A) ABSTRACT / HEADNOTE

State of Punjab & Ors. v. M/s Om Prakash Brick Kiln Owner, Etc., Civil Appeal Nos. 10687–10694 of 2013; 21 January 2025 (Abhay S. Oka & Ujjal Bhuyan, JJ.) addresses whether the State can lawfully levy royalty on excavation and removal of brick earth once that material has been declared a minor mineral under the Mines & Minerals (Regulation & Development) Act, 1957 and rules framed thereunder. The respondents (brick-kiln operators) sought permanent injunctions restraining the State from assessing or recovering royalty for earth excavated from leased private lands, relying on Section 42 of the Punjab Land Revenue Act, 1887 and on alleged absence of State ownership in the Wajib-ul-arz.

The Trial Court and the First Appellate Court dismissed the suits; the High Court allowed them. The Supreme Court reversed the High Court, holding that once brick earth was notified as a minor mineral and the Punjab Minor Mineral Concession Rules, 1964 (Rules 54A, 54B, 54C) provide for licensing, returns, assessment and recovery of royalty, the State is empowered to levy royalty on production and disposal irrespective of unresolved title questions. The Court emphasised that Rule 3 contains limited exemptions and that owners of the excavated lands were not shown to fall within those exemptions. The right to challenge quantum or assessment remains open through the statutory remedy (Rule 54F). The judgment confines itself to the levy right and expressly refrains from adjudicating land-ownership. 

Keywords: brick earth, minor mineral, royalty, Punjab Minor Mineral Concession Rules, 1964, Section 42 Punjab Land Revenue Act.

B) CASE DETAILS

C) INTRODUCTION AND BACKGROUND OF JUDGEMENT

The dispute arises from recurring practice across jurisdictions where extraction of soil or earth for brick manufacture intersects with public revenue claims under mineral regulation. The State issued a notification under clause (e) of Section 3 of the Mines & Minerals Act, 1957, declaring brick earth a minor mineral, and framed state rules (Punjab Minor Mineral Concession Rules, 1964) prescribing permit/approval requirements, returns, and a statutory procedure for assessment and recovery of royalty (Rules 54A–54C, 54F). Brick-kiln operators excavating earth from leased private parcels were assessed for royalty.

They filed suits seeking injunctions to restrain assessment and recovery, asserting that Section 42 of the Punjab Land Revenue Act, 1887 (the Wajib-ul-arz presumptions) and the absence of explicit State ownership in revenue records precluded the State’s levy. The Trial Court and the first appellate forum dismissed injunction claims on record and presumption grounds. The High Court reversed, holding that mere declaration as a minor mineral did not automatically vest rights enabling royalty levy unless State ownership of the mineral was proved.

The appeal to the Supreme Court thus required the Court to determine the legal effect of declaring brick earth a minor mineral, interplay between revenue presumption under Section 42, and the rule-making power under Section 15 of the 1957 Act that enables royalty charging provisions. The Supreme Court’s task was narrowly framed: to decide whether the State could lawfully levy royalty under the Rules, rather than to settle title to the land or minerals themselves.

D) FACTS OF THE CASE

Respondents operated brick kilns and excavated earth from several parcels taken by them on lease from private owners. They did not claim ownership of the lands; the landlords were not impleaded as parties. The State issued notices to respondents assessing royalty for brick earth removal. Respondents instituted suits for permanent injunctions restraining the State from assessing, levying or recovering royalty. Trial Court examined the Wajib-ul-arz (revenue entries) and noted that the record-of-rights for the village had been completed before 18 November 1871; in the absence of express record that quarries belonged to landowners, the Trial Court applied Section 42(1) presumption that such quarries belong to the Government and dismissed the suits.

The first appellate court affirmed dismissal, holding that declaration of brick earth as a minor mineral sufficed to attract State regulation and levy powers. The High Court, however, allowed the suits on the ground that declaration alone did not vest rights to levy royalty in the State unless ownership of the mineral was established. On appeal, the Supreme Court evaluated the statutory scheme: the central notification (Section 3(e)), the enabling Section 15 (rule-making power), and the Punjab Rules that impose certificate/approval (Form B), monthly returns (Form N) and assessment/recovery mechanism (Form O, P, Q, R, S).

The respondents’ principal contention was absence of State title in the Wajib-ul-arz and consequent non-entitlement to levy royalty. The State relied on rule-making power under the 1957 Act and on the presumption available under Section 42 (where applicable) and on Rule 54A–54C to justify levy. The Supreme Court found the rightness of the regulatory levy irrespective of unresolved title between private lessors and the State.

E) LEGAL ISSUES RAISED

i. Whether declaration of brick earth as a minor mineral under Section 3(e) of the 1957 Act empowers the State to levy royalty under rules framed under Section 15 regardless of land-ownership entries in Wajib-ul-arz?

ii. Whether the presumption under Section 42 of the Punjab Land Revenue Act, 1887 precludes the State from levying royalty where the Wajib-ul-arz does not expressly record State ownership of quarries?

iii. Whether civil courts had jurisdiction to entertain suits challenging royalty when a statutory remedial route (Rule 54F) exists?

F) PETITIONER / APPELLANT’S ARGUMENTS

i. The State relied on Section 15 of the 1957 Act empowering state rule-making to provide for charging royalty; the notification under Section 3(e) declaring brick earth a minor mineral falls squarely within that power.

ii. The State submitted that Rule 54A makes certificate/approval mandatory to undertake quarrying/mining and Rules 54B–54C prescribe returns, assessment and recovery; these rules create an independent statutory regime for levy irrespective of private title.

iii. The State argued the Wajib-ul-arz for the village was completed before 18 November 1871 and, in absence of explicit ownership by landowners, Section 42(1) presumption favors State ownership of quarries.

iv. The State contended that statutory remedies (appeal under Rule 54F) are efficacious and civil injunctions challenging assessments were not maintainable.

G) RESPONDENT’S ARGUMENTS

i. Respondents maintained that possession/lease of land from private owners and absence of State title in Wajib-ul-arz precluded the State from levying royalty; mere statutory declaration of mineral-status could not divest private proprietary rights or create a revenue charge.

ii. They argued that because they were not landowners and owners were not parties, the trial court could not validly find State entitlement to royalties based on presumption of ownership.

iii. Respondents asserted that without proof of the landowners’ not being in an exempted category (Rule 3), the State could not treat the excavation as subject to royalty.

H) JUDGEMENT

The Supreme Court allowed the appeals and set aside the High Court decree, restoring the Trial Court dismissals. The Court framed the core question narrowly: whether, given the statutory notification and Rules, the State has the right to levy royalty on brick earth extraction. The Court noted the central notification of 1 June 1958 (declaring brick earth a minor mineral) and the enabling Section 15 under which the State promulgated the Punjab Minor Mineral Concession Rules, 1964. The Court analysed Rule 3 (exemptions), Rule 54A (certificate/approval) and Rules 54B–54C (returns and assessment), observing the regulatory scheme imposes duties and creates a mechanism for assessment and collection of royalty.

The Court held that once brick earth is a minor mineral and the Rules apply, the activity of excavation falls under the statutory fiscal regime: holders must obtain certificates, furnish returns, and are liable to assessment; the Assessing Authority is empowered to assess, reassess and recover royalty and minerals/price where unlawfully raised. The Court emphasised that the Rules contain their own remedy (appeal under 54F), thereby providing an efficacious statutory route to challenge assessments. The Court said ownership disputes were collateral to the central question and noted that respondents did not make the landowners parties; hence trial courts were not enabled to decide title.

Consequently, the State’s right to levy royalty under the rule scheme could be sustained without undertaking a conclusive determination of proprietary title. The Court expressly refrained from adjudicating the land-ownership issue, confining itself to the levy power and observing that owners excavating in their exempt category under Rule 3 would be treated differently only if they can establish such exemption. The judgment allowed appeals with no costs and preserved the statutory appellate remedy for quantum/assessment challenges.

a. RATIO DECIDENDI

The operative ratio is that declaration of brick earth as a minor mineral under Section 3(e) of the 1957 Act together with rule-making power under Section 15 enables the State to create a statutory fiscal framework (licensing, returns, assessment, recovery) that authorises levy of royalty on production and disposal irrespective of unresolved private title in land, unless an express exemption under the Rules applies. The legal effect of the Rules is to render the levy independent of a prior conclusive judicial or administrative determination of ownership; statutory remedies (Rule 54F) are the proper channel to contest assessments.

b. OBITER DICTA

The Court observed obiter that the trial courts and the High Court “unnecessarily” focused on ownership; the better course is to determine entitlement under the statutory mineral regime first. The Court also noted that while it did not adjudicate ownership, if landowners (or persons in exempt categories) establish rights under Rule 3, they may be outside the levy’s scope; the judgment leaves such factual proofs and disputes to appropriate fora. The Court affirmed the principle that administrative fiscal schemes may apply notwithstanding parallel disputes over property title, subject to statutory exemptions and procedural safeguards.

c. GUIDELINES 

1. Where a material is notified as a minor mineral under the 1957 Act, State rules providing for licensing, returns and assessment may lawfully impose royalty on its extraction and disposal.

2. Procedural compliance (certificate in Form B; monthly returns in Form N) is mandatory unless a person falls within the exemptions of Rule 3.

3. Assessment and recovery must follow the procedure in Rule 54C (Forms O–S); remedies of appeal under Rule 54F are the efficacious statutory channels to challenge assessment or quantum.

4. Civil courts should be cautious in granting injunctions that frustrate statutory fiscal regimes where an adequate statutory remedy exists; jurisdictional bars and non-joinder of true owners can be decisive.

5. Determination of ownership under Section 42 and Wajib-ul-arz remains relevant for property rights but does not automatically negate the application of a statutory royalty regime once the material is lawfully declared a minor mineral.

I) CONCLUSION & COMMENTS

This judgment clarifies the interaction between mineral regulation and land revenue presumptions in the Punjab context. The Court’s approach is pragmatic: it upholds the State’s legislative and rule-making competence to regulate and tax extraction of materials declared minor minerals while preserving the right of assessed parties to challenge assessments through the statutory machinery. The decision emphasises procedural channeling compliance, assessment and appeal under the Rules — as the appropriate route to test the legality and quantum of royalty. From a public-law perspective, the ruling underscores the breadth of Section 15 rule-making power and the normative effect of a legislative declaration converting a material into a minor mineral.

From a litigational perspective, it warns private extractors that unresolved title or non-joinder of landowners can be fatal to equitable relief against revenue claims. The Court’s reluctance to decide title matters reflects institutional competency: specialized fiscal schemes with designated remedies must be exhausted before seeking equitable respite. The decision therefore balances State fiscal authority with procedural safeguards for assessees, but leaves open future factual contests where Rule 3 exemptions or explicit record entries in Wajib-ul-arz may entitle private claimants to relief. Practitioners should note that challenges to assessments must deploy the statutory appeal route under Rule 54F, and that pleading must include necessary parties (landowners) where title is central.

J) REFERENCES

a. Important Cases Referred

i. State of Punjab & Ors. v. M/s Om Prakash Brick Kiln Owner, Etc., Civil Appeal Nos. 10687–10694 of 2013, Supreme Court of India, 21 Jan. 2025, [2025] 1 S.C.R. 859 : 2025 INSC 88.

b. Important Statutes Referred

i. Mines & Minerals (Regulation & Development) Act, 1957 (Sections 3(e), 15).
ii. Punjab Minor Mineral Concession Rules, 1964 (Rules 3, 54A, 54B, 54C, 54F).
iii. Punjab Land Revenue Act, 1887 (Sections 41, 42).
iv. Code of Civil Procedure, 1908 (Section 80 – Government notice).