UPSC Prelims Practice Questions — Amid Opposition protests, Lok Sabha clears Mines and Minerals Amendment Bill
Q1. The Mines and Minerals (Development and Regulation) Act, 1957 was enacted by Parliament principally in exercise of the legislative power conferred by which one of the following entries of the Seventh Schedule?
- A. Entry 23 of the State List, relating to regulation of mines and mineral development in the State
- B. Entry 54 of the Union List, relating to regulation of mines and mineral development under Union control
- C. Entry 50 of the State List, relating to taxes on mineral rights subject to parliamentary limitations
- D. Entry 52 of the Union List, relating to industries whose Union control is declared expedient
Q2. Consider the following statements regarding the division of legislative power over mines and minerals between the Union and the States:
1. Entry 23 of the State List, which deals with regulation of mines and mineral development, is expressly made subject to the provisions of the Union List, so that to the extent of a parliamentary declaration the State Legislature's power stands excluded.
2. The parliamentary declaration required to activate Union control over regulation of mines and mineral development is contained in Section 2 of the Mines and Minerals (Development and Regulation) Act, 1957.
3. Entry 50 of the State List confers on States an exclusive power to levy taxes on mineral rights, and this power is not capable of being restricted by any law made by Parliament.
Which of the statements given above is/are correct?
- Entry 23 of the State List, which deals with regulation of mines and mineral development, is expressly made subject to the provisions of the Union List, so that to the extent of a parliamentary declaration the State Legislature's power stands excluded.
- The parliamentary declaration required to activate Union control over regulation of mines and mineral development is contained in Section 2 of the Mines and Minerals (Development and Regulation) Act, 1957.
- Entry 50 of the State List confers on States an exclusive power to levy taxes on mineral rights, and this power is not capable of being restricted by any law made by Parliament.
- A. 1 and 2 only
- B. 2 and 3 only
- C. 1 and 3 only
- D. 1, 2 and 3
Q3. The power of the Central Government to exclusively auction mining leases and composite licences for the 24 critical and strategic minerals placed in Part-D of the First Schedule was conferred by which one of the following?
- A. The MMDR Amendment Act, 2015, which made auction by competitive bidding the mode of granting concessions
- B. The MMDR Amendment Act, 2021, which removed the distinction between captive and non-captive mines
- C. The MMDR Amendment Act, 2023, which also inserted the Seventh Schedule and created the Exploration Licence
- D. The MMDR Amendment Act, 2025, which renamed and widened the scope of the exploration trust
Q4. With reference to the Mines and Minerals (Development and Regulation) Amendment Act, 2025, consider the following:
1. Renaming of the National Mineral Exploration Trust as the National Mineral Exploration and Development Trust, with its scope widened to fund development of mines and minerals, including in offshore areas and outside India.
2. Increase in the contribution payable by lessees to the Trust from two per cent to three per cent of royalty.
3. Enabling lease holders to apply to the State Government for adding other minerals to an existing lease, with no additional amount payable for critical and strategic minerals and other specified minerals.
4. Introduction, for the first time, of auction by competitive bidding as the mandatory mode of grant for all mineral concessions, replacing every form of discretionary allocation.
Which of the above is/are correctly identified as changes made by that Act?
- Renaming of the National Mineral Exploration Trust as the National Mineral Exploration and Development Trust, with its scope widened to fund development of mines and minerals, including in offshore areas and outside India.
- Increase in the contribution payable by lessees to the Trust from two per cent to three per cent of royalty.
- Enabling lease holders to apply to the State Government for adding other minerals to an existing lease, with no additional amount payable for critical and strategic minerals and other specified minerals.
- Introduction, for the first time, of auction by competitive bidding as the mandatory mode of grant for all mineral concessions, replacing every form of discretionary allocation.
- A. 1 and 3 only
- B. 2 and 4 only
- C. 1, 2 and 3
- D. 2, 3 and 4
Q5. With reference to the Mines and Minerals (Development and Regulation) Amendment Bill, 2026, consider the following:
1. It empowers the Central Government to make rules prescribing the conditions or restrictions subject to which a State Government may impose a tax, cess or other such levy on mineral rights or on mineral-bearing lands.
2. It brings under Union control the regulation of mineral-bearing lands, that is, land having mineral contents in accordance with parameters prescribed by the Central Government.
3. It provides that State levies on mineral rights that remained unpaid before the commencement of the Amendment Act shall stand invalid, and that amounts already recovered by States shall be refunded to those who paid them.
4. It abolishes altogether the States' power to levy any tax on mineral rights, vesting that power entirely and permanently in Parliament.
Which of the above is/are NOT correct?
- It empowers the Central Government to make rules prescribing the conditions or restrictions subject to which a State Government may impose a tax, cess or other such levy on mineral rights or on mineral-bearing lands.
- It brings under Union control the regulation of mineral-bearing lands, that is, land having mineral contents in accordance with parameters prescribed by the Central Government.
- It provides that State levies on mineral rights that remained unpaid before the commencement of the Amendment Act shall stand invalid, and that amounts already recovered by States shall be refunded to those who paid them.
- It abolishes altogether the States' power to levy any tax on mineral rights, vesting that power entirely and permanently in Parliament.
- A. 1 and 3 only
- B. 3 and 4 only
- C. 2 and 4 only
- D. 4 only
Q6. The Statement of Objects and Reasons of the Mines and Minerals (Development and Regulation) Amendment Bill, 2026 justifies central limits on State levies by enumerating a set of distinct problems said to arise from the uneven imposition of taxes and levies by States in the absence of reasonable limitations. How many such distinct problems does it enumerate?
- A. Three
- B. Four
- C. Five
- D. Six
Q7. The Supreme Court's 2024 ruling in Mineral Area Development Authority v. Steel Authority of India, holding that royalty payable under the MMDR Act, 1957 is not a tax, was delivered by a Bench of how many judges and with how many dissenting opinions?
- A. Seven judges, with one judge dissenting from the majority view
- B. Nine judges, with one judge dissenting from the majority view
- C. Nine judges, with two judges dissenting from the majority view
- D. Five judges, with no dissent recorded on the principal question
Q8. With reference to the Supreme Court's decision in Mineral Area Development Authority v. Steel Authority of India (2024) and its consequences, consider the following:
1. The majority held that royalty payable under the Mines and Minerals (Development and Regulation) Act, 1957 is a tax falling within Entry 50 of the State List.
2. The decision overruled the 1989 seven-judge ruling in India Cement Ltd. v. State of Tamil Nadu.
3. The Court affirmed that Parliament may, by a law relating to mineral development, impose limitations on the States' power to tax mineral rights.
4. In its follow-up order the Court gave the ruling purely prospective effect, barring States from recovering any dues on mineral rights or mineral-bearing lands for periods before the date of the judgment.
Which of the above is/are NOT correct?
- The majority held that royalty payable under the Mines and Minerals (Development and Regulation) Act, 1957 is a tax falling within Entry 50 of the State List.
- The decision overruled the 1989 seven-judge ruling in India Cement Ltd. v. State of Tamil Nadu.
- The Court affirmed that Parliament may, by a law relating to mineral development, impose limitations on the States' power to tax mineral rights.
- In its follow-up order the Court gave the ruling purely prospective effect, barring States from recovering any dues on mineral rights or mineral-bearing lands for periods before the date of the judgment.
- A. 1 and 2 only
- B. 2 and 3 only
- C. 3 and 4 only
- D. 1 and 4 only
Q9. The National Critical Mineral Mission, covering exploration, mining, beneficiation, processing and recovery of critical minerals, was approved by which authority, in which year, and with what outlay?
- A. The Union Cabinet, in 2025, with an outlay of Rs. 34,300 crore spread over seven years
- B. The Cabinet Committee on Economic Affairs, in 2024, with an outlay of Rs. 18,000 crore over seven years
- C. The NITI Aayog Governing Council, in 2025, with an outlay of Rs. 34,300 crore over five years
- D. The Union Cabinet, in 2023, with an outlay of Rs. 16,300 crore spread over seven years
Q10. Under the MMDR Act, 1957 as it stands after the 2023 amendment, the Central Government alone may auction the mining lease and composite licence for the critical and strategic minerals placed in Part-D of the First Schedule. How many minerals are placed in that Part?