The Supreme Court on Friday issued notice to the Karnataka government on a petition filed by MSPL Ltd challenging the blanket ban imposed on transport and export of iron ore in the state.
The move is seen as hurting exports as India is the world?s third largest exporter of the resource. It is estimated that the loss to mining firms since the ban came into effect has been over Rs 1,000 crore and the state and the Centre had totally suffered Rs 2,000-crore revenue loss on account of it.
At the central level, there is no ban on iron ore exports although there is canalisation of exports of high grade ore and also export duties. The state government had issued the twin orders in a bid to curb illegal mining, transportation and storage of of iron ore in the state for export, especially to China, where demand for low-grade iron ore in the form of fines and pellets is huge.
Illegal mining had created a storm in Karnataka politics, with the opposition targeting three ministers-cum-mining magnates?B Janardhana Reddy, his brother Karunakara Reddy and their associate B Sreeramulu, charging them with carrying on illegal mining operations.
A Bench headed by Justice R V Raveendran sought reply from the state government as to why it should not be asked to revoke the ban.
The bench, however, declined to stay any immediate relief to Baldota group-owned mining firm MSPL Ltd, which complained that 6,42,706 tonnes of iron was lying unutilised in its premises due to the government’s refusal to issue a mineral dispatch permit. It has challenged the the Karnataka High Court that upheld the state government orders of July 26, 2010 and July 28, 2010 banning transport of iron ore and its exports from 10 minor ports.
According to the petition, ?The petitioner (MSPL) has been hit very hard by the export ban order. It is a reputed company engaged in the mining and export of iron ore and is registered as an export-oriented unit.? It further said that during the course of litigation proceedings in another case, the government itself had told the high court that all 6,42,706 tonnes of iron ore lying idle in the firm’s premises had been lawfully mined. ?The additional advocate general has filed a memo in these proceedings stating that transport permit for export of this ore would be issued as soon as the ban on export is lifted,? the petition said.
Alleging that the state government had no jurisdiction and authority to pass such orders under the Mines and Minerals Development and Regulation (MMDR) Act, MSPL said that it was only the Centre that could take such measures.
?The MMDR Act does not vest any power in the state government to impose a complete prohibition or ban on the mining, transportation or storage of minerals. The only power of the state government, even under the MMDR Act, is at best to frame rules to create a machinery to detect and prevent illegal mining, transportation and storage of minerals in individual cases,? the petition said.