Goa Mining Scam: Bombay HC & Environment Min Have a Lot to Answer

The SC cancelled all mining leases in Goa and criticised the Goa Govt. But were they the only ones to blame?

On 7 February 2018, the Supreme Court of India cancelled all 88 iron ore mining leases in the State of Goa for being contrary to the law and the directions previously given by the Court in 2014. In their judgment, Justices Madan Lokur and Deepak Gupta strongly criticised the decision of the BJP government in Goa to grant the leases – all of which were second renewals of previous leases – calling it:

A hasty charade, regardless of violations of the law by the mining lease holders, without any benefit to the Indian industry and without any concern for the health of the average Goan.

However, while this aspect of the judgment has been reported on, the whole fiasco was not created by the state government alone, but also relied on the Union Ministry of Environment and Forests (MoEF), as well as the Bombay High Court (at Goa). It was the High Court that directed the state government to grant renewals of the leases (the previous leases had expired in 2007), and the MoEF that lifted blocks on environmental clearances for the mining companies.

All of this took place despite the Supreme Court’s decision in 2014 in which they’d declared all mining leases operating in Goa to be illegal, and said that the state government had to frame a new policy on mining, which had to be followed for any mining operations to be allowed. This leads to some uncomfortable questions for not just the Goa government, but also the Bombay High Court and the union government.

The HC’s Questionable Decision

How did the case reach the High Court and why was it significant?

The Justice Shah Commission had prepared a report in 2012 on illegal mining in Goa. It found widespread, gross violations of the law in the way that mining was taking place in Goa, with severe environmental impacts. Further to these findings, in April 2014, the Supreme Court found that all mining taking place in Goa since November 2007 was illegal. However, this did not affect the legality of the mining leases which had all expired in 2007. It should be noted that these leases were also not new ones – they were already renewals of leases which had expired in 1987.

After the Supreme Court’s decision in April 2014, the mining companies filed petitions before the High Court of Bombay at Goa, in which they asked for renewals of the leases which had ended in 2007 since they had already paid stamp duty and fees for renewals. In August 2014 the High Court decided to accept the argument raised by them, and directed the state government to grant the renewals (the Lithoferro case).

This was then used as the basis for the state government to renew the leases from November 2014-January 2015 – which the Supreme Court has now quashed.

Why was the High Court decision wrong?

The High Court decision turned on how they interpreted the Supreme Court’s 2014 judgment. However, the apex court’s judgment was very clear in saying that all mining in Goa had to take place on the basis of fresh leases, which were to be granted in accordance with a new policy. Even the state government had accepted this, according to their arguments before the High Court. A subsequent Supreme Court decision in October 2014 also took this as a given.

It is quite often possible for there to be contrary interpretations of the law, but there is very little scope for that in this case. Accordingly, the Lithoferro decision is described by Justices Lokur and Gupta (in the 2018 Supreme Court judgment) as erroneous, and based on a “totally incorrect” understanding by the High Court. As a result, they set aside the High Court judgment.

What needs to be done about this?

Without the High Court decision, the state government would not have had any legal authority to grant renewals of leases. Because of this, mining had resumed despite severe harm to the environment and the people of Goa. These are severe consequences.

This is not something that should be easily ignored, and yet there has been little to no comment on this aspect of the whole controversy. There are two potential ways we can look at this. One, as a failure of legal training and reasoning; the other is to apply the same criticism used by the Supreme Court for the Goa Government: “that the rule of law was not their concern.”

At this time, we do not wish to bandy about accusations without any basis, and so we should not be espousing either, especially the second. However, there needs to be some sort of inquiry into how this decision was made, by the judiciary themselves. Whether the result is to conduct more training for judges or a further investigation, it is important to do so, to prevent any further miscarriages of justice whether in this case or others.

The Ministry of Environment and Forests Drops the Ball

What did the Ministry do?

Prior to the Supreme Court’s decision in 2014, the MoEF had already suspended all environmental clearances granted to the mines in September 2012. However, when the state government granted renewals to the leases in 2014-15, they requested the MoEF to lift the restrictions so that the mining operations could continue.

The MoEF decided to agree to the Goa Government’s request, lifting the block on the suspended clearances and also passing an order which expressly said that no fresh environmental clearances were needed for any renewal of leases.

What was wrong with the Ministry’s decision?

The MoEF decision appears to be wrong on several counts.

1. First, the Supreme Court’s 2014 decision expressly says that the Ministry would have to grant fresh environmental clearances for mining projects to go forward (para 67).
2. Secondly, the environmental clearances for several of the leases being renewed had already expired by 2014-15. This meant that the Ministry’s order that no fresh clearances would be required for any renewal of leases was incorrect, and violated previous Supreme Court orders. Even where clearances had not expired, the fact that the Supreme Court had directed the Ministry to grant fresh clearances for all further mining, meant that the Ministry’s order got it wrong.
3. Thirdly, and perhaps most worryingly, the MoEF appear to have made their decision without considering the extent to which the conditions for the old environmental clearances had been violated by the mining companies. These violations had been key to the Shah Commission’s finding that mining in Goa had been illegal. The mining companies had extracted much more ore than they were allowed to under the clearances received, some incurring fines to the tune of Rs 1,500 crore. The Ministry, however, saw fit to lift all blocks on the clearances, including for companies which hadn’t paid the fines or even given assurances to do so.

What needs to be done about this?

The Supreme Court also expressed its disturbance at the decision of the MoEF, which it felt had been taken without application of mind,and by ignoring the law and the misconduct of the mining companies. Unfortunately, no further punitive action is provided for or even suggested, even though the Court seems to indicate that this smacks of collusion, saying “The inferences that can be drawn are quite obvious.”

Like the decision of the Bombay High Court, the Ministry’s lifting of the block on environmental clearances also enabled the state government’s actions, as without this, the mining operations could not have been resumed in Goa. An investigation into the failure of the MoEF needs to be conducted by a Parliamentary Standing Committee at the very least, to understand why the Ministry caved in to the demands of the Goa government despite having clear grounds to refuse to do so.

The fact that both the union and state governments were of the same political party isn’t good enough. The Environment Ministry has to be above such considerations, and must take its decisions after considering all relevant expert reports – something the Supreme Court found it had failed to do – and must ensure it is following the law correctly.

Any failures to do so must be dealt with strictly and action taken to ensure this doesn’t happen again. Although he wasn’t the minister back then, one would expect someone like Dr Harsh Vardhan to realise the importance of doing so and conduct a review of the Ministry’s actions.