A) ABSTRACT / HEADNOTE

The judgment in Dharmendra Kumar Singh v. State of Uttar Pradesh & Ors. addresses a recurring conflict between environmental protection and vested commercial interests in the mining sector. The Supreme Court examined whether mining leaseholders, whose operations were halted due to judicial and administrative interdictions aimed at forest conservation, were entitled to an extension of their mining leases for the obstructed period. The appellants argued that since mining was stopped without fault on their part, equity demanded extension of leases to restore them to their original position. The State of Uttar Pradesh contended that neither the Uttar Pradesh Mining Minerals (Concession) Rules, 1963 nor the lease deeds permitted such extension, and that statutory policy had shifted decisively towards auction-based grants.

The Court rejected the proposition that every judicial interdict automatically entitles a party to restoration by extension of contractual or statutory rights. It held that extension of a mining lease must strictly flow either from statutory authority or contractual terms, and cannot be granted merely on equitable considerations. The Court interpreted Rule 68 narrowly as a limited relaxation provision and affirmed that Rule 40(h) exhaustively governs consequences of disruption of mining operations. In light of the New Mining Policy, 2017, which mandates e-auction and does not contemplate extensions, the Court declined to order lease extensions.

However, invoking Article 142 of the Constitution, the Court balanced equities by directing refund of security deposits and advance royalties with simple interest at 9% per annum. The judgment reinforces statutory supremacy, restricts judicially created commercial benefits, and clarifies that environmental protection orders cannot be used as a basis to bypass transparent mining policies.

Keywords:
Mining Lease, Obstructed Period, Rule 68, Rule 40(h), Article 142, Forest Conservation, Eco-Sensitive Zone, Environmental Jurisprudence

B) CASE DETAILS

C) INTRODUCTION AND BACKGROUND OF JUDGEMENT

The litigation arose from long-standing disputes surrounding mining activities in Village Billi Markundi, District Sonbhadra, Uttar Pradesh, an ecologically sensitive area proximate to forest land and wildlife zones. Mining leases had been granted decades earlier, but overlapping forest notifications under Section 4 of the Indian Forest Act, 1927 created persistent uncertainty. Judicial interventions, particularly by the National Green Tribunal, sought to halt mining pending clarification of forest boundaries and compliance with environmental safeguards.

The impugned orders stemmed from proceedings initiated to prevent illegal mining near the Kaimur Wildlife Sanctuary. Acting on environmental concerns and earlier forest notifications, the NGT directed prohibition of mining activities until proper statutory notifications under Section 20 of the Forest Act were issued. Leaseholders were not impleaded, yet administrative orders by District Magistrates enforced suspension of mining operations.

The appellants, whose lands were ultimately found to be outside reserved forest areas, claimed severe commercial loss due to prolonged stoppage. They sought extension of leases equivalent to the obstructed period, invoking principles of equity and the maxim actus curiae neminem gravabit. The State resisted, citing statutory constraints and policy shifts toward transparent auction-based mining. The Supreme Court was thus called upon to reconcile environmental imperatives, statutory mining regimes, and equitable considerations.

D) FACTS OF THE CASE

Mining leases for minor minerals such as dolostone, gitti, boulders, and building stone were granted to the appellants between 2007 and 2011 in Village Billi Markundi. The land had earlier been included in a 1969 notification under Section 4 of the Indian Forest Act, though no subsequent notification under Section 20 was issued for decades. Following directions in Banwasi Seva Ashram v. State of U.P., settlement proceedings were conducted, and claims of several leaseholders were accepted, excluding their lands from forest classification.

Despite this, fresh environmental litigation before the NGT culminated in orders dated 13 July 2018 and 25 March 2019, directing cessation of mining in areas covered under Section 4 notifications. Acting on these orders, District Magistrates suspended mining operations of the appellants from 29 August 2018 and 5 February 2019. During this period, some leases expired, while others subsisted.

Subsequently, the State issued the long-pending Section 20 notification on 15 June 2020, clarifying forest boundaries and confirming that appellants’ lands were non-forest revenue lands. Mining, however, had remained halted for nearly two years. The appellants approached the Supreme Court under Section 22 of the NGT Act, 2010, seeking restoration by extension of leases for the obstructed period or, alternatively, compensation for losses incurred.

E) LEGAL ISSUES RAISED

i. Whether mining leases can be extended for the obstructed period when mining was halted due to judicial or administrative orders not attributable to the leaseholders?
ii. Whether Rule 68 of the UP Mining Minerals (Concession) Rules, 1963 empowers the State to grant such extension?
iii. Whether equitable principles like actus curiae neminem gravabit override statutory mining policy?
iv. What is the legal consequence of disruption of mining operations under Rule 40(h)?

F) PETITIONER / APPELLANT’S ARGUMENTS

The counsels for the appellants submitted that mining operations were suspended without any illegality or fault on their part. The stoppage resulted solely from judicial proceedings initiated behind their back and prolonged administrative inaction in issuing the Section 20 notification. It was argued that prior litigation, including Banwasi Seva Ashram, had conclusively settled that the appellants’ lands were non-forest lands.

Reliance was placed on Beg Raj Singh v. State of U.P. to assert that courts must restore parties to the position they would have occupied but for judicial error. The appellants invoked Rule 68 as a plenary relaxation power permitting extension in special cases and cited J.P. Yadav v. Kanhaiya Singh to argue that extension for obstructed periods had judicial sanction. It was contended that denial of extension would unjustly enrich the State and penalise lawful leaseholders.

G) RESPONDENT’S ARGUMENTS

The counsels for the State contended that extension of mining leases is a matter of statute, not equity. Neither the lease deeds nor the Mining Rules provide for extension due to judicial interdicts. Rule 68 was argued to be a narrowly tailored provision meant to further mineral development, not to bypass mandatory procedures under Chapters II and IV relating to grant and auction of leases.

The State relied on consistent Allahabad High Court precedent, including Sukhan Singh v. State of U.P., Mohammad Yunus Hasan v. State of U.P., and Vijay Kumar Dwivedi v. State of U.P., holding that obstructed periods do not confer a right to extension. Emphasis was placed on the New Mining Policy, 2017, mandating e-auction and containing no provision for extension. At most, the State conceded refund of security deposit and advance royalties under Rule 40(h).

H) JUDGEMENT 

The Supreme Court framed the controversy narrowly, limiting its inquiry to whether leases could be extended for the obstructed period or whether monetary restitution was the only permissible relief. The Court underscored that mining rights are statutory privileges and not vested property rights. Any extension must strictly emanate from statutory provisions or contractual terms.

Interpreting Rule 68, the Court held that it is a restrictive relaxation clause intended to advance mineral development in exceptional cases, not a general equity provision. The language “in the interest of mineral development” was construed narrowly to prevent misuse, especially given India’s troubled mining history. The Court approved the reasoning in Mohammad Yunus Hasan and Vijay Kumar Dwivedi, rejecting expansive interpretations.

The Court further noted that the New Mining Policy, 2017 reflects a decisive shift towards transparency through e-auction. Granting extensions retrospectively would defeat this policy and create an impermissible exception. On disruption consequences, the Court held that Rule 40(h) exhaustively governs the field, providing only for adjustment or refund of monetary amounts, not extension of time.

Balancing equities, the Court acknowledged that the appellants suffered loss due to no fault of theirs. Invoking Article 142, it directed refund of security deposits and advance royalties with 9% simple interest, treating this as complete justice without violating statutory mandates.

a) RATIO DECIDENDI

The right to extension of a mining lease must flow from statutory provisions or contractual terms. Judicial or administrative interdictions, by themselves, do not create an enforceable right to extension, especially where statutory rules and policy prohibit such extension. Rule 68 cannot be invoked to override transparent auction-based mining policy, and Rule 40(h) limits relief to monetary adjustment or refund.

b) OBITER DICTA

The Court observed that while the maxim actus curiae neminem gravabit reflects a sound equitable principle, it cannot be applied mechanically. Environmental protection orders serve a larger public purpose, and individual commercial inconvenience cannot automatically translate into extended statutory benefits.

c) GUIDELINES

i. Extension of mining leases must strictly comply with statutory mining rules and prevailing policy.
ii. Judicial interdicts aimed at environmental protection do not, per se, justify extension of commercial rights.
iii. Consequences of mining disruption are confined to monetary adjustments under Rule 40(h).
iv. Equitable relief, if warranted, may be moulded under Article 142 without contravening statute.

I) CONCLUSION & COMMENTS

The judgment reinforces legislative supremacy in natural resource governance and curtails judicial creation of commercial entitlements under the guise of equity. By denying lease extensions yet granting monetary restitution with interest, the Court struck a calibrated balance between statutory discipline and fairness. The decision affirms that environmental adjudication cannot be diluted through post-hoc commercial adjustments and that mining policy must be applied uniformly to preserve transparency and ecological integrity.

J) REFERENCES

a) Important Cases Referred

• Banwasi Seva Ashram v. State of U.P., (1986) 4 SCC 753

• Beg Raj Singh v. State of U.P., (2003) 1 SCC 726

• Sukhan Singh v. State of U.P., (2015) 2 All LJ 619

• Mohammad Yunus Hasan v. State of U.P., (2016) 4 All LJ 4

• Vijay Kumar Dwivedi v. State of U.P., (2016) 4 All LJ 690

• Sulekhan Singh & Co. v. State of U.P., (2016) 4 SCC 663

• Deepak Kumar v. State of Haryana, (2012) 4 SCC 629

b) Important Statutes Referred

• Indian Forest Act, 1927

• Uttar Pradesh Mining Minerals (Concession) Rules, 1963

• Mines and Minerals (Development and Regulation) Act, 1957

• National Green Tribunal Act, 2010

• Constitution of India