A mining lease was granted, then cancelled. The company ignored the cancellation and won in court. The Supreme Court just shut that down.

In 2006, the government said 'yes.' In 2010, it said 'no.' The company pretended the second word never came.

For twelve years, Chiranjilal carried a dead document from court to court, from government office to government office. The Supreme Court just buried it for good.

The case — State of West Bengal v. M/s Chiranjilal (Mineral) Industries of Bagandih — asks a question that every business with a government approval should answer: What happens when the government gives you something, then takes it back, and you do nothing?

1998: A mining application, a rival, and a court order

Chiranjilal applied for a dolomite mining lease in West Bengal in 1998. There was one problem. A government corporation called WBMDTCL had already applied for the same patch of land.

In 2003, the government rejected Chiranjilal. The company went to the Calcutta High Court, which told the government to reconsider. In 2006, the government issued a grant order in Chiranjilal's favour. The physical document — a thin file with official seals and a list of conditions — must have felt like a victory. The company's representatives likely carried it from one office to another, showing it as proof of their right.

Four years later, in 2010, the government cancelled that grant order. The Supreme Court judgment does not record why. But the cancellation was clear. It was unambiguous. And Chiranjilal never challenged it. The courtroom fell silent when the cancellation date was read aloud — 2010 — and the company's lawyer could point to no challenge filed in any subsequent year.

Not in 2010. Not in 2011. Not ever.

2015: The law changes — but does it save a dead order?

Then Parliament amended the Mines and Minerals (Development and Regulation) Act, 1957 — the central law that governs every mining operation in India. The amendment inserted Section 10-A, which declared that all pending mining lease applications that had not resulted in a grant before the amendment would become ineligible. The idea was simple: wipe the slate clean, start fresh with auctions.

Section 10-A(1) (the provision that makes pre-existing applications ineligible) was sweeping. But Parliament created narrow exceptions. Section 10-A(2)(c) saved applications where the government had already issued a "Letter of Intent" or obtained prior Central Government approval. West Bengal's own Minor Minerals Concession Rules, 2016 — Rule 61 — declared pending applications ineligible, with a proviso (an exception clause) for applicants who held a grant order or letter of intent.

Chiranjilal looked at the new law and saw a door. They had a grant order from 2006. The exceptions mentioned "grant orders." They walked through.

The High Court agrees — twice

Chiranjilal argued that the 2006 grant order was exactly what the exceptions were meant to protect. They had a grant order. They had invested time and money. The new law, they said, could not take away a right that had already crystallised.

The Calcutta High Court agreed. A single judge allowed Chiranjilal's writ petition in 2017. A division bench dismissed the state's appeal in 2018. Both courts held that the 2016 West Bengal rules did not apply to Chiranjilal because the company had a grant order from before the rules came into force. The smell of old paper and the weight of the file must have felt reassuring to the company's legal team as they left the courtroom.

The gap the High Court missed

The Supreme Court bench — Justice Sanjiv Khanna and Justice Aravind Kumar — looked at the dates. They found a hole the High Court had simply overlooked.

The 2006 grant order had been cancelled in 2010. Chiranjilal had never challenged that cancellation. By 2015, when the MMDR amendment came into force, the grant order was legally dead. A cancelled order, the Court held, cannot be revived by a later law that mentions "grant orders" as exceptions. The exception applies only to grant orders that were alive — legally operative — when the new law took effect.

The Court applied its own precedent in Bhushan Power and Steel Ltd. v. S.L. Seal (2017), which had interpreted the meaning of "Letter of Intent" under Section 10-A(2)(c). The principle was clear: a letter of intent or grant order that has been revoked, and where the revocation has become final (because it was never challenged), cannot be used to claim the benefit of the saving clause.

As the Supreme Court observed, "a Grant Order or Letter of Intent that has been cancelled/revoked and the cancellation is unchallenged and final cannot be relied upon to claim the benefit of the proviso." The words landed in the courtroom with the finality of a gavel — a dead document could not be resurrected by a later law that mentioned "grant orders" as exceptions.

The conditional grant that wasn't

There was another problem. Even the 2006 grant order — before it was cancelled — was not a simple, unconditional grant. It was hedged with pre-conditions: Chiranjilal needed consent letters, conversion certificates, and a No Objection Certificate (NOC) from various authorities. The Supreme Court noted that a grant order with unfulfilled pre-conditions is provisional. It does not create an accrued right (a right that has already vested and cannot be taken away) that would survive a change in the law. The stack of unfulfilled conditions — consent letters never obtained, certificates never submitted — sat in government files as silent evidence that the grant was never complete.

The Court observed that Section 10-A(1) renders all pre-2015 applications ineligible, and the exceptions under Section 10-A(2) are to be "narrowly construed" — read strictly, not expansively. They apply only to situations where applicants had altered their position based on a legitimate expectation or had acquired rights that had crystallised. A cancelled, unchallenged grant order does not meet that standard.

What the Supreme Court actually decided

The Court set aside the Calcutta High Court's judgment. It held that the division bench had erred in ruling that the proviso to Rule 61 and the Section 10-A exceptions applied to Chiranjilal. The revoked grant order could not sustain the exception. The conditional grant order of July 2015 — which the company had also tried to rely on — was provisional and did not change the position.

The ratio (the court's central reasoning) is straightforward: a grant order or letter of intent that has been cancelled, where the cancellation is unchallenged and final, cannot be used to claim the benefit of the saving clause under Rule 61 of the West Bengal Concession Rules 2016 or Section 10-A(2)(c) of the MMDR Act.

THE PLAY: If a government order in your favour is cancelled, challenge it immediately — a dead letter cannot be resurrected by a later law that mentions "grant orders" as exceptions.

Why this matters for every business dealing with the government

For advocates and CFOs, the lesson is procedural but critical. When a government order is revoked, the clock starts ticking. If you do not challenge the revocation within a reasonable time, you lose the right to rely on that order forever — even if a later law or regulation seems to protect "existing grant orders." The law looks at the order's legal status on the date the new law comes into force, not at its historical existence.

For founders and business owners: never assume that an old government approval will protect you after a change in the law. If the approval has been cancelled — even if you think the cancellation was wrong — you must go to court immediately. Silence is fatal.

The Supreme Court ended where it began: with a grant order that said "yes" in 2006, a cancellation that said "no" in 2010, and a company that spent twelve years pretending the second word never came. The final judgment — Civil Appeal No. 8238 of 2022, decided on 12 September 2023 — now stands as a warning: a dead document, no matter how many courtrooms it visits, remains dead.