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B.L.A. Industries Pvt. Ltd. vs. Union of India

Writ Petition (Civil) · 2022 INSC 838Decided 17 Aug 2022
Writ Petition (Civil) No. 63 of 2015
N.V. Ramana · Krishna Murari · Hima Kohli

Background

The petitioner company had obtained a coal mining lease in Madhya Pradesh in 1998 through the ordinary State Government application process under the Mines and Minerals (Development & Regulation) Act, not through the Central Government's "Screening Committee" or "Government Dispensation" routes. In 2014, the Supreme Court's Manohar Lal Sharma judgments struck down as illegal and arbitrary the entire nationwide allocation of coal blocks made through those two routes between 1993-2011, and ordered allottees covered by that scheme to pay an additional compensatory levy of Rs. 295 per metric tonne of coal extracted. The Union of India mistakenly included the petitioner's name in the list of allottees liable to pay this levy, and later filed a contempt petition against it for non-payment.

Decision Breakdown

The Supreme Court examined the actual correspondence trail and found that the petitioner's mining lease had never actually been granted through the Screening Committee or Government Dispensation Route: the State Government itself had independently verified the petitioner's application and recommended it, and even the State Government's own affidavit before the Court confirmed this was the sole such case handled differently. The Court held that merely attending Screening Committee meetings did not make the petitioner a "beneficiary" of the flawed process, and since the petitioner was never actually part of the illegal allocation scheme, the additional levy demand against it was quashed and the related contempt petition was dismissed as meritless. The Court also strongly criticised the Union of India for carelessly including the petitioner in its list of errant allottees without due diligence, and awarded the petitioner Rs. 1,00,000 in litigation costs.

Lesson Learnt

Being administratively associated with a category of wrongdoers (here, coal block allottees found guilty of illegal allocation) does not make someone liable for the consequences unless they actually benefited from the illegal process, and a citizen who followed the lawful procedure throughout is entitled to have the record corrected, plus costs, when a government department wrongly lumps them in with others.

Official source (sci.gov.in)View Judgment (PDF)

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