Congress-ruled states have decided to challenge the Centre’s amendment to the Mines and Minerals (Development and Regulation) law, alleging it undermines state rights and affects their tax revenues. Karnataka, Kerala, Telangana and Himachal Pradesh have said the changes dilute states’ authority over levies linked to mineral-bearing lands and mining activity.
The amendment was introduced and passed during the recent Parliament monsoon session amid disruptions, and received President Droupadi Murmu’s assent on August 18, bringing it into force nationwide. Opposition parties have since stepped up criticism, arguing that the new framework will weaken states’ fiscal powers.
While the Constitution gives the Union a role in regulating mining, states have maintained that the power to impose taxes on mineral resources and mineral-bearing lands rests with them. States also issue mining leases and mineral exploration licences, with the Centre setting rules and auction procedures.
A nine-judge Constitution Bench of the Supreme Court, in a 2024 ruling, affirmed that states have full authority to levy such taxes and permitted collection of arrears pending since 2005. Congress-ruled states contend the new amendment effectively neutralises that verdict by invalidating older pending dues, and argue Parliament cannot directly overturn a court ruling without changing its legal basis—amounting, they say, to interference in judicial powers.
The states are preparing to approach the Supreme Court, and discussions are reportedly on to bring Jharkhand into the legal effort as well. The Centre, however, has defended the amendment as a move to end uneven levies across states, citing multiple charges such as royalty, district mineral funds and transport fees, and arguing that standardisation will support investment and reduce costs in sectors like steel, cement, power and infrastructure, while claiming states will not be adversely affected.
