Vedanta Iron and Steel Limited v. State of Karnataka

Order dated

16.09.2013, the Apex Court permitted the CBI to refer cases involving exports of less than 50,000 metric tonnes of iron ore to the State Government. The relevant portion of the order dated 16.09.2013 reads as under:- "x x x

(a) The CBI is permitted to register criminal case against those exporters who were enquired into in the preliminary enquiry and who had exported iron ore of more than 50,000 MT without valid permits and as recommended by the Central Empowered Committee in its report dated 5th September, 2012.

(b) The CBI is permitted to refer the matter with respect to the exporters who had exported less than 50,000 MT and were not enquired into in the preliminary enquiry, to the Government of Karnataka for taking further necessary action under the relevant laws, as recommended by the Central Empowered Committee in its Report dated 5th September, 2012.

(c) We also permit the Central Bureau of Investigation to refer to the Government of Karnataka for taking further action under relevant laws with regard to those exporters who were enquired into in the preliminary enquiry and who had exported less than 50,000 MT of iron ore without valid permits as recommended by the Central Empowered Committee in its Report dated 5th September, 2012.

(d) We direct the State of Karnataka to take further necessary action under the relevant laws as recommended by the CEC in its Report dated 5th September, 2012 with regard to those exporters who have exported less than 50,000 MT and report compliance within a period of four weeks from the date of receipt of communication of this order. x x x"

¶19The quantity claimed by the writ petitioner was 34,544.61 MT and was, therefore, below the threshold of 50,000 MT. Pursuant to the liberty granted by the Apex Court, the matter was investigated by the State authorities. The investigation culminated in the filing of a 'B' Report, which was accepted by the competent Court. The order accepting the 'B' Report has not been challenged. The respondents cannot, therefore, contend that an investigation by the CBI is necessarily required merely because the iron

ore had originally formed part of the stock seized at Belekeri Port.

¶20The respondents contend that the 'B' Report filed by the SIT in Crime No.2/2014 did not concern the ownership of the iron ore seized in FIR No.17/2009-10. The writ petitioner's claim for release of the very same iron ore was specifically considered by this Court in Criminal Petition No.7827/2018. By order dated 25.09.2023, this Court set aside the order dated 03.09.2018 passed by the CBI Court and directed the competent Forest authorities to determine the available quantity and value of the iron ore and thereafter release it to the writ petitioner upon furnishing one surety and executing an indemnity bond for the value so determined. The direction to release the iron ore is explicit and admits of no ambiguity.

¶21The State Government challenged the said order before the Apex Court. The Special Leave Petition was dismissed on 17.05.2024. The State thereafter filed a "Memo for Being Spoken To", seeking inclusion of a condition requiring surety for a like sum. The memo was

rejected by this Court and was subsequently withdrawn by the State in the proceedings before the Apex Court. Consequently, the order dated

25.09.2023 remains unmodified and operative. The respondents have also relied upon the order dated 23.09.2023 passed by the JMFC, Ankola, rejecting the writ petitioner's application under Sections 451 and 457 of the Code of Criminal Procedure. The said order preceded the order dated 25.09.2023 passed by this Court. The subsequent order of this Court contains a specific direction to the competent Forest authorities to release the iron ore subject to the conditions stipulated therein.

¶22The objections now raised regarding ownership, the distinction between the CBI and SIT investigations, the pendency of other criminal proceedings and the nature and extent of the surety cannot be made the basis for refusing to comply with the order dated 25.09.2023. Such objections cannot now be relied upon to reopen matters concluded by the order dated 25.09.2023 or to render the direction contained therein ineffective.

¶23The respondents also cannot rely upon the order dated

02.06.2025 passed in Criminal Petition No.100029/2023, permitting the State Government to take custody of and auction the available iron ore. By the subsequent order dated 02.09.2025, this Court expressly clarified that the order dated 02.06.2025 was subject to the earlier orders passed in Criminal Petition No.7827/2018. The direction for release contained in the order dated

25.09.2023 was thus expressly preserved.

¶24Pursuant to the order dated 25.09.2023, the Senior Geologist determined the available quantity of iron ore at 20,083.95 MT and its value at Rs.7,71,42,452/-. The writ petitioner thereafter executed the indemnity bond and furnished the surety contemplated by the said order. The execution of these documents is not disputed. The conditions imposed upon the writ petitioner having been complied with, nothing further remained to be performed by it for securing release of the iron ore.

¶25The impugned communication dated 08.12.2025 postpones the release of iron ore until the conclusion of the

proceedings pending before the Apex Court. The pendency of a review petition or any other proceeding before the Apex Court does not, in the absence of an order of stay, suspend the operation of the order dated 25.09.2023. The Apex Court in Collector of Customs, Bombay v. Krishna Sales

(P) Ltd, reported in 1994 Supp (3) SCC 73, held that the mere filing of an appeal does not operate as a stay or suspension of the order appealed against and that, if the authorities considered it necessary to withhold implementation of the order pending the appeal, the proper course was to obtain an order of stay or other appropriate direction from the competent Court and without such an order, the authorities could not refuse to implement the order under appeal. Similarly, in State of Haryana v. State of Punjab reported in (2004) 12 SCC 673, the Apex Court held that while dealing with successive proceedings assailing an operative decree, including proceedings before the Supreme Court, in the absence of any order of stay, the mere filing of proceedings does not operate as a stay.

¶26We are, therefore, of the opinion that the objections raised by the respondents do not furnish any legally sustainable ground for withholding release of the iron ore. The direction contained in the order dated 25.09.2023 remains operative, the subsequent order dated 02.09.2025 expressly preserves it and the writ petitioner has complied with the conditions imposed therein. The communication dated 08.12.2025 is, therefore, unsustainable.

¶27In the result,

(i) The writ petition is allowed.

(ii) The communication dated

08.12.2025 issued by respondent No.5, produced as Annexure 'J', is set aside.

(iii) Respondents No.1 to 5 are directed to release the available quantity of 20,083.95 MT of iron ore lying in Stock No.MC-12 at Belekeri Port to the writ petitioner, in terms of the order dated 25.09.2023 passed in Criminal Petition No.7827/2018.

(iv) The release of iron ore shall be completed within a period of two weeks from the date of receipt of a copy of this judgment.

All pending interlocutory applications shall stand disposed of.

Sd/- (ANU SIVARAMAN) JUDGE

Sd/- (VENKATESH NAIK T) JUDGE

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IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 7TH DAY OF SEPTEMBER, 2026 PRESENT THE HON'BLE MRS. JUSTICE ANU SIVARAMAN AND THE HON'BLE MR. JUSTICE VENKATESH NAIK T WRIT PETITION NO.35870 OF 2025 (GM-FOR) BETWEEN: VEDANTA IRON & STEEL LIMITED (DEMERGED IRON ORE ENTITY OF VEDANTA LIMITED) (A COMPANY INCORPORATED UNDER THE COMPANIES ACT, 2013) REGISTERED OFFICE AT C-103 ATUL PROJECTS, CORPORATE AVENUE NEW LINK CHAKALA, MIDC MUMBAI - 400 093 REP. BY ITS POWER OF ATTORNEY HOLDER, MR. NARAYANA M.P. HEAD - CORPORATE AFFAIRS - IRON ORE KARNATAKA (AMENDMENT CARRIED OUT VIDE COURT ORDER DATED 05.06.2026) …PETITIONER (BY SRI. K.N.PAHNINDRA, SENIOR COUNSEL A/W SRI. VIKRAM H. BHATT AND SRI. ARYAN RAO, ADVS. FOR SMT. VAISHALI HEGDE, ADVOCATE) Digitally signed by RAKSHA Location: High Court of Karnataka AND: 1. STATE OF KARNATAKA REPRESENTED BY THE ADDITIONAL CHIEF SECRETARY, FOREST, ECOLOGY AND ENVIRONMENT DEPARTMENT M.S. BUILDING, 4TH FLOOR DR. AMBEDKAR VEEDI BENGALURU 560 001 2. THE PRINCIPAL CHIEF CONSERVATOR OF FORESTS ARANYA BHAVAN 18TH CROSS, MALLESWARAM BENGALURU 560 003. 3. THE DEPUTY CONSERVATOR OF FORESTS KARWAR DIVISION, KARWAR DIVISION M.G. ROAD, KAJUBAG, KARWAR 581 301 4. ASSISTANT CONSERVATOR OF FORESTS ANKOLA SUB-DIVISION M.G. ROAD, KAJUBAG, KARWAR 581 301. 5. RANGE FOREST OFFICER ANKOLA RANGE M.G. ROAD, KAJUBAG, KARWAR 581 301 …RESPONDENTS (BY SMT. PRATHIMA HONNAPUR, AAG A/W SRI. KHAMROZ KHAN, AGA FOR R1 TO R5) THIS WP IS FILED UNDER ARTICLE 226 OF THE CONSTITUTION OF INDIA, PRAYING TO DIRECT THE RESPONDENTS TO CONSIDER THE REPRESENTATIONS DATED 25.10.2024, 20.11.2024, 07.04.2025, 27.05.2025 AND 09.10.2025 VIDE ANNEXURES 'A' TO A4 IN TERMS OF THE ORDERS PASSED BY THIS COURT IN CRL. PTN. NO.7827/2018 AND CRL. PTN. NO.100029/2023 AND RELEASE THE IRON ORE LYING IN STOCK NO.MC-12 AT BELEKERI PORT TO THE CUSTODY OF THE PETITIONER. THIS WRIT PETITION HAVING BEEN HEARD AND RESERVED FOR JUDGMENT ON 31.07.2026 AND COMING ON FOR PRONOUNCEMENT OF JUDGMENT THIS DAY, ANU SIVARAMAN J., PRONOUNCED THE FOLLOWING: CORAM: HON'BLE MRS. JUSTICE ANU SIVARAMAN and HON'BLE MR. JUSTICE VENKATESH NAIK T CAV JUDGMENT (PER: HON'BLE MRS. JUSTICE ANU SIVARAMAN) This writ petition is filed seeking a writ of mandamus directing the respondents to consider the representations dated 25.10.2024, 20.11.2024, 07.04.2025, 27.05.2025 and 09.10.2025, produced as Annexures 'A' to 'A4', in terms of the orders passed by this Court in Criminal Petitions No.7827/2018 and 100029/2023 and to release the iron ore lying in Stock No.MC-12 at Belekeri Port to the custody of the writ petitioner. The writ petitioner also seeks a writ of certiorari to quash the letter dated 08.12.2025, issued by respondent No.5, produced as Annexure 'J'. 2. We have heard Shri. K.N. Phanindra, learned senior counsel as instructed by Shri. Vikram H. Bhatt, learned counsel and Smt. Vaishali Hegde, learned counsel appearing for the writ petitioner and Smt. Prathima Honnapur, learned Additional Advocate General along with Shri. Khamroz Khan, learned Additional Government Advocate appearing for respondents No.1 to 5. 3. A quantity of 34,544.61 MT of iron ore claimed by the writ petitioner formed part of the stock seized at Belekeri Port in connection with FIR No.17/2009-10. The application filed by the writ petitioner seeking release of the said iron ore was rejected by the CBI Court, Bengaluru by order dated 03.09.2018 in Spl.C.C.No.268/2013. The writ petitioner challenged the said order in Criminal Petition No.7827/2018. By order dated 25.09.2023, this Court set aside the order dated 03.09.2018 passed by the CBI Court and directed the competent Forest authorities to determine the available quantity and value of the iron ore and thereafter release it to the writ petitioner upon furnishing one surety and executing an indemnity bond for the value determined. 4. The State Government challenged the order dated 25.09.2023 before the Apex Court in SLP (Crl.) Diary No.18017/2024. The Special