limiting  factor governs sub- sections (3), (4) and (5)The expression  purposes of this Act is pregnant with meaning. It  sets  a  ceiling  on  the  total  quantum  that  may  be collected.   It  canalises the objects for which the  fiscal levies  may  be spent.  It brings into focus the  functions, obligatory  or  optional,  of the municipal bodies  and  the raising  of  resources  necessary   for  discharging   those functions  nothing more, nothing else.

     Thus  this case clearly lays down that fixation of the policy  of  the  Act in the matter of taxation itself  is  a guidance  to  a  delegatee, which is also be  found  in  the present  case,  when its preamble, objects and  reasons  and various  other provisions refers to for the development  and regulation  of mines and minerals.  The fixation of rate has co-relate for this purpose of the Act and not beyond it.

     With  reference  to  another   submission  that   only purposeful  guidance with control over the State  Government would  be to fix maximum limit of rate of royalty, which  is not  there  in the present case.  Similar question was  also submitted  and  this  Court in the case  of  Corporation  of Calcutta Vs.  Liberty Cinema 1965 (2) SCR 477 held:

     No doubt when the power to fix rates of taxes is left

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to  another body, the legislature must provide guidance  for such  fixation.   The  question then is, was  such  guidance provided  in  the  Act?  We first wish to observe  that  the validity of the guidance cannot be tested by a rigid uniform rule;   that  must  depend on the object of the  Act  giving power  to  fix the rate.  It is said that the delegation  of power  to fix the rates of taxes authorised for meeting  the needs  of the delegate to be valid, must provide the maximum rate  that  can be fixed, or lay down rules indicating  that maximum.   We are unable to see how the specification of the maximum  rate supplies any guidance as to how the amount  of the tax which no doubt has to be below the maximum, is to be fixed.   Provision for such maximum only sets out a limit of the rate to be imposed and a limit is only a limit and not a guidance.

     It  seems  to us that there are various  decisions  of this  Court  which  support  the   proposition  that  for  a statutory  provision for raising revenue for the purposes of the delegate, as the section now under consideration is, the needs  of  the  taxing body for carrying out  its  functions under  the  statute  for which alone the  taxing  power  was conferred  on it, may afford sufficient guidance to make the power to fix the rate of tax valid.

     Before  we  take up the history of delegation  of  the power  of the State Government as delegatee, it is necessary to  refer  to  two  decisions  of  this  Court  in   messrs. Bhatnagar  & Co.  and Anr.  Vs.  The Union of India and Ors. AIR  1957  SC 478.  This case also considers the history  of the  earlier provisions of the Act where challenge of  vires was made.  It held:

     Thus,  if  the preamble and the relevant section  of the earlier Act are read in the light of the preamble of the present  Act, it would be difficult to distinguish this  Act from  the  Essential Supplies Act with which this Court  was concerned  in  Harishankar  Baglas case, AIR 1954  SC  465. Incidentally we may also observe that in Pannalal Binjraj v. Union  of India, Petns.  Nos.  97 and 97A etc.  of 1956( (8) AIR  1957 SC 397, (B), where the vires of s.  5 (7-A) of the Income  tax  Act  were put in issue before this  Court,  the challenge was repelled and during the course of the judgment delivered  on December 21, 1956, the previous history of the earlier  Income  tax Acts was taken into account  to  decide what  policy could be said to underlie the provisions of the impugned section.

     This  Court in Municipal Corporation of Delhi  (Supra) also  referred  to the history of enactment while  examining and  testing  vires of the Act.  It records:  According  to our  history also there is a wide area of delegation in  the matter  of  imposition of taxes to local bodies  subject  to controls  and  safeguards of various kinds which partake  of the  nature  of guidance in the matter of fixing  rates  for local taxation.  It is in this historical background that we have  to  examine the provisions of the Act impugned  before us.

     We  may  further  examine this question  from  another angle.   In  order to adjudicate, whether any delegation  of power  is unbridled or excessive, the historical  background

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of  similar provisions which preceded the impugned provision should  also  be  kept  in mind as it  is  also  a  relevant consideration.  In fact, D.K.  Trivedis case (supra) itself has  taken  the  note of its historical background.   It  is significant  that Entry 54 List I of the Seventh Schedule of the  Constitution  of  India,  reproduces Entry  36  in  the Federal  Legislative  List in the Government of  India  Act, 1935,  except by omitting the words and oil fields.  Under this  Entry  36  the  Mines  and  Minerals  (Regulation  and Development)  Act,  1948  was  enacted as we  have  now  the present  1957 Act under Entry 54 List I.  This Act conferred very wide rule making power upon the Central Government, for regulating   and   granting   of    mining   leases.     The constitutional  maker  also knew that Central Government  in exercise  of  this  rule  making power,  made  the  Minerals Concession Rules, 1949 and by Rule 4 the extraction of minor minerals  was left to be regulated by the rules made by  the Provincial Governments.  When the present 1957 Act came into force,  the  Parliament  was   aware  that  different  State Governments  in pursuance of this Rule 4 were regulating the grant  of  leases  in respect of  minor  minerals  including fixation  of rate of royalties.  This Parliament approved in the  present Act through sub-sections (2) and (3) of Section 15,  then  existing  Rules which were in  force  immediately before  the commencement of this Act which included the rate of  royalty/dead rent for it to be continue in force, unless superseded  by the Rules made under sub- section (1).  Thus, the  Parliament was fully aware that even in the past it was the  State Governments which were entrusted and were dealing with  minor  minerals as a delegatee.  The  only  difference being,   earlier  the  State   Governments  were  acting  as sub-delegatee  of the Central Government but now they act as delegatee  of the Parliament.  This was the pattern  adopted and approved since inception.  This seems to be also because minor  minerals being more useful for the local uses and the State  Government  being the highest executive in the  State knowing  fully  well  of   its  uses,  management  including fixation  of its prices thus, in this historical  background there  is nothing wrong to delegate the State Government  to fix rate of royalty/dead rent.

     In D.K.  Trivedis case (supra) this Court records:

     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 Jethabai (1951 SCR 51) and State of Madras v.  Gannon Dunkerley & Co. (Madras) Ltd.  (1959 SCR 379).

     This  takes  us  to the next submission,  whether  the introduction  of  sub-  section  (3) of Section  28  by  the Parliament  in  any way strengthen the guideline and  put  a check  on  the  exercise of power by the  State  Government. Sub-section  (1)  of Section 28 refers to the  placement  of every  rule  and  every  notification made  by  the  Central Government  before each House of Parliament for a period  of 30  days  when  the same becoming effective subject  to  its modification, if any.  Sub-section (3) of Section 28 directs placement  of  every rule or notification made by the  State Government  before  each  House of State  Legislature.   The submission  is, there is no provision in sub-section (3)  as in  sub-section (1), of such rule being subject to  scrutiny

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for  its approval or modification by the State  Legislature. The  submission  is,  sub-section (3) in no way  places  any check  on the State Government, as State Legislature is  not entrusted  with power to approve or modify.  In other words, introduction  of  sub-section (3) is merely for the sake  of information and nothing more.  Further it is submitted, when language  of two different sub-sections in the same  Section are  different  it has to be differently interpreted,  which cannot be construed to connote same meaning and same effect. It is also submitted, even if sub-section (3) was brought on the Statute Book, it was not sufficient for the State, as it has  to  show that in fact both the  impugned  notifications were so laid before both the Houses of the Legislature.  The submission  is,  actually  they were not so  laid.   Further reliance  is  placed in the case of Atlas  Cycle  Industries Ltd.   Vs.   State  of Haryana, 1979 (2) SCC 196  (para  30) where  this  Court  held  that a mere  laying  procedure  is directory  not mandatory.  On the other hand, submission  on behalf of the State is that this laying procedure before the Legislature  cannot be a mere show, but it is for a purpose, the  effect of which it has to be given.  In our  considered opinion,  the incorporation of this by the Parliament cannot be said to be in futility.  In fact, this was brought in, in view  of  the observation made by this Court in the case  of D.K.  Trivedis (supra).

     It  is true that the language of both sub-sections (1) and  sub-sections (3) of Section 28 are different.  They are reproduced below:

     28.   Rules  and  notifications  to  be  laid  before Parliament  and certain rules to be approved by  Parliament. -  (1) Every rule and every notification made by the Central Government  under this Act shall be laid, as soon as may  be after it is made before each House of Parliament while it is in  session  for a total period of thirty days which may  be comprised  in  one  session  or in two  or  more  successive sessions   and  if,  before  the   expiry  of  the   session immediately following the session or the successive sessions aforesaid,  both Houses agree in making any modification  in the  rule or notification or both Houses agree that the rule or notification should not be made, the rule or notification shall  thereafter have effect only in such modified form  or be  of no effect, as the case may be;  so, however, that any such modification or annulment shall be without prejudice to the  validity of anything previously done under the rule  or notification.

     xxx xxx

     (3)  Every  rule  and every notification made  by  the State  Government  under this Act shall be laid, as soon  as may  be  after  it is made, before each House of  the  State Legislature  where it consists of two Houses, or where  such Legislature consists of one House, before that House.

     There  is  no  difficulty  for   us  to  uphold  their submission  that  in view of difference in the  language  of sub-section  (3),  the  same  meaning  to  it  as  that   of sub-Section  (1) cannot be given.  This difference has  been

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carved out for a purpose to give different projection to the said  two  provisions.  In the case of major  mineral  which plays  important role in the National growth and wealth  and where  the  delegatee is the Central Government,  Parliament retained  its  full  control  but  for  the  minor  mineral, Parliament  felt  as the subject is for local use and  State Government  well  versed to deal with it in  the  historical background, mere placement of rules, notifications framed by it  before the State Legislature would be a sufficient check on  the  exercise of its powers.  Thus, this  difference  of language  gives  two  different thrust as  intended  by  the Parliament.   Any  act of the Parliament, far less  when  it introduces  any new provision through amendment, it could be said for it to be in futility.  The purpose has to be found. What could be the purpose for such an amendment?  One of the reasons  is  that  this  was  brought in,  in  view  of  the observation  made by this Court in D.K.  Trivedis  (supra). This Court records:

     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’  industry and economy, but did not think if fit to do  so  in  the case of minor minerals because  it  did  not consider them to be of equal importance..

     The  Parliament  through its wisdom, apart from  above brought  this amendment also to keep a check on the exercise power  by the State Governments as delegatee.  The question is  whether  mere laying rules and notification  before  the legislature,  as in the present case, can be construed as  a check on the State Government power.  Laying before House of Parliament  are made in the three different ways.  Laying of any  rule  may be subject to any negative resolution  within specified period or may be subject to it confirmation.  This is  spoken as negative and positive resolution respectively. Third  may be mere laying before the House.  In the  present case,  we  are  not  concerned with  either  affirmative  or negative procedure but consequence of mere laying before the legislature.

     Administrative Law by HWR Wade & Forsyth, 7th Edition, page  898  records with reference to mere  laying:   Laying before Parliament An Act of Parliament will normally require that  rules or regulations made under the Act shall be  laid before  both Houses of Parliament.  Parliament can then keep its  eye upon them and provide opportunities for  criticism. Rules  or regulations laid before Parliament may be attacked on  any  ground.  The object of the system is to  keep  them under  general  political  control,  so  that  criticism  in Parliament   is  frequently  on   grounds  of  policy.   The legislation concerning laying has already been explained.

     Laying  before  Parliament  is  done in  a  number  of different ways.  The regulations may merely have to be laid; or  they may be subject to negative resolution within  forty days;   or  they may expire unless confirmed by  affirmative resolution.

     Constitutional  and  Administrative  Law,  Stanely  De Smith and Rodney Brazier, 7th Edn., records:

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     If  the instrument has merely to be laid, or laid in draft,  before Parliament, it will be delivered to the Votes and  Proceedings  Office  of  the   House  of  Commons.   No opportunity  is provided by parliamentary procedure for  the instrument  to be discussed, but its existence will at least be brought to the notice of members and the Minister is more likely  to  be  questioned about it than if it is  not  laid before Parliament at all.

     In  a  democratic  set up, every State  Government  is responsible  to  its  State Legislature.  When  any  statute require  mere laying of any notification or Rule before  the Legislature  its  execution,  viz., State  Government  comes under  the  scrutiny  of the concerned  Legislature.   Every function  and  every  exercise  of   power,  by  the   State Government  is  under one or other Ministry who in  turn  is accountable  to  the  legislature   concerned.   Where   any document, rule or notification requires placement before any House  or  when placed, the said House inherently  gets  the jurisdiction  over  the  same.  Each member  of  the  House, subject  to  its procedure gets right to discuss  the  same, they   may   put  questions  to  the   concerned   Ministry. Irrespective  of  the fact that such rules or  notifications may  not be under purview of its modification, such  members may  seek explanation from such Ministry of their  inaction, arbitrariness, transgressing limits of their statutory orbit on  any such matter.  Short of modification power, it has  a right  even  to condemn the Ministry.  No doubt in the  case where  House  is entrusted with power to annually modify  or approve  any  rule,  it plays positive role  and  have  full control  over it, but even where the matter is merely placed before  any House, its positive control over the  executive, makes  even  mere laying to play a very vital  and  forceful role   which  keeps  a  check   over  the  concerned   State Government.   Even  if  submission   for  the  appellant  is accepted  to  be  that  mere   placement  is  only  for  the information,  even  then such information, inherently in  it makes legislature to play an important role as aforesaid for keeping  a  check on the activity of the  State  Government. Such placement cannot be construed to be non est.  No act of Parliament  should be construed to be of having no  purpose. As  we  have  said  mere   discussion  and  questioning  the concerned  ministry or authority in the House in respect  of such  laying would keep such authority on guard to act  with circumspection which is a check on such authority, specially when  such  authority is even otherwise answerable  to  such Legislature.   Further examining the scheme of the Act, with its   historical   background,  we   find  there  is   clear demarcation  in  dealing between the Major minerals and  the Minor  minerals.   For minor minerals all its activity  from before  this Act has been delegated to the State  Government as  it having all conceivable knowledge over it, as it being of local use and not being of much national importance.  For this  difference also stricter control is made for the Major minerals  through Section 28(1) than for the minor minerals. Thus, this mere check on the State Government, as aforesaid, may have been found to be sufficient by the Parliament, with reference to the minor minerals.  Thus, the language of both sub-section  (1) and sub-section (3) though different,  this is  only  for two different purposes.  Thus when  Parliament introduced  sub-section  (3)  through amendment, it  was  to further  strengthen  the control over the  State  Government power.    Any  other  submission,  the   one  made  by   the

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appellants,  makes  such  an Act of the  Parliament  meaning less, which cannot be attributed to the Parliament.

     This takes us to the next submission.  It is submitted that  the  State Government, in spite of the  mandate  under sub-section  (3)  of Section 28, to place the rules and  the notifications  framed by it before each House of Legislature the   impugned   notifications  have    not   been   placed. Appellants case is that stating they were not placed, while for  the  respondent  State submission is  it  were  placed. Subsequent to the conclusion of the hearing, learned counsel for the State sought leave of this court, which was granted, to  place  affidavit  with  annexures  to  substantiate  its submission.   An additional affidavit by Mr.  Anand Vardhan, District  Mining  Officer dated 1st May, 2000 was  filed  on behalf  of the respondent State of Bihar.  A reply affidavit dated  4th  June, 2000 was filed by one Mr.  Subhash  Kumar, Secretary of the appellants association.

     It  may  be  pointed  here, out of  the  two  impugned notifications  only  one  notification dated  28.9.1994  was required  to  be  placed  before  the  House  of  the  State Legislature  since  sub-section (3) of Section 28  was  only brought  in  the year 1994.  As per the State affidavit,  on the date the arguments concluded in this case, a fax message was  received by the Standing Counsel that the  notification dated  28.9.1994  had been placed before two houses  in  the May-June 1994 and 1995 session through Administrative Report of  the  Department  of Mines and  Geology.   The  affidavit further  states, every year Department of Mines and  Geology prepares  Administrative Report, which includes the  revenue earned  from  mining  and there is a section in  the  office which  reports  the  prevailing  rates of  royalty  and  the notifications  under which it is fixed.  This report is sent every  year  to  both the houses of  the  State  Legislature through    their   respective     Sections.    In    1994-95 Administrative  Report,  the   impugned  notification  dated 28.9.1994  is mentioned in para 4.40 of Chapter IV at page 6 and  notification  as a whole is included as Annexure  6  at page  29.  Similarly, the Administrative Report for  1995-96 mentions  the  fixation of royalty as fixed by  notification dated 28.9.1994, is mentioned para 4.4 of Chapter at page 7. Similarly,  Administrative Report for 1996-97 also  mentions fixation  of royalty on mines minerals through  notification dated  28.9.1994.  Each year these reports were supplied  to the  Secretary, Bihar Vidhan Sabha with sufficient number of copies  enable  its  circulation to the members of  the  two Houses.   About 400 copies were sent to Vidhan Sabha and 100 copies  to Vidhan Parishad.  Based on the aforesaid averment in the concluding para of the affidavit it is averred:

     it  is clear that the notification dated  28.9.1994 fixing  royalty  had been laid before the two houses of  the State  legislature as required by Section 28(3) of the Mines and Minerals (Regulation and Development) Act, 1957.

     In  the  reply affidavit for the appellants  one  Mr.. Subhash  Kumar, a letter dated 4.6.2000 which is in response to  a  quary is annexed, which is of under Secretary,  State Minister  Homes,  annexing letter No.  4/99-4-7  dated  27th May, 2000 of the Dy.  Secretary, Bihar Legislative Assembly, which records:

     .as  per  direction (1) have to inform  that  Bihar

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Legislative Assembly has no knowledge of Bihar Minor Mineral Concession  Rules,  1972 and amendment made therein  of  any regulation made in this connection:.

     The  perusal of the two affidavit makes it clear  that truly  as  required  by sub section (3) of  Section  28  the impugned  notification  dated 28.9.1994 was not placed.   It seems  various  departments  of  the  Government  sends  its administrative  report  every  year   with  respect  to  its functioning  and  revenue  earned.  It is  in  this  context department  of  Mines  and  Geology prepared  and  sent  its administrative  report for 1994-95, 1995-96 and 1996-97  and the  notification  dated  28.9.1994  is  referred  in  these reports.   Further  400 copies for the Vidhan Sabha and  100 copies  for  Vidhan  parishand were  sent  for  circulation. Thereafter  there  are  no  other document  showing  it  was actually  placed  before the House.  Even if  these  reports were  sent  and  placed  before   the  House  it  were  said administrative   report   which  did    contain   the   said notification  dated  28.9.1994.  In fact, the  letter  dated 27th  May,  2000  from  Shri   Jagdish  Prasad  Yadav,   Dy. Secretary Bihar Legislative Assembly, reveals that the House has  no knowledge of the Bihar Mineral Concessions Rule 1972 and amendment made thereunder or any regulation made in this connection.

     So, it is not possible to hold, based on affidavits of the  parties that the impugned notification dated  28.9.1994 was  actually  placed in terms of Section 28(3).   It  being part of some administrative report cannot constitute to be a fact to hold its placement in terms of said sub-section (3). Though  the affidavit on behalf of State reveals that  under rules  of  procedure  and conduct of business of  the  Bihar Vidhan  Sabha,  there is a delegated legislation  committee, which  examines, all the rules which are required to be laid before  the  House,  which also inspects  and  examines  the working of such personals involved under it.

     M/s  Atlas  Cycle Industries Ltd.  and Ors.  1979  (2) SCC  196.  In this case also one of the contentions was that the  notifications were not placed before the Parliament  as required  by  sub-section (6) of Section 3 of the  Essential Commodity  Act  1955  The sub-section (6) of Section  3  of this  Act requires that every order made under this  section by  the Central Government or by any officer or authority of the  Central Government shall be laid before both houses  of Parliament,  as  soon as may be, after it is made.  This  is similar  to  the  provision which we are  considering  under sub-sectionn  (3)  of  Section  28.   The  Court  held  such provision  to be directory and hence for this default of not placing   the  Iron  and  steel   control  order  1956   and notification  under  clause 15(3) before the Parliament  the order shall not become be invalid.

     However,   since   we  have   upheld   that   impugned notifications  issued by the State to be within the ambit of delegation and that delegation is not excessive as there are enough  guidelines  and  control over the  State  Government notwithstanding its check on the State under sub-section (3) of Section 28, it would not have any effect on its validity. But we make it clear when a statute as under sub-section (3) of Section 28 requires its placement it is the obligation of the  State Government to place such with this specific note, while  placing before each Houses of Parliament.  Even if it

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has  not  been done, the State shall now do place it  before each  houses  of the State legislature at the  earliest  the notification  dated 28.9.1994 and will also do so in  future while  framing rules or issuing any notifications under  the rules framed under sub-section (1) of Section 15 of the Act.

     Another  submission  for  the appellants is  that  the delegator or the Parliament must retain its control over the delegatee  and such delegatee cannot be entrusted to another Legislature,  namely,  State Legislature as in  the  present case.   To  repel  this submission learned counsel  for  the State,  referred to the The Delegated Legislation Provisions (Amendment)  Act, 1983.  This Act amended various Parliament Acts  to implement the recommendations of the Committees  on Subordinate  Legislation  regarding laying of certain  rules framed  by the delegatee before the State legislatures.  The Schedule  of  this Act, refers to the large number  of  such amendments  made  by the Parliament.  Few of them are  being referred  hereunder,  namely, The Religious Endowments  Act, 1863,  amendment Section 8 which requires Every rule framed under  this section shall be laid, as soon as it is  framed, before the State Legislature. By amending Section 20 of the Press and Registration of Books Act, 1867 it directs, Every rule  made by the State Government under this Section  shall be  laid,  as  soon as may be after it is made,  before  the State  Legislature.  Similarly  Section 83  of  the  Indian Christian Marriage Act, 1872, requires that Every rule made by the State Government under this Section shall be laid, as soon  as  may  be  after  it   is  made,  before  the  State Legislature.  The Registration Act, 1908 amended Section 91 (1)  through which the following was brought in Every  rule prescribed under this Section or made under Section 69 shall be  laid,  as  soon  as  it   is  made,  before  the   State Legislature.

     We are not further enumerating such is large number of cases  recorded  in the Schedule itself.  Each one  of  them were  the  act  of Parliament in which with reference  to  a delegatee,  provisions are made for placing its rules framed by it, before the State Legislature.  Thus, placement of any notification  or rules framed by the State Government  under sub-section (3) of Section 28 cannot be said to be something out  of  any  novel  procedure  but  is  a  well  recognised principle.  The submission was how can a delegatee under one legislature,  viz.,  the  Parliament  be  placed  under  the control  of  another  legislature.  This submission  has  no merit.   In  a Federal structure of any constitution,  their fields  are well defined, sometime same subject may be under control  of  both legislatures as in the concurrent list  of our  Constitution.   Thus in a given case, as in the  above, large  numbers  of  such cases were a delegatee  is  of  the Parliament  were  put  under  the   control  of  the   State legislature.   This submission is sought to be challenged by submitting  by learned senior counsel Mr.  Nariman that  the cases  in  the  Schedule under the 1983 Act  are  all  cases falling under the Concurrent List of the Seventh Schedule of our  Constitution.  This was because both the Parliament and the  State  Legislature had the plenary power to  make  laws over the same subject.  This in our considered opinion would make no difference.  It is significant to record, though the subject  we are dealing with, viz., Regulation of mines and mineral  development does not fall in the Concurrent  List, but  still  both falls in the field of the Parliament  under Entry  54  List I and the State legislature under  Entry  23 List  II,  their  possible  conflict   is  resolved  by  the

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following  words  in  Entry  23 List  II,  subject  to  the provisions  of  List  I  with   respect  to  regulation  and development  under the control of the Union.  This  control may be full, or partial.  In the present case when this 1957 Act was passed, Union came in full control over this subject and  no  field was left for the State to make the law.   But this covering of the entire field was by the 1957 Act itself not  by  any other constitutional limitation.  Then the  Act which  takes the entire field can also withdraw from it both partial  or fully.  In the present case since the Parliament has exercised its discretion under Item 54 List I, the State Legislature  is denuded of its power under Entry 23 List II. It may be said so long that Act remains in force it eclipses the  power of the State Legislature.  In the present case as held  in Baij Nath Kedias case (supra) after passing of the aforesaid  1957 Act the power of State Legislature has  been completely  denuded by the Parliament.  If that be so, it is always  open  for the Parliament to withdraw  partially  the eclipse  if  so desires, may leave the Legislature for  such part  to  exercise  its power which it  originally  have  by virtue  of Item 23 of List II.  It is in this light when  we examine  the  amendment  by introducing sub-section  (3)  of Section  28, with provision to lay the rule or  notification made by the State Government before the State Legislature it cannot  be said it can only be when it is in the  concurrent list.   Thus such placement cannot be said to be incompetent or  keeping if beyond the control of the Parliament.  As  we have said this placement before the State legislature is for a  limited  purpose for which the Parliament  is  competent. Thus  introduction of sub-section (3) in Section 28, in this light  cannot be said to be of no consequence.  It was  done for  a purpose and that purpose, as aforesaid, is sufficient to  hold  the State Government under check while  exercising its power as a delegatee.

     We  also  find  there  are   few  provisions  in   our Constitution   which   require  mere   laying   before   the Parliament.   Article  151 requires laying of the report  of the  Comptroller  and Auditor-General of India  before  each House  of Parliament and with reference to the State, to  be laid  before the Legislature of the State.  Article 338  (5) requires placing of the report of the Commission before each House  of  Parliament  and  with   reference  to  the  State Government,  under sub-Article (7) it to be laid before  the Legislature  of the State.  Though they are mere  provisions of  mere laying before the Parliament, but it is always open to  any  Member of the House to discuss and comment  on  the said report.

     Next coming to the quantum of imposition, on the facts of  this case, the imposition of royalty/dead rent could  be said  to be arbitrary or excessive by the State  Government. We  do not find any material placed by the appellants in the writ  petition  to  come to such a  conclusion.   Though  by proviso  to sub-section (3) of Section 15 it is open for the State Government to revise the royalty every three years but the  history shows it has not done so.  Since 1975 the State Government  has increased royalty only four times and  there is  no  increase since 28th September 1994 despite lapse  of six  years, in other words, raising royalty only four  times during  25 years.  Even in the case of D.K.  Trivedis  case (supra)  as  we  have recorded above a large  percentage  of increase in royalty has been made yet it was not struck down on  that account.  Before concluding we would like to record our appreciation in the manner in which learned counsels for

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the  parties made their valuable submissions which made  our task easy.  Though at times their ingenuity made us to think and  rethink but the precision through which the submissions were  made  helped  us  to  conclude  to  the  best  of  our conscience.

     In  view  of the aforesaid discussion and findings  we conclude:

     (a)  The impugned two notification dated 17th  August, 1991  and  28th  September, 1994 are valid.  (b)  The  State Government  while acting as delegatee under Section 15(1) of the  Act is not confined to fix the royalty/dead rent within the  peripheral  ambit of Entry 54 Schedule II of  the  Act. Neither  D.K.   Trivedi (Supra) has said so, nor can  it  be construed  to  be  so.  (c) The State Government  has  acted within  the  ambit  of the power delegated to  it  and  such delegation  is with sufficient guidelines and check in  view of  the Preamble, object and reasons and various  provisions of  the Act.  (d) Requirement of mere placement of the Rules or  the  Notifications before the State Legislature is  also one of the form of check on the State Government to exercise its  powers  as a delegatee.  (e) In this case the  impugned notification dated 28.9.1994 has not been placed as required by  sub-section  (3)  of Section 28 of the Act.   The  State Government  is  directed to do so now at the earliest.   (f) However,  non-placement  of the said notification would  not invalidate  the same, as said requirement is only directory. (g)   The   enhancement  of  royalty   on  the   facts   and circumstances of this case cannot be said to be arbitrary or otherwise illegal.

     In  view of the aforesaid findings, we do not find any merit  in these appeals and accordingly they are  dismissed. We  upheld the judgment of the High Court but on a different reasoning  as  recorded  by us earlier.  The  appeals  stand dismissed with costs.