Supreme Court's Landmark Decision on Mineral Rights Tax Reignites State vs. Centre Debate

The Supreme Court is addressing pleas concerning tax on mineral rights following a pivotal verdict stating that states, not the Centre, have the legislative power. The Centre's opposition, citing a pending curative petition, explores future implications and adjustments related to the 2024 ruling favoring mineral-rich states.

The Supreme Court is set to decide on listing pleas related to the tax on mineral rights. On July 25, 2024, a nine-judge bench led by then Chief Justice D Y Chandrachud ruled by an 8:1 majority that states have the legislative power to tax mineral rights, not the Centre.

This decision, providing significant revenue advantages to mineral-rich states, declared that Parliament lacks the authority under Entry 54 of List I of the Constitution for such taxation. Currently, a bench led by Chief Justice Surya Kant is considering various state petitions due post-verdict.

Solicitor General Tushar Mehta argued that these petitions should await the outcome of the Centre's curative plea against the landmark decision. The court had previously refused the Centre's review pleas on this verdict — a considerable win for mineral-laden states.