The Orissa High Court held that the cancellation of a lease under the Odisha Minor Mineral Concession Rules, 2016 cannot be treated as illegal merely because the order was issued by a Mining Officer functioning in an “in-charge” capacity. The Court clarified that when statutory rules designate a particular office as the competent authority to take decisions, the powers attached to that office can be exercised by an officer who is temporarily holding charge of the post in the absence of the regular incumbent. The Court observed that administrative functioning cannot come to a standstill simply because the regular officer is not available, and that an officer entrusted with the responsibilities of the post during such absence can validly exercise the powers assigned to that office.
The ruling was delivered while the Court was considering a writ petition challenging the cancellation of a quarry lease granted under the Odisha Minor Mineral Concession Rules. The petitioner approached the High Court seeking to set aside the cancellation order primarily on the ground that the order had been issued by a Mining Officer who was functioning only as an in-charge officer. According to the petitioner, the statutory rules authorize only the Mining Officer as the competent authority to cancel a lease, and therefore a person holding charge of the post did not have the legal authority to exercise such power.
The dispute originated from the grant of a quarry lease following an auction process conducted by the authorities. A notice inviting tender had been issued for auctioning certain sairat sources. The petitioner participated in the auction and emerged as the highest bidder. After the completion of the bidding process, an agreement was executed between the petitioner and the authorities granting the lease for a period of five years.
Under the terms of the agreement and the statutory rules governing such leases, the petitioner was required to deposit royalty and other statutory payments for every financial year during the period of the lease. The petitioner deposited the required royalty and related charges for the first financial year after the lease agreement was executed. However, he subsequently failed to deposit the statutory amounts for the remaining financial years covered by the lease.
Due to this failure, the authorities initiated action in accordance with the provisions of the Odisha Minor Mineral Concession Rules. A demand notice was issued requiring the petitioner to deposit the outstanding statutory dues. When the petitioner did not comply with this demand, the authorities issued a reminder reiterating the requirement to deposit the pending amounts. Despite receiving these communications, the petitioner did not respond and did not clear the dues.
As the non-payment continued, the authorities issued show-cause notices to the petitioner. These notices were issued by the Mining Officer who was holding charge of the office at that time. Through these notices, the petitioner was asked to explain why action should not be taken for violation of the terms and conditions of the lease agreement and the relevant statutory provisions governing quarry leases. The petitioner did not submit any response to the show-cause notices.
Since the petitioner neither responded to the notices nor deposited the required statutory amounts, the authorities concluded that there had been a breach of the conditions of the lease. As a result, the lease granted in favor of the petitioner was cancelled and the security deposit made at the time of execution of the lease agreement was forfeited. The cancellation was carried out by invoking the provisions of the Odisha Minor Mineral Concession Rules that permit the competent authority to cancel a lease in cases where the lessee violates the terms and conditions of the agreement.
The petitioner challenged this action before the High Court through a writ petition. The central argument raised in the petition was that the cancellation order was invalid because it had been issued by an in-charge Mining Officer rather than by the regular Mining Officer. The petitioner argued that the statutory rules clearly specify that the competent authority to cancel a lease is the Mining Officer. According to the petitioner, since the person who issued the order was not the regular office-holder but only an officer holding charge of the position, the order lacked legal authority and should therefore be set aside.
The High Court examined the provisions of the Odisha Minor Mineral Concession Rules to determine whether the order had been issued by a competent authority. The Court referred to the rule that empowers the competent authority to cancel a lease or impose a penalty if the lessee violates any of the conditions of the lease deed. The rule also requires that before such action is taken, the lessee must be given notice and an opportunity to respond.
The Court also examined the definition of the term “competent authority” contained in the rules. According to this definition, the competent authority refers to the officer specified in the relevant schedule attached to the rules. The schedule provides that for minor minerals other than certain specified categories occurring within village boundaries, the competent authority is the Mining Officer of the concerned jurisdiction under the Steel and Mines Department.
After examining these provisions, the Court observed that the petitioner had clearly breached the terms of the lease agreement by failing to deposit the statutory amounts required under the agreement and the rules. The Court noted that several notices had been issued to the petitioner requiring him to clear the outstanding dues and to explain the default. Despite receiving these notices, the petitioner had neither responded nor complied with the requirements.
In light of these facts, the Court stated that the only issue that needed to be examined was whether the Mining Officer functioning in an in-charge capacity had the authority to cancel the lease in the absence of the regular Mining Officer. The Court considered the broader principles governing administrative functioning within government departments.
The Court observed that the functioning of administrative departments depends on the allocation of powers and responsibilities to various officers. When an officer holding a particular post is unable to perform the duties of that office due to absence, transfer, or other circumstances, the functioning of the department cannot be suspended. In such situations, another competent officer may be entrusted with the responsibility of performing the duties of the post so that the work of the department continues without interruption.
The Court emphasized that administrative posts cannot remain inactive simply because the regular officer is not available. When powers and responsibilities are temporarily assigned to another officer to perform the functions of the post, the exercise of those powers by such an officer cannot be treated as illegal. According to the Court, allowing departmental functions to remain inoperative due to the absence of a particular officer would create an administrative vacuum and disrupt the functioning of government institutions.
Applying these principles to the present case, the Court held that the Mining Officer who was functioning in an in-charge capacity had been entrusted with the responsibilities of the post during the relevant period. Since the statutory rules designate the office of the Mining Officer as the competent authority to cancel a lease, the powers attached to that office could be exercised by the officer holding charge of the post.
The Court therefore concluded that the cancellation order issued by the in-charge Mining Officer could not be treated as invalid merely because he was temporarily performing the duties of the office. The authority to exercise the statutory powers of the post extended to the officer entrusted with the responsibilities of that post during the absence of the regular office-holder.
After examining the facts and the legal provisions, the Court found no reason to interfere with the cancellation order. It noted that the petitioner had failed to comply with the obligations imposed by the lease agreement and had not responded to the notices issued by the authorities. In these circumstances, the authorities were justified in cancelling the lease and forfeiting the security deposit.
Accordingly, the High Court dismissed the writ petition and upheld the cancellation of the lease. The Court reaffirmed that an order issued by an officer holding charge of a statutory post cannot be considered invalid merely because the officer is serving in an interim capacity, provided that the officer has been entrusted with the responsibilities and powers of that office.
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