MMDR Act

The Supreme Court has affirmed that states have the authority to levy taxes on mineral rights and would not be limited by the Mines and Minerals (Development and Regulation) Act 1957 (MMDR Act)

The states are denuded of power to levy taxes on mines and minerals under the Constitution as the field is taken over by the Centre by virtue of the Mines and Minerals (Development and Regulation) Act, the Supreme Court was told on Wednesday. A nine-judge bench headed by Chief Justice DY Chandrachud was told by senior advocate Abhishek Singhvi, appearing for mining companies, that the 1989 verdict in India Cements case which held that royalty is tax is correct in law. "... once the field of mining and levies including taxes on mining are taken over by the Centre (which they in fact are, by virtue of the MMDR Act, 1957 as confirmed in Orissa Cement (1990 verdict) and Mahanadi Coalfields (1994 verdict)), the states stand denuded of their powers under both Entries 23 as well as 50 of List 2," he said. The bench, also comprising Justices Hrishikesh Roy, Abhay S Oka, BV Nagarathna, JB Pardiwala, Manoj Misra, Ujjal Bhuyan, Satish Chandra Sharma and Augustine George Masih, is considering t

The original case dates back to 1992, when the Bihar government, through an amendment, imposed additional taxes on land revenue coming from mineral-bearing lands leased out to mining industries

The Union Cabinet on Thursday approved the amendment in the MMDR Act to specify the royalty rate on 12 critical and strategic minerals, an official statement said. A decision in this regard was taken at a meeting of the Union Cabinet chaired by Prime Minister Narendra Modi, the Ministry of Mines said in a statement. "The Union Cabinet... approved the amendment of Second Schedule to the Mines and Minerals (Development and Regulation) Act, 1957 (MMDR Act) for specifying rate of royalty in respect of 12 critical and strategic minerals," the statement said. The 12 critical and strategic minerals are beryllium, cadmium, cobalt, gallium, indium, rhenium, selenium, tantalum, tellurium, titanium, tungsten, and vanadium, it said. This completes the exercise of the rationalisation of royalty rates for all 24 critical and strategic minerals, the Ministry said. The government notified the royalty rate of four critical minerals, namely glauconite, potash, molybdenum and platinum group of miner

'The approval would ensure auction of mineral blocks in respect of glauconite, potash, emerald, platinum group of metals, andalusite and molybdenum thereby reducing imports of these minerals'

The repealing of certain sections of the MMDR Act amounting to cancellation of mining leases already granted would send a wrong signal to both domestic and global investors, said FIMI

Recently, Odisha successfully conducted electronic auctions of 19 lapsing iron and manganese ore blocks now run by merchant or non-captive iron ore blocks

Analysis by Fimi shows how auctions have lulled mining from virgin blocks

Iron ore supply growth woul be primarily driven by India, Brazil where major miner Vale is set to expand output with its new mine

Inventory at pit-heads of mines lapsing by next March end largely has lower grade fines with Fe content of up to 62%, which has no takers in domestic market

Centre believes the clause results in duplicity and complexity of efforts; even after lease is granted, it takes time for lessee to start actual mining operations

The Odisha government has collected mining royalty valued at Rs 6693.62 crore (as on March 27, 2017) since the enactment of the amended Mines and Minerals- Development & Regulation (MMDR) Act.The revenue has accrued from 96 operational mines engaged in the extraction of iron ore, chromite, bauxite and limestone. The revenue collection is of the period from January 12, 2015, the date of promulgation of MMDR Act, 2015 to March 27 this year.The enactment of the new MMDR Act has enabled Odisha to extend the validity of more than 60 mine leases, boosting both production and despatch, especially that of iron ore. Also, the state government has executed mining lease (ML) deeds with 16 lessees before the January 11, 2017 deadline stipulated for such mines. These mining leases were saved under Section 10 (A) (2) (c) of the amended Mines and Minerals- Development & Regulation Act (MMDR), 2015.In Odisha, ML deeds have been executed for the mines owned by Odisha Mining Corporation (OMC), .