In Brief
Mahanadi Coalfields Limited challenged demand notices from the State of Odisha for premium and compensation totalling Rs. 70 and Rs. 40 lakhs respectively, alongside royalty claims for coal-bearing lands acquired under the Coal Bearing Areas Act, 1957 and vested in the company. The Supreme Court held that when acquired lands are diverted to a Government company under Section 11 of the Act, that company becomes a deemed lessee of the State. The State, as the original owner and 'person interested,' is entitled to claim compensation and land rent in addition to royalty under Section 18(a). Royalty compensates for mineral extraction, while compensation addresses loss of the State's land ownership. The Court dismissed the appeal, confirming the State's right to recover both.
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