SC rejects FIMI's plea over royalty to DMF

The Supreme Court on Wednesday rejected a plea by the FIMI Southern Chapter to discontinue taking contribution as 10 % of the royalty from the miners towards District Mineral Foundation (DMF).

The industry lobby contended that over Rs 11,000 crore collected so far has not been utilised for any infrastructure projects in Karnataka's mineral-rich areas.

"We are of the view that the present is not the stage where contribution is ought to be discontinued," a bench of Justices Ranjan Gogoi, Abhay Manohar Sapre and Navin Sinha said.

The court took into consideration a report given by the Central Empowered Committee on Monday and submission made by amicus curiae senior advocate Shyam Divan, saying it was "not prudent" to discontinue it.

They further said the Comprehensive Environmental Plan for the Mining Impact Zone (CEPMIZ) is a vision document and the quantum of money required for each project was still not clear.

"The ambit of CEPMIZ is in the interest of social justice and may require huge money for carrying out various socio-economic development projects," the CEC said.

Senior advocate P Chidambaram, representing Federation of Indian Mineral Industries, Southern chapter, contended that the Karnataka Mining Environment Restoration Corporation (KMERC), a special purpose vehicle, created for carrying out the projects, did not have in-house experts, they have engaged Rail India Technical and Economic Services (RITES), among others, for feasibility study for laying of conveyor belt system, railway sidings and sub-lines.

"They are at the stage of giving draft feasibility report. The detailed project report will not see light of the day before a year or so. The plan is for 10 years. At the rate on which the money was being collected, they would accumulate Rs 80,000 to 90,000 crore by then," he said.

"It will not serve your purpose by painting a gloomy picture," the bench said, rejecting his plea.

The court directed the KMERC and the state government, represented by senior advocate Raju Ramachandran, to submit a report within six months on the proposed projects including details on total outlay and cost escalation.

"It is going to be a gigantic task. The outcomes will still be nebulous. It would be wishful thinking to say that the project reports can be prepared within six months," the bench said.

The court, however, directed the KMERC, comprising top officials from different ministries of the state government, to involve FIMI Southern Chapter in all future deliberations.