Constitutional validity of rules to compute mining royalties held valid

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Supreme Court upheld the constitutional validity of the Explanation to Rule 38 of the Minerals (Other than Atomic and Hydro Carbons Energy Minerals) Concession Rules, 2016, and Rule 45(8)(a) of the Mineral Conservation and Development Rules, 2017. The Court affirmed that including payments made towards royalty, District Mineral Foundation (DMF), and National Mineral Exploration Trust (NMET) in the “average sale price” (ASP) calculation—which serves as the basis for calculating royalty—is a valid legislative measure to check tax evasion and under-invoicing in the mining sector.

Background The petitioners challenged the constitutional validity of the Explanation to Rule 38 of the 2016 Rules and Rule 45(8)(a) of the 2017 Rules. They contended that these provisions, by including royalty, DMF, and NMET contributions in the Average Sale Price (ASP), caused a “cascading effect” (royalty on royalty) and led to double taxation in auctioned mines. The petitioners argued these rules were ultra vires the Mines and Minerals (Development and Regulation) Act, 1957 (MMDR Act), and violated Articles 14 and 19(1)(g) of the Constitution.

Arguments

  • Petitioners: Asserted that the inclusion of statutory levies in the ASP is arbitrary, causes excessive financial burden, and contradicts the principle that ASP should reflect the true value of the mineral. They drew parallels to coal, where such statutory dues are excluded from the “actual price” calculation.
  • Union of India: Argued that the rules were designed to prevent large-scale under-invoicing, a problem prevalent in iron ore mining where disparate private players operate. They highlighted that the revenue loss to States if these provisions were removed would exceed ₹3 lakh crore over 50 years. They also clarified that comparing iron ore to coal is unjustified due to fundamental differences in market structure and price discovery mechanisms.

Court’s Observations

  • Presumption of Constitutionality: The Court emphasized that subordinate legislation enjoys a presumption of constitutionality, and the burden lies on the petitioner to prove manifest arbitrariness or lack of legislative competence.
  • Legislative Policy and Evasion: The Court held that the legislature has broad discretion in fiscal matters. Measures intended to prevent tax evasion—even if they involve “legal fictions” or proxy measures for value—are permissible if they have a rational nexus to the object of the Act.
  • Nature of Levy: Drawing on precedents like Sanyasi Rao, the Court held that adopting a measure (like the inclusive ASP) to assess a levy does not change the nature of the levy itself; it is a valid tool to ensure the State receives its due revenue.
  • Classification: The Court rejected the discrimination claim, stating that treating coal and iron ore differently is not arbitrary given the distinct commercial realities and risks of evasion in each sector.

Conclusion The Supreme Court dismissed the challenge, ruling that the impugned rules are not manifestly arbitrary or irrational. The Court concluded that the Government’s mechanism to load certain factors onto the sale value to check manipulation is a valid exercise of power to protect state revenue.

2026 INSC 679

Kirloskar Ferrous Industries Ltd. and Anr. vs. Union of India & Anr. (D.O.J. 13.07.2026)

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Supreme Court Acquits Appellant in the Absence of Corroborating Circumstances Beyond Last Seen Theory

August 5, 2026 No Comments

In this criminal appeal, the Supreme Court addressed whether a conviction for murder can be sustained solely on the basis of a weak “last seen” theory without any other corroborating incriminating circumstances. The appellant, who was the son-in-law of PW1, was convicted alongside other co-accused based on testimonies of witnesses including PWs 1 to 4, some of whom were initially declared hostile before turning to implicate the accused. Although the appellant had already been released on remission, he pursued the appeal seeking a clean acquittal. The Supreme Court allowed the appeal and set aside the conviction, holding that the testimonies regarding the last seen theory did not inspire confidence and that a conviction cannot rest merely on the last seen theory in the complete absence of other incriminating evidence.

  • Unreliable Testimony: The testimonies of witnesses (PW1 to PW4), some of whom were initially declared hostile before alleging assault by PW1’s husband and the appellant, failed to inspire judicial confidence.
  • Limitation of the Last Seen Theory: A conviction cannot be based solely on the last seen theory without any other supporting incriminating circumstances.
  • Acquittal Granted: The Supreme Court set aside the judgments of the lower courts and granted a clear acquittal to the appellant, directing the cancellation of any bonds executed for earlier remission releases.

2026 INSC 780

Munu Sen v. The State of Chhattisgarh (D.O.J. 29.07.2026)

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Proving Adultery at the Threshold: Supreme Court Rules on Interim Maintenance and Private Investigation Evidence

August 5, 2026 No Comments

In this criminal appeal, the Supreme Court examined whether a husband’s application under Section 125(4) of the Code of Criminal Procedure, 1973 (CrPC) alleging adultery by the wife can be deferred until the final adjudication of the main maintenance proceedings, or if it must be considered at the threshold when determining interim maintenance. The appellant-husband had opposed interim maintenance by presenting electronic evidence (photographs and videos) indicating an adulterous relationship, but the lower courts dismissed his application on the grounds that such allegations could only be proved during final trial. The Supreme Court allowed the appeal, set aside the High Court’s order, and remanded the matter to the Trial Court. The Court held that if a husband presents clear, cogent, and ex-facie evidence at the threshold establishing adultery, interim maintenance can be barred or suspended, and such applications cannot be routinely postponed to the final judgment. Additionally, the Supreme Court highlighted the legal lacuna surrounding unregulated private detective agencies and directed that a copy of the judgment be forwarded to the Ministry of Law and Justice and the Law Commission of India for appropriate legislative consideration.

  • Nature and Object of Section 125 CrPC: Proceedings under Section 125 CrPC are summary and civil in nature, designed to prevent vagrancy, destitution, and neglect by ensuring a dignified life for dependents through social justice.
  • Bar Under Section 125(4) CrPC: Section 125(4) acts as an exception, explicitly barring a wife from receiving maintenance (interim or final) if she is living in adultery, refuses to live with her husband without sufficient reason, or lives separately by mutual consent.
  • Timing of Section 125(4) Adjudication: An application under Section 125(4) does not have to wait until the final conclusion of the main petition. If the husband produces ex-facie, clear evidence establishing adultery or mutual consent at the threshold, interim maintenance is impacted; if evidence requires formal proof, interim maintenance continues in the interregnum until the Section 125(4) application is decided.
  • Evidentiary Standard for Electronic Records: Evidence procured through private investigators (such as digital photographs and videos) must satisfy strict admissibility and verification standards, including compliance with Section 65B of the Indian Evidence Act / Bharatiya Sakshya Adhiniyam (BSA) and the foundational tests of relevancy and accuracy.
  • Need for Regulation of Private Investigators: Acknowledging the absence of statutory regulation for private detective agencies in India, the Supreme Court directed the Ministry of Law and Justice and the Law Commission of India to examine the framework for regulating private investigators, balancing evidence collection with privacy and data protection rights.

2026 INSC 778

Himanshu Chordia v. State of Rajasthan & Anr. (D.O.J. 31.07.2026)

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Supreme Court Bars Late-Stage Counter-Claim Court Fee Deposit After Conclusion of Evidence

August 5, 2026 No Comments

In this civil appeal, the Supreme Court examined the legality of an order permitting a defendant to pay court fees on a counter-claim with a delay of four years, specifically after the entire evidence in the suit had been closed. When the written statement and counter-claim were initially filed, the defendant did not pay the required court fees due to financial constraints, and only the written statement was taken on record, leaving the counter-claim non-existent. Years later, after the plaintiff’s evidence and the cross-examination of PW1 concluded, the trial court permitted the defendant to deposit the court fees and prosecute the counter-claim. The Supreme Court allowed the appeal and set aside the orders of the High Court and Trial Court, holding that since the counter-claim was never formally on record and the trial had already concluded, introducing it at that belated stage violated the strict parameters of Order VI Rule 17 of the Civil Procedure Code, 1908 (CPC), as no due diligence or foundational grounds were established.

  • Non-Existence of Counter-Claim Without Court Fees/Taking on Record: Where a defendant fails to pay court fees upon raising a counter-claim and explicitly requests the court to take only the written statement on record due to lack of financial capacity, the counter-claim does not legally exist on record.
  • Limits of Section 149 CPC: While Section 149 CPC grants courts the discretionary authority to allow the payment of deficient court fees at any stage of the suit, it presupposes that the pleading or claim itself is validly and properly on record.
  • Application of Order VI Rule 17 CPC Post-Trial: Introducing a counter-claim after the conclusion of trial amounts to an amendment of the pleadings. Under the proviso to Order VI Rule 17 CPC, such amendments post-commencement of trial are barred unless the party proves that, despite due diligence, they could not have raised the matter earlier.
  • Prejudice to the Plaintiff: Permitting a counter-claim after the entire evidence is closed causes severe prejudice, as the plaintiff has had no opportunity to adduce evidence to controvert the new claims.
  • Final Direction of the Supreme Court: The Supreme Court allowed the appeal, set aside the High Court’s affirmation of the trial court’s order, and directed that the suit shall proceed and be adjudicated strictly without the counter-claim.

2026 INSC 777

IJM Corporation Berhad v. M/s Lakshmi Sai Constructions Company and Anr. (D.O.J. 28.07.2026)

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Navigating Discretionary Equity: Supreme Court Restores Trial Court Decree Denying Specific Performance

August 5, 2026 No Comments

In this civil appeal arising from a property transaction spanning over two decades, the Supreme Court examined the limits of appellate interference with the discretionary and equitable relief of specific performance under Section 20 of the Specific Relief Act, 1963. The sole appellant (original defendant) had entered into an agreement to sell a property in Udhagamandalam for ₹2,25,00,000, but the transaction collapsed amid allegations of bounced cheques, mutual lack of candor, inconsistent pleadings, and criminal complaints. While the trial court decreed only a refund of the advance amount of ₹85,00,000 with interest, the High Court reversed it and granted specific performance. The Supreme Court allowed the appeals, set aside the High Court’s judgment, and restored the trial court’s decree. It held that the plaintiffs failed to prove continuous readiness and willingness, approached the court with unclean hands due to retaliatory criminal proceedings, took contradictory stances regarding property assignment, and that the long passage of time combined with the advanced age of the appellant rendered specific performance inequitable.

  • Scope of Order XLI Rule 22 CPC: A respondent supporting a decree can impugn an adverse finding without filing cross-objections, provided they seek no relief beyond what the decree already grants.
  • Maintainability Without Declaration: Where an agreement does not confer a contractual right of unilateral termination, such termination amounts to repudiation, and the aggrieved party may sue for specific performance without seeking a separate declaratory relief as to the invalidity of the cancellation.
  • Continuous Readiness and Willingness: The plaintiff in a specific performance suit must prove continuous readiness and availability of funds from the date of the agreement up to the date of the decree. Dishonour of advance cheques and absence of concrete fund-raising material at the time of the suit demonstrate a lack of continuous financial readiness.
  • Conduct and “Clean Hands” Principle: Specific performance is an equitable and discretionary remedy. Plaintiffs who adopt contradictory stands across litigation (such as blowing hot and cold regarding assignment of rights) and file retaliatory criminal complaints seeking recovery of money rather than upholding the contract are not entitled to equitable relief.
  • Hardship and Delay: An inordinate lapse of time (over two decades), coupled with the advanced age of the vendor and the death of a key plaintiff, constitutes severe hardship and makes specific performance inequitable, warranting the restoration of the trial court’s alternative remedy of refund with interest.

2026 INSC 776

V.N.A.S. Chandran v. S. Venila and Others (D.O.J. 31.07.2026)

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