Supreme Court Hearing On Royalty And Tax Recovery On Mineral Rights Resumes

During a recent hearing on the case related to royalty and tax recovery from mineral-rich land, the central government informed the Supreme Court that efforts are underway to resolve the dispute between the Centre and several mineral-rich states.

The case, which has been pending for years, will be heard again on April 24.

The petition, filed by various state governments, including Jharkhand, seeks to recover royalty and tax arrears amounting to thousands of crores from both the central government and mining companies.

A bench consisting of Justice Abhay S Oka, Justice MM Sundaresh, and Justice Ujjwal Bhuiyan discussed the order of hearing for petitions from various states.

The bench will decide the sequence in which the petitions will be heard.

Jharkhand Government Pushes For Expedited Hearing

Senior advocate Rakesh Dwivedi, representing the Jharkhand government, urged the court to avoid further delays and emphasized that both parties could reach a settlement at any stage of the case.

Meanwhile, Solicitor General Tushar Mehta, representing the central government, requested a postponement of the hearing until May.

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The case has a long history, with the Supreme Court’s Constitution Bench of nine judges ruling by a majority of 8:1.

The bench had upheld the power of states to levy taxes on mineral-rich land.

The case has been pending for over 25 years, with the Constitution Bench hearing 85 petitions that addressed the rights of states to impose taxes.

Central Government Opposes Additional Tax Imposition

The central government filed an affidavit opposing the imposition of taxes beyond the royalty on minerals by state governments.

It argued that allowing states to impose higher taxes would increase inflation, hinder foreign direct investment (FDI) in the mining sector, and raise the cost of Indian minerals.

These minerals are crucial for sectors like electricity, steel, cement, and aluminum, and any price increase due to additional taxes could negatively impact the economy.

Concerns Over Regional Imbalances In Mineral Resources

The affidavit further pointed out that Odisha, Jharkhand, Chhattisgarh, and West Bengal concentrate 78% of India’s coal resources, while coal accounts for 55% of the country’s commercial energy production.

The central government emphasized the need for equitable development across the country, stating that mineral-based raw materials should be available at competitive prices to foster nationwide development.

Looking Ahead: Continued Efforts To Resolve The Dispute

As the case progresses, the Supreme Court’s upcoming decision on April 24 will determine the next steps in this long-standing legal battle.

Both the central government and the state governments continue to seek a resolution to the complex issue of royalty and tax recovery on mineral-rich land.