Sarda Mines’ rights to the Thakurani-B iron ore deposit expires on 13 August 2021, following which the 947.046 ha area in Keonjhar district will be put up for auction, says a Odisha government order.
SteelMint has reviewed this 20 May order of the Additional Secretary, Department of Steel and Mines, Odisha disposing of a show cause notice issued six years ago. The move could have repercussions on Jindal Steel and Power Ltd, a long- term buyer of Sarda’s ore.
Background
Thakurani A and B had been originally granted to the brothers, ML Sarada and SL Sarada on 1 August 1934. The lease to Deposit B was renewed on 11 February 1999, after part A was surrendered. A lease deed of 20 years was executed on 14 August 2001 (valid until 13 August 2021) in favour of ML Sarada and SL Sarada and subsequently transferred to a registered company Sarada Mines Private Ltd on 07 June 2006. The deed for the transfer was executed on 22 June 2006 for the remaining period of the grant or up to 13 August 2021.
Ten years later, the state government woke up to the fact that the first renewal should have begun from when the first 30 years lapsed or from 1 August 1964. On 8 May 2015 it issued the miner a show cause notice asking why the first renewal should not be revised.
SMPL had challenged this in the High Court of Odisha which disposed of the matter on 06 August 2019 directing the petitioner to file an additional reply to the government notice within a week or before 13 August 2019 before the competent authority.
Sarda had done this and submitted additional written replies and been given a hearing by the authorised officer. Its main argument had been that the State Government did not have the jurisdiction to effect a retrospective revision of a renewal period granted in compliance to a HC order, dated 30 June 1998, and followed by a SC order dated 15 July 1998. The miner contended that the state could not take up any such revision of an order after a lapse of more than two years.
A mining lease of 61 years, 2 months, 28 days
The state government has countered these arguing that Rule 58 of MCR, 2016 that Sarda’s lawyers cite only offers a two year window to correct cases of clerical and arithmetical mistakes – which this matter of renewal was not. The order, reviewed by SteelMint, also states that the 1998 order of the High Court of Odisha referring to a “date of renewal” has at no point insisted on renewal being done from the date of execution of the lease deed. Every renewal of lease is made effective from the day next to the date of expiry of the original/ renewed lease, and the court never intended to make any special relaxation in this case, argues the additional secretary.
Its renewal pending, the lessee was allowed to work on the strength of working permission by the State Government from 30 April 1963 to 28 July 1974 or for a period of 11 years, 2 months and 28 days. “The lessee has in effect, been allowed to enjoy the benefits of the mining lease for a total period of sixty-one years, two months and twenty eight days, and thus one year two months and twenty eight days in excess than the period of renewal as ordered by the Honourable High Court of Odisha,” says the 20 May 2021 order disposing of the show cause notice.
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