Pakistan Mineral Development Corporation (PMDC) has approached the Supreme Court against the Sindh High Court verdict on grant of mining lease to M/S Sindh Lakhra Coal Mining Company (Pvt). The PMDC on Saturday filed an appeal under Article 185(3) of Constitution and made Sindh province through secretary Energy Department, DG (Licensing Authority) Coal Mines Development, and M/S Sindh Lakhra Coal Mining Company (Pvt) Ltd as respondents. It requested the apex court to set aside the SHC judgement.
The petitioner, PMDC, being a company in corporate sector, was granted two prospecting licences on 18-04-1984 for excavation/exploration of coal over an area of 3818.18 acres in Lakhra, district Dadu, for one year. The petitioner, pursuant to prospecting licence, carried out a widespread and detailed exploration and evaluation of the area through Japan International Cooperation Agency (JICA) and USAID at a cost of US $12 million in addition to local counterpart funds to the tune of Rs 31.million.
The DG (Licensing Authority) Coal Mines Development converted the prospecting licences into mining leases under Pakistan Mining Concession Rules, 1960, for 30 years on 08-04-1985, which expired on 15-04-2015. The petitioner mentioned that it developed the Lakhra Coal Project with state-of-the-art equipment and produced good quality of coal ranging between 175,000 tonnes to 260,000 tonnes per year and the main consumer is Wapda thermal power plant.
The PMDC contended that as per Clause 58 of the lease deed and Rules 48 and 52 of Sindh Mining Concession Rules, 2002, it is entitled to the renewal of these leases. Therefore its project manager submitted around 11 applications to DG Mines Sindh from 12th November 2014 to 8th December 2016. However, the DG (Licensing Authority) Coal Mines Development refused to renew the mining lease to the petitioner.
Resultantly, it filed an appeal under Rule 71 read with Rules 48 and 52 of Sindh Mining Concession Rules, 2002 before the Secretary Energy Department, Sindh, which was also dismissed vide order dated 8th November, 2018.
The petitioner claimed that during the pendency of appeal, the DG (Licensing Authority) Coal Mines illegally and with mala fide granted mining permit to Sindh Lakhra Coal Mining Company (Pvt) Ltd in sheer violation of Rules 2002.
The petitioner submitted that it is expressly provided in the Rules 2002 that till the decision of renewal application, lease shall not expire, and that licensing authority shall not grant lease to the other party during subsistence or in continuation of such lease.
However, the DG Licensing in contravention of the rules and procedures, "without observing codal formalities," granted mining lease to Lakhra Coal Mining Company.
The petitioner contended that the mining permit was granted during the period of caretaker government which is in contravention of Section 230 of Election Act, 2017 as well as in violation of Supreme Court judgment that grant of mining lease does not come within the ambit of day to day affairs.
The petitioner also contended that under Sindh Mining Concession Rules 2002, before grant of mining lease, prospecting licence or quarrying of mineral, prior approval of government is mandatory, whereas, in awarding of this lease no approval was sought from the cabinet which is not only contrary to law but also had caused huge loss to the public exchequer.
It submitted that DG (Licensing Authority) Mines Development, being public functionary, is bound to act fairly, transparently, objectively, reasonably and justly as huge public money is being utilised for grant of mining lease.
"The respondents are acting in most unfair, unjust, unreasonable, mala fide, discriminatory and illegal manner and the entire process of impugned refusal of renewal of mining lease to the petitioner and grant of mining permit to the R-3 is being undertaken in sheer violation of Rules 68 of Sindh Mining Concession Rules, 2002.
"Neither was Sindh Public Procurement Regulatory Authority consulted nor was any advertisement in this regard ever published and entire exercise was carried out hurriedly and haphazardly in order to benefit and favour certain individuals irrespectively of public interest.
"The petitioner is bound to supply coal to the government-owned power generation sector at subsidised rates and discontinuation of coal supply to the power sector will exacerbate the gap between demand and supply of electricity in the country."
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