Big Win For Mineral Rich States Like Odisha; Supreme Court Allows Refund of Royalty on Minerals from 2005

New Delhi: In a significant order judgment that will benefit mineral rich states like Odisha, the Supreme Court on Wednesday ordered that states can impose levies with effect from April 1, 2005 and the payments will be staggered in 12 years.

The verdict will benefit mineral-rich states like Odisha, Jharkhand, Bengal, Chhattisgarh, Madhya Pradesh, and Rajasthan.

The bench, however, directed the states to not impose a penalty of any kind on payment of dues.

The Centre has opposed the demand of states for refund of royalty levied on mines and minerals since 1989, saying it will impact the citizens and the PSUs will have to empty their coffers by Rs 70,000 crore.

CJI Chandrachud said this verdict will be signed by eight-judges of the bench who by majority decided the July 25 judgement giving the state’s power to levy taxes on mineral rights.

Justice Nagarathna will not sign Wednesday’s verdict as she had given a dissenting view.

In the landmark 8:1 verdict in July, the Supreme Court upheld state governments’ right to levy royalty on mineral-bearing land, reasoning they had the competence and power to do so.