The Supreme Court judgment on mining royalty case has sparked a major discussion among the industry leaders. On August 14, the top court asserted that the July 25 ruling granting power to tax mineral rights to the states will apply retrospectively.
Many mining bodies said that states seeking refund of royalty from April 1, 2005 onwards will bear a huge cost on the companies.
However, many industry players remain cautious in their approach and said that they will look at the situation on ‘case-to-case’ basis.
Vedanta spokesperson told CNBC-TV 18 that “(we are) evaluating the judgment from the SC on the retrospective mining tax issue. Can confirm that no material demands raised upon any of our business at this time”. The Vedanta spokesperson also said that they “will consider all regulatory and legal remedial measures on a case-to-case basis”.
Similarly, in a statement on the issue, CNBC TV-18 quoted Hindustan Zinc CEO Arun Misra saying, “Having reviewed today’s order, Hindustan Zinc is of the view that there is no material impact owing to the retrospective effect of this judgement on the company.”
However, a PTI report said that the arrears for the mining company will work out to the tune of more than Rs 1.5 lakh crore to Rs 2 lakh crore.
Quoting a senior official, the PTI report said that "the investment of the companies operating in mining, power and steel sectors will also be hit.”.
BK Bhatia, Additional Secretary General FIMI said, “Now this order of 14th August mandating collecting dues retrospectively with effect from 1st April, 2005 will give further jolt to the Indian mining industry as arrears may work out to the tune of more than Rs 1.5 to Rs 2 lakh crores and the mines in the States like Odisha and Jharkhand would be most affected."
International Copper Association India MD Mayur Karmarkar also said that the apex court verdict will impact the mining industry’s business models.
(With PTI inputs)
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