The Supreme Court issues notice to Govt. on a plea challenging 18% GST on services by way of grant of mineral exploration and mining rights.
The petitions are filed by a group of firms involved in mining and crushing operations. The petitions urge that the impugned circular has far-reaching repercussions to the effect that every mining company has been made liable to pay Goods and Services Tax on the amount of royalty paid for mining operations inasmuch as the royalty paid by such companies is already a kind of tax being paid to the government and more importantly which question, i.e. royalty being a tax, is pending adjudication before a nine-judges bench of the Supreme Court.
It is urged that the Petitioners have been paying GST on mining royalty which is paid by them to the state government in accordance with the respective mining lease deeds.
It is submitted that this issue is pending before the Supreme Court in a batch of matters with lead matter titled Udaipur Chambers of Commerce and India SLP(Civil) No. 37326 of 2017 vide Order dated 11.01.2018 wherein stay has been granted of payment of service tax on mining royalty until further order and similarly in various tagged matters, stay has been granted to mining companies for payment of service tax on mining royalty.
The three-judge bench of Justice D. Y. Chandrachud, Justice Surya Kant and Justice Vikram Nath while listing the petition on 4 January 2022 asked the advocate for the Petitioners, Mr. Kartik Seth, regarding the issue of maintainability and why have these writ petitions been filed in the Supreme Court directly under Article 32 of the Constitution of India.
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