What are the provisions of Mineral Laws (Amendment) Bill, 2020 passed ...

  Mar 14, 2020

What are the provisions of Mineral Laws (Amendment) Bill, 2020 passed by the parliament recently?


1. Recently, the Parliament has passed the Mineral Laws (Amendment) Bill, 2020.

2. The Bill replaces the ordinance for amendment of the Mines and Minerals (Development and Regulation) Act, 1957 (MMDR Act) and the Coal Mines (Special Provisions) Act, 2015 (CMSP Act) which was promulgated on 11th January 2020.

3. The Bill is expected to open a new era in Indian coal & mining sector especially to promote Ease of Doing Business.

4. The amendment leads to removal of restriction on end-use of coal.

5. Currently, companies acquiring Schedule II and Schedule III coal mines through auctions can use the coal produced only for specified end-uses such as power generation and steel production.

6. The Bill removes this restriction on the use of coal mined by such companies. And thus companies will be allowed to carry on coal mining operation for own consumption, sale or for any other purposes, as may be specified by the central government.

7. The Bill clarifies that the companies need not possess any prior coal mining experience in India in order to participate in the auction of coal and lignite blocks.

8. The Bill adds a new type of license, called prospecting license-cum-mining lease. It will be a composite license providing for both prospecting and mining activities.

9. Currently, separate licenses are provided for prospecting and mining of coal and lignite, called prospecting license, and mining lease, respectively. Prospecting includes exploring, locating, or finding mineral deposit.

10. The Bill provides that state governments can take advance action for auction of a mining lease before its expiry.

11. The Bill provides that the various approvals, licenses, and clearances given to the previous lessee will be extended to the successful bidder for a period of two years.

12. During this period, the new lessee will be allowed to continue mining operations. However, the new lessee must obtain all the required clearances within this two-year period.

13. Currently, upon expiry, mining leases for specified minerals (minerals other than coal, lignite, and atomic minerals) can be transferred to new persons through auction. This new lessee is required to obtain statutory clearances before starting mining operations.

14. The Bill provides that prior approval of the central government will not be required by the state government in granting licenses for coal and lignite, in certain cases.

15. These include cases where the allocation has been done by the central government, and the mining block has been reserved to conserve a mineral.