The MMDR Amendment Act, 2026 revives the Centre–State tussle settled in *MADA v. SAIL*. Examine it in light of Entries 49 and 50 of List II and Entry 54 of List I.

In Mineral Area Development Authority v. SAIL (2024), a nine-judge Constitution Bench ruled 8:1 that royalty is not a tax. The ruling upheld the States' power to tax mineral rights and mineral-bearing land [1]. The MMDR Amendment Act, 2026 uses Parliament's Entry 54 power to cut back that power, which reopens the federal dispute.

Constitutional scheme as settled by MADA

• Entry 50, List II lets States tax mineral rights, subject to limits Parliament sets by law on mineral development. The Court held that the MMDR Act, as it then stood, set no such limit [1].
• Entry 49, List II (tax on lands) covers mineral-bearing land, and the tax can be measured by the value or yield of the minerals [1].
• Entry 54, List I is a regulatory entry, not a taxing one. It cannot by itself take away State taxing power [1].
• A later order let States recover dues from 1 April 2005 and waived interest and penalties for the period before 25 July 2024 [2].

How the 2026 Act revives the tussle

• It extends Union control to "mineral-bearing land", defined by parameters the Centre prescribes [3].
• States can tax mineral rights and mineral-bearing land only in line with central conditions. This uses the limitation clause in Entry 50 [3].
• Unrecovered levies from before the Act are deemed invalid, but sums already paid are not refunded [3].
• The Centre's reasons are a heavy tax burden, levies added after mining begins, and non-uniform levies across States [3].

Constitutional fault lines

• Entry 49 competence: Entry 49 has no "subject to Parliament" clause. PRS notes that MADA bars Parliament from restricting State taxes on land [4].
• Excessive delegation: the Centre's conditions have no guiding principles written into the law [4].
• Article 14: firms that paid lose out, while firms that defaulted gain [4].
• Fiscal federalism: mineral-rich States such as Jharkhand and Odisha lose an own-revenue base, along with arrears the Court had allowed them to collect [2][3].

The Act stands on firm ground under Entry 50 but on weak ground under Entry 49, and its retrospective cancellation of dues is open to challenge. Parliament could write a rate ceiling or band into the Act, leave land taxes to the States and respect the Court's recovery order [2][4]. Agreeing on these terms with States through Article 263 forums would give miners a predictable tax regime while keeping the cooperative federalism that MADA upheld.