Mining dept’s ‘royalty’ demand for earthfill has industry ruffled

: Visits by officials of the state mining department to under-construction industrial units in various parts of Punjab, asking the owners to pay “royalty” at Rs 2 per cubic feet for earthfill has left the industry troubled.

The department is implementing a notification issued on August 22 this year.

As per the notification, issued by the department of water resources (mines and geology), the royalty rate of ordinary clay is fixed at Rs 2 per cubic feet for use in construction of commercial infrastructure projects, except brick kilns.

Armed with the notification, employees of the mining department have been visiting underconstruction industrial sites and demanding royalty.

While no show-cause notice has been issued, they have reportedly warned the owners about challans if they fail to deposit the royalty amount.

Even industries being constructed under the Invest Punjab Investment policy are not being spared.

Vishal Vinayak, managing director of Nano Tech Chemical Brothers, whose bio technology plant, a first-of-its-kind project in the state in Kohara, is being constructed under the Invest Punjab Investment policy, said there seemed to be some flaw with the government’s notification, as it was still unclear how the royalty could be calculated.

“The mining officials told me that five-time penalty will be imposed if I refuse to pay the amount,” he said.

Confederation of Indian Industry (CII), Punjab, has condemned the move, saying the matter will be taken up with the state government.

CII Punjab chairman Amit Thapar said in an era where focus was on ease of doing business, the industry was having to deal with a new department (mining) now for compliance of royalty: “Worse, it’s being demanded from the industry that is expanding to boost employment and generate taxes.”

“Such petty taxes in form of royalty are a dampener for the industry. Moreover, it is not even verified as to how the royalty is quantified and what is the mechanism to deposit it,” he said, adding that he will approach the state government about this.

Multiple phone calls to principal secretary, water resources (mines and geology), Krishan Kumar, elicited no response.