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D. Y. CHANDRACHUD, J. B. PARDIWALA, MANOJ MISRA
In the Matter of : - Kirloskar Ferrous Industries Limited – Appellant
Versus
Union of India – Respondent
JUDGMENT :
J.B. PARDIWALA, J.
1. The petitioners have invoked the jurisdiction of this Court under Article 32 of the Constitution inter-alia seeking to challenge the validity of the Explanation to Rule 38 of the Mineral (Other than Atomic and Hydrocarbons Energy Minerals) Concession Rules, 2016 (for short, the “MCR, 2016”) and the Explanation to Rule 45(8)(a) of the Mineral Conservation and Development Rules, 2017 (for short, the “MCDR, 2017”) that stipulates the computation of royalty to be levied for the extraction or consumption of mined ores.
A. BRIEF FACTUAL MATRIX
2. The petitioner no.1 herein is a mining leasehold company inter-alia engaged in the extraction of pig iron and the manufacturing and sale of its by products by way of a mining lease for iron ores in the State of Karnatak in terms of the provisions and procedure envisaged under the Mineral (Development and Regulation) Amendment Act, 2015 (for short the “2015 Amendment Act”). The petitioner no.2 herein is one of the shareholders in the petitioner no.1 company. The respondent no. 1 herein is the Union of India through the Secretary, Ministry of Mines, whereas the respondent no. 2 herein is the Indian Bureau of Mines.
3. A
The methodology for computing royalty under the MMDR Act is a policy decision, and courts should exercise restraint in reviewing such economic policies unless they violate constitutional provisions.
Royalty, under the MMDR Act, is not a tax but a contractual consideration for mineral rights. State legislatures retain the power to tax mineral-bearing land, but this power is subject to any limita....
Subordinate legislation must align with the parent Act; regulations exceeding authority are invalid. Royalty payment under mining laws can only be for minerals actually removed or consumed.
The demands raised by the Deputy Director of Mines were found to be unsustainable in the eye of law, in view of the law laid down in National Mineral Development Corporation Limited v. State of M.P.,....
Royalty is a contractual obligation distinct from taxes; amendments to regulations cannot retrospectively apply to existing contracts unless explicitly stated.
Point of Law : MMDR Act, 1957, though takes away power of State to make laws under Entry 23 of List II, by S.15 of MMDR Act, power to regulate quarry leases, mining leases or other mineral concession....
The stamp duty or the dead rent is to be charged on the basis of the amount of royalty to be paid, and the proviso to section 26 of the Act of 1899 applicable to the mining lease is required to be re....
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