Technical team to examine levy of royalty

At a time when Orissa is losing out on revenue by way of mining royalty due to under-reporting of iron ore prices, the state government has constituted a five-member technical team to examine levy of royalty on minerals under Section 9 of Mines & Minerals (Development & Regulation) Act, 1957 along with Rule-64 (B) of Mineral Concession Rules-1960.

The members of the committee include S K Das, director (mines), P C Patra, deputy director (mines), M R Mohanty, deputy director (mines), S K Das, mining engineer (directorate of mines) and K C Sahoo, deputy secretary, steel & mines department.

This committee will examine the entire matter relating to levy of royalty on minerals.

The mining royalty on iron ore is fixed at 10 per cent ad-valorem and the state government had requested the Centre to raise it to 20 per cent.

Meanwhile, the state government and Indian Bureau of Mines (IBM) were at loggerheads over the issue of under-reporting of sale value of iron ore.

The state had sought the intervention of the Department of Mines, Government of India to arrest the disturbing trend.

Holding the IBM responsible for its faulty procedures adopted in fixing sale value of iron ore, the state Chief Secretary B K Patnaik has urged the Union mines secretary S Vijay Kumar to take appropriate remedial measures so that the state government does not suffer revenue loss.

Patnaik suggested that the IBM may revise the average sale value retrospectively from August 2009 to enable the state government to collect the differential royalty for the past months also.

Underscoring the need for initiating action against unscrupulous lessees who are found to suppress facts or submit erroneous figures, Patnaik has stressed for conducting an audit of statistical figures on price of iron ore to avoid wide variation in price of iron ores of identical nature and grade.

"It would be fair to consider the highest price reported by a lessee rather than the average of the prices reported by lessees for a particular grade and type of ore for the purpose of calculation of royalty in a region. Besides, the pit mouth value (PMV) and sale values submitted by the lessees and which have been considered for calculation for the IBM price should be made transparent and put in public domain", the state Chief Secretary B K Patnaik said in his letter to the Union mines secretary S Vijay Kumar.

The state Chief Secretary's letter comes close on the heels of a letter by the state steel & mines secretary Manoj Ahuja to the Controller General of Mines-IBM, pointing out glaring disparities between the sale value of iron ore sold in Orissa and Chhattisgarh. Earlier, the state Chief Minister Naveen Patnaik had also shot off a letter to the Union minister of state for mines, urging the latter to take action in connection with the under-reporting of iron ore prices.