‘Royalty not same as tax’: Supreme Court upheld rights of states to impose royalty on mining, mineral use

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The Supreme Court on Thursday revoked its earlier order and upheld the rights of states to impose royalty on mining and mineral-use activities..

In an 8:1 verdict, the bench led by Chief Justice of India DY Chandrachud ruled that 'royalty' is not the same as 'tax' and said that states have the competence and power to impose royalty..

Justice BV Nagarathna delivered the dissenting verdict, which is a big win for mineral-rich states such as Odisha, Bengal, Jharkhand and Chhattisgarh...

The Supreme Court is currently examining whether state governments have lost the power to tax and regulate activities related to mines and minerals due to the Mines and Minerals (Development & Regulation) Act (MMDRA)..

In 1989, the court ruled in the India Cements vs Tamil Nadu case that royalty is a form of 'tax' under the MMDRA and that states cannot impose cesses on such royalty...

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