1. States to deposit funds collected under NMET to consolidated fund

States to deposit funds collected under NMET to consolidated fund

States will now have to deposit the fund collected under the National Mineral Exploration Trust to the Consolidated Fund of India instead of the trust’s own bank account.

By: | New Delhi | Published: February 15, 2018 5:36 AM
NMET, NMET FUND, MMDR (Amendment) Act, 2015,  budget , budget 2018 The power of managing and supervising the NMET Fund, which had Rs 969-crore corpus as on December 4, 2017, vests with its executive committee, headed by the member secretary. (IE)

States will now have to deposit the fund collected under the National Mineral Exploration Trust (NMET) to the Consolidated Fund of India instead of the trust’s own bank account. However, it will still be administered by the mines ministry as earlier.

Created through a provision in the MMDR (Amendment) Act, 2015, the NMET Fund is provided to the states, on their demand, for carrying out exploration work in the natural resources bearing areas. NMET is levied at 2% of the royalty. States collect the money from the miners and deposit the sum with the bank account of the Trust.

The power of managing and supervising the NMET Fund, which had Rs 969-crore corpus as on December 4, 2017, vests with its executive committee, headed by the member secretary.

However, following directions from the finance ministry, the mines ministry has now started working on the National Mineral Exploration Trust Amendment Rules, 2018, which also suggests that the bank account of the trust shall be closed as soon as possible and the entire proceeds would be booked under a head in the public account of a state and be transferred to the Consolidated Fund of India.

“The accretions will thereafter be periodically transferred to the Fund under the Public Account of India through appropriations during the financial year and suitable Budget provisions in the inter-account transfer shall be formulated,” as per the draft amendment rules.

The member secretary of the executive committee shall, before the beginning of each financial year, cause preparation of an annual budget containing the details of the proposed income and expenditure on activities covered in the annual plan for that particular financial year, including the legal, administrative and other costs to be incurred by the Trust together with the details of funding requirements in the annual budget.

“Annual Budget provision shall also be made in the demands of grants of ministry of mines under appropriate head for incurring expenditure under Trust fund. The equivalent amount shall be met from the Trust fund,” it said. On the basis of the sanction by the trust office, the pay and accounts office shall make the payment by debiting from the government account.

The NMET fund shall be non-lapsable under non-interest bearing section of Public Account of India and shall be administered by the ministry of mines.

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