Section 4 of MMDR : Section 4: Prospecting Or Mining Operations To Be Under Licence Or Lease

Explanation using Example

Imagine a company, XYZ Minerals Pvt. Ltd., wants to explore a particular area for bauxite deposits. According to Section 4(1) of The Mines and Minerals (Development and Regulation) Act, 1957, XYZ Minerals Pvt. Ltd. cannot simply start reconnaissance or prospecting activities in the desired area. They must first obtain a reconnaissance permit or a prospecting licence from the government under the terms and conditions set by this Act and the associated rules.

For instance, if XYZ Minerals Pvt. Ltd. starts surveying the area without a permit, they would be violating the Act, which could result in legal consequences including fines and sanctions. However, if they had already been granted a prospecting licence before this Act commenced, and it's still valid, their operations could continue under the existing terms as per the first proviso of Section 4(1).

If the company were to discover a valuable mineral deposit and decides to transport or store the mineral, they must comply with the provisions of the Act as per Section 4(1A), meaning they need to follow specific rules regarding the transportation and storage of the mineral to avoid penalties.

Finally, XYZ Minerals Pvt. Ltd. must understand that any mineral concession they seek must be granted in accordance with the Act and its rules, as stated in Section 4(2). Should the company fail to adhere to these regulations, their concession could be deemed invalid.

In another scenario, if the State Government where XYZ Minerals Pvt. Ltd. wishes to operate decides to conduct its own reconnaissance, prospecting, or mining operations, it can do so after consulting with the Central Government and following the rules made under section 18, as long as the area is not already under a mineral concession, as explained in Section 4(3).