1

GRANT OF QUARRY LEASES

Grant of quarry lease:—

(1) The area of the quarry lease shall be delineated and notification inviting application(s)for

grant of quarry lease(s) through auction shall be published in two daily newspapers, at
least one of which shall be a State level and other having wide publicity in the area, where
the lease is located and such notification shall be published at least fifteen days before
the intended date of inviting applications and shall contain the date and time within
which applications shall be received.

(2) The notice inviting applications for grant of quarry lease shall be issued by the Competent

Authority and shall specify the minimum guaranteed quantity of the minor mineral to be
extracted in a year by the applicant and the minimum amount of additional charge payable
for the same

(3) In case the mining plan or Environment Clearance for the proposed lease has been obtained

by the Competent Authority, this fact, along with the cost of obtaining thereof shall be
recoverable from the selected bidder which shall also be mentioned in the notice.

(4) Subject to other provisions of these rules for settlement of quarry lease, the intending

applicant may apply to the Competent Authority in a sealed cover for grant of quarry lease
for such area or areas in Form-M in triplicate accompanied by the following documents and
particulars, namely:—
(i) Treasury challan showing deposit of one thousand rupees (non-refundable) towards
the application fee;
(ii) An affidavit stating that no mining due payable under the Act and the rules made

thereunder, is outstanding against the applicant;

(iii) Proof of payment of earnest money equivalent to 5% of the minimum amount of

additional charges specified in the notice and the amount of royalty, both calculated
 2

on the basis of minimum guaranteed quantity for one whole year for the minimum
guaranteed quantity of minor mineral to be extracted in one full year; and
(iv) a solvency Certificate or Bank guarantee valid for a period of eighteen months for an

amount not less than the amount of additional charge offered and the royalty payable
for the minimum guaranteed quantity for one whole year and a list of immovable
properties from the Revenue Authority.

(5) Subject to the provisions of these rules, the quarry lease shall be granted in favor of the

applicant who has quoted the highest rate of additional charge

(6) The selected bidder shall be intimated by the Competent Authority within seven days in

Form-F about the selection and terms and conditions of the lease.

(7) Within fifteen days of such intimation, the selected bidder shall be required to convey his

acceptance of the terms and conditions and to deposit an amount which shall be calculated
in such a way that it shall be equivalent to one-fourth of the total amount of royalty and
additional charge and the amount of contribution payable to the District Mineral
Foundation on the annual minimum guaranteed quantity, taken together, reduced by the
amount of earnest money, which, along with the earnest money, shall be held as interest-
free security deposit.

(8) The selected bidder shall also deposit the costs of obtaining the mining plan and

environmental clearance approvals, in case those have been obtained by the Competent
Authority (non-refundable) before executing the lease deed.

(9) The selected bidder shall be required to execute quarry lease in Form-N within three weeks

from the date of intimation of his selection, if the approval of the mining plan and
environment clearance has been obtained before auction, and in other cases, three months
from the date of intimation, failing which, the intimation shall stand cancelled and the
 3

security deposit shall stand forfeited:

(10) Security deposit shall be refunded after expiry of the lease period if the lessee has

fulfilled all conditions of lease and in case of violation of any of the conditions of lease, the
security deposit shall be forfeited in whole or in part by the Competent Authority.

(11) The minimum amount of additional charge to be quoted shall be such as the Competent

Authority, in consultation with the Controlling Authority, decide and specify in the notice
inviting applications for grant of quarry lease:
Provided that the minimum amount of additional charge so fixed should not be less than 5%
of the rate of royalty.

(12) Where the lessee, who has quoted the highest rate of additional charge, dies after deposit

of the amount specified under rule 42 or after execution of lease deed by him, such deposit
or deed shall be deemed to have been made or executed by the legal heir or legal
representative, if they so like.

Mining plan as a pre-requisite to the grant of quarry lease:—

(1) No quarry lease shall be granted by the Competent Authority unless there is a mining plan

prepared by the recognized person and duly approved by the authorized officer for the
development of the mineral deposits in the area concerned.

(2) The Competent Authority may cause the mining plan to be prepared and approved.

(3) In case the approval under sub-rule (2) has not been obtained by the Competent Authority,

the selected bidder shall cause a mining plan to be prepared from a recognized person and
approved by the authorized officer having jurisdiction.
 4

(4) The recognized person shall prepare the mining plan in Form-O within thirty days from the

date of receipt of communication from the selected bidder or Competent Authority and
submit the same to the authorized officer for approval.

(5) The authorized officer shall, after receipt of the mining plan from the recognized person,

approve the same within thirty days from the date of receipt of the mining plan or its
modification (s), if any, desired by him.

(6) The mining plan for quarry lease shall contain,—

(i) the plan of area showing the nature and extent of the mineral body, spot or spots where
the mining operations are proposed to be carried out by the applicant;
(ii) details of mineral reserve of the area;
(iii) the extent of manual mining or mining by the use of machinery and mechanical devices
on the area;
(iv) the plan of the area showing natural water course, limits of reserve and other forest
areas and density of trees, if any, assessment of impact of mining activities on forest, land
surfaces in the vicinity of the spot of mining, details of the scheme of restoration of the
area by afforestation, if required, land reclamation and use of pollution control devices;
(v) annual programme and plan for excavation on the area; and
(vi) a progressive mines closure plan.

(7) The selected bidder shall bear the cost for preparation of the mining plan.

Environment clearance for grant of quarry lease: –

(1) No quarry lease for minor minerals other than the specified minor minerals shall be granted
without the approval of the appropriate authority under the provisions of the Environment
(Protection) Act, 1986.
(2) The Competent Authority may apply for and obtain the environmental clearance.

(3) In case the clearance under sub-rule (2) has not been obtained by the Competent Authority,
the selected bidder shall obtain the environmental clearance before executing the lease
 5

deed.
(4) The lessee shall be responsible for obtaining environment clearance and implementing the
environment management plan.

Liability for payment of royalty, dead rent, surface rent, additional charge, amount of
contribution payable to the District Mineral Foundation, amount of contribution payable to
the Environment Management Fund:—

(1) All the lessees for minor minerals other than specified minor minerals shall be liable to pay

royalty or dead rent, surface rent, additional charge, amount of contribution payable to the
District Mineral Foundation, amount of contribution payable to the Environment
Management Fund and fees for compensatory afforestation.

(2) The lessee shall pay to the State Government every year dead rent and surface rent at the

rates specified in Schedule-I for all the areas included in the lease deed and royalty at the
rates specified in Schedule-II:
Provided that the rates specified in Schedule-I and Schedule-II may be revised by the
Government, from time to time, by an amendment made to the said Schedules, but no
revision shall be made before the expiry of three years from the date when the rates were
last fixed:
Provided further that where the lessee becomes liable for payment of royalty for any minor
mineral removed or consumed by him or his agent, manager and employees or the
contractor from the leased area, he shall be liable to pay either such royalty or the dead rent
whichever is higher.

(3) In addition to the surface rent, dead rent or royalty, as the case may be, the lessee shall be

liable to pay additional charge, amount of contribution payable to the District Mineral
 6

Foundation and an amount of contribution payable to the Environment Management Fund

in advance, on annual basis on the minimum guaranteed quantity of minor minerals even if
the actual extraction falls short of such quantity.

(4) In case the actual extraction exceeds the minimum guaranteed quantity, such mineral may

be removed from the lease area only after payment of royalty, additional charge, amount
of contribution payable to the District Mineral Foundation and an amount of contribution
payable to the Environment Management Fund on pro-rata basis.

(5) The royalty, additional charge, amount of contribution to the District Mineral Foundation

and amount of contribution payable to the Environment Management Fund for the period
up to commencement of the next year shall be paid on a pro-rata basis before the execution
of lease deed.

(6) For the purpose of determination of minimum guaranteed quantity in the cases where the

lease has been executed on or after the 1st April, the minimum guaranteed quantity for the
first financial year shall be equal to the minimum guaranteed quantity divided by twelve and
multiplied by the number of months remaining in the first year of the lease, treating part of
any month as full month.

(7) The lessee shall pay, in addition to the surface rent, dead rent or royalty, additional charge,

amount of contribution payable to the District Mineral Foundation and to the Environment
Management Fund, fees for compensatory afforestation at rates as may be specified by the
Government from time to time.

Conditions of quarry lease:—

(1) The lessee shall pay to the State Government surface rent before the execution of the lease-

deed for the remaining period of the year and thereafter pay such yearly rent on or before
the 15th January of every year.
 7

(2) The lessee shall pay dead rent for the remaining period of the year before the execution of

the lease deed and thereafter pay yearly dead rent on or before the 15th January of every
year and an account of the royalty payable by him shall be kept by the Competent Authority
and as soon as the royalty payable by him becomes equal to or in excess of the dead rent
already paid by him, he shall remove the minor minerals only after payment of the royalty
and in such cases advance dead rent paid by him shall be deemed to have been merged into
the amount of royalty he was liable to pay.

(3) The lessee shall pay to the Government, compensation for all damages, injuries or

disturbance which has been caused by him in the course of mining operation and shall
indemnify the Government against all claims which may be made by third parties in respect
of such damage, injury or disturbances.

(4) The lessee shall commence quarrying operations within three months from the date of

execution of the lease deed which shall be carried on in a proper, skillful and workman-like
manner and the lessee shall send to the Director and Deputy Director or Mining Officer
concerned, under whose jurisdiction the area is located and to the Director of Mines Safety,
Bhubaneswar an intimation in Form-H of the opening or reopening of the quarry so as to
reach them within a period of fifteen days from the date of such commencement.

(5) If the lessee does not work upon the quarry for a continuous period of six months, the lease

shall be liable to be cancelled, unless prior permission has been granted by the Competent
Authority for such stoppage on reasonable grounds.

(6) The lessee shall not carry on or allow to be carried on, any quarrying operation at any point

within a distance of:—

(a) one hundred meters from any Railway line (except under and in accordance with the
 8

written permission of the Railway Administration concerned) and in case of National

Highway, State Highway, monuments, heritage sites, or any reservoir; except in
accordance with the previous permission of the Collector.
(b) fifty meters from any tank, canal, road(other than a National or State Highway or other

public works or buildings or inhabited sites), except under in accordance with the
previous permission of the Collector.

(7) The lessee, with prior written permission of the competent authority, can erect at his own

cost, temporary structures including buildings required for the purpose of quarrying
operation within the leased area, without violating any law or obstructing any natural flow,
community access or without causing damage to any embankment or public property, which
shall be dismantled by the lessee at his own cost on completion of the lease term or on
determination of the lease. The competent authority can pass orders to dismantle such
structures if found erected illegally or causing damage to public.

(8) The lessee shall obtain permission of the competent authorities of the Forest Department,

Odisha to carry on any operation in forest area.

(9) The lessee shall keep correct accounts of minor minerals other than specified minor

minerals quarried and dispatched and shall furnish a quarterly return in Form-P and annual
return in Form-K to the Competent Authority and the Director.

(10) The lessee shall afford reasonable facilities for inspection of the quarries, accounts and

records pertaining to quarrying operation, to the Competent Authority and Director or any
other officer authorized by any of them and such officer may issue directions to prevent
wasteful extraction of minerals and to ensure observance of the provisions of rules and
specify the time limit not exceeding sixty days within which the directions shall be complied
with.
 9

(11) If the lessee does not allow the inspecting officer reasonable facilities for inspection or fails

to comply with the directions within the specified time limit, the Competent Authority may
forfeit the whole or part of the security deposit paid by the lessee or impose penalty not
exceeding rupees fifty thousand and may cancel the lease and forfeit the security deposit.

(12) The lessee shall report about all accidents involving injury or loss of life or loss or damage

to property forthwith to the concerned Competent Authority and Collector of the District.

(13) If any Government dues payable under the lease deed remain unpaid for one month

beyond the date fixed in the lease deed for such payment, the Competent Authority or any
officer authorized by him may enter into the leased area and seize all or any of the minor
minerals or other movable properties and may dispose of such seized minor minerals or
properties towards sufficient satisfaction of the Government dues and all costs and
expenses occasioned by the non-payment thereof and if any such government dues remain
unpaid over two months beyond the date fixed in the lease agreement for such payment,
the Competent Authority may determine the lease, and take possession of the leased area
on re-entry without prejudice to such action as may be taken under the provisions of the
Odisha Public Demands Recovery Act, 1962 for recovery of such dues.

(14) The lessee shall remove all minor minerals extracted before the end of the lease period or

of its determination, if it is determined earlier, and all other materials and structures within
such reasonable period not exceeding two months or as the Competent Authority may allow.

(15) All minor minerals, materials, machineries, buildings and other structures, left in the

leased area after the date-line fixed or time allowed by the Competent Authority shall be
deemed to be the property of the Government and the Competent Authority may dispose
of such property by public auction and the sale-proceeds shall be credited to Government
account with the approval of Controlling Authority.
 10

(16) The lessee shall ensure proper maintenance of hill slopes so as to prevent major erosion

and observe all such safeguards as provided in the Mines Act, 1952 and the rules and
regulations framed thereunder from time to time.

(17) The lessee shall carry out quarrying operation with appropriate environment safeguards

and shall take such steps for reclamation and raising of plantations in the lease area in line
with the prescriptions under rules 29 to 37 of the Granite Conservation and Development
Rules, 1999.

(18) The lessee shall abide by the provisions of the Mines Act, 1952 and rules and regulations

framed thereunder, the Explosives Act, 1884 and rules made thereunder for development
of the source of minor minerals in workman like manner and for avoidance of any danger
arising out of such winning of minor mineral.

GRANT OF QUARRY PERMITS

1. Application for quarry permit:— An application for grant of quarry permit shall be made to
the Competent Authority in Form-Q and shall be accompanied by:–
(a) treasury challan showing deposit of rupees two hundred (non-refundable) towards
application fee;
(b) description of the land shown in a plan from which the mineral is to be extracted and
removed;
(c) consent of the owners of the land, if a private land permitting diversion of his land for
extraction of minor mineral is proposed to be removed; and
(d) an undertaking by the applicant to the effect that he agrees to abide by the conditions
governing extraction and removal of minor minerals under a quarry permit:
Provided that no quarry permit shall be granted to anybody other than the State
Agencies or Project Proponents for public purposes.
Explanation I.-“State Agency” shall mean any Department of the State or Central
 11

Government or company or corporation under the control of the State or Central Government
and shall include any Government organization as defined in sub-rule (3) of rule 39.
Explanation II. - “Project Proponent for public purposes” shall mean any person or firm or
company executing any Government project and shall include schematic beneficiaries under
Government scheme like IAY, RAY etc.
2. Authority to grant quarry permit:— (1) The Competent Authority or any officer authorized
by him may grant quarry permit in Form-R for extraction and removal from any specified
land, any minor mineral not exceeding one thousand cubic meters under any one permit on
payment of dues such as surface rent and royalty calculated at the rates specified in
Schedule-I and Schedule-II and compensatory afforestation fees, contribution to District
Mineral Foundation and Environmental Management Fund, as prescribed, in advance.
Provided that the Competent Authority may grant quarry permit in excess of one thousand
cubic meters for any minor mineral when used for public work.
(2) If the application is rejected, the Competent Authority shall inform the applicant, stating
the reasons of such rejection.
3. Duration of quarry permit:—The period of a quarry permit shall not exceed three months
at a time.
4. Conditions of quarry permit:— (1) The holder of a quarry permit shall obey the following
conditions, namely:—
(a) The depth of the quarry below the surfaces shall not exceed six meters;
(b) The quarry permit shall be non–transferable;
(c) Minor mineral, other than that for which quarry permit has been granted, shall not be
excavated or removed without prior approval of the Competent Authority;
(d) If any mineral other than minor mineral is found during quarrying operations, the
holder of the quarry permit shall report the matter to the Competent Authority and
the Director forthwith and the quarry permit shall be determined without payment of
any compensation to the holder of the quarry permit;
(e) The holder of the quarry permit shall maintain complete and correct accounts of the
minor mineral excavated and quantity removed from the area;
 12

(f) The holder of the quarry permit shall immediately report all accidents to the
Competent Authority and the Collector of the district;
(g) The holder of the quarry permit shall have no right over the quarried material and
other properties lying in the permit area after expiry of the validity of the quarry
permit;
(h) The holder of the quarry permit shall not undertake any operation in forest area
without obtaining the permission from the Competent Authority of the Forest
Department, Odisha;
(i) The permit holder of the quarry permit shall not carry on the quarrying operation
within a distance of fifty meters from any public roads, public buildings, temples,
reservoirs, dams, burial grounds, railway track monuments, heritage sites, etc. and
shall not cause any damage to any public and private properties.
(2) The holder of the quarries shall allow the Director, Controlling Authority and Competent
Authority or any officer authorized by any of them to inspect the quarrying operations and
to check the accounts and verify the details of dispatches from the registers maintained by
him.
(3 )If any minor mineral is removed in excess of the quantity permitted, such material shall be
confiscated and the holder of the quarry shall be liable for punishment under the provisions
of the Indian Penal Code 1860, Act and these rules.
(4) As soon as removal of the mineral granted under the permit is completed, the holder of
the quarry permit shall surrender the permit to the Competent Authority and furnish the
particulars of permit contained in Form-S indicating the quantities of minor minerals
removed and other information as may be required by the Competent Authority.
5. Register of quarry permit:—The Competent Authority shall maintain a register of quarry

permits in Form-T.
 13

SPECIAL PROVISIONS FOR GOVERNMENT ORGANISATIONS

Reservation of mines for Government organizations:—

(1) Notwithstanding anything contained in these rules, the State Government may,

by a written order, reserve any area for prospecting operation or mining

operation or quarrying operation by a Government organization, subject to
such terms and conditions as may be specified in the said order.

(2) Upon such reservation, quarry lease as the case may be, for the area so reserved,

shall be granted to the Government organization in whose favor the reservation

has been made subject to such terms and conditions, as may be decided by the
Government.

(3) Government organization, for the purpose of these rules, shall mean

Government, a Corporation established by any Central, State or Provincial Act

or a Government Company within the meaning of Clause (45) of Section 2 of the
Companies Act, 2013 and includes State level apex cooperatives, such other
agencies, authorities or organization controlled substantially by the
Government, as may be decided by the Government.

(4) The lessee, to whom a lease has been granted under this rule, shall pay to the

Government all amounts payable by a lessee under these rules and such
additional charges as may be decided by the Government from time to time.

Note:
Extract from “ODISHA MINOR MINERAL CONCESSION RULE 2016” regarding quarry lease &
permit.