Goa govt slept over mining lease issue for 3 yrs, didn’t recover money or file criminal complaints against ex-lessees

gmpf-cartoon-3By Claude Alvares*

Fully aware that mining will not start in Goa this year, the Goa Foundation decided to approach the Supreme Court with a fresh PIL challenging the renewals illegally granted to 88 former lease holders to continue operations of leases they worked earlier. The Foundation’s lawyers are also expected to make a plea to the Court to hear the SLP filed by the Goa Foundation in September last year, challenging the judgement of the Bombay High Court directing the Goa government to renew some of the leases.

The Foundation’s petition challenges the 88 lease renewals on three major grounds:

  1. a) The renewal orders violate the directions given in the Supreme Court’s judgement in WP No.435/2012, the earlier PIL filed by the Goa Foundation.
  2. b) The renewal orders are in violation of specific provisions of the Mines and Minerals (Development and Regulation) (MMDR) Act, 1957; the Mineral Concession Rules, 1960 and the MCDR Rules, 1988.
  3. The renewal of the leases violates the constitutional provisions governing the allocation of natural resources, highlighted by the Supreme Court in the cases of the coal block allocations, the judgement in the allocation of spectrum (2G scam) and Presidential Reference.

It will be recalled that the judgement dated April 21, 2014 specifically gives the Goa Foundation the right to return to the Supreme Court if the lease grants are in violation of the MMDR Act and constitutional norms governing allocation of natural resources to persons for the purpose of profit-making.

In its judgement dated April 21, 2014, the Supreme Court had declared all mining leases in Goa as “expired” on November 22, 2007. Since the leases had expired, they could not be renewed. However, due to the control of the Mines Department by miners, the Goa government was determined to hand the leases back to the same old lease-holders. Thus, within days of the Supreme Court judgement on April 21, 2014, the Bombay High Court at Goa was approached with writ petitions by former lease-holders. Some of them claimed they had paid stamp duty on demand from the Goa government.

The High Court entertained the petitions and directed the government to renew the leases by its judgement dated August 13, 2014. The Goa government resisted the petition filed by the miners in Court by filing an affidavit stating this could not be done. However, it refused to appeal the High Court’s order, forcing the Goa Foundation to approach the Supreme Court instead.

On November 5, 2014, the Mines Department began approving the first of several second renewals of leases belonging to former lease-holders. As soon as the Goa government came to know that an amendment was being brought to the MMDR Act which would eliminate the possibility of renewing leases, it made great haste to grant a total of 54 renewals in the short span of 6 days. Thirty one of these renewals were granted on January 12, 2015, on which date the provision to grant second renewal had ceased to exist.

On January 15, 2015, the Goa government announced its withdrawal of the mining suspension order it had issued three years earlier on September 10, 2012.

A few months later, on March 20, 2015, the Ministry of Environment & Forests (MoEF) also obliged the mining lobby and revoked its suspension of Environment Clearances (EC) in respect of 91 mining leases.

When the Goa Foundation put the second renewal list (of 88 leases) together with the MoEF order dated March 20, 2015, it found that only 61 leases had both a renewal order and the EC restored.

Of the 61, only 56 applications were accepted by the Goa Pollution Control Board for the purpose of granting consents to operate under the Air and Water Acts. As of today, some 22 mining leases have been granted consent and can operate, as per information made available under the RTI Act on September 22, 2015.

The Goa Foundation has naturally asked for an interim stay of the operation of these consent orders as they violate the law.

Here are some of the problems with all the leases:

  • 31 are renewed on February 12, 2015, when the provision for renewing leases ceased to exist on the law books.
  • 54 are renewed in just one week (January 6-12, 2015). In none of these cases is there any report from the IBM as required; in fact, except in one solitary case, there are no such reports after the SC judgement dated April 21, 2014.
  • Only 61 have environment clearances restored on March 20, 2015. The renewal of the remaining leases is therefore pointless.
  • None of the leases has got the no-objection certificate (NOC) from the standing committee of the National Board for Wild Life (NBWL), as required by the Supreme Court’s order dated 4.8.2006.
  • 11 leases have been renewed without forest clearance. These orders are clearly illegal.
  • Practically 24 leases have violated Section 37. However, government claims it is yet to conduct an inquiry.
  • 42 leases have violated Section 38. Results of inquiry, if committed, not known.
  • All leases of Sesa Goa and two other Sesa companies have been found to be illegal, in violation of MMDR Act, in Justice Shah Report III.
  • EAC report findings most damaging.

In the above circumstances, it would have been best if the Goa government had issued these leases to itself and then asked mining companies to mine on its behalf under contract and pass the ore extracted to the Government for auction through  Metals and Minerals Trading Corporation (MMTC). Companies’ profits would then remain around 10-15%, which is more than enough compensation for mining. However, the Goa government has decided to act against public interest and return the leases to the former lease-holders despite their gross misconduct in the past 8 years when mining took place.

The equally serious charge made in the petition is that the leases have been granted free of cost, involving iron ore valued at several hundred crores of rupees, all belonging to the people of the State. The figures about this are as follows:

1 Total quantity permitted for extraction as per ECs granted in 88 leases: 43.973 million metric tonnes (MMT), for at least 12 years (Nov-Jan 2014 – 21-Nov-2027)
2 Value of mineral ore @ Rs. 311.12 crores per MMT Rs. 164,172 crores


3 Extraction costs for 43.973 million tonnes @ Rs. 120.25 crores per MMT Rs. 63,453 crores


4 Net value of iron ore @ Rs. 190.87 crores per MMT Rs. 100,720 crores


5 Royalty @ Rs. 8.46 crores per MMT to Goa Govt Rs. 4,467 crores
6 Goa Iron Ore Permanent Fund @ 10% of sale value, Rs. 31.11 crores per MMT Rs. 16,417 crores


7 Net loss to the public of Goa: Rs. 151 crores per MMT Rs. 79,836 crores

This is not mining or legal mining. It is legal looting of Goa’s resources. This cannot be tolerated. The Goa Foundation (GF) does not have problems with mining, if done through proper controls. At present, the manner in which these leases have been approved show that the former lease holders still control everything that happens in the Department of Mines & Geology. People of Goa will never benefit in such circumstances, though they own the ore collectively and should get all the benefits from its sale.

Unless the leases are cancelled, mining in Goa will continue to be affected by the deadly disease of full-blown illegalities which infected it during the past decade. Symptomatic is how Sesa Goa started mining operations at Codli on August 10, in the presence of the CM, without having a valid consent order.

Right now the issue is whether the SC finds substance in the petition. Since this is a PIL, we are informing the public of the main issues in the petition.

*Director, Goa Foundation, www.goafoundation.org


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