DBT Bureau
Bengaluru, 16 August 2024
Odisha will be one of the major beneficiary states of the recent Supreme Court Verdict that allowed for the retrospective collection of taxes on mineral-bearing land from April 1, 2005.
The eastern state of Odisha is likely to recover dues of around Rs 1 lakh crore as taxes from mining and mineral-based industries.
According to reports, the total arrears for mineral-rich states since 2005 are expected to be around Rs 1.5 lakh crore. While the dues from public sector undertakings are estimated to be around Rs 70,000 crore, and the rest will be paid by private industries.
Reports also noted that Odisha will receive the pending dues in installments over 12 years. Moreover, the state will collect an annual tax of around Rs 12,000 crore under Orissa Rural Infrastructure and Socio-Economic Development Act.
These dues will be paid to the state by both public-sector and private-sector undertakings. Tata Steel disclosed that it would owe around Rs 17,300 crore to Odisha after this verdict.
Meanwhile, other states like Andhra Pradesh, Jharkhand, Telangana, and other mineral-rich states like Madhya Pradesh, Karnataka, Tamil Nadu, & Chhattisgarh will also benefit from this verdict.
Andhra Pradesh is likely to recover Rs 5,000 crore-Rs 6,000 crore, it will be around Rs 1,000 crore for Jharkhand. Telangana is likely to gain around Rs 300 crore from this verdict.
The Supreme Court in its ruling on Wednesday (14th August 2024) authorized the states to levy and collect tax on mineral bearing land from 1st April 2005. The court has directed that tax payments can be staggered in instalments for 12 years from 1st April 2026 (FY27) onwards. Additionally, the court has instructed the states not to impose any penalties and interest of any kind on payment of dues on royalty.
