Supreme Court Rules on Mining Royalties

Shares of major mining companies, including NMDC, Tata Steel, and Vedanta, fell by up to 5% following a Supreme Court ruling that allows states to collect past dues on royalties for mineral-bearing land from the Centre, dating back to April 1, 2005. The nine-judge Constitution Bench upheld state authority to levy taxes on mineral rights, reversing a previous ruling that granted the Centre sole taxing power. NMDC experienced the most significant drop, trading over 5% lower, while Tata Steel saw a decline of over 4%. The ruling has raised concerns about potential retrospective claims, with analysts estimating that the impact on public sector undertakings could be around ₹60,000 crore. Despite the downturn, Hindalco stated that it does not anticipate any retrospective claims affecting its operations. The ruling is considered a major setback for mining operators, prompting widespread selling pressure in the sector.