P L D 1969 Dacca 293 (PLP)

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20. Priority.‑If more than one application for the grant of Prospecting Licence of mining lease, in respect of the same land are made then unless the licensing authority in his discretion decides otherwise preference shall be given to the applicant who has, in accordance with these Rules, filled the application first." "

75. Priority.‑When applications for a prospecting licence or applications for a mining lease are presented in respect of the same area, by applications for a mining lease out being in possession of a prospecting licence in respect of that area, the prior 'to the concession whether licence or lease shall, subject to any order which the licensing authority may pass in any particular case, be deemed to lie with the applicant who, after compliance with the procedure prescribed by the rules, shall have been the first to file his appli cation with the licensing authority :‑ Provided that if the prior right to the concession is held to lie with an applicant for a lease the licensing authority may, in his discretion, grant him a licence instead." Mr. Khondkar, learned Advocate for the petitioner contends that the authorities are bound under rule 20 of the said Rules to give licence to his client as his client was the first applicant in regard to the matter in question. In developing his argu ment, Mr. Khondkar submitted that the discretion exercisable by the authorities in granting licence in the present case must necessarily be exercised judiciously and in confirmity with the rules, even though the order granting the licence was of executive nature. In the present case, the rules 20 and 75 are of a mandatory nature and, therefore, the licensing authority cannot, in violation of the mandate given in the said rules, refuse to grant licence to the first applicant. In support of his contention Mr. Khondkar submitted that since it was found that the East Pakistan Small and Cottage Industries Corporation, after obtaining licence from the Director‑General did not do anything in the matter whereas his client was ever ready to work from the very beginning of the grant of licence, if given, the discretion exercised by the authority in favour of the Corporation could not be said to have been properly exercised. Next be contended that, that the discretion was not properly exercised would be further evident from the fact that the chunk of 60 acres of land out of the allotment made to the Corporation had been given to respondent No. 5 which would show that the discretion in rejecting the application of the petitioner and giving licence to the Corporation in 1961 was not properly exercised. Of course, Mr. Khondkar had to concede towards the close of his argument that since his client's enterprise fell within the private sector and the East Pakistan Small and Cottage Industries Corporation fell within the public sector, the grant of licence to the said Corporation in preference to this client could not be very strongly argued to have been either illegally or illogically made. The learned Advocate‑General appearing on behalf of the respondents Nos. 1 to 3 produces before us the relevant files of the Department concerned containing the full notes and decision taken for and against the parties. Mr. Khondkar rather indicated to us that if upon reading the departmental papers we found that the discretion had not been improperly exercised, he would have very little to argue in support of his client's case. We have looked into the papers and we find firstly, that the reasons for the East Pakistan Small and Cottage Industries Corporation not working in the clay field immediately after obtaining the licence at the end of 1961 has been that the Corporation was in need of funds and sanctions from the Planning Authority for import of certain machineries for washing Clay and for developing the Ceramic Industries undertaken by it and this proceeding took some time. In the meantime the subject (Minerals) stood transferred to the Provincial List after coming into force of the 1962 Constitution of Pakistan and the Corporation applied to the Provincial Government for fresh licence in respect of the self‑same land. This application was made on 13‑7‑1965 and the licence was granted on 4‑9‑1965. It is stated by the learned Advocate‑General and is found from the records that the Provincial Government realised fees and rents from the Corporation with effect from the first date of granting of licence at the end of 1961 treating the licence granted in favour of the Corporation in 1961 to be a continued one. We shall deal with the grant of licence to respondent No. 5 in respect of 60 acres of land later. The question for decision is as to whether the petitioner has any right to call in question the grant of licence to the respondents Nos. 4 and 5 under Article 98(2) of the Con stitution. There is no doubt in our mind that in the matter of granting licence it is the sole discretion of the authority concerned. In the present case although rule 20 gives an indication that the first applicant should be preferred to subsequent ones, yet that has not been made mandatory on the licencing authority, as we read the rules, because of the provisions of discretion mentioned in the self‑same rule. It is for the licensing authority as we read the rules, to decide by exercise of its discretion as to whether any of the subsequent applicants should be preferred to the first applicant., This discretion, of course, we agree, should not be a whimsical one. In the present case the East Pakistan Small and Cottage Industries Corporation has two advantages over the petitioner. Firstly, that it is a semi‑Governmental Organisation within the public sector for the development of the cottage industries in the Province of East Pakistan and secondly, that the Corporation had undertaken the‑ production of Ceramics for which they needed raw materials and if any raw materials are available within the Province of the country, certainly they stand on a better footing than the petitioner. It is found from the records produced by the learned Advocate- General that the Corporation has after obtaining licence and necessary permission from the relevant authorities, spent more than eighteen lakhs of rupees for import of machineries for production of Ceramics and we are informed by the learned Advocate‑General that the Corporation is producing standard China‑Clay articles which have been released for sale in the open market. This fact of the Corporation producing China -Clay articles had not been controverted by Mr. Khondkar. In the facts, stated above, if the Director‑General, Bureau of Mineral Resources Government of Pakistan has, in prefer ence to the petitioner who was the first applicant, granted the licence to East Pakistan Small and Cottage Industries Corporation, we do not think that he exercised the discretion wrongly. We would rather say that it has been very rightly exercised. Similarly, with regard to the application of the Corporation, dated 17‑7‑1965 made to the Provincial Government quite sometime after an application had been made by the petitioner to the same Government for the same purpose, it may well be said that the discretion exercised by the Provincial Government in favour of the East Pakistan Small and Cottage Industries Corporation in preference to the petitioner has not been improperly exercised. In this connection it may be recalled that the Provincial Government treated the licence of the Corporation granted in 1961 by the Director‑General, Bureau of Mineral Resources, Government of Pakistan to be a continued one and for the whole period realised all rents and dues from the Corporation. In a matter like this it cannot by any strength of imagina tion, be said that the petitioner has a vested right in obtaining a licence. In spite of the fact that rule 20 speaks of the preferential treatment in respect of the first comer, yet the a provision of discretion made in that rule takes away the force of the preferential treatment that the first applicant can claim. The petitioner, if at all aggrieved, was aggrieved by the decision of the Director‑General, Bureau of Mineral Resources, Government of Pakistan when he in preference to the petitioner granted the licence to the East Pakistan Small and Cottage Industries Corporation. Although Article 98 of the Constitution was not available to him in October 1961, he could have filed a civil suit challenging the decision of the said Director- General if he felt aggrieved or a couple of months thereafter he could have made an attempt by filing an application under Article 98(2) of the Constitution when the same came to force on the 8th June 1962. From the papers and the records it is found that the petitioner was consistently in touch with the relevant department in regard to, this matter and it is difficult for us to accept the position as is contended by the petitioner that he did not come to know of the fact of granting licence by the Provincial Government to the Small and Cottage Industries Corporation in September 1965. It is argued by Mr. Khondkar that his application cannot be considered to have been delayed because his client was not aware of the grant of licence to the respondent No. 4 and later when another licence was granted to the respondent No. 5, he made enquiries from the Industries Department, Government of East Pakistan and found out about the latest position. He did not come to challenge that order until the 13th May 1966. The licence to the respondent No. 5 having been granted on 14‑4‑1966 the present application which was filed on 13‑5‑1966, according to Mr. Khondkar, cannot be considered to be delayed. In point of fact if the petitioner had any cause of action, that arose not with regard to the grant of licence to respondent No. 5 but with regard to the grant of licence to respondent No. 4 first in 1961 and then in 1965. However, even if we do not put much importance on the question of delay in filing this application, yet on merits, as we have already stated, it would become difficult to find in favour of the petitioner. The respondent No. 5, as we have indicated earlier, was granted a licence with regard to 60 acres of land which, unfortunately, lay within the block chat was granted to the East Pakistan Small and Cottage Industries Corporation. Records of this case were placed before us by the learned Advocate‑General and from these it is found that as soon as this grant of 60 acres of land was given to the respondent No. 5, the Chairman of the Small and Cottage Industries Corporation protested to the Secretary, Department of Commerce and Industries, Government of East Pakistan for having granted licence to the respondent No. 5 in respect of 60 acres of land falling within the block already licensed out to the Corporation. The records do not very clearly show as to under what circumstances the Corporation either agreed or was forced to part with the 60 acres of land in favour of respondent No.

5. Mr. Hamidul Haq Choudhury, learned Advocate, appearing on behalf of respondent No. 5 submitted that his client Messrs Pakistan Cermic Industries Limited had got the clay of this area tested as for back as in 1959 by Japanese and German Experts and after finding out that the clay was suitable for production of cermic articles obtained permission from the Government and loan from the different authorities for purchasing machineries for setting up Ceramic Factory and that when they were busy in processing all these, the petitioner filed an application before the Director‑General, Bureau of Mineral Resources, Government of Pakistan for a licence to work the clay found in the area. After the respon dent No. 5 had imported machineries, set them up and started working of the factory and found that they were in great difficulty with regard to raw materials, they applied to the East Pakistan Small Industries Corporation for supplying them one hundred tons of clay every month at the market rate for feeding their ceramic factory. The East Pakistan Small Cottage Industries Corporation having not yet been able to start the work, it is said by Mr. Choudhury that the Government decided to give facility to the respondent No. 5 to directly obtain the clay from a portion of the area licensed out to the East Pakistan Small Cottage Industries Corporation. Thus Mr. Choudhury wanted to show that there was no question of any preferential treatment being shown to his client by the licensing authority in the circumstances, stated above. Be that as it may, the argument of Mr. Khondkar that the grant of a licence for 60 acres of land to the respondent No. 5 relate back to the granting of licence to the East Pakistan Small Industries Corporation either in 1961 or in 1965 in regard to improper use of the discretion is some thing which he find it difficult to accept. Mr. Khondkar wants to say that because in 1966 sixty acres of land was licensed out to the respondent No. 5 it must be held that the dis cretion exercised by the authority in 1965 in granting the licence to the East Pakistan Small and Cottage Industries Corporation in preference to his client must be bad both in law and on facts, as according to him, the granting of licence to the East Pakistan Small and Cottage Industries Cor poration was with the ulterior motive of subsequently giving a portion of the land to respondent No.

5. We find nothing on record to connect this grant of 60 acres of land to respondent No. 5 with the granting of 1053 acres of land to the East Pakistan Small Industries Corporation in 1965. If Mr. Khondkar could show that respondent No. 5 had applied at or about the time when his client as well as the East Pakistan Small and Cottage Industries Corporation had made the application and then to avoid his client, the authorities gave the licence to the East Pakistan Small and Cottage Industries Corpo ration with a view subsequently to giving a portion to respondent No. 5 then and then alone, it could be said that the grant of licence of the entire land to the East Pakistan Small and Cottage Industries Corporation was motivated and that the discretion contemplated in Rule 20 exercised by the authorities was improper, and, therefore, could not be sustained in law. We find nothing of the sort on records to agree with the conten tion of Mr. Khondkar. The petitioner, we are informed and Mr. Khondkar admits, has a mining lease from the Government in respect of 1600 acres of land in the same area lying adjacent to the land licensed out to the East Pakistan Small Industries Corporation for as many as 30 years for recovery of China -Clay. This is a fact which may as well be taken into consideration. The petitioner is holding almost double the land than the East Pakistan Small and Cottage Industries Corporation in the same area and, as such, it cannot be said that the petitioner, even though he applied first, has been deprived of this type of business which is a new venture for the "Kohinoor Aluminium Works". If the petitioner's applica tion was allowed by the Director‑General, Bureau of Mineral Resources, Government of Pakistan or by the Provincial Government knowing the fact of their holding lease for 30 years of 1600 acres of land in preference to two other appli cants who are dealing with ceramic and had ceramic factories, namely, respondents Nos. 4 and 5, then we think, it could without any fear of contradiction be said that the discretion exercised in favour of the respondent No. 4 has been improper. That would have given the petitioner the monopoly and all other ceramic factories would have been solely dependant upon the mercy of the petitioner in regard to the supply of raw materials for consumption in the factories. Thus we find that the licences granted to the respondents Nos. 4 and 5 by the Government in respect of thousand acres of land has not been done in violation of any law or rules or the normal working of the Government whose duty it is to see that "all Enterprisers are created equally. In conclusion, we find no right vesting in the petitioner to challenge the impugned orders under Article 98 of the Constitution and also that on merits the petitioner has not been able to make out any case in his favour. We may repeat that Mr. Khondkar has frankly conceded that between him and the Corporation it is difficult for him to say that an order in favour of the Corporation can be said to have been made improperly. Thus we find no substance in this application and the Rule is accordingly discharged without any order as to costs. ABDUL HAKIM, J.‑I agree. A. E. Rule discharged.