Centre seeks review of Supreme Court order on mineral royalty, tax

Mineral-rich states, including Jharkhand, Odisha, Chhattisgarh, Karnataka, Andhra Pradesh, and Rajasthan, are poised to benefit significantly from recent developments in the sector.

The Central has filed a review petition against a recent Supreme Court order that allowed states to collect royalty on extracted minerals and levy tax on mineral-bearing land, The Times of India has reported.

Facing a huge financial burden following the judgment of a nine-judge constitutional bench, the Centre said the order has several errors and could have significant financial implications for public sector undertakings (PSUs) and industries, the report said.

The Centre and Madhya Pradesh, a co-petitioner, said the issue raised in the review petition pertained to "the fundamental rights of citizens of the country and raises larger issue of of public interest", the report said. It would be a "grave injustice" if the plea for an oral hearing of the review petition was not allowed.

Moneycontrol couldn't verify the report independently.

The Supreme Court's July 25 ruling, which clarified that arrears of royalty and tax would be paid in installments over 12 years, has significant financial implications for the government and private companies.

The estimated arrears for Public Sector Units (PSUs) alone have been calculated to be Rs 70,000 crore and this figure rises to Rs 1.5 lakh crore when private sector is included, the report said.

When senior advocate Rakesh Dwivedi, representing some mineral-rich states, urged an early listing of cases related to dues to follow on the nine-judge verdict for financial relief to states, Solicitor General Tushar Mehta and senior advocate AM Singhvi told the bench, led by Chief Justice of India D Y Chandrachud, about the review petitions filed by the Centre and a Tata group entity.

Expressing surprise, CJI remarked, "Review of a Constitution bench judgement?" Dwivedi said PSUs, which long benefited from mineral extraction without paying due royalties or taxes, were resisting the minimum payments mandated by the court.

States such as Jharkhand, Odisha, Chhattisgarh, Karnataka, Andhra Pradesh and Rajasthan are expected a windfall from the ruling. The Centre has argued that retrospective implementation of the levies would create a huge burden on PSUs and industries, potentially damaging the larger economy and driving up prices of various products, the ToI report said.