• News
  • Columns
  • Interviews
  • BW Communities
  • Events
  • BW TV
  • Subscribe to Print
  • Editorial Calendar 19-20
BW Businessworld

Anti-Illegal Mining Move; Jharkhand In Question

The Supreme Court’s specific order that was made in connection with illegal mining in Odisha in particular and has nothing to do with Jharkhand, has been enforced in Jharkhand presumably out of greed

Photo Credit :


Even as different functionaries in Jharkhand have locked horns over the modality to levy penalties against illegal mining in the light of the Supreme Court order, the pertinent question is whether the apex court’s order has relevance in the State?

The Supreme Court’s specific order that was made in connection with illegal mining in Odisha in particular and has nothing to do with Jharkhand, has been enforced in Jharkhand presumably out of greed. In the garb of the punitive order issued by the SC to recover 100 per cent compensation from companies involved in illegal mining operations in Odisha, the Jharkhand Government pounced on the judgement to reap pecuniary benefits. It has, so far, collected over Rs. 1000 crore from the defaulters and that too, in violation of the norms set by the apex court for the purpose. Contrary to the order for making a one-time payment of compensation, the Jharkhand Government has allowed defaulters to make part-payment of the compensation and it also aims to use the fund for general expenditure in variance with the directive to use it for benefit of the tribals in affected districts of Odisha.  

Acting on the petition filed by the NGO Common Cause against illegal mining in Odisha, the Supreme Court had on August 2, 2017 given a specific order – imposing 100 per cent penalty to the tune of the value of illegally extracted minerals –  on companies responsible for illegal mining of iron and manganese ore in the state. The petitioner sought judicial intervention in the large-scale illegal mining of iron and manganese ore in Odisha in the light of the findings of the Central Government-appointed M.B. Shah Commission. The Shah Commission was set up by the Union Government in 2010 to enquire into operations of illegal mining across the country.

While issuing a specific order to defaulters in the districts of Kendujhar Sundargarh and Mayurbhanj in Odisha to deposit the compensation by December 31, 2017, the apex court had also ruled that the amount realised in form of compensation from the defaulters be used for ‘benefit of tribals in the affected districts’.

The SC observed, “We also expect that as a result of the orders that we are passing today, very large amounts will again be made available to the state of Odisha and the compensation amount recovered should be used for benefit of tribals in the affected districts.” As per the Central Empowered Committee that was entrusted by the Supreme Court with the task to support the State Government while dealing with the compensation issue, an estimated amount of over Rs. 61,000 crore was to be recovered as compensation for the illegal mining in Odisha.

The compensation on the companies has been levied as per provisions of the Mines and Minerals (Development and Regulation) Act, 1957 (as amended in 2015). Section 21(5) of the Act, empowering the state government to recover the price of the illegally-mined ore from each defaulting lessee. In addition, the SC allowed the government to recover any rent, royalty or tax, for the period during which such illegal mining activity was being carried out outside the mining lease area.

Incidentally, the ruling of the Supreme Court appears to be a specific order in connection with illegal mining in Odisha in particular and has nothing to do with other mineral-rich States such as Jharkhand that is also faced with illegal mining as per the findings of the Shah Commission. Jharkhand was, however, neither directed by the apex court to comply with the order nor did it ever file an Intervener Application in the SC seeking directives in this regard.

If well-placed sources are to be believed, the Jharkhand Government has, however, reason enough to enforce the Supreme Court’s ruling in the State on its own. The Government has resolved to enforce the order in the State out of greed. It is learnt that the State Government had to shut down 21 iron and manganese ore mines in the State in the light of the Shah Commission report and it has, consequently, been suffering huge revenue losses in the past four years of the present BJP-led Raghubar Das dispensation. The consequent resource gap that the State Government is faced with, is believed to be mopped up with the support of recovery of compensation from illegal lessees in the light of the apex court order.

However, the State Government would not be in consonance with the ruling of the Supreme Court while using the fund for other work than for the benefit of the tribals. In its landmark judgment, the apex court has stressed upon the need to ensure one-time payment of the compensation and second, the amounts recovered in form of compensation had to be used for benefit of tribals in the affected districts. Incidentally, while enforcing the SC order by proxy in the State, the Jharkhand Government has allowed defaulters such as Shah Brothers and NKPK to make part payments and it aims to use the recovered amount for general expenditure while replenishing its kitty.

Ironically, unencumbered by what the SC judgment was meant for, mining companies such as Shah Brothers and NKPK as well moved the Jharkhand High Court against the State Government’s diktat to pay a one-time payment of compensation and sought for relief to make part payment. Incidentally, the defaulters did not argue in the HC about discrepancies mooted by the State Government while enforcing the SC order –  that was exclusively meant for three districts of Odisha – in Jharkhand. The High Court, however, directed the State Government to recover the compensation in installments acting upon the submission by Advocate General, Ajit Kumar who endorsed the request for part payments of compensation. However, reacting to the Government decision to allow part payment in the light of the High Court order, the opposition alleged that the Advocate General had misled the Court in the matter. AG was accused of telling a lie in the court while informing that the mines department of the State Government had consented to the proposal for part payment of the compensation. Senior BJP leader and Cabinet Minister Saryu Rai raised stiff objection over the AG submission in favour of the part payments and sent a dissent note to the Chief Minister, while former Chief Minister and JVM Chief Babulal Marandi demanded the removal of the Advocate General forthwith. Incidentally, both the senior leaders remained silent over the relevance of the SC order in Jharkhand. 

To top it all, another question remained answered: Whether it is Jharkhand Government, defaulters or opposition, what led them to feign ignorance about the essence of the judicial order and keep on beating around the bush? Whatever the reasons may be, they are, indeed, accountable for concealing the fact  –  by choice or by default – ostensibly to cash-in on the situation.

Tags assigned to this article: