Odisha may get windfall revenue of over Rs 25,000 cr from defaulter miners

Odisha may have a revenue bonanza in excess of Rs 25,000 crore in the current fiscal thanks to the Supreme Court order on illegal mining in the state.

The apex court has asked the mining companies to cough up 100 per cent of the value of ore they had lifted without lawful authority since 2000-2001.

The defaulting companies included some of the big names in the mining business- Tata Steel, Aditya Birla group owned Essel Mining, public sectors Steel Authority of India (SAIL), Odisha Mining Corporation, Mesco, Rungta Mines, KJS Ahluwalia, Sirajuddin Mines, Indrani Patnaik etc.

Following the Shah Commission probe into illegal mining, the state government, in 2013, had issued notices in 146 cases to lease holders, most of them engaged in iron ore and manganese excavation, for recovery of illegally mined ore under section 21 (5) of the Mines and Mineral Development and Regulation (MMDR) Act. The law mandated recovery of value of such ore if the material is already sold. The total value of recovery claim slapped on miners then was over Rs 59,000 crore.

However, the Supreme Court appointed Central Empowered Committee (CEC) later conducted a separate probe into unlawful mining activity in the state and said in its report that total 215.5 million tonne of iron ore and manganese had been extracted without or in excess of environment clearance (EC) and pegged its value at Rs 17,576 crore.

On the wide variance in the estimation of value of illegally mined ore by the state government and CEC, an official said, the state had made the assessment taking into consideration the highest value of ore during period of commitment of offence while CEC has taken the average price of minerals as proposed by Indian Bureau of Mines (IBM). Similarly, the CEC calculation was only for iron ore and manganese and it did not take into account mineral production without forest clearance and in violation of other norms.

The apex court order has clarified that any mining activity without requisite environment clearance, forest clearance, consent to operate from the pollution control board and in contravention of mining scheme and plan would be construed as illegal mining as opposed to the interpretation of only mining outside the allotted area.

The court has also rejected the CEC suggestion of recovery of 30 per cent of the cost of minerals mined without or in excess of EC permit and ordered for 100 per cent recovery. It has asked for similar recovery for FC violation while capping the compensation at 100 per cent in case of violation on both fronts.

CEC had estimated the iron ore and manganese mined without EC permit at Rs 17576 crore. It would easily go up by another Rs 8,000 crore if FC violations are taken into account, bringing a bonanza of more than Rs 25,000 crore to the exchequer, said an official.

Meanwhile, state director of mines, Deepak Mohanty said, the state would revisit the recovery claims imposed on the defaulting miners following the Supreme Court order. "If there are any discrepancy, it will be sorted out", he said. The apex court has suggested recovery at 100 per cent of the price of the illegally mined ore as rationalized by the CEC.

Prabodh Mohanty, secretary, Eastern Zone Miners Association said, the apex court order might hit some miners who are going through a rough phase. Out of 187 mines in the state, 102 were closed. "If required, miners might go to the court to seek some relief", he added.

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