Mining Law

The Mining industry in India is a major economic activity which contributes significantly to the economy of India. However, the mining in India is also infamous for human right violations and environmental pollution. The industry has been hit by several high profile mining scandals in recent times. Still, mining sector plays a crucial role in the industrial development of the country. FDI up to 100% is permissible through automatic route for coal and lignite mines.

Mining law in India is the branch of law which extensively deals in statutory and mandatory regulations, govt. notifications, legal judicial precedents and pronouncements regarding allotment, ownership of the mines; the health and safety of miners; as also the environmental issues impacting mining.

Govt. of India got two mining laws amended/ enacted in the year 2015, namely, the Mines and Minerals (Development and Regulation) Amendment Act, 2015 & The Coal Mines (Special Provisions) Act, 2015.

As per Section 8A (2) of the Mines and Minerals (Development and Regulation) Amendment Act, 2015, the mining lease period for all minerals other than coal, lignite and atomic minerals, has been increased from 20 years to 50 years. The Act provides for the creation of a District Mineral Foundation (DMF) and a National Mineral Exploration Trust (NMET). The DMF is to be established by the state government for the benefit of persons in districts affected by mining related operations. The NMET shall be established by the central government for regional and detailed mine exploration. As per the Act, the Licensees and the lease holders will have to pay the DMF an amount not more than one-third of the royalty prescribed by the central government, and the NMET two percent of royalty.

The Coal Mines (Special Provisions) Act, 2015 comes into existence after the apex court cancelled the allocation of 214 blocks since 1993. The Act has provisions for allocation of coal mines through a transparent bidding process i.e. E-auction, in order to ensure the continuity in coal mining operations and promotion of optimum utilization of coal resources. The Act also facilitates E-auction of coal blocks for private companies for captive use and allots mines directly to state and central Public Sector Undertakings (PSUs). It contains provisions that propose strong measures for rehabilitation and compensation for displaced persons. It further enables sale of coal especially to small, medium and cottage industries which will increase employment & incomes in these sectors.

In India, systematic surveying, prospecting and exploration for minerals is undertaken by the Geological Survey of India (GSI), Central Mine Planning & Design Institute (CMPDI),Oil and Natural Gas Corporation (ONGC), Mineral Exploration Corporation Limited (MECL), National Mineral Development Corporation (NMDC), Indian Bureau of Mines (IBM),Bharat Gold Mines Limited (BGML), Hindustan Copper Limited (HCL), National Aluminium Company Limited (NALCO) and the Departments of Mining and Geology in various states. The Centre for Techno Economic Mineral Policy Options (C-TEMPO) is a think tank under the Ministry of Mines which looks at the national exploration policy.

In the mining sector we provide strategic advice to private and public sector companies in India and to foreign companies on different ventures. Our lawyers have in depth knowledge of mining laws including The Mines Act, 1952; The Mines Rules, 1955; Mines Rescue Rules, 1985; Coal Mines Regulations, 1957; The Oil Mines Regulations, 1984; The Minor Mineral Concession Rules, 1960. We have assisted clients in negotiating, drafting and vetting agreements such as joint ventures for coal mining projects, coal import and marketing agreements, leasing agreements for mining and quarrying, sub contracting agreements, coal supply agreements, drilling contracts etc. We provide legal opinion on joint ventures and mergers and acquisitions in the mining sector. We also conduct due diligence. We assist clients in obtaining approvals and consents from competent authorities. We also deal in employment and labour related matters in the mining sector. We draft and vet bidding documents relating to mining sector.

India’s energy future and prosperity are integrally dependant upon mining and using its most abundant, affordable and dependant energy supply – which is coal. Coal is extremely important element in the industrial life of developing India. In power, iron and steel, coal is used as an input and in cement, coal is used both as fuel and an input. It is no exaggeration that coal is regarded by many as the black diamond.

Vital Features Of Mining Law

• Govt. Notifications

• Regulations

Courts & Fora: Mining Law

• Bharat Gold Mines Limited (BGML)

• Central Mine Planning & Design Institute (CMPDI)

• Centre for Techno Economic Mineral Policy Options (C-TEMPO)

• District Mineral Foundation (DMF)

• Geological Survey of India (GSI)

• Hindustan Copper Limited (HCL)

• Indian Bureau of Mines (IBM)

• Mineral Exploration Corporation Limited (MECL)

• National Aluminium Company Limited (NALCO)

• National Mineral Development Corporation (NMDC)

• National Mineral Exploration Trust (NMET)

• Oil and Natural Gas Corporation (ONGC)

Legislations Governing Mining Law In India

• Coal Mines (Special Provisions) Act, 2015

• Coal Mines Regulations, 1957

• Mines Act, 1952.

• Mines Rules, 1955

• Mines Rescue Rules, 1985

• Mines and Minerals (Development and Regulation) Amendment Act, 2015

• Minor Mineral Concession Rules, 1960.

• Offshore Areas Mineral (Development and Regulation) Act, 2002.

• Oil Mines Regulations, 1984.

Judgments & Citations: Mining Law In India

• Common Cause and Ors. v. Union of India and Ors., _____- (2016) 11 SCC 455- Mineral Law- What is “In the interest of mineral development” [Full PDF Judgment].

• Gotan Lime Stone- State Of Rajasthan & Ors Versus Gotan Lime Stone Khanji Udyog Pvt. Ltd. & Anr., SC- 20.01.2016- Civil Appeal No. 434 Of 2016- - SC- _____- Mineral Law- Held, “26. .....the doctrine of lifting the veil can be invoked if the public interest so requires or if there is allegation of violation of law by using the device of a corporate entity. In the present case, the corporate entity has been used to conceal the real transaction of transfer of mining lease to a third party for consideration without statutory consent by terming it as two separate transactions – the first of transforming a partnership into a company and the second of sale of entire shareholding to another company. The real transaction is sale of mining lease which is not legally permitted. Thus, the doctrine of lifting the veil has to be applied to give effect to law which is sought to be circumvented.” [Full PDF Judgment].

• Manohar Lal Sharma, Vs. The Principal Secretary & Ors.- SC- _____- Writ Petition (Crl.) No. 120 Of 2012- Mineral Law- The allocation of coal blocks made during the above period by the Central Government, according to petitioners, is illegal and unconstitutional inter alia on the following grounds: (a) Non-compliance of the mandatory legal procedure under the Mines and Minerals (Development and Regulation) Act, 1957 (for short, ‘1957 Act’). 3 (b) Breach of Section 3(3)(a)(iii) of the Coal Mines (Nationalisation) Act, 1973 (for short, ‘CMN Act’). (c) Violation of the principle of Trusteeship of natural resources by gifting away precious resources as largesse. (d) Arbitrariness, lack of transparency, lack of objectivity and non-application of mind; and (e) Allotment tainted with mala fides and corruption and made in favour of ineligible companies tainted with mala fides and corruption [Full PDF Judgment].

• Natural Resources Allocation case- Special Reference No. 1 of 2012- SC- _____- (2012) 10 SCC 1- Mineral Law-“Why must the renewal operate automatically when there needs to be application of mind to ascertain if the renewal would be in the interest of mineral development?”. [Full PDF Judgment].

• Ramakant Dwivedi Versus Rafiq Ahmad & Ors., SC-04.01.2016- Civil Appeal No.4 Of 2016- Mineral Law- Issue Of Grant Of Lease For Excavation Of Minor Minerals [Full PDF Judgment].

Kindly CLICK HERE or e-mail us at info@hellocounsel.com if you want to have Legal Consultations with the empanelled Lawyers at Hello Counsel.