Case Commentary: Supreme Court judgment on illegal mining in Odisha

By Norma Alvares 

 

It is really heartening for an environment activist lawyer like me -- who has been fighting against illegal mining on behalf of the Goa Foundation and other anti-mining activists for the past 20 years -- to read the recent judgment of the Supreme Court in WP(C) 114 of 2014 (Common Cause vs UOI & ors).

 

 

The judgment is both far reaching and long overdue. It is well known that rampant illegal mining has been the order of the day not just in Odisha -- the State under reference -- but also in states like Goa and Karnataka where it has played havoc with the local ecology and the health of people living in the vicinity of the mine leases, or along the routes that transport the minerals to their destination.

 

That such gross violations of mining laws have occurred with the blessings of State Governments which have turned a blind eye to petitions and memoranda from the affected people, makes the situation that much worse, as it means there is zero hope of redress. Once again, the affected people and concerned public interest groups have returned to the judiciary. The judiciary has not let them down. I hope the judgement will have the required impact on other mining states as well.  

 

The main issues highlighted in the Supreme Court judgment are the following:

 

  1. Where mining has been conducted without a valid environment clearance (EC), it is an illegal operation and has to be penalised. Such a firm decision is the need of the hour and it is the only way to halt the rapacious greed of the miners and the endless destruction of the natural environment. In Goa, several mining leases are operating on the basis of ECs issued in 2005 under the 1994 EIA notification whose validity was for 5 years only. But even after the period of the EC expired, mining operations have continued till date under the illegal sanction of the Ministry of Environment & Forests on the specious ground that the 2006 EIA notification permits an EC to be valid for the term of the lease (or 30 years). The Goa Foundation has challenged the operation of these leases in the NGT and the matter is under consideration. 

 

  1. It is mandatory for miners to adhere to the laws that govern the operation of the lease, which is not just the mining plan, but environment laws as well. The judgment states: "If any mining operation is conducted in violation of any of these requirements, then that mining operation is illegal or unlawful. Any extraction of a mineral through an illegal or unlawful mining operation would become illegally or unlawfully extracted mineral.” The Supreme Court has firmly rejected the plea that illegal mining is to be restricted only to mining outside the lease area (encroachments). It holds lease-holders responsible for implementation of environmental regulations as well. When the Goa Foundation took its challenge against illegal mining in Goa to the Supreme Court in 2012 post the Justice M.B. Shah Commission's report on Illegal Mining in Goa and the apex court halted all mining in the state for 3 years, the environmental NGO had provided elaborate documentary proof of a variety of outright violations of mining laws, including benami mining operations, amalgamation of leases without permission, falsification of records, export details, etc. All this, in addition to violation of environment laws including overloaded trucks, air pollution, silting of rivers and streams, drying of water sources and destruction of agriculture.It is very important therefore that the Supreme Court has held that violations of laws render the mineral ore that is extracted illegal.

 

  1. The third and most important aspect of the. Supreme Court judgment is its decision that all instances of illegal mining would be actionable under Section 21(1) (fine & jail term) and 21(5) (return of the mineral or its value in compensation) of the MMDR Act. The compensation under Section 21(5) is the value of the mineral. Writes the bench: “In our opinion, there can be no compromise on the quantum of compensation that should be recovered from any defaulting lessee – it should be 100%. If there has been illegal mining, the defaulting lessee must bear the consequences of the illegality and not be benefited by pocketing 70% of the illegally mined ore. It simply does not stand to reason why the State should be compelled to forego what is its due from the exploitation of a natural resource and on the contrary be a party in filling the coffers of defaulting lessees in an ill gotten manner.” 

 

For too long the State has allowed and encouraged miners to amass huge profits even if this has meant that the public forgo its rightful share of earnings or benefits from the extraction of the minerals -- a publicly owned resource. The greed of the miners is in the nature of a cancer and is all-devouring, it appears. Hence, compelling them to pay back 100 percent is the right medicine. 

 

  1. There are other merits in the judgment as well. The SC is contemplating setting up an expert committee to identify the lapses that have occurred in mining across the nation and to recommend preventive measures. The proposed formation of the Expert Committee is welcome and overdue. There have been numerous reports detailing the various ways in which illegal mining continues to take place. However, there hasn’t been a systematic process to plug the loopholes. The goal must be to design an effective control system that cannot be manipulated by miners and by govt officials.

 

  1. The SC has also directed the Union of India to have a fresh look at the National Mineral Policy, 2008, particularly with regard to conservation and mineral development. The Goa Govt's Policy on Mining turned out to be a damp squib after all its boastful promises. Hopefully, a policy that will be drafted under directions of the Apex Court and keeping in mind particularly the principle of intergenerational equity, will give citizens some reason to cheer. Consequently, we must have radical transparency (open data, etc), right to social audits, whistleblower rewards and protection in order that everyone can get involved in safeguarding our common natural endowment or wealth.

 

Minerals are a shared inheritance. It is our duty to ensure that we protect our inheritance for future generations. Only if we do that, may the present generation consume some of the fruit. We hope this moral perspective of Intergenerational Equity underpins the new National Mineral Policy when it is drafted and notified. The Policy must base itself on receiving inputs from the public. In the past, too many critical decisions on mining regulations have been the unholy result of bureaucrats sitting with the mining lobby. That relationship must be scorched and cauterized for good.

 

Norma Alvarez is a prominent environment and animal rights advocate. She is a trustee of Lawyers Collective. 

 

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