SC Judgement on Taxing Mines
Conflicting Judgments: There were two key Supreme Court rulings:
1989 Judgment: India Cements vs. State of Tamil Nadu - Declared "royalty is tax," limiting state powers to impose additional cess.
2004 Judgment: State of West Bengal vs. Kesoram Industries - Stated "royalty is not tax," allowing states to levy taxes on mineral rights.
July 25, 2024 Judgment
Upheld states’ power to tax mines and mineral rights.
Recent Updates
The Supreme Court ruled against restricting the judgment's application to only future cases.
Retrospective Taxation Allowed: States can tax from April 1, 2005.
No interest or penalties on taxes due between April 1, 2005, and July 25, 2024.
Tax dues from this period can be paid in installments over 12 years, starting April 1, 2026.
State Discretion
States can choose whether to collect taxes for periods before July 25, 2024.
Financial Impact
The retrospective tax may lead to significant demands, such as the estimated ₹3,000 crore for the Steel Authority of India.
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