CIL to pay Rs.2,500 cr. more as levies
Coal India Limited is likely to fork out an additional Rs.2,000 crore to Rs.2,500 crore as mining levies, with the Centre making the District Mineral Foundation (DMF) levy applicable on coal mining from the same date as it is for other minerals.
The development assumes significance as the Centre is defending the retrospective applicability of this levy on miners from January 2015, though its rules were only notified in September 2015, in the Supreme Court.
The Coal Ministry had made the levy applicable on coal and lignite mining in October 2015, but with prospective effect from the date of notification.
Development projects
“You can’t have two sets of different rules for mining activity of major minerals and coal,” a top government official told The Hindu, confirming that the Coal Ministry has now issued a fresh notification making DMF applicable from January 12, 2015. “Coal is also generically a mineral, but the DMF levy was applied retrospectively for major minerals governed by the mines ministry, and prospectively for coal and lignite governed by the Coal Ministry.”
The levy is used to fund local area development projects under the Pradhan Mantri Khanij Kshetra Kalyan Yojana and has so far yielded more than Rs.3,200 crore.
Miners have to pay an additional levy on top of royalty payments towards the District Mineral Foundation that will finance development projects in mining-affected areas, under the Mines and Mineral Development and Regulation Act of 2015.
The DMF levy is pegged at 30 per cent of royalty for mines allotted administratively in the past and 10 per cent for those acquired through transparent auctions — now a norm for all coal mines and major minerals such as iron ore.
“Coal India Limited is expected to deposit about Rs.2,000 crore to Rs.2,500 crore as DMF for the period between January 2015 and October 2015, while those who acquired mines through the auction route would pay 10 per cent,” a Mines Ministry official said.
Court cases
The government hopes the alignment of the dates for DMF levies will bolster its arguments in the Supreme Court, which is examining the validity of the retrospective applicability of the DMF rules, challenged by the mining industry in several high courts.
The Delhi High Court had stayed the payment of DMF dues for the period from January 12, 2015 to September 17, 2015 when the rules were notified.
The Supreme Court has begun hearing the case and the Coal Ministry’s fresh notification has been shared with the Law Ministry and the Additional Solicitor General representing the ministry in the matter, the official said.
Source: The Hindu
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