Odisha to Examine Supreme Court Ruling on Mineral Royalty

The Odisha government plans to review the Supreme Court's recent decision, which states that the authority to tax mineral rights lies with the states. Odisha’s Steel and Mines Minister, Bibhuti Bhusan Jena, mentioned on Thursday that they are awaiting the judgement copy, which could significantly increase revenue for mineral-rich states.

Supreme Court Ruling

The Supreme Court ruled that the legislative power to tax mineral rights belongs to the states. The court clarified that royalties paid on minerals are not considered a tax. This ruling was delivered by a nine-judge constitution bench led by Chief Justice D Y Chandrachud, with an 8:1 majority.

"We have not seen the judgement copy. Let it come and we will study. The state will examine the verdict on mines and mineral tax," Jena stated at the assembly premises. However, officials from the Steel and Mines Department declined to comment on the ruling, which is viewed as a setback for the BJP-led central government.

Implications for Mineral-Rich States

Mining experts believe this judgement will benefit states rich in minerals, such as Odisha. The opposition party, Biju Janata Dal (BJD), which has been advocating for state rights in the mining sector, announced plans to hold a press conference on Friday to discuss the verdict.

Steel and Mines Secretary DK Singh did not respond to phone calls regarding the matter. Similarly, Mines Director Rajesh Gopalan said, "We have not received the copy of the judgement. Let us see the judgement copy before making any comment."

Parliament's Legislative Competence

The Supreme Court's decision also noted that Parliament lacks legislative competence to tax mineral rights under Entry 54 of List I of the Constitution. This entry pertains to the regulation of mines and mineral development by the Centre. However, Parliament can still legislate to impose limitations on states' power to levy taxes on mineral rights.

Some executives from leading mining companies welcomed the Supreme Court's verdict. They see it as a positive development for states like Odisha, which are abundant in mineral resources.

The Odisha government is keenly awaiting the official judgement copy to understand its implications fully. This decision is expected to provide a substantial revenue boost for states involved in mining activities.