{"id":308452,"date":"2023-12-05T15:30:14","date_gmt":"2023-12-05T10:00:14","guid":{"rendered":"https:\/\/www.scconline.com\/blog\/?p=308452"},"modified":"2023-12-11T15:25:12","modified_gmt":"2023-12-11T09:55:12","slug":"calcutta-high-court-grants-extension-of-lease-invoked-force-majeure-in-sand-mining-lease-dispute-scc-blog","status":"publish","type":"post","link":"https:\/\/www.scconline.com\/blog\/post\/2023\/12\/05\/calcutta-high-court-grants-extension-of-lease-invoked-force-majeure-in-sand-mining-lease-dispute-scc-blog\/","title":{"rendered":"Calcutta High Court invokes Force Majeure in sand mining lease dispute; grants extension of lease"},"content":{"rendered":"
\n

Calcutta High Court:<\/span> In a petition by a private limited company engaged in sand mining, challenging the Assistant Secretary’s order dated 10-042023 rejecting petitioner’s plea for extension of mining lease, a single-judge bench comprising of Suvra Ghosh, J., directed the Assistant Secretary to grant an extension for the period of lost mining operations within six weeks.<\/p>\n

Factual Matrix<\/p>\n

In the instant matter, the petitioners, a private limited company engaged in sand mining, and its sole director, challenged an order dated 10-04-2023 passed by the Assistant Secretary, Department of Industry, Commerce and Enterprises.<\/p>\n

The petitioner company being the highest bidder in an e-auction for a sand mining lease in Mouza-Mamudpur, faced operational challenges due to a restriction imposed by the District Magistrate on the movement of heavy-loaded goods vehicles from 25-03-2021, to 22-02-2022, and the same is the sole route to the mining area.<\/p>\n

The petitioners asserted that they suffered substantial financial losses during the period of the restriction and notified the authority of their predicament through a letter dated 07-12-2021. The District Magistrate acknowledged the impact of the restriction on the petitioner’s sand mining activities, and the State requested favorable consideration from the concerned authority.<\/p>\n

In response to the petitioner’s representation, the District Magistrate directed the matter to the Assistant Secretary for consideration, who, in an order dated 10-04-2023, rejected the extension request citing no restriction during 25-04-2021, to 22-02-2022, and the petitioner’s failure to seek an alternative route.<\/p>\n

Moot Point<\/p>\n

    \n
  1. \n

    Whether the petitioner qualifies for force majeure extension under clause 5 of the lease?<\/p>\n<\/li>\n

  2. \n

    Whether the Assistant Secretary’s decision to reject the extension request valid?<\/p>\n<\/li>\n<\/ol>\n

    Parties’ Contentions<\/p>\n

    The petitioners contended that the Assistant Secretary failed to consider the force majeure provision and wrongly relied on the absence of excavation restrictions during the later period. It was argued that the Google map presented by the respondents, suggesting an alternative route, is irrelevant as it does not address the actual mining operation constraints. The petitioner asserted that the Assistant Secretary’s rejection is based on improper reasoning and contradicts the terms of the lease deed. On the other hand, the respondents argued the existence of an alternative route through Khandaghosh and that the petitioners failed to seek permission for stacking minerals during the restriction.<\/p>\n

    Legal Principles<\/p>\n

      \n
    1. \n

      High Courts can issue writs in the nature of mandamus when a government authority wrongly exercises discretion or acts on irrelevant considerations.<\/p>\n<\/li>\n

    2. \n

      The definition of “force majeure” under clause 5 of part-IX of the lease includes situations beyond the lessee’s control.<\/p>\n<\/li>\n<\/ol>\n

      Court’s Observation<\/p>\n

      The Court emphasised the definition of mining operations under the lease agreement and rejects the respondents’ reliance on the Mines and Minerals (Development and Regulations) Act, 1957<\/a>. The Court noted that the West Bengal Sand Mining Policy, 2021, is not applicable to the case, eliminating any restraint on extending the lease.<\/p>\n

      The Court acknowledged the impact of the restriction on the petitioner’s mining activities during the specified period. The Court observed that the Google map presented lacks evidentiary value as it does not clearly show an alternative route.<\/p>\n

      While relying on clause 5 of the lease, the Court found the petitioner qualified for force majeure extension and criticised the Assistant Secretary for overlooking relevant facts. The Court found the Assistant Secretary’s rejection unjust, emphasizing the petitioner’s entitlement to an extension of the lease for the lost period due to force majeure.<\/p>\n

      The Court cited Comptroller and Auditor General of India v. K.S. Jagannathan, (1986) 2 SCC 679 and Mohinder Singh Gill v. Chief Election Commissioner, (1978) 1 SCC 405, affirming the High Court’s power to intervene when authorities fail to exercise discretion properly. The Court opined that the order is deemed arbitrary and liable to be set aside under the Court’s power of judicial review.<\/p>\n

      Court’s Decision<\/p>\n

      The Court allowed the writ petition, setting aside the Assistant Secretary’s order, and directed the Secretary to reconsider the petitioner’s representation within six weeks, granting an extension for the lost mining period.<\/p>\n

      [Radharaman Constructions & Marketing (P) Ltd.<\/span> v. State of W.B.<\/span>, 2023 SCC OnLine Cal 4791<\/a>, order dated 04-12-2023<\/span>]<\/p>\n

      *Judgment by Justice Suvra Ghosh<\/span><\/strong><\/p>\n\n

      Advocates who appeared in this case :<\/p>\n

      Mr. Asoke Kr. Banerjee, Mr. Arijit Dey, Counsel for the Petitioners<\/p>\n

      Mr. Santanu Kr. Mitra, Mr. Amartya Pal, Counsel for the State<\/p>\n

      Mr. Sanjay Saha, Mr. Subhasish Bhattacharya, Counsel for the WBMDTCL<\/p>\n<\/div>\n","protected":false},"excerpt":{"rendered":"

      Calcutta High Court opined that the Assistant Secretary wrongly rejected the petitioners’ request based on irrelevant considerations, ordering an extension of the lease for the lost period.<\/p>\n","protected":false},"author":67514,"featured_media":290502,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[3,10],"tags":[2689,63234,15811,63203,2643],"class_list":["post-308452","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-casebriefs","category-highcourts","tag-Calcutta_High_Court","tag-extension-of-lease","tag-force-majeure","tag-justice-suvra-ghosh","tag-Sand_mining"],"yoast_head":"\nCalcutta High Court grants extension of lease; invoked Force Majeure in sand mining lease dispute | SCC Blog<\/title>\n<meta name=\"description\" content=\"While invoking Force Majeure in sand mining lease dispute, the Calcutta High Court granted extension of lease to sand mining company.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.scconline.com\/blog\/post\/2023\/12\/05\/calcutta-high-court-grants-extension-of-lease-invoked-force-majeure-in-sand-mining-lease-dispute-scc-blog\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Calcutta High Court invokes Force Majeure in sand mining lease dispute; 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It amends the Mineral Concession Rules, 1960. \u00a0 Key amendments made by the Mineral Concession (Amendment) Rules, 2021, are: Definition: \u201crun-of-mine\u201d means the raw, unprocessed or uncrushed material in its natural state obtained after blasting\u2026","rel":"","context":"In "Legislation Updates"","block_context":{"text":"Legislation Updates","link":"https:\/\/www.scconline.com\/blog\/post\/category\/legislationupdates\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":213214,"url":"https:\/\/www.scconline.com\/blog\/post\/2019\/04\/04\/all-hc-lease-cannot-be-extended-beyond-specified-period-in-absence-of-specific-provision-for-the-same\/","url_meta":{"origin":308452,"position":3},"title":"All HC | Lease cannot be extended beyond specified period in absence of specific provision for the same","author":"Bhumika Indulia","date":"April 4, 2019","format":false,"excerpt":"Allahabad High Court: This petition was filed before the Division Bench of Pankaj 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