Featured image for Supreme Court Judgment dated 11-08-2020 in case of petitioner name Common Cause vs Union of India & Others
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Orissa Mining Compensation Case: Supreme Court’s Ruling on Delay Condonation and Resumption of Mining

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The Supreme Court of India, in its judgment dated August 11, 2020, deliberated on the case involving M/s Orissa Minerals Development Company Limited (OMDC), which sought condonation of delay in payment of compensation and permission to resume mining operations. The case primarily revolved around the penalties imposed for illegal mining, compliance with the Court’s previous orders, and the rights of a mining company to continue operations after fulfilling legal obligations.

The dispute stemmed from the Supreme Court’s earlier ruling in Writ Petition (Civil) No. 114 of 2014, where OMDC was directed to pay compensation for illegal mining activities. The company subsequently delayed its payments, leading to legal proceedings to determine whether the delay should be condoned and whether mining activities could resume.

Background of the Case

The case originated with a petition filed by the organization Common Cause, which challenged illegal mining operations in Odisha. In its judgment dated August 2, 2017, the Supreme Court directed various mining companies, including OMDC, to pay compensation for mining activities conducted without necessary clearances.

The Supreme Court ordered:

  • Payment of compensation for illegal mining operations.
  • Completion of payments before December 31, 2017.
  • Restriction on further mining activities until payments were made.

OMDC failed to make timely payments, leading to the filing of multiple applications seeking condonation of delay and resumption of mining operations.

Petitioner’s Arguments (OMDC)

OMDC argued that:

  • The delay in payment of compensation was unintentional and caused by administrative and financial constraints.
  • They had now completed all payments, including interest, as per the Court’s orders.
  • Their mining operations had been halted, leading to financial distress and loss of employment for many workers.
  • They should be permitted to resume operations since they had complied with the compensation requirements.
  • The State of Odisha should be directed to conduct joint verification of undisturbed stock and allow its sale to recover funds.

Respondent’s Arguments (State of Odisha)

The State of Odisha, in its reply, stated that:

  • OMDC had indeed cleared all outstanding compensation payments along with interest.
  • The company had no further liabilities in terms of illegal mining penalties.
  • The request for delay condonation could be considered, provided all other statutory clearances were obtained before resuming operations.

Supreme Court’s Observations

The Supreme Court carefully examined the submissions and past compliance records, making the following key observations:

  • OMDC had fully paid the compensation amount, along with interest, as required under Section 21(5) of the Mines and Minerals (Development and Regulation) Act, 1957.
  • Since payments were made and acknowledged by the State of Odisha, the delay could be condoned.
  • Permission for resumption of mining operations could be granted, subject to obtaining all necessary statutory clearances.
  • The State authorities should conduct a joint verification of undisturbed stock and allow OMDC to sell the same following due procedures.

Final Verdict

The Supreme Court issued the following orders:

  • The delay in payment of compensation along with interest was condoned.
  • OMDC was permitted to resume mining operations, provided it obtained all necessary statutory clearances.
  • The competent officers of the State of Odisha were directed to conduct a joint verification of undisturbed stock and allow its sale following proper procedures.

Impact of the Judgment

The ruling had significant implications for the mining industry in India:

  • It reinforced the principle that mining companies must adhere to environmental and legal regulations.
  • It clarified that companies could resume operations once they fully comply with penalties imposed by regulatory authorities.
  • It ensured that delays in payment, when justified and rectified, could be condoned.
  • It provided a framework for other mining companies in similar situations to seek relief based on compliance.

By allowing the resumption of mining activities, the Supreme Court balanced legal accountability with economic considerations, ensuring that industries could recover while adhering to environmental and regulatory obligations.


Petitioner Name: Common Cause.
Respondent Name: Union of India & Others.
Judgment By: Justice S. A. Bobde, Justice A. S. Bopanna, Justice V. Ramasubramanian.
Place Of Incident: Odisha.
Judgment Date: 11-08-2020.

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