Congress governments in Karnataka, Kerala and Telangana will soon challenge in the Supreme Court the contentious Mines and Minerals (Development and Regulation) Amendment Act that curbs states’ power to levy taxes on minerals and mineral-bearing land.
The bill was passed in the recently concluded Monsoon Session of Parliament amid Opposition demand that it be sent to a parliamentary standing committee for further scrutiny. The Lok Sabha had passed the Bill in five minutes while it was passed in the Rajya Sabha in 50 minutes, with 12 members participating in the debate, amid Opposition protest.
Congress sources said the petition has been prepared and it would be filed within days. They argued that the latest amendment, which was signed by President Droupadi Murmu after it was passed, was meant to negate a 2024 Supreme Court ruling by a nine-judge Constitution Bench that said the states can tax minerals separately from royalties, which is not a tax.
Kerala Chief Minister VD Satheesan had earlier said the bill went against federal principles as it seeks to take away rights and ownership of the states over minerals.
Earlier, Congress MP S Sasikanth Senthil wrote to the Speaker demanding that the bill be sent to the Standing Committee on Coal, Mines and Steel. He said the bill placed “substantial restrictions” on the powers of the state governments to impose taxes, cess or other levies on mineral rights and mineral-bearing land while empowering the Union government to prescribe conditions and restrictions.
Senthil had also said the bill provides retrospective invalidation with respect to certain taxes, cess and levies that have not been deposited or recovered before the commencement of the proposed Act. He also said the restrictions proposed on states would have “significant implications” for the revenue and fiscal autonomy of mineral-producing states.
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