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Petitioner: ALI MOHATARAM NAQVI VS Respondent: MESSRS COGEFAR-ASTALDI SIDMAIL
Court Name: Sindh High Court Judge(s): Tanzil-ur-Rehman Title: ALI MOHATARAM NAQVI vs MESSRS COGEFAR-ASTALDI SIDMAIL Case No.: Suit No. 45 of 1971 Date of Judgment:1986-07-13 Reported As: PLD 1986 Karachi 574 Result: Suit dismissed
JUDGMENT
JUDGMENT ' The facts of the case are that the plaintiff on behalf of Messrs All & Co., Contractors, submitted an application on or about 27th June, 1969 to the Deputy Commissioner, District Dadu, for the grant of lease or one year for utilising and removing quarries gravel stone aggregate in Deh Sonvaiher Makan Para Tipchatul, Taluka Kotri, District Dadu in an Area of about 800 acres for 5000 tons being the quantity to be excavated, on payment of usual royalty. A sketch of the area was also attached to that application. The matter was referred to Mukhtiarkar, Kotri who, having stated no objection on 19th August, 19o9 to the said grant, put up the file before the Deputy Commissioner, who on 20th August, 1969 agreed to the said grant as suggested in the Note submitted to him by the Revenue Branch. Accordingly a permit, dated 25th August, 1969 was issued in favour of Messrs Ali & Co., to excavate stone aggregate (Bajri) and ordinary sand from an area of 800 Acres of the said Deh on the terms and conditions as embodied in the said permit. Defendant No. 1, a foreign firm, at the relevant time, was constructing Super Highway under a contract with the Government of West Pakistan. As alleged in the plaint before the plaintiff could commence excavation, defendant No. I without the plaintiff's consent excavated huge quantities of ordinary stone etc. Which, according to the estimate of the Mukhtiarkar, Taluka Kotri, was in the region of approximately 30 lacs tons. The excavation was done between 25th August, 1969 and the next 3/4 months thereafter. The Mukhtiarkar, Kotri issued a notice, dated 5th January, 1970 to the plaintiff demanding a royalty from the plaintiff for the entire stone etc. Excavated. On receipt of the notice, the plaintiff made enquiries to confirm the contents thereof and found that in fact it was defendant No. I who had taken the aforementioned stone aggregate and had utilised a vast quantity thereof in construction of the Pakistan National Highway (Karachi to Hyderabad Section) for which it had a contract with the
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Highway Department. On receipt of another notice, dated 14th March, 1970 from the Mukhtiarkar, Kotri demanding the payment of royalty, within a fortnight, the plaintiff served a notice dated 24th March, 1970 on defendant No. 1 through their counsel with a copy of the same to Mukhtiarkar. Thereupon, defendant No. 1 through their letter, dated 31sth March, 1970 called upon the plaintiff to furnish certain documents to it. The plaintiff through his letter, dated 9th April, 1970 furnished the said documents to defendant No. 1, as desired. Some correspondence between defendant No. 1 and the Highway Department was exchanged and the plaintiff was kept informed of it. Defendant No. 1 ultimately wrote a letter, dated 12th June, 1970 to the plaintff that the said defendant had excavated the quantity of 1, 23, 21.0 tons, as detailed below, at Mile-S1 (1) Various aggregates 1, 170 tons (2) Base Course 1, 90, 303 tons (3) Shoulder Base Course 12,737 tons ..Wwwweessa. Total 1, 23, 210 tons Defendant No. 1 having denied its liability to pay compensation for the quantity of stone excavated by it, the plaintiff has filed the above suit claiming a sum of Rs. 45,00,000 (Rupees fourty-five lacs) for 30 lacs tons of stone at Rs. 1.50 per ton plus 11,10,000 being royalty payable to the Government with 9% interest and cost of the suit. 2. Defendant No. I filed its written statement. It also gave notice to the Government of Sind under third party proceedings which was served on it on 20th August, 1971, and the service was held good by the Additional Registrar (0. S) on 24th August, 1971. The Government of Sind gave no reply to it. However, the Government of Sind was impleaded by this Court's order, dated 10th April, 1972, as defendant No. 2. The said defendant No. 2 filed its written statement on 10th January, 1973. 3. Defendant No. 1 while denying almost every allegation of the plaintiff, inter aliu, contended that said permit was fradulently procured by the plaintiff and/or unlawfully issued by the Deputy Commissioner, Dadu and was otherwise null and void as it was issued in disregard to the provisions of law. It was specifically denied that the excavation site utilised by defendant No. 1 in the vicinity of 81 mile on the Karachi-Hyderabad Super Highway under contract with the Government of then West Pakistan belonged to the plaintiff or it was ever in his possession, power or control. It was further denied that defendant No. 1 excavated 30 lac tons of stone either from the land covered by the alleged permit or from any other land. It was, however, submited that defendant No. I procured approximately 1,23,210 tons of aggregates and other stones from the quarrying site in the vicinity of 81 mile in respect of which the said defendant was not liable to pay any royalty to the plaintiff. The claim of the plaintiff was thus denied. It was further submitted that the plaintiff did not inform or make any claim to the said defendant in respect of the alleged right. In any case, it was alleged that in the event of difficulty, the said defendant could have easily shifted to another site. It was, however, submitted that the plaintiff was himself not liable to the said sum of Rs. 11,10,000 to be paid to the Mukhtiarkar. Lastly, while denying the claim in tow, it was alternatively prayed that in the event of any judgment and decree to be passed against the said defendant, a decree against third party, now defendant No. 2, to the extent of the said amount may be passed. 4. The Government of Sind having been impleaded as defendant No. 2, as aforesaid, filed its written statement on 10th January, 1973. The genuineness and the validity of the alleged permit issued to the plaintiff was, inter cilia, disputed. 5. The following content issues were adopted by this Court on 3rd September, 1984, as re-cast, in place of the issues framed on 23rd September, 1974 :- `(1) Whether the plaintiff has been lawfully granted permit, dated 25th August, 1969 or whether it is invalid for any of the reasons stated in the written statement ?
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(2) Whether the rights purportedly granted to the plaintiff by the said permit were not available for allocation to the plaintiff? (3) Whether in terms of the contract, dated 20th March, 1967 the defendant's No. 1 acquired the right to enter upon or to exploit all the quarry rights for the purposes of the construction of the Karachi/Hyderabad Super Highway ? (4) Whether the land allegedly covered by the permit, dated 25th August, 1969 was demarcated and possession taken by the plaintiff. If so, when and what is the effect ? (5) Whether the plaintiff paid any surface or permit fee during the period of the permit ? If not, what is its effect ? (6) Whether the permit was revoked on grounds of public purpose prior to and/or after the grant of the same to the plaintiff ? (7) Whether or not the defendant No. 1 excavated a quantity of 30 lacs tons of stone either from the lands covered by the alleged permit or from any land and whether the defendant No. 1 was required to take the plaintiff's consent or pay him any royalty for the excavated stone. (8) Whether the plaintiff has waived his right, if any, for reasons of inaction, lathes, delay and acquiescence ? (9) Whether the defendant No. l's possession of the land in question being prior to the application the grant of the alleged permit, the plaintiff has any claim against the defendant No. 1 ? (10) Whether the plaintiff is entitled to the amount of Rs. 56,10,000 with interest at 9% from the defendant No. 1 ? (11) Whether the defendant No. 1 is entitled to full indemnity from the defendant No. 2 in respect of any amount that may be found payable by defendant No. 1 to the plaintiff ? (12) Whether the defendant No. 1 is entitled to an additional 25% from the defendant No. 2 ? (13) What should the decree be ? 6. It will not, perhaps, be out of context to mention here that the plaintiff had filed an application, dated 4th March, 1971 under Order XXXVIII, rule 5 and Order XXXIX, rule I read with section 151, C. P. C. For attachment before judgment of the properties of defendant No. 1 and alternatively for restraining the said defendant from selling, transferring or disposing of the said properties specified in the schedule annexed therewith This application was dismissed by a learned Single Judge of this Court by his order, dated 29th April, 1971. The plaintiff filed a Letters. Patent Appeal bearing No. 85 of 1971 which was disposed of by a Division Bench on 26th October, 1976 whereby the above said application for interim relief was ordered to be disposed of afresh, according to law. Certain submissions have been made by Mr. Nomani, learned counsel for defendant No. 1 in this regard which will, however, be adverted to by me at the proper stage. Now I propose to deal with the case issue-wise. 7. Issues Nos. 1 to 6 and 9.-To examine issue No. 1, "whether the plaintiff has been lawfully granted permit, dated 25th August, 1969 or whether it is invalid for any of the reasons stated in the written statement", it is imperative to see 'the reasons' on which the validity of the permit has been challenged. The said reasons as they have been stated in para. 4 of the written statement of defendant No. 1 are, therefore, reproduced as under :- "The said permit was fradulently procured by the plaintiff and/or unlawfully issued and/or issued due to inadvertence on the part of the Deputy Commissioner, Dadu and/or is otherwise null and void on all or any of the following grounds in that- (i) the alleged permit has not been issued in accordance with the West Pakistan Regulation of Mines and Mineral Development Ordinance, 1958 and the West Pakistan Mineral Concession Rules, 1958; (ii) the alleged permit has been issued contrary to the provisions of Act XXIV of 1948 and the Pakistan Mining Concession Rules, 1960;
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(iii) the Deputy Commissioner, Dadu had no power to issue such permit, which is entirely illegal and void ab initio; (iv) the said permit was not issued in the manner prescribed by law and is of no legal consequence; (v) the alleged permit purports to have been issued pursuant to an application, dated 27th June, 1969 after the defendants had already entered the land and had completed all requisite preliminary work during the first and second weeks of June, 1969, for setting up the 5th site and last for crushing plant and the said land was not available for allocation to the plaintiff; (vi) the alleged permit was granted on 25th August, 1969 when the defendants having already set up the crushing up (sic) as aforesaid had admittely gone into production of aggregates etc., and when the land in question was not available to any person other than the defendants, who having been awarded on 20th March, 1967, the contract for the construction of the Karachi-Hyderabad Super Highway work duly authorised to enter upon and/or to exploit all the quarrying sites for the purpose of said construction; (vii) the land allegedly covered by the permit, dated 25th August, 1969 was never demarcated and was consequently never taken possession of by the pliantiff or any other person on his behalf; (viii)the alleged permit was deliberately applied for unlawfully procured with a view to making dishonest claims on the defendants; (ix) the alleged permit was not issued by a duly authorised officer and has not been signed by any such officer; (x) the relevant law relating to the mining concession does not contemplate the grant of permit at all; (xi) the alleged permit did not come into effect during the period in question as the plaintiff did not even pay the surface fee during this period; (xii) in any case in terms of clauses 6 and 7 of the alleged permit, the land in question was liable to be resumed by the granter without any compensation and the alleged permit, even if valid, could be revoked for public purposes and was in effect so revoked by the land in question being put to such public purpose prior to and/or after the grant thereof. ' From the abovestated reasons, it appears that some of them have been the basis of a number of other issues separately numbered as issues Nos. 2, 3, 4, 5, 6 and 9. All these issues are, therefore, being considered together. 8. Mr. A.A. Fazeel, learned counsel for the plaintiff, submitted that the alleged permit (Exh. 4/2) was issued to the plaintiff on 25-8-1969 which was valid for six months of an area of 800 acres. The survey fee, as envisaged in the permit, was paid by the plaintiff on 2nd June, 1970. As to the validity of the said permit Mr. Fazeel, referring to office file of the Deputy Commissioner, Dadu (Exh. 4/36) invited my attention to office noting starting from page 1 and the order of the Deputy Commissioner for the issuance of the permit 'as suggested' which is signed by the Deputy Commissioner himself and is, dated 20th August, 1969. In support of his contention that the said permit was lawfully granted to the plaintiff, be relied on sections 62 and 69 of the Sind Land Revenue Code, 1879 read with Rule 66 made thereunder. 9. In the alternative, Mr. Fazeel submitted that the said permit could be issued under Rule 3(2) of the Pakistan Mineral Concession Rules, 1960. As a second alternative, it was submitted by him that Rule 6 of the said Rules provides for prospecting licence and a mining lease only, as set out in Parts I and II of the Second Schedule to the said rule. He, thus, submitted that the permit in question was not to be governed by the said Rules. 10. Mr. Fazeel, in relation to issue No. 2, relied on the permit (Exh. 4/2) and submitted that the plaintiff, in so far as the alleged noncompliance of clauses 6, 7 and 8 was concerned, was not required to fulfil the same by the Government, at any point of time'.
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11. As regards issue No. 5, he submitted that the contract, dated 20th March, 1967 between defendant No. 1 and the Government of West Pakistan has not been exhibited, though it has been referred to in the evidence, but he will, however, have no objection if the said contract is taken into consideration. He, therefore, conceded "that the said contract includes for payment of royalties in the tender price and indemnity against royalties for the material used by defendant No. 1, but it was an internal arrangement between defendant No. 1 and the then Government of West Pakistan, now the Government of Sind, with which the plaintiff has little concern, in so far as it goes against the interest of the plaintiff and the rights acquired by him under the permit. 12. As regards issue No. 4 he referred to the plaintiff's evidence, (Exh. 4) to the effect that his staff was working in the area and his Manager Maqbool Hussain had visited the site. The area was duly demarcated which, according to him, has not been rebutted by defendant No. 1. 13. 13. As regards issue No. 5, he submitted that the surface fee was paid by the plaintiff on 2nd June, 1970. The mere delay or non-payment of the said fee will not render the permit invalid. The Government was empowered under Rule 71 of the Mining Concession Rules to exercise its power of distress to realise the fee. Even otherwise, the Government did not take any action as to the non- payment of the fee. 14. As regard issues Nos. 6 and 9 Mr. Fazeel submitted that the plaintiff being a grantee, it makes no difference if defendant No. 1 was in possession or not. It was further submitted by him that the Government could revoke the permit issued to the plaintiff, but as it was not done, the plaintiffs right to claim compensation from defendant No. 1 remains intact, even if defendant No. 1 is held to be in possession of the area in question at the relevant time. 15. A. E. Nomani, learned counsel for defendant No. 1 contended that the Regulation of Minefield and Mineral Development (Federal Control) Act, 1948 is a Central Statute and, therefore, the Provincial Land Revenue Code and the Rules made thereunder stand superseded by it. Articles 106, 110, 218 and 224 of the Constitution of Pakistan of 1956 and Articles 131, 142, 134 and 225 of the Constitution of 1962 validating Central Acts were relied on by him. It was, further, contended that section 62 of the Land Revenue Code speaks of sale and grant of lease and not of the issuing of the permit. Rule 66 of the Land Revenue Rule regarding grant of permit, is, therefore, ultra vires the Code. In any case, the permit having not been signed by the Deputy Commissioner is invalid. Lastly, it was contended by him that rule 3(2) of the Mining Concession Rules, 1960 provides for delegation of authority by Notification published in the official Gazette. The Memorandums produced by Mr. Fazeel have not been published in the official Gazette as no copy of the said Memorandums appear to have been endorsed to the Government Press for Publication. It was further contended that since the power of delegation is not available in the Act, the Central Government could not delegate the said power under the Rules. 16. Mr. Nomani further submitted that the right purportedly granted to the plaintiff under the permit was not available for allocation to the plaintiff, inasmuch as the land was under occupation of defendant No. 1 and the area was not free. The plaintiff did not and, in fact, could not take possession of the land in question as it was already occupied by defendant No. I. The land was also not demarcated at all. 17. Mr. Abdul Ghafoor Mangi, Assistant Advocate-General, who appeared for defendant No. 2 at the last stage of arguments, in 1986, in place of Mr. Abdul Sattar Shaikh, Additional Advocate-General who has been conducting the case since the beginning, submitted that the permit, though invalid, was issued under the Pakistan Mining Rules, 1960. Mr. Mangi further submitted that the Deputy Commissioner, Dadu has granted the alleged permit contrary to the several memos, issued in respect of delegation of powers to issue permits. Moreover, the plaintiff has failed to prove
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payment of surface fee and royalty inasmuch as no treasury challan has been produced by the plaintiff in respect thereof. The plaintiff has also failed to prove his possession of the said land or its demarcation by any Government Official. The plaintiff has, however, failed to furnish monthly statement to the department concerned in respect of the production and disposal of the material. He, therefore, submitted that the permit was illegally issued to the plaintiff and, further, due to non- compliance of the terms of the said permit no right was created in favour of the plaintiff. ' It was further submitted by him that the area in question was already in possession of defendant No. 1, much prior to the grant of the alleged permit. It was further submitted by him that the permit was invalid for the reason that under instructions of the Government, a copy of the permit was to be sent to the Bureau of Mineral Resources, Karachi, which has not been done by the Deputy Commissioner. The construction of Super Highway entrusted to defendant No. 1 was public purpose and, therefore, the permit stood revoked in respect of the area in possession of defendant No. 1 and lastly, he submitted that "the permit appears to be an act of manipulation". In fact, according to him, it was "all arranged" between the plaintiff and the Mukhtiyarkar and was a collusive and fraudulent act on the part of the plaintiff and some of the Government officials including Mukhtiyarkar, Kotri. 18. In the alternative, Mr. Mangi submitted that "the plaintiff was entitled to the quantity of 5000 tons only and in excess of that no authority was given to him and the rest of the material rests with the Government, and there is no concern or entitlement of the plaintiff, who will be exonerated from the liability to pay royalty for the material exceeding 5000 tons," in that case. 19. As regards the first limb of the argument of Mr. Fazeel that the alleged permit Exh. 4/2 was issued under Rule 6b of Land Revenue Rules read with sections 62 and 69 of Land Revenue Code 1879, it will be advantageous to quote sections 62 and 69 of the Land Revenue Code, 1879 and Rule 66, which read as under : "Section 62.-It shall be lawful for the Collector, subject to such rules as may from time to time be made by the Provincial Government in this behalf, to require the payment of a price for unalienated land or to sell the same by auction, and to annex such conditions to the grant as he may deem fit, before permission to occupy is given under section 60. The price (if any) paid for such land shall include the price of the Crown right to all trees not specially reserved under the provisions of section 40, and shall be recoverable as an arrears of land revenue." "Section 69.-The right of the Crown to mines and mineral products in all unalienated land is hereby declared to be expressly reserved : Provided that nothing in this section be deemed to affect any subsisting rights of any occupant of such land in respect of such mines or mineral Products." "Rule 66.-Disposal of earth, stone, etc., by the Collector.-(I) The Collector may, at his discretion, sell by public auction or otherwise dispose of the right to remove earth, stone, Kankar, sand, Muram, or any other material which is the property of Government for such period and in such quantities and on such terms as he thinks fit." 18. 18. Sections 62 and 69 have been mentioned in Chapter VI, which deals with the grant, usage and relinquishment of unalienated land. Section 60 requires written permission of the officer named in the section before entering upon occupation of the land. Section 61 prescribed penalties for unauthorised occupation of land. Section 62 gives power to the Collector subject to such rules as may from time to time be made by the Provincial Government in this behalf, to require the payment of a price for unalienated or to sell the same by auction, and to annex such conditions to the grant as he may deem fit, before permission to occupy is given under section 60. Section 63 gives power to the Collector to dispose of any alluvial land which vests under any law for the time being in force in the Crown for the purpose of the province, to the occupant (if any) of the bank or
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share on which such alluvial land has formed, having due regard to the interests of the public revenue. It also provides for the price of the land for disposing of the said land. Section 64 deals with the temporary right to alluvial land of small extent. Section 65 entitles an occupant of land for the purpose of agriculture to < make certain constructions for Bette cultivation of the land. Permission may, however, be given by the Collector to the occupant if he wishes to use the holding for any other purpose after due enquiry subject to payment of fine in addition to an new assessm ent, which may be leviable under the provisions of section 48. Section 6o provides for penalty for using the land in occupation, without permission. Section 67 is an exception to the provisions of sections 65 and 66 not preventing the granting of the permission aforesaid on such terms or conditions as may be prescribed by the Collector, subject to any rules made in this behalf by the Provincial Government. Section 68 provides that occupant's rights are conditional. Section 69 reserves the right of Crown to mines and mineral products provided that nothing in section 69 shall be deemed to affect any subsisting right of any occupant of such land in respect of such mines or mineral products. Section 70 postulates a case where in occupancy is not transferable. It shall not be transferred, without the previous sanction of the Collector. Section _72 provides for, sale of intestate occupancy or holding, whereas section 73 provides that an' occupancy, unless otherwise provided, shall be deemed as heritable. Section 73-A gives power to the Provincial Government to restrict right of transfer. Sections 74, 76 and 67 deal with the relinquishment of land. Sections 79-A to 82-A deal with the eviction of an unauthorised occupant of land, forfeiture of occupancy, power of Provincial Government to suspend operation of section 60 or 64 and partition of occupancy. 21. The whole scheme of Chapter VII of the Land Revenue Code, it seems, deals with the power of the Collector for disposal of land for agricultural purposes. He may, however, permit the occupant for using B the land for a purpose other than agriculture. It presupposes an existing occupant at the time of applying for permission to put the land (in occupation) to another use. 22. Now to examine rule 66, it…
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