Continuing with Certain Provisions of MMDR Act to Cause Loss to State Exchequer: Govt

Continuing with certain provisions of the Mines and Minerals (Development and Regulation) Act will cause huge financial loss to state exchequer, the Mines Ministry has observed while proposing amendments to the law. The amendments will pave way for unlocking of large number of potential mineral bearing areas which are blocked as of now due to various reasons, including absence of sun set clause in the Act, the ministry said on its website.

The ministry said it proposes to amend provisions related to grant of prospecting licence and mining leases, and allocate such mineral blocks through transparent method of auction. Section 10A(2)(b) pertains to the leases where reconnaissance permit or prospecting licence were granted and 10A(2)(c) relates to grant of mining leases (ML). “Since continuing with existing provisions of 10 A 2(b) and 10 A (2) (c) will also cause huge financial loss to the state exchequer, the Amendment bill seeks to amend the existing provision of 10 A 2(b) and 10 A (2) (c) and reallocation of such mineral blocks through transparent method of auction,” the mines ministry said. At present, a large number of potential leases are blocked in legacy cases. These cases can neither be granted because of the time period to grant them is already over, nor can they be brought to auction because of legal impasse, the ministry said.

“The cases coming under section 10A(2) (c) of the Act which stood extinguished on January 12, 2017, as per law, but are still litigated or pursued unnecessarily at various levels, need to be brought to a closure to end the policy stalemate,” it said. The cases coming under section 10A (2) (b) of the Act are still disputed in the absence of specific sun set clause in the Act, and they have not reached closure till date, it said. Section 7 of the MMDR Act provides for maximum period of five years for completing the prospecting operations. These amendments came in effect on January 12, 2015, and the maximum period of five year for prospecting has also lapsed on January 12.

In both the cases, large number of potential mineral bearing areas are blocked and not contributing towards mineral production and employment generation. It is also proposed for appointment of an authority to decide the value of expenditure incurred for exploration in such legacy cases whose rights are terminated and to reimburse the exploration expenditure from funds under National Mineral Exploration Trust (NMET).