Central Government May Amend Law To Provide Relief To Mining Companies Affected By 2017 Supreme Court Order

The central government plans to amend the mining law to provide relief to thousands of mining companies affected by a 2017 Supreme Court order which made it illegal for any venture which violated environment and pollution laws.

The Union Mines Ministry may move a cabinet note proposing amend to Mines and Minerals (Development and Regulation) Act or MMDR Act, 1957 which would change the definition of ‘illegal mining’.

The government's proposal to amend the law follows recommendations given by a high level committee (HLC) chaired by Niti Aayog Vice Chairman Rajiv Kumar and consisting of the Cabinet Secretary and the mines, steel, coal, revenue and finance Secretaries. The committee was set up in April to identify key challenges and negate their impact in the mines, minerals and coal sectors. It has given its report to the central government.

In its recommendations, the high level committee has suggested amending Section 21(4) of MMDR Act, replacing the wording “without any lawful authority” with “in contravention of the provisions of this Act and rules made thereunder”. The changes would help revise penalties for violation of rules related to environment, pollution and other issues and extend relief to mining companies.

Under the current law, illegal mining occurs when a person, without any lawful authority, extracts any mineral from any land. In this case, the state government can recover from such person the mineral so extracted, or where minerals have already been disposed of, the price thereof along with rent, royalty, or tax, for the period when illegal mining was done.

The high level committee report has said that the Supreme Court judgment had led to the raising of huge demands on leaseholders in Odisha and Jharkhand. Other states may also impose similar penalties.

The committee has not said anything about application of the amendment, with prospective or retrospective effect.