Case Details : Udaipur Chambers of Commerce & Industry v. Union of India Special Leave to Appeal (C)
The application of GST or Service Tax to mining royalties is under consideration by the Supreme Court, led by Chief Justice DY Chandrachud including Justices JB Pardiwala and Manoj Misra who issued a procedural order on July 24 regarding 61 petitions. The Court has scheduled the hearing of these petitions for the third week of August.
An examination into the imposition of GST or Service Tax on mining royalties will be carried out by the Supreme Court. Recently, an 8:1 majority decision by a 9-judge Constitution bench ruled that royalty on mining leases cannot be considered a tax. The Court appointed advocates Kartik Seth and Omprakash Ajitsingh Parihar as the Nodal Counsel for the GST-related petitions, with Advocate Bhuvan Mishra representing the Union with the purpose of streamlining the hearing procedure.
In 2017, the Rajasthan High Court in Udaipur Chambers of Commerce & Industry v. Union of India observed that royalty is a consideration for mining operations leased by the lessor, implying that such an assignment of the right to use minerals in a leased area constitutes a 'service' and is thus taxable under the service tax regime. This decision is also under challenge in the current batch of petitions before the Supreme Court.
TAGS: GST Service Tax Mining Royalties Supreme Court State Inflation
