The Committee will submit its report by July 15, Speaker Kavinder Gupta said.
Mohammad Akbar Lone, Devender Singh Rana (both National Conference), Sukhnandan Chaudhary, Ajit Jasrotia (both BJP), ALtaf Bukhari, Javaid Baig (PDP), Bashir Dar (Peoples Conference), Nawang Rigzin Jora (Congress) and H M Yaseen (Independent) will be the members of the Committee, he said.
National Conference, Congress and CPI(M) members claimed that an order issued by the Industries and Commerce department has allowed non-state subjects to participate in the mineral extraction bidding process and it should be revoked immediately.
The agitating members claimed that continuation of the State Regulatory Order (SRO)-105 would affect the livelihood of thousands of families as big contractors from outside the state will put the local contractors out of competition, resulting in escalation of cost of construction material.
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The Speaker had initially refused to give in to the demand of the members, stating that a question was listed in the Question Hour on the issue and they could raise it at that time.
This led to several opposition MLAs storming the Well of the House and raising slogans against the government.
The opposition members alleged that the order was brought to favour mining contractors from neighbouring Punjab.
However, Prakash said that only state subjects of Jammu and Kashmir will be allowed to participate in the bidding process. He also rejected the opposition charge that its implementation would lead to escalation in cost of construction material.
"Only Rs 62 has been increased per truck," he said.
Not satisfied with the minister's statement, the opposition members again stormed the Well of the House.
The Speaker adjourned the House for 15 minutes. This was the first adjournment of the proceedings since the Budget session of the Assembly began on May 25.
Congress MLAs and Akbar Lone (NC) said there was no need for a House Committee.
"There is a general consensus that this order should be revoked. What is the need for a House Committee," Nawang Rigzin Jora (Congress) asked.
The Congress members and some from the National Conference then staged a walkout.