The March 31 SRO be revoked ab initio, the committee, headed by National Conference MLA Mohammad Akbar Lone, said in its report which was tabled in the Assembly today.
The Jammu and Kashmir Minor Mineral Concessions, Storage, Transportation of Minerals and Prevention of Illegal Mining Rules, 2016, has a provision permitting non-state subjects to carry out mineral excavation in the state.
On June 3, Speaker Kavinder Gupta had constituted the nine-member committee to look into the order.
"It deprives the permanent residents of the state of their exclusive rights," the panel said and recommended that the rules be framed afresh after due consultation with all stakeholders.
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"Under proposed rules, grant of mineral concession like mining lease, mining licence, quarry licence, short-term permit and disposable permit be restricted to permanent residents of the state and partnerships or other business concerns with all the partners (being) permanent residents.
The proposed rules should clearly state that all mineral concessions should be subject to the laws governing the transfer of the property in the state, it said.
The committee also recommended that open auction mode and e-tendering be restricted to mining lease where the lease area is more than 25 hectares.
In grant of small mining lease, quarry licence, short-term permit or disposal permit, the method in vogue under the J&K Minor Mineral Concession Rules, 1962, be maintained, it said.