*Mineral Area Development Authority v. Steel Authority of India* (2024)
In July 2024, a nine-judge Constitution Bench of the Supreme Court held, by an 8:1 majority, that royalty payable under the MMDR Act is not a "tax" but a contractual payment arising from the mining lease. The judgment overruled the earlier seven-judge bench ruling in India Cement Ltd. v. State of Tamil Nadu (1990), which had held that royalty was a tax and that states lacked the competence to impose additional taxes on mineral rights.
- The 2024 majority held that state legislatures retain the power under Entry 50 of the State List to tax mineral rights, and that this power is not automatically excluded by the Centre's collection of royalty under the MMDR Act.
- Justice B.V. Nagarathna dissented, holding that royalty is in the nature of a tax/exaction and not merely a contractual payment.
- The judgment reaffirmed states' fiscal autonomy over mineral taxation, prompting several mineral-rich states to raise fresh or retrospective tax and cess demands on mining companies.
● Tracked since August 13, 2026 · last seen August 16, 2026 · updates as the daily brief publishes
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