The Supreme Court dismissed appeals challenging demand notices for depositing 10% of the total bid amount with the District Mineral Foundation (DMF). The Court held that Section 9B of the Mines and Minerals (Development and Regulation) Act, 1957, is inapplicable to minor minerals due to Section 14. The State Government is empowered under Section 15A to fix the amount payable to the DMF for minor minerals. The Court found the demand consistent with statutory provisions and the 2017 Rules
Facts Of The Case:
Chandra Bhan Singh, a successful bidder for mining minor minerals (sand), was allotted a tender. In line with the Policy decision dated April 22, 2017, the Appellant was required to deposit an amount of ₹54,12,960/-, representing 10% of the total bid amount of ₹5,41,29,600/-, to the District Mineral Foundation Trust, Kanpur, in addition to a 2% stamp fee. This demand was communicated via a Demand Notice dated October 25, 2017.The Appellant challenged this Demand Notice before the High Court, arguing it contradicted Section 9B of the Mines and Minerals (Development and Regulation) Act, 1957, which stipulates deposit based on royalty fixed in the Second Schedule. The High Court dismissed the challenge on November 15, 2017, leading to the present appeal. The Appellant contended that the April 22, 2017 Policy was unsustainable due to non-adherence to Rule 68 of the Uttar Pradesh Minor Minerals (Concession) Rules, 1963, and that the demanded amount exceeded the fixed rate in the First Schedule of the 1963 Rules. The Respondent-State defended the High Court’s judgment, asserting that Sections 9 and 9B of the 1957 Act are inapplicable to minor minerals due to Section 14 of the same Act
Procedural History:
Chandra Bhan Singh, the appellant, initiated the legal process by challenging the Demand Notice dated October 25, 2017, before the High Court of Allahabad through a writ petition. The High Court subsequently ruled against the appellant, dismissing the challenge with its Impugned Judgment dated November 15, 2017. This decision prompted the appellant to file the present civil appeals before the Supreme Court of India. The Supreme Court, in a procedural step, ordered the production of original records on September 24, 2024, concerning the Policy decision dated April 22, 2017. These records were then perused by the Court on October 15, 2024. The Supreme Court considered Civil Appeal No. 12314 of 2024 as the lead case among the connected appeals. Ultimately, the Supreme Court upheld the High Court’s Impugned Judgment and dismissed the appeals, thereby affirming the validity of the Demand Notice
READ ALSO :Big Relief for Mothers: Supreme Court Backs Woman’s Right to Benefit After Remarriage
Court Observation:
The Supreme Court found that the State’s Policy decision dated April 22, 2017, which led to the demand notices, adhered to Rule 68 of the 1963 Rules, noting that the process was well-reasoned and justified by a High Court order allowing such measures due to a mining ban affecting development works. The Court observed that Section 9B of the 1957 Act is inapplicable to minor minerals like sand due to Section 14, and the State Government is empowered under Section 15(4)(c) and Section 15A to fix the amount payable to the DMF. The Demand Notice was therefore consistent with statutory provisions and Rule 10(2) of the 2017 Rules, which allows for a prescribed amount by the State. Lastly, the Court noted that Rules 21 and 54 of the 1963 Rules were inapplicable as per Rule 23(3) when an e-tender process is followed
Final Decision & Judgement:
The Supreme Court dismissed the appeals, upholding the Impugned Judgment dated November 15, 2017, passed by the Division Bench of the High Court of Allahabad. The Demand Notice dated October 25, 2017, which required the Appellant to deposit 10% of the total bid amount with the District Mineral Foundation Trust, was also upheld, implying the Appellant’s liability towards the DMF Trust. Consequently, Civil Appeal No. 12314 of 2024 and the connected appeals, Civil Appeal Nos. 12315-16 of 2024, were all dismissed. The Court also ruled that there would be no orders as to costs, and any pending applications would stand disposed of.
Case Details:
Case Title: CHANDRA BHAN SINGH VERSUS STATE OF UTTAR PRADESH & OTHERS Citation: 2025 INSC 763 CIVIL APPEAL NO.12314 OF 2024 Date Of Judgement: May 23, 2025 Judges/Justice Name: Augustine George Masih, and Abhay S. Oka
Download The Judgement Here