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PHC issues stay order in Chitral mining lease case

PESHAWAR: Issuing a stay order, the Peshawar High Court (PHC) stopped a government department from charging the successful bidder for mining lease of over 40,000 acres of metal blocks in Chitral Rs2.5 million per 1,000 acres of the metal block.

A bench consisting of Justice Ibrahim Khan and Justice Abdul Shakoor ordered the director general (mines and minerals) to maintain status quo on the issue until the appellate tribunal disposed of the company’s plea.

The court was hearing a petition filed by the privately-owned company Habibullah Metals Limited, which challenged the retrospective application of Rs2.5 million per 1,000 acres on metal blocks in Chitral, whereas in the expression of interest as advertised, the company had to pay Rs1 million as call deposit per block and each block comprises of 3,000 or more acres.

The petitioner requested the court to declare illegal the impugned intimation letter issued on Feb 3, 2023, by an assistant director (mineral development) in Chitral asking it to visit the office of the director (licensing), Malakand division, to deposit Rs2.5 million per 1,000 acres.

It also requested the court to strike down the decision made by the Mineral Title Committee (MTC) in its meeting on Nov 28, 2022, on the basis of which the department has been demanding the said amount from the company.

The petitioner sought an interim relief requesting the court to order status quo on the matter.

The petitioner’s counsel, Nouman Muhib Kakakhel, said the directorate-general (mines and minerals) invited an expression of interest from public and private organisations for the 15 years long mining lease through a joint venture for some base metal blocks in Chitral district.

He said the terms and conditions for the lease were mentioned in the expression of interest.

Mr Kakakhel said the petitioner was “best suited and qualified” for the lease, so it agreed to the terms and conditions and applied for the lease.

He said the company was the successful bidder for several such blocks in the past.

The counsel said base metal blocks in question were raw lands and the infrastructure was to be developed by the company to explore, which would cost millions of rupees.

He said the petitioner was informed through the impugned intimation on Feb 3, 2023, to visit the director (licensing) in Malakand division for signing the joint venture agreement for those blocks.

Mr Kakakhel said the impugned intimation, which based on the meeting of the Mineral Titles Committee of Nov 28, 2022, also “advised” the petitioner to deposit Rs2.5 million per 1,000 acres.

He said there was nothing in black and white regarding that payment upfront, and after the auction took place and “due to foul play, the new rule was introduced at the will and whims of the department.”

“The directors of the petitioner were given confidence time and again that there would be no additional payments but later on introduced the impugned rule,” he said.

Mr Kakakhel said his client approached the appellate tribunal but his plea hadn’t been fixed for hearing for two months.

He said if the petitioner did not deposit the money as demanded by the DG, metal blocks would be given to the one with the second highest joint venture proposal.


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