Supreme Court Verdict Shakes Indian Mining Industry with Retrospective Taxation

The Supreme Court's recent verdict on mining royalties has posed significant financial implications for India's mining industry. The decision allows states to retrospectively collect taxes from April 2005, potentially affecting the entire mining value chain and triggering inflationary trends. Industry experts stress the need for urgent legislative mitigating measures.

The recent Supreme Court verdict on mining royalties is set to have far-reaching financial implications for India's mining industry. As per industry players, the retrospective collection of taxes dating back to April 2005 could amount to Rs 1.5-2 lakh crore.

On Wednesday, the apex court upheld the states' power to levy taxes on mineral rights and lands, allowing them to collect royalties retroactively. This could lead to significant disruptions for mining, steel, power, and coal companies.

Economic Advisory Council member Shamika Ravi expressed concerns on social media about potential retrospective taxation, stressing the need for laws that protect against property expropriation. Meanwhile, miners' body FIMI pointed out that this judicial decision adds strain to an already highly taxed sector.

(With inputs from agencies.)