(1) Upon completion of the auction process, the preferred bidder shall submit a performance security in the manner specified in sub-rule (1) of rule 19 and upon receipt of such performance security, the Director, Mines /Deputy Commissioner shall issue a letter of intent to the preferred bidder.
(2) On receipt of the letter of intent the preferred bidder shall be considered to be the successful bidder upon fulfilment of the following conditions, namely:—
(a) compliance with all the terms and conditions of eligibility;
(b) obtaining all consents, approvals, permits, no-objections and the like as may be required under applicable laws for commencement of prospecting operations; and Jharkhand Gazette Ordinary Notification No.—24, dated—06 September,2017
(c) submitting the Scheme of prospecting.
(3) Upon fulfilment of the conditions specified in sub-rule (2), the Director, Mines /Deputy Commissioner shall grant a Composite Licence to the successful bidder and such Composite Licence shall be subject to the provisions of the Act and the rules made thereunder, as applicable to a prospecting licence and mining lease.
(4) The minimum area for grant of a Composite Licence shall not be less than the minimum area for which a mining lease may be granted in accordance with the provisions of the Jharkhand Minor Mineral Concession Rules, 2004 as amended from time to time and the maximum area shall be in accordance with section 6 as applicable to a prospecting licence.
(5) The holder of a Composite Licence shall conduct geological exploration of the area under the Composite Licence so as to ascertain evidence of mineral contents and shall submit periodic reports in accordance with the Act and rules made thereunder, as applicable to a prospecting licence and all reports, studies and other documentation related to the geological exploration of the area under the Composite Licence shall be submitted to the Director, Mines/Deputy Commissioner.
(6) If a holder of a Composite Licence,—
(a) fails to complete prospecting operations or fails to establish the existence of mineral contents in accordance with the guidelines issued by the Director, Geology such holder shall not be eligible to receive a mining lease and the Composite Licence shall be terminated;
(b) completes prospecting operations in accordance with the guidelines issued by the Director, Geology resulting in determination of evidence of mineral contents, such holder shall make an application to the Director, Mines/Deputy Jharkhand Gazette Ordinary Notification No.—24, dated—06 September,2017 Commissioner for grant of a mining lease accompanied with the first installment, being ten percent of the upfront payment:
Provided that the mining lease shall be granted only with respect to the area for which evidence of mineral contents has been found and shall not be for an area larger than the maximum area for which a mining lease may be granted under the Act:
Provided further that any excess area shall be deemed to be surrendered by the holder of Composite Licence after completing its reclamation.
(7) Upon receipt of the duly completed mining lease application and the first installment of the upfront payment as specified in clause (b) of sub-rule (6), the Director, Mines /Deputy Commissioner shall issue a letter of intent for mining lease.
(8) A Mine Development and Production Agreement shall be executed between the Director, Mines /Deputy Commissioner and the holder of Composite Licence if the holder of a Composite Licence—
(a) continues to comply with the terms and conditions of eligibility;
(b) pays the second instalment being ten percent of the upfront payment;
(c) furnishes the enhanced performance security as specified in subrule (2) of rule 19;
(d) satisfying the conditions with respect to Mining Plan specified in Jharkhand Minor Mineral Concession Rules, 2004 as amended from time to time;
(e) obtains all consents, approvals, permits, no-objections and the like as may be required under applicable laws for commencement of mining operations; and
(f) satisfies such other conditions as may be specified by the Director, Mines with the prior approval of the State Government.
Jharkhand Gazette Ordinary Notification No.—24, dated—06 September,2017
(9) The holder of the Composite Licence shall pay the third instalment being eighty percent of the upfront payment, subsequent to execution of the Mine Development and Production Agreement and upon such payment, the State Government shall execute a Mining Lease Deed with the holder of the Composite Licence within thirty days of the date of completion of all the conditions specified in sub-rule (8).
(10) The mining lease shall be subject to the provisions of the Act and the rules made thereunder.
(11) The mining lease shall be for minerals found in the area pursuant to exploration prior to the auction:
Provided that where subsequent to the auction, any new mineral is discovered, then the holder of the mining lease shall follow the provisions of the Jharkhand Minor Mineral Concession Rules, 2004 as amended from time to time for inclusion of such new mineral in the Mining Lease Deed.
(12) The date on which a duly executed Mining Lease Deed is registered shall be the date of commencement of the mining lease.
19. Performance Security for Composite Licence— (1) An amount of 0.25% of the value of estimated resources shall be payable by the preferred bidder as performance security prior to the issuance of the Composite Licence.
(2) The amount of performance security shall be revised, prior to the issuance of the mining lease, to an amount of 0.50% of the value of estimated resources.
(3) The performance security provided under sub-rule (2) shall be adjusted every five years so that it continues to correspond to 0.50% of the reassessed value of estimated resources.
(4) The performance security may be invoked as per provisions of,-
(i) the Mine Development and Production Agreement and
(ii) the Mining Lease Deed.
Jharkhand Gazette Ordinary Notification No.—24, dated—06 September,2017
CHAPTER IV MISCELLANEOUS
20. Power to rectify apparent mistakes—Any clerical or arithmetical mistake in any order passed by the Director, Mines /Deputy Commissioner or any authority or officer under these rules and any error arising therein due to accidental slip or omission, may be corrected by the Director, Mines /Deputy Commissioner the concerned authority or officer, as the case may be:
Provided that no rectification order prejudicial to any person shall be passed unless such person has been given a reasonable opportunity of being heard.
21. Exploration Obligation—The holder of a Composite Licence shall complete detailed exploration and prepare a detailed feasibility study report confirming to the Guidelines issued by the Director, Geology over the entire area under the mining lease, within a period of Three years from the date of commencement of such mining lease.
By order of Governor of Jharkhand Sunil Kumar Barnwal, Secretary of Government.
Jharkhand Gazette Ordinary Notification No.—24, dated—06 September,2017
SCHEDULE I Terms and conditions of eligibility [See rules 6(1) and 6(2)]
1. The following net worth requirements shall be applicable for an auction of mining lease depending on the Value of Estimated Resources,—
(a) If the Value of Estimated Resources is more than Rupees 10 (Ten) Crores, the applicant, including an individual, shall have a net worth more than 4% of Value of Estimated Resources.
(b) If the Value of Estimated Resources is less than or equal to Rupees 10 (Ten) Crores, the applicant, not being an individual, shall have a net worth more than 2% of Value of Estimated Resources.
(c) If the Value of Estimated Resources is less than or equal to Rupees 10 (Ten) Crores, the applicant, being an individual, shall have a minimum net worth of 1% of the Value of Estimated Resources.
2. In case of auction of Composite Licence, the applicant must have a net worth of more than 1% of the Value of Estimated Resources.
Explanation:
(1) In case an applicant is a subsidiary of another company incorporated in India, the net worth of such holding company may also be considered:
Provided that, in such case, the applicant must continue to be a subsidiary of such holding company until such time the applicant meets the aforementioned net worth threshold.
(2) In case of a Company, the Net worth shall be the sum of paid up share capital and the free Reserves as per the audited Balance Sheet of the immediately preceding financial year.
(3) In case of an individual, the Net worth shall be the closing cash balance on the last date for submission of application, and such amount may include amount in Savings Bank accounts in Scheduled Bank/ Post Office, free and un-encumbered Fixed Deposits in Scheduled Banks, Post Office, Listed Companies/Government Organisation/Public Sector Undertaking of State and Central Government, Kisan Vikas Patra, National Saving certificate, Bonds, Shares of Listed Companies, Listed Mutual Funds, Unit Linked Insurance Plan, Public Provident Fund, Surrender Value of Life Insurance policies in the name of Applicant.
By order of Governor of Jharkhand Sunil Kumar Barnwal, Secretary of Government.
Jharkhand Gazette Ordinary Notification No.—24, dated—06 September,2017
SCHEDULE II Format of Performance Security [See rules 12(2)] [Reference number of the bank] [date] To The Director, Mines/ Deputy Commissioner [address] WHEREAS A. [Name of the Successful Bidder] incorporated in India under the Companies Act, [1956/2013] with corporate identity number [CIN of the Successful Bidder], whose registered office is at [address of registered office], India and principal place of business is at [address of principal place of business, if different from registered office] (the “Successful Bidder”) is required to provide an unconditional and irrevocable bank guarantee for an amount equal to INR [figures] (Indian Rupees [words]) as a performance security valid until [date of expiry of performance bank guarantee] (“Expiry Date”).
B. The Performance Security is required to be provided to The Director, Mines/ Deputy Commissioner of [Name of District], for discharge of certain obligations under the Tender Document dated, [date] with respect to auction of [particulars of auction] and the Mine Development and Production Agreement to be executed between the Director, Mines /Deputy Commissioner and the Successful Bidder (collectively the “Agreement”).
C. We, [name of the bank] (the “Bank”) at the request of the Successful Bidder do hereby undertake to pay to the Director, Mines/ Deputy Commissioner an amount not exceeding INR [figures] (Indian Rupees [words]) (“Guarantee Amount”) to secure the obligations of the Successful Bidder under the Agreement on demand from the Director, Mines /Deputy Commissioner on the terms and conditions herein contained herein.
Jharkhand Gazette Ordinary Notification No.—24, dated—06 September,2017 NOW THEREFORE, the Bank hereby issues in favour of the Director, Mines /Deputy Commissioner this irrevocable and unconditional payment bank guarantee (the “Guarantee”) on behalf of the Successful Bidder in the Guarantee Amount:
1. The Bank for the purpose hereof unconditionally and irrevocably undertakes to pay to the Director, Mines /Deputy Commissioner without any demur, reservation, caveat, protest or recourse, immediately on receipt of first written demand from the Director, Mines /Deputy Commissioner, a sum or sums (by way of one or more claims) not exceeding the Guarantee Amount in the aggregate without the Director, Mines /Deputy Commissioner needing to prove or to show to the Bank grounds or reasons for such demand for the sum specified therein and notwithstanding any dispute or difference between the Director, Mines /Deputy Commissioner and Successful Bidder on any matter whatsoever. The Bank undertakes to pay to the Director, Mines /Deputy Commissioner any money so demanded notwithstanding any dispute or disputes raised by the Successful Bidder in any suit or proceeding pending before any court or tribunal relating thereto the Bank’s liability under this present being absolute and unequivocal.
2. The Bank acknowledges that any such demand by the Director, Mines /Deputy Commissioner of the amounts payable by the Bank to the State shall be final, binding and conclusive evidence in respect of the amounts payable by Successful Bidder to the Director, Mines /Deputy Commissioner under the Agreement.
3. The Bank hereby waives the necessity for the Director, Mines /Deputy Commissioner from demanding the aforesaid amount or any part thereof from the Successful Bidder and also waives any right that the Bank may have of first requiring the Director, Mines/Deputy Commissioner to pursue its legal remedies against the Successful Bidder, before Jharkhand Gazette Ordinary Notification No.—24, dated—06 September,2017 presenting any written demand to the Bank for payment under this Guarantee.
4. The Bank further unconditionally agrees with the Director, Mines /Deputy Commissioner that the Director, Mines /Deputy Commissioner shall be at liberty, without the Bank’s consent and without affecting in any manner the Bank’s obligation under this Guarantee, from time to time to:
(i) vary and/or modify and of the terms and conditions of the Agreement;
(ii) extend and / or postpone the time for performance of the obligations of the Successful Bidder under the Agreement, or
(iii) forbear or enforce any of the rights exercisable by the Director, Mines /Deputy Commissioner against the Successful Bidder under the terms and conditions of the Agreement. and the Bank shall not be relieved from its liability by reason of any such act or omission on the part of the State or any indulgence by the Director, Mines /Deputy Commissioner to the Successful Bidder or other thing whatsoever which under the law relating to sureties would, but for this provision, have the effect of relieving the Bank of its obligations under this Guarantee.
5. Any payment made hereunder shall be made free and clear of and without deduction for, or on account of, any present or future taxes, levies, imposts, duties, charges, fees, commissions, deductions or withholdings of any nature whatsoever.
6. The Bank agrees that Director, Mines /Deputy Commissioner at its option shall be entitled to enforce this Guarantee against the Bank, as a principal debtor in the first instance without proceeding at the first instance against the Successful Bidder.
7. The Bank further agree that the guarantee herein contained shall remain in full force and effect during the period that specified in the Agreement and that it shall continue to be enforceable till all the obligations of the Successful Bidder under or by virtue of the said Agreement with respect Jharkhand Gazette Ordinary Notification No.—24, dated—06 September,2017 to the Performance Security have been fully paid and its claims satisfied or discharged or till the Director, Mines /Deputy Commissioner certifies that the terms and conditions of the Agreement with respect to the Performance Security have been fully and properly carried out by the Successful Bidder and accordingly discharges this guarantee.
Notwithstanding anything contained herein, unless a demand or claim under this guarantee is made on the Bank in writing on or before the Expiry Date the Bank shall be discharged from all liability under this guarantee thereafter.
8. The payment so made by the Bank under this Guarantee shall be a valid discharge of Bank’s liability for payment thereunder and the Director, Mines /Deputy Commissioner shall have no claim against the Bank for making such payment.
9. This Guarantee is subject to the laws of India. Any suit, action, or other proceedings arising out of this Guarantee or the subject matter hereof shall be subject to the exclusive jurisdiction of courts at Ranchi.
10. The Bank has the power to issue this Guarantee in favour of the Director, Mines /Deputy Commissioner. This guarantee will not be discharged due to the change in the constitution of the Bank.
11. The Bank undertakes not to revoke this Guarantee during its currency except with the previous consent of the Director, Mines /Deputy Commissioner in writing.
12. The Director, Mines/Deputy Commissioner may, with prior intimation to the Bank, assign the right under this Guarantee to any other departments, ministries or any governmental agencies, which may act in the name of the Director, Mines /Deputy Commissioner. Save as provided in this Clause 12, this Guarantee shall not by assignable or transferable.
13. Notwithstanding anything contained herein, Jharkhand Gazette Ordinary Notification No.—24, dated—06 September,2017 a. the liability of the bank under this bank guarantee shall not exceed the Guarantee Amount.
b. This bank guarantee shall be valid up to the Expiry Date.
14. The Bank is liable to pay the guaranteed amount or any part thereof under this bank guarantee only and only if the Director, Mines /Deputy Commissioner serves upon the Bank a written claim or demand on or before the Expiry Date. Dated the [day] day of [month] [year] for the Bank. In witness whereof the Bank, through its authorized officer, has set its hand and stamp.
————————————— (Signature) (Name and Designation) (Bank Stamp) By order of Governor of Jharkhand Sunil Kumar Barnwal, Secretary of Government.
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