Goa mining order may impact leases in other states

The cancellation of 88 mining leases in Goa Supreme Court may lead to other mineral-rich states reviewing the court order to ensure the leases granted by them were consistent with the provisions of the The Mines and Minerals Development and Regulation Act (MMDRA), 2015, said legal experts.

A legal expert with a major law firm, who spoke anonymously, told DNA Money that the apex court's pronouncement on renewal of mining leases by the Goa government, essentially, made it clear as to how the provisions of MMDRA, 2015 should be read.

"We don't know how it (renewal or grant of leases) has happened in other states, but, of course, it has an impact because there is a judicial pronouncement of SC dealing with how the provisions of MMDRA (2015) have to be read. The (state) governments could very well review the judgements themselves and then take action. Therefore, they could change their position on their existing (mining lease) cases, based on facts and background. We don't know, but that could happen," he said.

He said states like Odisha, Karnataka, Andhra Pradesh, Jharkhand and others, which have abundant mineral resources, will ensure that that prescribed processes of renewal and fresh mineral mining leases under the MMDRA are duly followed, as interpreted by SC.

"In all these states, the governments are going to take action. All minerals are covered under the MMDRA. The interpretation of provisions under it is the same for all minerals. So essentially it could impact other states," he said.

In February, the SC cancelled the renewal of leases of 88 mining firms claiming they were done in a haste by the Goa government and were in violation of the provisions of MMDRA, 2015.

Lalit Bhasin, president, Society of Indian Law Firms (SILF), also sees other states with extensive mining activities reassessing the mining leases issued or renewed by them.

"Yes, other states could review the leases (granted by them)," he said. Bhasin, however, felt that such judgements should be passed prospectively along with providing guidelines for future leases.

"Cancellation is a very drastic step and it (Goa judgement) does leave an effect on other similar cases. These things should always be done prospectively, not retrospectively," he said.

Backing his argument for a prospective order, Bhasin said, "It (such judgements) affects the economy of the country because people have got the leases, which were considered to be valid at the time they were issued. Now, retrospectively you say that these are all void. That puts the clock back to the detriment of those who have already developed a vested interest in the business. They have made huge investments. Such judgements should always be prospective in nature and not retrospective. They should lay down the guidelines for future as to what modalities are to be done, but not cancel leases retrospectively," he said.

According to a legal expert, who spoke off-the-record, the MMDRA, which was amended in 2015, provided a provision for bona fide applications for mining lease, made for the second and subsequent renewal, to be saved, but to be done on judicious ground.

"In Goa's case, the government did not apply the later part. They simply extended the renewals, which the court has struck down, saying that you guys have not followed the due process and given these extensions in haste. Now, to that extent, the court's judgement is to be interpreted as a clarification on that issue," he said.

DIGGING DEEPER

• Legal experts say the apex court judgement clarifies how the provisions of The Mines and Minerals Development and Regulation Act, 2015 should be read
   
• This could see state govts review the SC judgement and relook at mining leases issued by them