In a significant ruling, the Odisha High Court on Wednesday upheld the State Government’s circular of December 2012 in which the Government had asked the mines owners in the State to supply half of their mine lumps to local standalone units. Dismissing a batch of petitions, including that of the petition of the Federation of Indian Mining Industries (FIMI), a Division Bench of Chief Justice AK Goel and Justice AK Rath observed that the step taken by the State Government is valid as a right of preemption.
The State Government on December 5, 2012 had come out with a circular asking the mine owners to allocate 50 per cent of their produce to the units without captive powers as an attempt to regulate the mining activities in the State.
The circular issued by the Director of Mines had authorised the competent mining officials to monitor and implement the directives with immediate effect. However, terming the directive as “restrictive”, the FIMI, the apex mining industry body of the country, challenged the same before the Central Government. Entertaining the FIMI plea, the Central Government in February 2013 had asked the State Government to withdraw the December 2012 directive.
When the State Govt did not pay heed to the Central Govt’s instruction, the FIMI and a few other mines owners had approached the Odisha HC seeking judicial intervention to quash the State Government’s order.