Forest royalty is a one-time imposition; therefore, a verification mechanism must be established to prevent double taxation when materials have already suffered royalty payments.

ORDER

Heard Mr. D Das, the learned Senior Counsel, assisted by Mr. K Mohammed, the learned counsel appearing on behalf of the petitioner. Also heard Mr. M Gogoi, the learned counsel who appears on behalf of the NRL and Mr. RR Gogoi, the learned Standing Counsel for the Forest Department, Govt. of Assam.

2. The petitioner herein is aggrieved by the deduction of forest royalty from the running account bills of the petitioner in respect to a particular contract.

3. It is the specific case of the petitioner that the petitioner uses the RMC mix after getting the same from the two entities namely:

(i). PECO Project & Infrastructure Pvt. Ltd. and

(ii). Novoco Vistas Corporation Ltd.

4. It is the further case of the petitioner that these two entities use the minor minerals after purchasing it from various sellers who have already paid the royalty and, therefore, it is the case of the petitioner that there cannot be a double imposition of royalty by deducting from the bills of the petitioner.

5. Mr. M Gogoi, the learned counsel who appears on behalf of the NRL drew the attention of this Court to paragraph 8 of the affidavit-in-opposition filed wherein it is stated that the NRL is bound to deduct the forest royalty in view of Rule 5(3), 8(3) and 27(4) read with the third schedule of the Assam Minor Mineral Concession Rules, 2013 (for short, ‘the Rules of 2013’). It is also mentioned that when a contractor is unable to prove the payment of the requisite forest royalty by submitting the appropriate forest royalty clearance certificate along with each invoice, the NRL are required to withhold the applicable forest royalty and deposit the same with the Government as per the directions issued by the Forest Department in the letter dated 13.01.2023.

6. Mr. RR Gogoi, the learned counsel appearing on behalf of the Forest Department fairly submits that the forest royalty is a one-time imposition and in respect to those materials wherein the forest royalty had already been suffered, there cannot be a fresh imposition.

7. It is the opinion of this Court that there is a requirement for a mechanism set up by the Forest Department as to how to ascertain when deduction of forest royalty is required at the time of payment of bills to the contractors inasmuch as this very issue had been agitated by various contractors in various writ proceedings.

8. Accordingly, this Court, therefore, directs the Forest Department, more particularly, the PCCF to find out a mechanism as to how the aforesaid aspect could be addressed. It is also the opinion of this Court that there has been unnecessary litigations on account of deductions of forest royalty by the Corporations as well as the Government Departments though such materials which have been used have already suffered the forest royalty.

9. An affidavit in that regard be submitted by the Forest Department as to how this situation can be resolved.

10. This Court also finds it very pertinent to observe at this stage that while evolving the mechanism some modality is to be evolved whereby the Forest Department can also be a part of the proceedings for ascertaining as to whether the forest royalty had already been imposed on the materials or not. The Forest Department may explore such modalities by keeping in mind the principles of the Assam Ease of Doing Business Act, 2016.

11. List this matter again on 19.06.2026 for further hearing.