Legally Bharat

Pointing out several ‘errors apparent in the judgment’, the Centre is seeking to review a judgement of nine-judge bench of Supreme Court that allowed states to collect royalty on extracted minerals and to levy tax on mineral-bearing land.

Previously, the apex court on Wednesday said it will set up a bench to hear subsequent pleas of mineral-rich states like Jharkhand seeking to recover royalty and tax dues on mineral rights and mineral-bearing lands worth thousands of crore of rupees from the Centre and mining firms.

On July 25, a nine-judge bench headed by Chief Justice D Y Chandrachud, in a majority 8:1 verdict, had ruled that the legislative power to tax mineral rights vests in states and not Parliament.

In a subsequent order on Aug 14, SC clarified that the judgement will not have prospective effect and permitted mineral-rich states recover from the Centre and mining firms the royalty and tax dues on mineral rights and mineral-bearing lands worth crore since April 1, 2005 over a period of 12 years.

‘Review of a Constitution bench judgement’
Additionally, the Centre has roped in Madhya Pradesh as a co-petitioner to seek review of the July 25 judgment in an open court hearing and argued that the issue raised by it “pertains to the fundamental rights of the citizens of the country and raises larger issue of public interest and grave injustice would ensue if the application for oral hearing of the review petition is not allowed”.

Appearing for some mineral-rich states, senior advocate Rakesh Dwivedi sought early listing of pending cases relating to dues before a regular bench to follow the nine-judge verdict and give the intended financial relief.

“Review of a Constitution bench judgement,” exclaimed the Chief Just of India DY Chandhrachud after hearing about the review plea. Dwivedi said the review plea was indicative of the fact that PSUs, who have benefited immensely from extraction of minerals without paying royalty or tax on mineral-bearing land for decades, did not want to pay the minimum amount fixed by the SC.

Financial burden on PSUs
A huge financial burden is expected for the public sector undertakings as without interest, the amount to pay back has been estimated to be Rs 70,000 crore. This jumps to Rs 1.5 lakh crore if the arrears due from 2005 to be realised from private sector industries are included. Mineral-rich states which would benefit majorly are Jharkhand, Odisha, Chhattisgarh, Karnataka, Andhra Pradesh and Rajasthan.

Pleading with the SC for prospective implementation of its nine-judge bench ruling, the Union govt had argued that retrospective application would create a burden humongous enough to ruin many PSUs and industries, dent the larger economy and send prices of almost every product soaring.

(with ToI inputs)

  • Published On Sep 12, 2024 at 10:42 AM IST

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