2026:JHHC:17663-DB 1 IN THE HIGH COURT OF JHARKHAND AT RANCHI W.P. (C) No. 4283 of 2021 --- Godfam Investment & Finance Co. Ltd., having its registered office at 1/42, Azad Garh, Ground Floor, P.O.-Regent Park, P.S.-Jadavpur, District-Kolkata (West Bengal), through one of its Directors, Sri Subeg Singh, S/o Late Govind Singh, R/o Shastri Nagar East, Dhanbad, P.O., P.S. & District-Dhanbad … … Petitioner Versus 1. The State of Jharkhand 2. Secretary, Department of Mines and Geology, Government of Jharkhand, Ranchi 3. District Mining Officer, Dhanbad 4. Assistant Mining Officer, Dhanbad 5. Deputy Commissioner, Dhanbad 6. The State Level Environment Impact Assessment Authority, Jharkhand, through its Member Secretary, Ranchi …. .… Respondents ----- CORAM: HON’BLE THE CHIEF JUSTICE HON'BLE MR. JUSTICE RAJESH SHANKAR ----- For the Petitioner : Mr. Shailesh Kumar Singh, Advocate For the Res.-State : Mr. Sachin Kumar, A.A.G.-II Mr. Srikant Swaroop, A.C. to A.A.G.-II For the Res. No. 6 : Mr. Bhanu Kumar, Advocate Mr. Anuj Sarwesh, Advocate Mr. Prabhakaran Munda, Advocate ----- Reserved on 10.06.2026 Pronounced on 18.06.2026 Per : Rajesh Shankar, J. : 1. The present writ petition has been filed for quashing the order dated 16.07.2020 passed by the Secretary, Department of Mines and Geology, Government of Jharkhand (respondent no. 2) whereby the request of the petitioner regarding release of the proportionate bid amount along with the proportionate amount of royalty, registration fee and stamp duty for the period it was restrained from operating five (5) sand ghats allotted to it i.e. for the period between 04.06.2012 to 31.03.2014, has been rejected. Further prayer has been made for release of the 2026:JHHC:17663-DB 2 aforesaid proportionate amount in favour of the petitioner including suitable interest for delayed payment. 2. The learned counsel for the petitioner submits that a notice was published from the office of the Deputy Commissioner, Dhanbad (respondent no. 5) on 14.07.2011 inviting prospective bidders to participate in an auction for settlement of right with respect to twelve (12) sand ghats situated in different circles of the Dhanbad district for three financial years i.e. 2011-2012, 2012- 2013 and 2013-2014. 3. The petitioner participated in the aforesaid auction and was declared successful in respect of five (5) sand ghats situated in different Panchayats of Tundi circle namely Kolhar, Lukaiya, Chururiya, Ukma and Mairnwatand. 4. On 9.8.2011, the Assistant Mining Officer, Dhanbad informed the petitioner about acceptance of its bid in respect of aforesaid five sand ghats at the price quoted by it and five separate Letters of Acceptance were issued showing allotment of the aforesaid sand ghats in its favour. The said Letters of Acceptance did not contain any term and condition about requirement of taking environmental clearance from the Ministry of Environment and Forest, Govt. of India (MoEF) or from the State Level Environment Impact Assessment Authority, Jharkhand (SEIAA). 5. The petitioner deposited 40% of the bid amount as the first installment and 10% of the bid price as the earnest money and commenced its operation from 9.8.2011. 6. Thereafter, five separate registered mining lease agreements, all 2026:JHHC:17663-DB 3 dated 05.10.2011 were executed between the petitioner and the respondent no. 5 in respect of the five sand ghats which also did not contain any term and condition regarding the petitioner’s obligation to obtain environmental clearance from MoEF or SEIAA. 7. The petitioner paid the second installment of 30% of the bid amount by February, 2012 as per the terms and conditions of the agreements. Thus, altogether 80% of the bid amount was deposited by the petitioner and the remaining 20% of the bid amount was due to be paid in March, 2013. 8. It is further contended that the petitioner submitted the monthly returns of the minor minerals excavated by it till June, 2012 and accordingly transit challans were issued by the Department of Mines and Geology, Government of Jharkhand. However, from July, 2012, the respondents stopped issuing transit challans, which resulted in stoppage of mining operation from the sand ghats allotted to the petitioner. 9. It is also submitted that vide letter no. 883 dated 4.6.2012 addressed to the Director, Mines, Department of Mines and Geology, Government of Jharkhand (a copy of which was also communicated to the petitioner), the Assistant Mining Officer, Dhanbad (respondent no. 4) sought necessary instructions mentioning inter-alia that the petitioner was demanded the environmental clearance from MoEF and the consent to operate from Jharkhand State Pollution Control Board with respect to the said five sand ghats allotted to it, however it failed to submit the 2026:JHHC:17663-DB 4 same, which resulted in non-issuance of transit challan. 10. It is asserted that the petitioner vide its letter dated 19.7.2012 replied letter no. 883 dated 4.6.2012 and requested the Additional Chief Secretary-cum-Mines Commissioner, Jharkhand to issue transit challans, but the respondents did not issue any transit challan to it which ultimately resulted in stoppage of its mining activities. 11. The petitioner preferred writ petition being W.P. (C) No. 5235 of 2012 and during pendency of the said writ petition, the petitioner, vide letter dated 15.10.2012, surrendered all the five sand ghats allotted to it requesting the respondent no. 5 to refund the proportionate bid amount for the period it was not allowed to carry out the mining activities on the allotted sand ghats. The petitioner also claimed for refund of the proportionate amount pertaining to royalty, registration fee and stamp duty incurred by it in course of allotment of the said sand ghats. 12. The said writ petition was disposed of by learned Single Judge of this Court vide order dated 6.3.2020 with a direction to the petitioner to make a fresh representation before the Principal Secretary, Department of Mines and Geology, Government of Jharkhand within a period of four weeks and the said respondent was in turn directed to take a final decision within a period of eight weeks thereafter. It was further directed that if the said authority came to a finding that the petitioner was entitled for refund, necessary benefit would be extended to it within a period of six weeks thereafter. 2026:JHHC:17663-DB 5 13. The petitioner submitted detailed representation on 16.3.2020 before the respondent no. 2, however the same was rejected by the respondent no. 2 vide impugned order dated 16.07.2020 observing that in spite of the notice given to the petitioner, it failed to produce the environmental clearance of the concerned five sand ghats allotted to it before the respondent no. 3. Moreover, the claim of the petitioner for refund of the proportionate bid amount, royalty, registration fee and stamp duty was also rejected. 14. It is further argued that the petitioner has suffered huge loss due to stoppage of its mining activities and as such it is required to be suitably compensated by the respondents. 15. It is also submitted that the petitioner had fulfilled all the terms and conditions mentioned in the auction notice, the mining lease agreements as well as the letters of acceptance and had made timely payments of installments of the bid amount. 16. It is further urged that during the entire mining operation, the petitioner was never served any show cause notice for any kind of violation of the terms and conditions of mining lease agreements or auction notice or the letters of acceptance. 17. It is emphatically contended that since there was no requirement under the terms and conditions of the auction notice, the Letters of acceptance and the mining lease agreements for taking environmental clearance to operate the sand ghats, the petitioner did not apply for the same. 18. According to the learned counsel for the petitioner, the 2026:JHHC:17663-DB 6 excavation of sand from the allotted sand ghats was stopped by the respondents due to wrong interpretation of the judgment of the Hon’ble Supreme Court rendered in the case of Deepak Kumar and Others Vs. State of Jharkhand & Others reported in (2012) 4 SCC 629. In the said judgment the Hon’ble Supreme Court had only restrained grant of fresh lease and/or renewal of lease by the State of Jharkhand without environmental clearance and the said judgment was not applicable to the existing lease agreements. 19. It is further argued that the National Green Tribunal, Principal Bench, New Delhi vide its order dated 05.08.2013 passed in Original Application No. 171 of 2013 (National Green Tribunal Bar Association Vs. Ministry of Environment & Forest & Others) had directed all the Deputy Commissioners/Superintendents of Police/Mining Authorities of all the respective States to restrain all the existing mining activities without obtaining environmental clearance from MoEF/SEIAA and license from the competent authorities. However, the said order was stayed by the Hon’ble Supreme Court vide order dated 31.10.2013 passed in Civil Appeal Nos. 9703-9706 of 2013. 20. On the contrary, the learned counsel for the respondents submits that in spite of the direction issued to the petitioner, it never submitted the environment clearance of MoEF/SEIAA and the consent to operate by the Jharkhand State Pollution Control Board for the settled sand ghats and accordingly, the issuance of 2026:JHHC:17663-DB 7 transport challan was stopped. 21. It is further submitted that environment clearance from State Level Environment Impact Assessment Authority (constituted by the MoEF, Government of India) was demanded from the petitioner against the concerned five (05) settled sand ghats vide letter no 869/M, 870/M, 871/M, 872/M, 873/M all dated 20.08.2013 and due to non-submission of the same, the transport challans were not issued by District Mining Office, Dhanbad. 22. It is also submitted that the order of the Hon’ble Supreme Court rendered in the case of Deepak Kumar (Supra.) mandates the requirement of environment clearance for the leases having area less than 05 Hectares. Moreover, as per order dated 05.08.2013 passed by National Green Tribunal, Delhi in O.A No. 171 of 2013, environment clearance of MOEF/SEIAA is necessary for sand mining throughout the country. 23. It is next contended that Part VII (2) of the registered lease agreements executed on 05.10.2011 in Model Form-C clearly states that all central as well as state laws will be applicable to “bandobastidhari”/”bandobastidharigan” to work on mines and minerals. Therefore, the law regarding obtaining environment clearance from MoEF/SEIAA for the settled ghats was also applicable to the petitioner. 24. It is lastly argued that clause 10 of the terms and conditions of auction notice and Part III (2) of the lease deed agreements executed in Model Form-C clearly states 2026:JHHC:17663-DB 8 that “bandobastidhari”/”bandobastidharigan” cannot claim any compensation from the State Government towards loss occurred due to hurdle in transportation or due to unavailability of minerals. 25. Heard the learned counsel for the parties and perused the materials placed on record. 26. Thrust of the argument of the learned counsel for the petitioner is that neither in the terms and conditions of the auction notice nor in the letters of acceptance or the mining lease agreements, there was any requirement of obtaining environmental clearance from SEIAA to do the mining activities over the settled sand ghats. Despite that, the petitioner was restrained from extracting sand from the settled sand ghats without any fault on its part which forced it to surrender all the lease agreements. Thus, the petitioner is entitled to refund of the proportionate bid amount, royalty, registration fee and stamp duty etc. including suitable interest for delayed payment. 27. It is evident from the record that the petitioner was allotted five (5) sand ghats for a period of three financial years starting from 01.04.2011 to 31.03.2014. The petitioner commenced extraction of sand from 09.08.2011 and continued till June, 2012. 28. In the meantime, the Hon’ble Supreme Court in the case of Deepak Kumar (Supra). held that leases of minor minerals including their renewal pertaining to an area less than five hectares have to be granted by the States/Union Territories only after getting environmental clearance from the MoEF. 2026:JHHC:17663-DB 9 29. In compliance of the order of the Hon’ble Supreme Court rendered in the case of Deepak Kumar (Supra.), the MoEF, Govt. of India issued an Office Memorandum No. L-11011/47/2011-IA.II(M), dated 18.05.2012 stating inter alia that all mining projects of minor minerals including their renewal, irrespective of the size of the lease would henceforth require prior environment clearance and that the projects of minor minerals with lease area less than 5 hectares, would be treated as category ‘B’ as defined in Environment Impact Assessment (EIA) Notification, 2006 and will be considered by the respective State Environment Impact Assessment Authorities (SEIAAs) notified by MoEF and following the procedure prescribed under the EIA Notification, 2006. 30. 30. From July, 2012, the respondents stopped issuing transit challan in favour of the petitioner for want of environmental clearance due to which operation of the sand ghats settled to the petitioner was stopped. Moreover, the claim for refund of the proportionate bid amount, royalty, registration fee and stamp duty deposited by the petitioner has been declined by the respondent no. 2 vide impugned order dated 16.07.2020. 31. The learned counsel for the petitioner puts reliance on the judgment of Raj Kumar Gupta Vs. The State of Jharkhand & Others reported in 2018 SCC OnLine Jhar 954 which has been delivered by one of us (Rajesh Shankar, J). In the said case, ‘Niktha Sand ghat’ located on Ajay river situated in ‘Soatar Panchayat’ of Deoghar district, was allotted to the petitioner of 2026:JHHC:17663-DB 10 that case. The said sand ghat was situated within 500 meters of High Level Bridge and in view of Clause 8 of the environment clearance, the mining operation was prohibited in the said area. The Bench held that the respondent authorities were duty bound to refund the amount which was received from the petitioner in lieu of allotment of the sand ghat, since the agreement itself was illegal in view of the stipulation made in the environment clearance and the settlement agreement. The Bench further observed that it was not in dispute that the sand ghats were selected and put to public auction by the respondent authorities themselves. Thus, if subsequently it was found that the lifting of sand from a particular sand ghat was not permissible due to such stipulation in the environment clearance and settlement agreement, the settlee/lessee couldn’t be subjected to adverse consequences arising therefrom. 32. In the case of Manoj Kumar Vs. The State of Jharkhand & Others reported in 2020 SCC OnLine Jhar 1760, one of the sand ghats notified in a public auction popularly known as ‘Amma Sand Mining Project’ was allotted to the petitioner of the said case which was found situated within the distance of less than 250 meters from the forest area and thus the environmental clearance for the said mining operation was cancelled. In that case, one of us (Rajesh Shankar, J.) held that in spite of the information given by the Divisional Forest Officer, Khunti Forest Division that certain area of the said sand ghat was within the distance of 250 meters from the nearest forest area, the 2026:JHHC:17663-DB 11 respondent Nos. 2, 3 & 4 of the said case proceeded to execute the lease deed in favour of the petitioner for the said project and thus they acted in contravention of the decision of the State Level Environment Impact Assessment Authority, Jharkhand taken in its meeting dated 07.05.2013. The petitioner was nowhere involved in selection of the place of the said project, rather the same was put to public auction by the respondent Nos. 2, 3 & 4 of the said case. As such, it was observed that the petitioner couldn’t be punished for no fault on his part. It was further held that a person cannot be compelled to do what he cannot possibly perform. The Bench finally held that the petitioner was entitled for refund of the proportionate amount of the bid value as well as the security amount deposited by him in relation to the said project. 33. The learned counsel for the petitioner also puts reliance on the judgment of a Co-ordinate Bench of this court rendered in the case of Mahadev Enclave Pvt. Ltd. Vs. The State of Jharkhand & Others reported in 2023 SCC OnLine Jhar 3936. In the said case, the petitioner was declared successful bidder pertaining to ‘Narottampur Sand Ghat Mining Project’ situated on ‘Sundar river’ in Godda district and it deposited the full security amount as well as 40% of the bid amount, however it could not operate the said sand ghat because of delay in obtaining environmental clearance. The Co-ordinate Bench observed that the petitioner should be refunded the amount deposited with the respondents. It was further observed that the 2026:JHHC:17663-DB 12 State of Jharkhand being a welfare State should not derive unreasonable benefit at the risk of rendering financial losses to the public or the companies operating within its jurisdiction. It was also observed that unreasonable gain on the part of the State Government is not within the compass of the constitutional Scheme. Finally, the Bench directed the Directors of Mines & Geology, Jharkhand (the respondent no. 2 therein) to refund the security deposit and 40% of the bid amount deposited by the petitioner with simple interest at the rate of 6 % per annum to be calculated from 14.08.2015, till the actual payment. 34. In the case of Sanjeev Kumar Vs. the State of Jharkhand [W.P.(C) No. 3387 of 2022] with other analogous cases, a Coordinate Bench of this court directed the Director of Mines and Geology, Jharkhand to refund the security deposit and bid amount deposited by the common petitioner in all the three cases with simple interest @ 6% per annum, to be calculated from the date of deposit till the date of actual payment by putting reliance on the judgment of Mahadev Enclave Pvt. Ltd. (Supra.). 35. Now, the question falls for consideration of this Court is as to whether the petitioner is entitled for refund of the proportionate bid amount as well as royalty, registration fee and stamp duty from the respondents w.e.f. July, 2012 in view of the fact that it was restrained from carrying out mining activities on the allotted sand ghats without its fault? 36. In the present case, there was no condition either in the auction 2026:JHHC:17663-DB 13 notice or in the letters of acceptance or the mining lease agreements that the allotee shall have to get environmental clearance for carrying out mining operation over the concerned allotted sand ghats. The petitioner was allowed to continue the mining operation without environmental clearance till June 2012. However, pursuant to the order passed by the Hon’ble Supreme Court in Deepak Kumar (Supra.), the respondent authorities decided to stop issuing transit challan to the petitioner and other mining lease holders who had not obtained environmental clearance and started demanding environmental clearance of the respondent no. 6 for operating the settled sand ghats. Due to the said subsequent development, the petitioner surrendered all the settled sand ghats to the respondents and demanded for refund of the proportionate bid amount, royalty, registration fee and stamp duty etc. 37. We are of the considered view that the respondent authorities are under legal obligation to refund the proportionate bid amount for the period the petitioner was not allowed to carry out the mining operation in the allotted sand ghats, since at the time of allotment of the sand ghats, the petitioner was not informed that it had to obtain environmental clearance from SEIAA for operating the sand ghats. 38. The respondents cannot be permitted to be unjustly enriched at the cost of the petitioner. Since the condition for operating the sand ghats allotted to the petitioner was subsequently changed after the judgment rendered by the Hon’ble Supreme Court in 2026:JHHC:17663-DB 14 the case of Deepak Kumar (Supra.), the petitioner was left with the option either to surrender the sand ghats or to get the environmental clearance for operating the same. In the present case, the petitioner chose the first option and as such it is entitled for refund of the proportionate bid amount for the period it could not operate the sand ghats. 39. For the reasons as aforesaid, the respondents are directed to refund the proportionate bid amount to the petitioner for the period it was not allowed to carry out the mining activities on the concerned five allotted sand ghats. The petitioner is also entitled to get simple interest over the said amount @ 6% per annum from the date it formally surrendered the mining leases to the respondent no. 5 vide its letter dated 15.10.2012 till the date of actual payment. However, we decline to order refund of royalty, registration fee and stamp duty paid by the petitioner for registration of the lease deed agreements. 40. The writ petition is, accordingly, disposed of with the aforesaid directions. 41. Pending interlocutory application, if any, also stands disposed of. (M.S. Sonak, C.J.) (Rajesh Shankar, J.) 18.06.2026 Vikas/A.F.R. Uploaded on 19.06.2026