The Orissa High Court has dismissed a writ petition filed by a quarry lease holder challenging the cancellation of his lease for failing to pay statutory dues. The court ruled that the authorities acted within their legal powers after repeated notices went unanswered and confirmed that the Mining Officer (In-charge) was competent to pass the cancellation order under the applicable rules.
Background of the Case
The case arose after a tender was issued for auction of certain sairat sources (minor mineral extraction rights) in Odisha. Narendra Nath Singh emerged as the highest bidder and signed a lease agreement with the government on 28 December 2020, granting him rights for five years.
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According to court records, the petitioner paid royalty and other charges only for the financial year 2020-21. For the subsequent years, the required statutory payments were not made.
Officials from the Deputy Director of Mines, Khordha Circle issued demand notices and reminders seeking payment. When no response came, authorities issued show-cause notices on 28 November 2024 and 19 December 2024 asking the petitioner to explain the default.
As the notices also went unanswered, the department cancelled the lease and forfeited the security deposit under the Odisha Minor Mineral Concession Rules, 2016 (OMMC Rules).
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Petitioner’s Arguments
Before the High Court, the petitioner challenged the cancellation mainly on two grounds.
First, he argued that his application seeking renewal or extension of the lease period was pending, and therefore the authorities should not have cancelled the lease during that time.
Second, he contended that the order was legally invalid because it was passed by the Mining Officer (In-charge). According to him, only the “Competent Authority” defined under the OMMC Rules could cancel a lease, and the officer who issued the order did not have such authority.
On this basis, the petitioner asked the court to quash the cancellation order.
Court’s Observations
The bench comprising the Chief Justice and Justice Murahari Sri Raman examined the relevant provisions of the OMMC Rules.
The court noted that Rule 51(7) allows the “Competent Authority” to cancel a lease or impose a penalty if the lessee breaches conditions of the lease after being given notice and time to rectify the violation.
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The judges observed that multiple notices had been issued to the petitioner regarding non-payment of royalty and other charges, but he did not respond or take corrective steps.
“The show-cause notices were basically founded upon non-payment of royalty and other charges… and it does not appear from the pleadings that the petitioner has deposited the same,” the bench recorded.
The court therefore concluded that there had been a continuous breach of the lease conditions, making the cancellation action justified.
Whether the Mining Officer Had Authority
The High Court also addressed the petitioner’s argument about lack of authority.
Referring to Rule 2(1)(f) and Schedule-IV of the OMMC Rules, the bench explained that for minor minerals within village boundaries, the Mining Officer of the jurisdiction is designated as the “Competent Authority.”
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The court held that the Mining Officer (In-charge) could exercise the same powers when entrusted with the duties of the post.
The bench noted that in administrative functioning, departments cannot stop working simply because a particular officer is absent or the post is vacant. In such situations, another authorized officer can discharge the responsibilities.
“If such powers are exercised, it cannot invite illegality,” the court observed while rejecting the petitioner’s argument.
Court’s Decision
After examining the record and the statutory provisions, the High Court concluded that the cancellation order had been passed by a competent authority and was legally valid.
Finding no merit in the challenge, the bench dismissed the writ petition.
“The writ petition fails and is dismissed,” the court held, adding that there would be no order as to costs.
Case Title: Narendra Nath Singh v. State of Odisha & Others
Case Number: W.P.(C) No. 2610 of 2026
Decision Date: 17 February 2026
