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PETITIONER: UNION OF INDIA ORS.

       Vs.

RESPONDENT: UNITED COLLIERIES LTD. & ORS.

DATE OF JUDGMENT03/12/1984

BENCH: SEN, A.P. (J) BENCH: SEN, A.P. (J) REDDY, O. CHINNAPPA (J) VENKATARAMIAH, E.S. (J)

CITATION:  1985 AIR  192            1985 SCR  (2) 209  1985 SCC  (1) 305        1984 SCALE  (2)899  CITATOR INFO :  RF         1986 SC1234  (40)

ACT:      Coal  Mines   (Nationalisation)  Act   1973  Section  2 (h)(xii)-Definition of  "Mine"-Whether a  staff car  of  the Technical Advisor  to the North Chirimiri Collieries Limited which was  nationalised under  section (3)(i)  of  the  Coal Mines (Nationalisation) Act 1973 with effect from May 1,1973 was or  was not covered by the definition of the term "mine" in section 2(h)(xii) and therefore stood transferred to, and become vested  in, the  Central  Government  free  from  all encumbrances.

HEADNOTE:      An Ambassador  car No.  MHX 3771  was purchased by M/s. Karamchand Thapar  & Bros.  (Coal Sales)  Ltd, Delhi  in the year 1966  and was  transferred to  respondent No.  I United Collieries  Ltd.,  the  owners  in  relation  to  the  North Chirimiri Collieries,  and it  was, therefore,  the owner of the said  vehicle. On and from the appointed day i.e. May 1, 1973, the  right,  title  and  interest  of  the  owners  in relation to  the coal  mines specified in the schedule stood transferred to  and became  vested in the Central Government free from all encumbrances, under sub-section (1) of section 3 of the Coal Mines (Nationalisation) Act, 1973. Immediately after the  nationalisation of  the coal  mines,  the  Deputy Custodian General,  Coal  Mines  Authority  Limited,  Nagpur addressed a  letter dated  May  9,  1973  to  the  Technical Advisor to  the North  Chirimiri Collieries  using the  said staff car  to hand  over if  to the custodian. Since the car was not  handed over on the plea that it was not used by the Technical  Advisor   exclusively  for  the  North  Chirimiri Collieries  but   used  by   him  for   looking  after   the multifarious activities  of the  Thapar Group  of industries which was a composite concern With the businesses other than coal mining,  and therefore  although the  car  belonged  to respondent  No.   1,  the  owners  of  the  North  Chirimiri Collieries, it  was not a staff car ’belonging to the mine’. The  Managing   Director,  Western  Division,  Coal  Mines’. Authority by  an order  dated August  9, 1983  directed  the respondents to hand over possession of the car failing which

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they  would   be  liable   to  prosecution  under  the  Act. Thereupon,  respondent  No.  1  and  the  Technical  Advisor assailed his  order by  a petition  under Art.  226  of  the Constitution before  the Nagpur  Bench of  the  Bombay  High Court. The  High Court purporting to rely on the decision of this Court  in New Satgram Engineering Works & Anr. v. Union of India  [1980] 4  S C.C. 570. held that the question as to whether the  staff car should be treated as belonging to the owner of a mine as part of the 210 mine itself  raised disputed  questions of  fact relating to its user which would A have to be determined on the basis of evidence. lt  accordingly discharged  the rule  and left the parties to  have their  rights adjudicated  in a civil suit. Feeding aggrieved.  Union of  India preferred  the appeal by special leave  as the  question involved  affected  a  large number of cases.      Allowing the appeal, the Court ^      HELD: Parliament by an enlarged definition of ’mine’ in section 2(h)  of the  Act has  indicated the  nature of  the properties that  vest and  the question whether a particular asset is  taken within  the sweep of section 2(h) depends on whether it  answers the description given therein. The staff car in  question was  undoubtedly a fixed asset of the North Chirimiri Collieries  Ltd., the  owners in  relation to  the said mine, being the staff car of the Technical Advisor, was a fixed  asset’ belonging  to the  mine. ’Fixed  assets’  in general comprise house assets Which are held for the purpose of conducting  a business,  in  contradistinction  to  those assets which  proprietor they include real estate, building, machinery etc.  The staff  car, therefore,  fell within  the definition of  ’mine’ as  contained in section 2(h)(xii) and vested in  the Central  Government under  subsection (1)  of section 3  of the  Coal Mines  (Nationalisation) Act,  1973. Merely because  the Technical  Advisor was putting the staff car to  his personal  use or  for multifarious activities of the Thapar  Group of  Industries would  not alter  the  true legal position  since the  subsequent user  for a  different purpose was not really germane. [214D-G]      There is  a difference  in the language used in section 2(h)(xi) and  (xii) Sub-clause (xi) uses the words if solely used’ in relation to lands and buildings for the location of the  management,   sale  or  liaison  offices,  or  for  the residence of  officers and  staff, of  the mine,  while sub- clause (xii)  uses the words belonging to the owner of mine, wherever situated’.  The difference  in language between the two expressions ’if solely used’ and ’belonging to the owner of a mine’ is obvious. The observations of this Court in New Satgram Engineering  Works  case  that  "where  there  is  a dispute as  to whether  a particular  property vest  in  the Central Government  or not  under sub-s.(i)  or S.  3 of the Act, the  dispute undoubtedly  is a  civil dispute  and must therefore be  resolved by  a suit" where made in the context of s. 2(h)(xi) of the Act. In that case it was observed that was therefore  possible to  contend that lands and buildings appurtenant to  a coal mine, if not exclusively used for the purpose of  the colliery business, would not come within the definition of mine’ in section 2(h) i.e it would depend upon the nature of user, and that the crucial date is the date of vesting. The  present case  is clearly  covered  by  section 2(h)(xii) and not by section 2(h)(xi).                                    [213G-H; 214A-B ; 213A-B]      New Satgram  Works &  Anr. v.  Union of  India [1980] 4 S.C.C. 570 distinguished

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JUDGMENT:      CIVIL APPELLATE  JURISDICTION: Civil Appeal No. 4512 of 1984      Appeal by  Special leave  from the  Judgment and  order dated 211 the 27th  October, 1980  of the  Bombay High Court in S.C.A. NO. 1021 of 1973.      M.S. Gujral,  R.N. Poddar  and Dalveer Bhandari for the appellant.      U.R. Lalit,  N.M. Ghatate  and S.V.  Deshpande for  the Respondent.      The Judgment of the Court was delivered by      SEN, J.  This appeal  by special leave directed against the judgment  and order  of a  Division Bench  of the Bombay High Court  at  Nagpur  dated  October  27,  1980  raises  a questions to whether a staff car of the Technical Advisor to the North  Chirimiri Collieries  owned by  respondent No. 1, the United  Collieries Limited, which was nationalized under sub-s.(l) of  s.3 of  the Coal  Mines (Nationalization) Act, 1973 w.e.f.  May 1,  1973, was  or was  not covered  by  the definition of  the term  ’mine’ in s.2(h)(xii) and therefore stood transferred  to, and  became vested  in,  the  Central Government free from all encumbrances.      It is  common ground  that the  Ambassador car  No. MHX 3771 was purchased by Messrs Karamchand Thapar & Bros. (Coal Sales) Ltd.,  Delhi in  the year 1966 and was transferred to respondent No.  1, United  Collieries Limited, the owners in relation to  the  North  Chirmiri  Collieries,  and  it  was therefore the  owner of  the said  vehicle. On  and from the appointed day  i.e. May  1,  1973,  the  right,  title,  and interest of  the  owners  in  relation  to  the  coal  mines specified in  the Schedule  stood transferred to, and became vested absolutely  in, the  Central Government free from all encumbrances, under  sub-s.(1) of s.3 of the Act. It is also not in  dispute that  the vehicle  had been  placed  at  the disposal of  one D.D.  Diddi, the  Technical Advisor  to the North Chirimiri  Collieries to  be used  as his  staff  car. Immediately after the nationalization of the coal mines, the Deputy Custodian  General,  Coal  Mines  Authority  Limited, Nagpur addressed a letter dated May 9, 1973 to the aforesaid D. D.  Diddi requiring him to hand over the staff car to the Custodian. In his reply dated May 25, 1973, he asserted that although the  said car  belonged to respondent No. 1 and had been allotted to him for use as a staff car, it was not used exclusively for  the North  Chirimiri Collieries but used by him for  looking after  the multifarious  activities of  the Thapar Group of Industries which 212 was a  composite concern  with businesses  other  than  coal mining. It  is not  necessary for  us to  refer to  the long correspondence that A ensued between the parties.      Eventually, the  Managing Director,  Western  Division, Coal Mines  Authority Ltd.,  Nagpur addressed  letters dated August 9,  1973 both  to respondent  No. 1 and the erstwhile Technical Advisor  stating that  on coming into force of the Act the  right, title  and interest  of the  North Chirimiri Collieries vested  in the Central Government under sub-s.(1) of s.3  of the  Act and therefore the car which was an asset belonging to  the mine  vested in  the Central Government It further stated  that if  they failed to hand over possession of the  car, they  would he  liable to prosecution under the

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Act. Thereupon  respondent No. 1, United Collieries Limited, the owners  of the  coal mine, and the aforesaid D.D. Diddi, the erstwhile  Technical  Advisor  of  the  North  Chirimiri Collieries.  filed   a  petition   under  Art.  226  of  the Constitution before  the Nagpur Bench of the High Court. The High Court  held that  the question  as to whether the staff car should be treated as belonging to the owner of a mine as part of  the mine  itself raised  disputed questions of fact relating to  its user  which would  have to be determined on the basis  of evidence.  In taking that view, the High Court purported to  rely upon  the decision  of this  Court in New Satgram Engineering Works & Anr. v. Union of India & Ors.(l) and left  the parties  to have their rights adjudicated in a civil suit.  It accordingly  discharged the  rule  directing respondent No.  I to  establish its  claim by filing a civil suit with a direction that in the event of such a suit being filed, the  Civil Court  will  consider  the  making  of  an appropriate  order  for  the  grant  of  interim  relief  on condition of  furnishing of  adequate P  security keeping in view that  the Coal Mines Authority had been deprived of the staff car for all these years.      We are afraid, the judgment of the High Court cannot be sustained. It  failed to appreciate that in dealing with the question whether  or  not  staff  car  was  covered  by  the definition of  ’mine’ in  s.2(h)(xii) the nature of its user was immaterial.  Undoubtedly,  the  staff  car  belonged  to respondent No.  1, the United Collieries Ltd., the owners in relation to  the mine,  and it  being the  staff car  of the Technical Advisor  of the North Chirimiri Collieries, was an asset belonging to the mine. The High Court should therefore have          (1) [1980] 4 SCC 570. 213 answered the  question  in  favour  of  the  appellants  and dismissed  the   writ  petition   on  merits.   Instead   it misdirected itself  into thinking  A  that  the  matter  was covered by  the  decision  of  this  Court  in  New  Satgram Engineering works’  case, supra,  where it was observed that where there is a dispute as to whether a particular property vests in  the Central  Government or  not under sub-s.(l) of s.3 of  the Act,  the dispute undoubtedly is a civil dispute and must therefore be resolved by a suit. These observations of the  Court in  New Satgram  Engineering Work.s’ case were made in the context of s.2(h)(xi).      In the Act, ’mine’ in s.2(h) is defined, except what is immaterial, in the following terms:              "2. Definitions-In this Act, unless the context otherwise requires,-          (h)   ’mine’  means   any  excavation   where   any      operation  for   the  purpose   of  searching  for  the      obtaining minerals has been or is being carried on. and      includes-          (vi)  all lands,  buildings, works,  adits, levels,      planes, machinery  and equipments, instruments, stores,      vehicles railways,  tramways and siding in, or adjacent      to a mine and used for the purposes of the mine,              (xi)   all lands and buildings other than those referred to  in sub-clause (x), wherever situated, if solely used for  the location  of the  management, sale  or liaison offices, or  for the residence of officers and staff, of the mine;              (xii)  all  other  fixed  assets,  movable  and immovable, belonging  to  the  owner  of  a  mine,  wherever situated, and  current assets,  belonging to a mine, whether within its premises or outside."

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    It will  be  seen  that  there  is  difference  in  the language used in s.2(h)(xi) and (xii). Sub-cl. (xi) uses the words ’if solely used’  in relation  to lands  and buildings  for  the location of  the management  sale or liaison offices, or for the residence of officers and staff, or the mine, while sub- cl.(xii) uses  the words  ’belonging to the owner of a mine, wherever situated’.  The difference  in language between the two expression  ’if solely used’ and ’belonging to the owner of a  mine’ is  obvious. In  New Satgram  Engineering Works’ case, this 214 Court observed  that it  was therefore  possible to  contend that lands  A and  buildings appurtenant  to a coal mine, if not exclusively  used  for  the  purposes  of  the  colliery business, would  not come within the definition of ’mine’ in s.2(h) i.e.  it would  depend upon  the nature  of user, and that the  crucial date  is the date of vesting. It then went on to  say that  the distinction  though apparent may not be real in  the facts  and circumstances  of a particular case. The workshop  or a  building constructed  initially for  the purposes of  a coal  mine cannot by itself being diverted to other purposes cease to belong to a mine. What is of essence is whether the workshop or building originally formed a part and parcel  of a  coal mine.  The Court  laid down  that the subsequent user may not be very material. The High Court was clearly in error in directing the parties to have the matter settled by a civil suit.      Parliament by  an  enlarged  definition  of  ’mine’  in s.2(h) of the Act has indicated the nature of the properties that vest  and the  question whether  a particular  asset is taken within  the sweep  of s.2(h)  depends  on  whether  it answer the  description given  therein.  The  staff  car  in question  was   undoubtedly  a  fixed  asset  of  the  North Chirimiri Collieries  and it,  belonging to respondent No. 1 the United  Collieries Ltd.,  the owners  in relation to the said mine, being the staff car of the Technical Advisor, was ’fixed asset’  belonging to  the  mine.  lt  is  righly  not suggested that  the staff  car was not a fixed asset. ’Fixed assets’ in  general comprise  those asset which are held for the purpose  of conducting  a business, in contradistinction to those  assets which  the proprietor holds for the purpose of converting  into cash,  and  they  include  real  estate, building,  machinery   etc.;  Words   &  Phrases,  Permanent Edition, Vol. 17, p. 161; Blacks Law Dictionary, 5th edn., p.573; Stroud’s Judicial Dictionary, 4th edn., Vol.1, p.201. The staff car therefore fell within the definition of ’mine’ as contained  in  s.2(h)(xii)  and  vested  in  the  Central Government   under    sub-s.   (1)   of   s.3   Coal   Mines (Nationalization) Act,  1973. Merely  because the  Technical Advisor was putting the staff car to his personal use or for multifarious activities  of the  Thapar Group  of industries would not alter the true legal position since the subsequent user for a different purpose was not really germane.              For  these reasons,  the appeal  must therefore succeed and  is allowed,  with costs. The judgment and order passed by  the High  Court dated October 27, 1980 relegating the parties  to a  civil suit  is set  aside  and  the  writ petition filed by the respondents is dismissed. S.R.                                         Appeal allowed. 215