Hon’ble Supreme Court today dismissed the SLP’s filed by FIMI and others, against High Court order for Odisha 50:50 rule on Iron ore. Now, the rule is to continue until MMDR Act is amended again, said P L Kandoi, President at AOSF.
Earlier in Aug’14, steelmakers located outside Odisha i.e. Chhattisgarh based Raipur Power and Steels and West Bengal based Mark Steels had filed a Special Leave Petition (SLP) numbered SC 21915/2014 and SC 21818/2014 respectively, in the Supreme Court.
The SLP was filed against Odisha government’s decision of reserving 50% of total Iron ore produced should be reserved for the state based industries. This was was also called valid by Odisha High Court.
In FY15, 46-48 MnT Iron ore was produced in Odisha. Out of this, 29-31 MnT came from merchant miners, who had to reserve 50% of it for state based industries. While, 54 MnT Iron ore was produced by the merchant miners in FY14, out of the state’s total output of 74 MnT.
What is SLP?
Special leave petition (SLP) means that you take special permission to be heard in appeal against any High Court/tribunal verdict.
Usually, any issue decided by the state High Court is considered as final. But, if there exists any constitutional issue or legal issue which can only be clarified by the Supreme Court of India, then this leave is granted by the Supreme Court and is heard as a civil or criminal appeal, as the case may be.
What is Odisha 50:50 Rule on Iron Ore?
On 05 Dec, 2012, the Odisha Steel & Mines department had issued a notification, directing all miners to reserve 50% of their monthly Iron ore output for state based industries, after captive consumption.
The notification was issued, citing mineral development and other rules contained in the Mineral Concession Rule (MCR) as well as raw material need for local steel companies as the cause for such action.
A number of miners had moved to Odisha High Court, challenging the legal validity of the notification, terming the restriction of mineral sales a breach of the constitution.
Hearing on writ petitions filed by AOSF (All Odisha Steel Federation) and FIMI (Federation of Indian Minerals and Industries), the High Court stated that the government has the right of preemption on minerals, as mentioned in the section 27 of MCR. Hence, the notification was legally valid.
Further, High Court asked the state government to form a mechanism, which will define equal supply to state based industries at a fair price.
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