Context: A constitution bench of the Supreme Court held that the power of State Legislatures to tax mining lands and quarries is not limited by the Parliament’s Mines and Minerals (Development and Regulation) Act of 1957.
About Mines and Minerals (Development and Regulation) Act, 1957
The Mines and Minerals (Development and Regulation) Act, 1957 (MMDR Act) is the primary legislation governing the mining sector in India.
| Major minerals(Coal, Lignite, Atomic Minerals, Metallic and Non-metallic minerals such as Iron-ore, bauxite, gold, precious stones, Copper, Lead, Zinc etc.) | Minor minerals(Building stones, gravel, ordinary clay, ordinary sand and any other mineral which the Central Government can notify.) | |
| Regulation | Central govt make rules for regulating the grant of lease for mining. | State govt make rules for regulating the grant of lease for mining. |
| Approval | · State govt grants mining lease for Coal and Lignite to those selected by the central govt based on the competitive bidding.· For other major minerals, the State govts provide grant. | · State govts directly grant mining lease to the applicants as per the rules prescribed by them. |
| Payment of Royalty | Fixed by the central govt and collected by the respective state governments. | Fixed and collected by the respective state governments. |
Key Changes made through amendment in 2021:
- Removal of restriction on end-use of minerals: The original act empowers the central government to reserve any mine (other than coal, lignite, and atomic minerals) to be leased through an auction for a particular end-use (such as iron ore mine for a steel plant). Such mines are known as captive mines. The amendment provides that no mine will be reserved for particular end-use.
- Issue of composite licensing: Earlier, the private sector was required to separately apply for Prospecting Licence, Reconnaissance permit (RP) and Mining Lease (ML). The amendment empowered the government to provide a common composite licensing.
- Transfer of statutory clearances: Earlier the statutory clearances (including Environmental clearances) do not get transferred to new lessee. The amendment Provides for transfer of statutory clearances from existing lessee to new lessee upon expiry of lease period.