"MMDR Amendment 2026 Strips States of Mineral Taxation Rights"
Major Minerals
Minerals of high economic or strategic value (coal, iron ore, bauxite) regulated by the Union government under the MMDR Act.
Minor Minerals
Minerals like sand, gravel, and laterite regulated by state governments under Section 15 of the MMDR Act.
The Mines and Minerals (Development and Regulation) Act, 1957 (MMDR Act) is the foundational legislation governing mineral extraction in India. It divides regulatory authority between the Union and the states. The Union government controls major minerals, coal, iron ore, bauxite, and similar resources of national industrial importance. State governments retain authority over minor minerals such as sand, gravel, and laterite under Section 15 of the MMDR Act. This division reflects the constitutional design under the Seventh Schedule, where mines and minerals fall under the Union List (Entry 54) for regulation and development, but states retain revenue rights over land and mineral-bearing land.
For decades, an informal federal compromise operated alongside this legal structure. The Union allocated mining rights for major minerals. States, in turn, were permitted to levy taxes and royalties on minerals and mineral-bearing land. This arrangement gave mineral-rich states, such as Odisha, Jharkhand, Chhattisgarh, and Rajasthan, a meaningful share of the economic value generated from their own natural resources. The MMDR Amendment Act, 2015 reinforced this by creating District Mineral Foundations (DMFs), which channelled a portion of mining revenues to communities affected by mining operations. The 2021 amendment further opened up commercial mining and auctioned critical mineral blocks. Each successive amendment has, however, tilted the balance of control further toward the Union.
The Supreme Court's 2024 ruling in Mineral Area Development Authority v. Steel Authority of India (the nine-judge bench decision) was a landmark moment. The Court held that states have the constitutional right to levy taxes on mineral-bearing land, independent of Union royalty determinations. This ruling was widely seen as a significant affirmation of states' fiscal autonomy in the minerals domain.
The constitutional basis for mineral taxation involves a genuine tension. Entry 54 of the Union List gives Parliament power to regulate mines and minerals in the public interest. Entry 50 of the State List gives states the power to levy taxes on mineral rights, subject to any limitations Parliament imposes. The MMDR Act has historically set royalty rates, which the Supreme Court in earlier rulings treated as a ceiling on what states could charge. The 2024 nine-judge bench ruling overturned this interpretation, holding that royalties are not taxes and that states retain independent taxing power over mineral land.
The MMDR Amendment Act, 2026 directly responds to, and effectively overrides, this judicial affirmation. It transfers control over all mineral and mineral-land taxation to the Union government. …
Consider the following statements:
Statement I: In India, State Governments have no power for making rules for grant of concessions in respect of extraction of minor minerals even though such minerals are located in their territories.
Statement II: In India, the Central Government has the power to notify minor minerals under the relevant law.
Which one of the following is correct in respect of the above statements?
Consider the following statements:
I.India has joined the Minerals Security Partnership as a member.
II.India is a resource-rich country in all the 30 critical minerals that it has identified.
III.The Parliament in 2023 has amended the Mines and Minerals (Development and Regulation) Act, 1957 empowering the Central Government to exclusively auction mining lease and composite license for certain critical minerals.
Which of the statements given above are correct?
With reference to the management of minor minerals in India, consider the following statements:
1.As per the law prevailing in this country, sand is a 'minor mineral'.
2.The power to grant mining leases of minor minerals lies with State Governments, but the power regarding the framing of rules related to grant of minor minerals lies with the Central Government.
3.The State Governments have the power to frame rules to prevent illegal mining of minor minerals.
Which of the statements given above is/are correct?
What changes has the Union Government recently introduced in the domain of Centre-State relations? Suggest measures to be adopted to build the trust between the Centre and the States and for strengthening federalism.
With reference to the constitutional provisions governing mineral taxation in India, consider the following statements:
1.Entry 54 of the Union List empowers Parliament to regulate mines and mineral development in the public interest.
2.Entry 50 of the State List empowers states to levy taxes on mineral rights, subject to any limitations Parliament may impose.
3.The Supreme Court has held that royalties fixed under the MMDR Act constitute a tax and therefore cap states' independent taxing power over mineral land.
Which of the statements given above is/are correct?
Consider the following statements about the Mines and Minerals (Development and Regulation) Act, 1957 and its amendments:
1.Section 15 of the MMDR Act empowers state governments to frame rules for grant of quarry leases for minor minerals.
2.The MMDR Amendment Act, 2015 created District Mineral Foundations to channel mining revenues to project-affected communities.
3.The MMDR Amendment Act, 2026 transfers control over all mineral and mineral-land taxation to state governments.
How many of the above statements are correct?
Match the following MMDR-related provisions/amendments with their primary effect:
List I (Provision/Amendment) — List II (Primary Effect)
A.Section 15, MMDR Act, 1957 — 1. Centralises all mineral and mineral-land taxation under the Union
B.MMDR Amendment Act, 2015 — 2. Empowers states to frame rules for minor mineral concessions
C.MMDR Amendment Act, 2021 — 3. Creates District Mineral Foundations for affected communities
D.MMDR Amendment Act, 2026 — 4. Opens commercial coal mining to private players; auctions critical mineral blocks
With reference to minor minerals in India, consider the following statements:
1.Sand is classified as a minor mineral under the MMDR Act, 1957.
2.The power to grant mining leases for minor minerals lies with state governments.
3.The power to frame rules related to the grant of minor mineral concessions lies exclusively with the Central Government.
Which of the statements given above is/are correct?
Which of the following best describes the constitutional significance of the Supreme Court's 2024 nine-judge bench ruling on mineral taxation in India?
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