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Odisha’s decision to auction mine leases awaiting second and subsequent renewal has set the stage for yet another feud between the state government and the mine owners.
The government’s decision is likely to prompt the mine leaseholders, especially the lessees of 18 iron ore and manganese mines that were awaiting express orders to resume operations, to legally challenge the move.
Out of 26 iron ore and manganese mines that were off operations after a Supreme Court order in May 2014, the state government had passed express orders for restarting work at eight mines. However, the balance 18 leases would now be disposed off via the auction route as per the state cabinet’s decision on Monday.
“The state government’s decision is discriminatory and it would not stand in a court of law. If the government issued express orders for eight mines, they could have done the same for the remaining 18 mines as well. The Supreme Court had never asked the state government to stop the renewal process, it had only called for disposing off the exercise in a span of six months,” said an official of a standalone mining company.
Says Prabhakar Rout, mining expert and vice president, Utkal Chamber of Commerce & Industry (UCCI), “This is a unilateral decision of the state government. The stakeholders have not been consulted. The decision shows the government did not obey either the Supreme Court or the Odisha High Court orders. The government’s decision smacks of disparity and is legally untenable.”
“The state government’s decision is totally uncalled for. There was no point in announcing the decision since the Centre is coming out with an Ordinance on mining. Miners may challenge the move of the state government as there is no provision in Mines and Minerals - Development & Regulation (MMDR) Act, 1957 that allows auctioning of leases awaiting second and subsequent renewal,” said a mining consultant.
The state cabinet on Monday decided to dispose off all major mineral leases, captive and non-captive, except coal, through auction.
The leasing of major minerals will be done through public auction after obtaining leave of the Supreme Court by filing a petition. The proposed auction will not apply to those leases that have already been issued grant orders and are awaiting execution of lease deed by the state government provided all such lease deeds are executed within the specified period.
Those mines awaiting first lease renewal will also be out of the purview of auction. The Cabinet decision on auction will not be applicable to all the existing leases of state-run miner Odisha Mining Corporation and all other central and state public sector undertakings.
Also, the auction would not apply to such leases for which the state government has already recommended prospecting license (PL) or mining lease (ML) to the Government of India in pursuance of an agreement or memorandum of understanding (MoU) for allocation of PL/ML provided the applicant had substantially fulfilled its obligations.
The auction would invariably apply to all other leases of major minerals awaiting second and subsequent renewal along with determined and lapsed leases.
