India: Supreme Court rejects review petitions against states' taxing of mineral rights

The Supreme Court has dismissed the Centre's review petition on the former orders recognising the power of states to levy tax on mineral-bearing lands.

The Union government, along with the state of Madhya Pradesh, had sought a review of the Supreme Court's 25 July 2024 order that could result in significant financial burden on mining companies. Recognising the same, in an 8:1 majority, the Constitution Bench, led by Chief Justice of India D.Y. Chandrachud, had allowed for dues to be staggered over a period of 12 years, and waived penalties and interest, restricting any claims to after 1 April 2005.

The majority again dismissed the Union Government's review petition along with those of Karnataka Iron and Steel Manufacturers Association and others, stating: "Having perused the review petitions, there is no error apparent on the face of the record. No case for review under Order XLVII Rule 1 of the Supreme Court Rules 2013 has been established. The review petitions are, therefore, dismissed."

Justice B.V. Nagarathna who had dissented in the earlier order, seeing merit in the review petition, dissented again, and ordered the issuance of notice on the review petition to the respondents, returnable within eight weeks, according to news reports.

The 25 July order had recognised the states' plenary right to impose taxes on land, land of any nature, including mineral-bearing land, unless the Parliament imposed a limitation. This, it had said, could be done under Entry 50 of List 2 of the Constitution by means of statutory instruments, but not by stretching the MMRDA Act to impinge upon the taxing rights of the states.