The Supreme Court of India on December 11, 1986 in Ambica Quarry Works Vs. State of Gujarat, AIR 1987 SC 1073 : 1987 (1) SCR 562 : (1987) 1 SCC 213 : JT 1986 SC 1036 : 1986 (2) SCALE 1037 held that the ratio of any decision must he understood in the background of the facts of that case.
Ration of Decision
A bench comprising of Justice Sabyasachi Mukharji and Justice K.N. Singh observed that a case is only an authority for what it actually decides, and not what logically follows from it.
The Court after referring the judgment Quinn v. Leathem,  Appeal Cases 495 distinguished two Apex Court decisions State of Rajasthan v. Hari Shankar Rajendra Pal,  3 SCR 402 and State of Bihar v. Banshi Ram Modi and Others,  3 SCC 643.
Renewal of Pre-existing mining leases
Sub-clause (b)(i) of rule 18 of Gujarat Minor Mineral Rules, 1966, which were framed under Act 67 of 1957, provides that the lease for all minerals specified in subclause (i) of clause (a) may be renewed by the competent officer for one or more periods not exceeding ten years at one time.
Section 2 of the Forest (Conservation) Act, 1980, brought into force on 25th October, 1980 provides that notwithstanding anything contained in any other law for the time being in force in a State, no State Government or other authority shall make, except with the prior approval of the Central Government, any order directing (i) dereservation of reserved forest, and (ii) the use of forest land for nonforest purposes.
The appellants had been granted leases for quarrying minor minerals prior to the coming into operation of the 1980 Act. Their applications for renewal of leases under r. 18 of the Rules were rejected by the competent authority on the ground that the lands fell under the reserved forests which were governed by the 1980 Act.
Their revision applications failed, and the High Court also rejected the writ petitions filed by them. In the appeals by special leave, it was contended for the appellants that the conditions precedent for the operation of the Act were not existing, that there was no question of extending for non-forest purposes forest lands, since their’s were existing quarry leases in areas which were at the relevant time dereserved forests, that they had not committed any breach of the terms of grant nor there were any other factors disentitling them to such renewal, that the words ’may be renewed’ in r. 18(b)(i) should be read as ’shall be renewed’, and so read they make it incumbent on the Government to renew the lease if the lessee so desired, and as they had invested large sums of money in mining operations a duty was cast on the authorities to exercise the power granting permission in a manner that they could receive full benefit of their investments.
For the respondents it was contended that after the coming into operation of 1980 Act there was no question of renewal of the leases because it had prevented renewal of lease without the approval of the Central Government.
Dismissing the appeals, the Apex Court, held that whether the power is one coupled with a duty must depend upon the facts and circumstances of each case and must be so decided by the Courts in each case.
The Gujarat Minor Minerals Rules, 1966 dealt with a situation prior to the coming into operation of the Forest (Conservation) Act, 1980. While under r. 18 of the Rules there was power to grant renewal, which might have cast a duty on account of the investments made by the appellants in the areas covered by the quarrying leases, they could not claim renewals as a matter of right after the Act was brought into force. Their applications were rejected on good grounds. The orders of the appropriate authorities deal with the situation.
Julius v. Lord Bishop of Oxford,  5 Appeal Cases 214 and Craies on Statute Law, 7th Edn. 229, referred to.
All interpretations must subserve and help implement the intention of the Act. The primary purpose of the Act of 1980 is to prevent further deforestation and ecological imbalances. Therefore, the concept that power coupled with duty enjoined upon the respondents to renew the lease, stands eroded by the mandate of the legislation manifest in the Act. The primary duty was to the community and that took precedence over the obligation to the individuals.
The appellants are asking for renewal of the quarry leases. It will lead to further deforestation or at least it will not help reclaiming hack the areas where deforestations have taken place. The Central Government has not granted approval. If the State Government was of the opinion that this was not a case where it should seek approval of the Central Government, the State Government could not apparently seek such approval.
The Civil Appellate Jurisdiction of Apex Court exercised in Civil Appeal Nos. 4250-425 1 of 1986 arose from the Judgment and Order dated 9th August, 1985 of the Gujarat High Court in Spl. Civil Appln. No. 2471 of 1985 and 62 18 of 1983.
Advocates Govind Dass, S.H. Sheth, Mrs. H. Wahi and M.V. Goswami appeared for the Appellants and P.S. Potio, T.U. Mehta, and M.N. Shroff for the Respondents.