The Supreme Court clarified the State Government's authority to levy royalty on the excavation of minor minerals under the Mines and Mineral (Regulation and Development) Act, 1957, and the Punjab Minor Mineral Concession Rules, 1964. The Court quashed the High Court's ruling that the State lacked such authority due to ownership ambiguities. It was held that brick earth, being declared a minor mineral, attracts royalty irrespective of the land's ownership.

• The State Government's right to levy royalty on brick earth is independent of land ownership.
• Ownership disputes concerning the land are irrelevant for determining royalty under the Punjab Minor Mineral Concession Rules.
• Remedies under Rule 54F of the Mineral Rules provide sufficient recourse for challenging royalty assessments.

1. Nature of the Dispute (Para 1-2):

• Parties: State of Punjab (Appellants) vs. M/s Om Prakash Brick Kiln Owner (Respondents).
• Issue: Respondents challenged the levying of royalty for excavating brick earth, claiming it was not owned by the State.

2. Trial and Appellate Court Findings (Para 3-4):

• Trial Court: Dismissed the suit; upheld the presumption of ownership of minerals by the State under Section 42(1) of the Punjab Land Revenue Act, 1887.
• First Appellate Court: Affirmed that brick earth, as a minor mineral, is liable for royalty.

3. High Court Ruling (Para 5):

• Overturned lower courts' decisions, stating the State failed to establish ownership over the brick earth.

4. Arguments before the Supreme Court (Para 6-7):

• State's Argument: Brick earth is a declared minor mineral, and the State has the authority to levy royalty irrespective of land ownership.
• Respondents' Argument: Ownership of the brick earth must be proven to justify the levy.

5. Supreme Court’s Observations (Para 8-13):

• Ownership Issue: Irrelevant for royalty assessment; Rule 54C empowers the State to assess and levy royalty.
• Minor Minerals: Notification under Section 3(e) of the 1957 Act suffices to classify brick earth as a taxable minor mineral.
• Procedural Remedy: Rule 54F provides an appellate mechanism for challenging royalty amounts.

Acts and Sections Discussed:

1. Punjab Land Revenue Act, 1887:
   • Section 42: Presumption of ownership of quarries and waste lands.
2. Mines and Mineral (Regulation and Development) Act, 1957:
   • Section 3(e): Definition of minor minerals.
   • Section 15: Power of States to make rules regarding minor minerals.
3. Punjab Minor Mineral Concession Rules, 1964:
   • Rules 3, 54A, 54B, 54C, and 54F: Regulation of minor mineral extraction and royalty assessment.
4. Code of Civil Procedure, 1908:
   • Section 80: Notice requirement for suits against the Government.

Ratio Decidendi:

The State's authority to levy royalty on the excavation of minor minerals does not depend on the ownership of the land but is rooted in its statutory power under the Mines and Mineral Act, 1957, and the corresponding rules framed thereunder.

Subjects:

Taxation on Minor Minerals – Royalty Assessment.

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