Amendment status not verified — confirm the current text below against the official source.
The State of Karnataka issued Notification No.FEE 248 FDP 2006 dated 16.8.2008 under Section 98A(1) of the Act whereby all lease-holders of mines and quarries situated in the forest area were notified in exercise of the powers conferred by section 98A(1). The validity of this notification and certain other issues came up for consideration before the Division Bench of the Karnataka High Court in W.P. No 2462 of 2009 (and other connected matters) and the judgment was rendered on 03.12.2015. The Hon’ble High Court, inter alia, was pleased to quash the notification on the ground that the expression “a body” would not include leaseholders of mines and quarries, whether as an individual or as other juristic entity. According to the Hon’ble High Court, leaseholders could be individuals, partnership firms, societies, co-operative societies, companies incorporated under the Companies Act or any other association or persons. Unless all of them constituted themselves into "a body", which would inevitably be a juristic entity having a legal persona, such as a federation in which the leaseholders are members, or a company, wherein they are Forest [1964: KAR. ACT 5 352 shareholders, or, a society, wherein they are members and one of the activities of such federation or company or society is disposal of minerals as forest produce by sale or otherwise, they could not be treated as a body that could be notified by the State Government. Thus, independent or separate lease holders, whether they are private individuals or partnership firms or companies or any other juristic entity, could not be construed to come within the expression "a body" under sub-section (1) of Section 98-A of the Act. This interpretation has resulted in numerous leaseholders of mines and quarries situated in forest area not being liable to collect and pay the “forest development tax” (FDT). This was clearly never the intention of the legislature because the word “a body” was never intended to apply to only juristic entities consisting of a conglomeration of leaseholders, either as individuals or companies or firms and so on. It is also clear that lease holders of mines and quarries situated in forest area will never collectively act as an association or a conglomerate while purchasing or selling or disposing of forest produce.