Mines and Minerals (Development and Regulation) Act, 1957 (MMDR Act) – Section 9, 9B, 9C, 13, 18; Mineral (Other than Atomic and Hydrocarbons Energy Minerals) Concession Rules, 2016 (MCR, 2016) – Rule 38, 39, 42; Mineral Conservation and Development Rules, 2017 (MCDR, 2017) – Rule 45; Article 14, 32 of the Constitution of India
This case involves a challenge to the validity of certain Explanations in the Mineral Concession Rules, 2016, and the Mineral Conservation and Development Rules, 2017, specifically Rule 38 of the MCR, 2016 and Rule 45(8)(a) of the MCDR, 2017. These Explanations stipulate that royalty payments, along with contributions to the District Mineral Foundation (DMF) and the National Mineral Exploration Trust (NMET), should not be deducted when computing the ‘Sale Value’ for calculating royalty.
The petitioners argued that this leads to a “compounding” effect, where royalty is effectively charged on royalty, violating Article 14 of the Constitution, which guarantees equality before the law. They further contended that this anomaly has been acknowledged by the government, which issued a notice for public consultation to amend the MMDR Act to address the “cascading impact of royalty on royalty.”
The respondents, however, contended that the petitioners are challenging the economic policy.