Orissa HC sets aside Demand of Royalty and Additional Charge u/r 51(4) of OMMCR on Stacking of mineral in the Brick Kiln Unit [Read Order]

M/s.Raja Bricks, the petitioner, has questioned the propriety of the order dated 03rd June, 2025 passed by the Mining Officer (in-charge), Balasore directing the business concern (petitioner) to deposit the amounts towards Royalty, Additional Charges, DMF & EMF coupled with penalty with respect to sand and soil found stacked in the business premise.

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Mr. Prafulla Kumar Rath, Senior Advocate appearing for the Petitioner submitted that the said direction to deposit is without any foundational fact. It is stated that purchase of the sand/soil found stacked were brought from various persons/licensees of sairat for making use in Brick Kiln Unit. Instead of granting opportunity to the Petitioner to substantiate its claim that it has no liability to pay the Royalty, Additional Charges, DMF & EMF on sand/soil being found stacked. The authority is not legally justified to issue letter dated 3rd June, 2025. He further submitted that such a demand by way of letter is untenable in the eye of law for want of adherence to the principles of natural justice.

Mr. Saswat Das, Additional Government Advocate on written instruction received from the Mining Officer, Minor Minerals, Balasore (opposite party No.2) submitted that on spot visit, it was found that soil and sand remained stacked in the Kiln Unit. The source of acquisition of such soil and sand was not explained at the spot, which led to issue of letter dated 3rd June, 2025.

He submitted that in view of Rule 51(4) of the Odisha Minor Minerals Concession Rules, 2016 (“the Rules”), as amended by virtue of the Odisha Minor Minerals Concession (Amendment) Rules, 2023, the Mining Officer is competent to recover the royalty, rent or tax etc. from the person who wins the mineral or disposes of such mineral.

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He also contended that since the petitioner did not submit any documentary evidence to show the source of acquisition of such soil and sand found stacked on spot inspection to the Unit of the Petitioner, it cannot be said that issue of letter dated 03rd June, 2025 requesting the petitioner to deposit the amount stated therein towards the Royalty and additional charges in addition to DMF and EMF is untenable.

The Petitioner by way of documents enclosed at series disclosed the source of acquisition of Minor Minerals from different persons during a period of time. As submitted by Mr. Prafulla Kumar Rath, Senior Advocate, had the Mining Officer issued show cause notice and/or afforded an opportunity to the Petitioner to submit copies of such documents, the same would have been done to substantiate that the Petitioner is not liable for Royalty, Additional Charges, DMF & EMF.

It is conceded by Mr. Saswat Das, Addl. Government Advocate that Rule 51(4) of the Odisha Minor Mineral Concession Rules, 2016 does not empower the Mining Officer to impose penalty. However, he submitted that there was no necessity for issuance of any show cause notice to the Petitioner as he failed to produce any document, as stated to have been in his possession vide Annexure-22 series, at the spot inspection.

As decision is taken adversely affecting the petitioner for liability to pay royalty, etc., by the authority concerned, the principles of natural justice demands at least an explanation to be called for from the party. The Chief Justice Harish Tandon and Justice Murahari Sri Raman viewed that there has been violation of principles of natural justice. To ascertain whether, at all, the petitioner is liable to pay royalty, additional charges, DMF & EMF, a notice should have been issued calling upon them to furnish documents.

In such an event, it was open for the petitioner to demonstrate that he neither won the minerals nor disposed of the sand/soil, which were found stacked on spot inspection. Copies of the transit passes issued by the competent authority during the relevant period are enclosed to the writ petition at Annexure-22 series, ex facie showing acquisition of sand/soil by the Petitioner from different sources.

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Therefore, in order to return factual finding in this regard and to ascertain whether the stacking of mineral in the Brick Kiln Unit by the Petitioner falls within the scope of Rule 51(4) of the Rules to demand Royalty, Additional Charges, DMF & EMF, the Court by setting aside the order/direction contained in letter dated 03rd June, 2025 issued by the Mining Officer (in charge), Balasore (Opposite Party No.2), directs the Petitioner to appear before the said authority on 28th July, 2025.

The petitioner may demonstrate by furnishing necessary evidence before the said Mining Officer to justify its nonliability. Upon appreciation of evidence and after affording an opportunity of hearing, the Mining Officer may proceed to take a decision thereon strictly in accordance with law.

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