New Delhi: The Supreme Court on Wednesday imposed a 100% penalty on illegal mining on account of lack of forest and environment clearances, mining outside lease/permitted area and for encroachment beyond the mining area in Odisha. The 100% penalty will be levied on the miners’ total value of illegal extracts over the years.

A bench headed by justice Madan B. Lokur also held that the National Mineral Policy (NMP) of 2008 which is almost a decade old, particularly with regard to conservation and mineral development required a review and accordingly directed the centre to have a fresh look by 31 December.

Applications by four mining companies, namely Jindal Steel and Power Ltd (JSPL), Rungta Group of companies, Sarda Mines Pvt. Ltd and Essel Mining and Industries Ltd, for resumption of mining will be heard separately by the court after two weeks.

“The amounts due from mining lease holders who have been served the notice by the state government would have to be deposited before or by 31 December and subject to compliance with statutory requirements, they can resume mining operations," the court said.

The court also refrained from initiating a Central Bureau of Investigation (CBI) led inquiry at this stage and was of the view that it would be appropriate if an expert committee was set up under the guidance of a retired judge to identify the lapses over the years leading to unlawful mining in the state.

The direction had come in response to a public interest litigation (PIL) filed by NGO Common Cause seeking a check against lessees for illegal, rampant mining in Odisha.

“Big mining companies will be forced to shell out lakhs of crores as a result of this direction. The quantum that would be payable is yet to be ascertained," said Prashant Bhushan, the petitioner’s counsel.

During the course of hearings, the court had appointed a central empowered committee (CEC) to look into illegal activities by mining companies and furnish a report on it.

While the state government had imposed about Rs60,000 crore penalty on mine lease holders between 2000 and 2010, CEC had recommended that 30% notional value be realized from illegal mining companies.

CEC had sought to ascertain the factual position of mining lessees that obtained approval under Forest (Conservation) Act, 1980 and secured environment clearances in Odisha.

In its report, the panel identified that 131 iron ore and manganese ore mines did not have statutory approval and were operating despite lapse of lease.

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