Mineral auction eligibility can be changed for tribal areas

This is a major shift in central govt's stance as no such powers were given in draft mineral auction rules

The central government has decided to give states power under the recently notified mineral auction rules to change its mineral auction eligibility criteria, keeping in mind the tribal concerns according to various provisions of the Constitution.

This is a major shift in the central government’s stance as no such powers were given in the draft mineral auction rules that were discussed.

According to the final rules,  made in accordance with the Mines and Minerals (Development and Regulation) Amendment Act, 2015, or MMDRA Act, the state government can change the eligibility criteria for the mining lease auction, keeping in mind Article 244 and the Fifth and Sixth  Schedule of the Constitution.

Additionally, the criteria can be changed by the state governments under the Panchayats (Extension to the Scheduled Areas) Act, 1996 and Scheduled Tribes and other Traditional Forest Dwellers (Recognition of the Forest Rights) Act, 2006.

These provisions of the Constitution are the ones that permit the enactment of such special laws relating to tribal areas like Andhra Pradesh Scheduled Areas and Land Transfer Regulation, 1959 and the Maharashtra Land Revenue Code, 1966. One of the focal points of such laws is to prohibit or restrict the transfer of land by or among the tribals in such areas.

“The rules seems to suggest the state government may take into account any law relating to restrictions in transferability and allotment of land in tribal areas while considering the terms and conditions of eligibility,” said Aakanksha Joshi, associate partner, Economic Laws Practice.

However, the state government’s powers — through such provision in the mineral auction rules — are discretionary. “Basically,  the rules have a wider eligibility criteria. They run counter to the restrictions under the state laws that require transfer of land to tribals only. Accordingly, there is a potential conflict,” Joshi added.

According to mining experts, such provision has also been given place because of the Samanta judgment (1997), which said in such tribal areas, only a cooperative consisting of tribals or a public sector undertaking will be permitted to mine. “The inserted provision enables government to reserve such areas and provide eligibility for such leases to operate,” said Kameswara Rao, leader (energy, utilities and mining), PricewaterhouseCoopers.

The MMDRA Act, 2015 was notified on 27th March, 2015 in order to amend the old MMDR Act, 1957. The Amendment has removed the discretionary powers — which used to be with the state government — in the grant of mineral concessions. Henceforth,all mineral concessions will be granted by the respective state government, only through auctions.
STATE OF MINE

• Mineral auction eligibility can be changed as per various Constitutional provisions for tribals
• Special laws of the states made as per these provisions prohibit and restrict transfer of land by and among tribals
• States will have the discretion to keep such laws in mind while forming eligibility criteria
• Samantha judgment of 1997 that said that only tribal cooperatives and PSUs can mine in such areas, has also been kept in mind