Andhra Pradesh High Court Upholds Amendments Introducing Auction Based System for Grant Of Minor Mineral Leases

The Andhra Pradesh High Court, on 20.03.2025, set aside a bunch of petitions challenging the amendments made to the A.P. Authority of the State Government With respect to the issue of the State Government not possessing the requisite authority to introduce such amendments, the Court held that Section 15 of the 1957 Act authorises the State to change the method of grant of leases in relation to minor minerals. Trivedi and Sons Vs. State of Gujarat, where the Supreme Court, while dealing with Section 15 of the 1957 Act and the Rules made thereunder, clarified that Section 13 stipulates guidelines for the State Governments to follow in framing the rules under Section 15, and the only difference between the ambit of power contemplated under Section Section 13 and under Section 15 is that the Central Government exercises the power in respect of minerals other than minor minerals and the State Governments, due to local significance, exercise power in respect of minor minerals. Once, it has been accepted that the State Government, by way of Rules, made under Section 15 of 1957 Act, could establish a system of first-cum-first serve basis, for grant of leases and a system of priority among the four categories mentioned above, it cannot be said that the State does not have any further power to change a system which was brought in, by way of the very same rules.” Whether the amendments have retrospective application Rejecting the contention that the applicants had a vested right for grant of a mineral concession, the Court held that Section 10 of the 1957 Act gave enough discretion to the State Government to grant or refuse mineral concession. “In the absence of such a conflict, the 1966 rules would continue to operate, even in relation to regulation of grant of mineral concessions for granite and marble.” Increased Security Deposit and Alleged Misuse by Officials With respect to this issue of excessive increment in the security deposit, the Court observed that the petitioners have not placed any material before the Court to demonstrate that there was an increase in the dead rent/royalty in the three years before the issuance of G.O.Ms.No.13 or G.O.Ms.No.14.