Skip to main content

Govt eases rules for auction of mineral blocks

Govt eases rules for auction of mineral blocks
New mining rules to allow wider participation, ensure auctions are not called off for want of biddersIn an attempt to generate fresh interest from miners for auctions of mineral blocks, the government has amended the rules to allow wider participation and reduce the chances of auctions getting called off for want of bidders.
A statement from the ministry of mines said on Friday that the Mineral Auction Rules were amended on Thursday, a move expected to enhance investor participation in future auctions.About 34 mineral blocks across six states have been chosen for auction by the end of the current fiscal year, the statement said.
Poor investor interest due to subdued commodity prices and tighter rules led to the cancellation of about 60 auctions since 2015, when auctions replaced administrative allocation of mineral blocks.The National Democratic Alliance government had introduced auctions to remove the element of discretion in the allocation of natural resources.
So far, 33 blocks have been auctioned, which could fetch Rs1.28 trillion for states over the lifetime of the lease.The statement said the 34 blocks to be auctioned in the states of Chhattisgarh, Gujarat, Maharashtra, Odisha, Rajasthan and Telangana are expected to fetch an additional revenue of Rs75,000 crore for states. States get royalty on the production of minerals.
As per the changed rules, auctions will not be cancelled if there are fewer than three bidders from the second round onwards. Earlier, three bidders were required up to the third round for an auction not to be cancelled.
“While a minimum of three bidders is still stipulated in the first attempt to auction, in the amended rules states have the flexibility of allocating the block in the second round itself even if there are less than three bidders. This will make the auction process less cumbersome and will help states auction mineral blocks quickly,” the statement said.
The revised rules also sharply reduce the net worth requirement for eligible bidders from Rs4 crore to Rs50 lakh for blocks with average annual production of up to Rs2 crore. It has been slashed from Rs40 crore to Rs10 crore in the case of mines, with average annual production of up to Rs20 crore, the statement said.
The end-use conditions of the mineral output have also been relaxed. The rules, however, discourage successful bidders from squatting on leases without mining, the statement added.
The Mint, New Delhi, 2nd December 2017


Popular posts from this blog

At 18%, GST Rate to be Less Taxing for Most Goods

About 70% of all goods and some consumer durables likely to cost less

A number of goods such as cosmetics, shaving creams, shampoo, toothpaste, soap, plastics, paints and some consumer durables could become cheaper under the proposed goods and services tax (GST) regime as most items are likely to be subject to the rate of 18% rather than the higher one of 28%.

India is likely to rely on the effective tax rate currently applicable on a commodity to get a fix on the GST slab, said a government official, allowing most goods to make it to the lower bracket.

For instance, if an item comes within the 12% excise slab but the effective tax is 8% due to abatement, then the latter will be considered for GST fitment.

Going by this formulation, about 70% of all goods could fall in the 18% bracket.

The GST Council has finalised a four-tier tax structure of 5%, 12%, 18% and 28% but has left room for the highest slab to be pegged at 40%. A committee of officials will work out the fitment and the council…

Coffee-Toffee, the GST Debate Continues

Hundreds of crores of rupees in the form of taxes ride on the exact categorisation of products Is Parachute hair oil or edible oil? Is KitKat a chocolate or a biscuit? Is a Vicks tablet medicament or confectionery? For the taxpayer and the tax collector, this is much more than an exercise in semantics -hundreds of crores of rupees ride on the exact categorisation.
As the government moves closer to rolling out the goods and services tax (GST) on July 1, many such distinctions are being debated so that no ambiguity remains. Not just that, the government is revisiting old tax cases that were lost over product categorisation, according to people with knowledge of the matter, presumably with a view to making sure that revenue collections can be maximised. “In the past, several tax officers had challenged some of the product categorisations, including those in the retail segment, but lost out in court or at appellate level,“ said one of the persons. “Now we have a chance to go ahead with speci…

Deposit gush:-CA Institute Bats for Special Audit