States’ right to tax mineral lands intact, Supreme Court rejects petition

New Delhi: The Supreme Court had said that states have the legislative authority to impose tax on mineral-rich lands and mines. Now the court has rejected the petition in which a demand was made to review that decision. The Supreme Court had passed order in this case on July 25. A review petition was filed against the said order of the court. After seeing the application in the chamber, other judges including the Chief Justice of the Supreme Court rejected the application and said that it had no merit. On July 25, the Supreme Court had said in an important decision that under the Constitution, the states have the right to own mines. And has the right to tax land containing minerals. A bench of nine judges led by the Chief Justice of the Supreme Court, in its decision with a majority of 8:1, had said that royalty payable on minerals is not a tax. States have the legislative power to impose taxes on mines and minerals and land containing minerals.

What did the judges say on this matter?
In the recently uploaded order dated September 24, the eight judges said that after perusing the review petitions, no error is apparent on record. No case has been instituted for review under Order 47 Rule 1 of the Supreme Court Rules, 2013. Therefore the review petitions are dismissed. Justice BV Nagarathna, who dissented from the majority in the July 25 judgment that only the Center has the power to tax mineral rights, also gave a separate order on the review petitions.

Parliament’s right to make laws
Eight judges, led by the Chief Justice, rejected the request for open court hearing in the review petitions, while Justice Nagarathna allowed the request for open court hearing. The top court, in a landmark judgment of 8:1 majority on July 25, had said that the legislative power to tax mineral rights lies with the states and royalty paid on minerals is not a tax. However, the top court said Parliament can still make any law limiting the power of states to tax mineral rights.