Mining, Minerals & Energy FinanceUpdated 5 October 2026

MMDR Section 9D After the 2026 Amendment Act: State Tax, Cess and Levy Screening Checklist

By Ravi Sisodia · Reviewed by CA Divyanshu Sengar · Updated 5 October 2026

2-minute summary

Section 9D is aimed at State taxes, cesses or levies on mineral rights or mineral-bearing land, including charges linked to mineral quantity, value, royalty or another base.
The practical test is not 'State levy = invalid'. First identify the exact legal character, charging provision, event date and any Central conditions or restrictions.
Keep royalty, auction premium, DMF/NMET, GST, land-related charges and a challenged mineral-right levy in separate ledger/legal buckets.

Current position

The 2026 measure is no longer merely a proposal. Official PIB material describes the Mines and Minerals (Development and Regulation) Amendment Act, 2026 and records the new section 9D framework; a separate official release states that the Amendment Act was notified by the Central Government on 17 August 2026.

Control and evidence map

#	Control	What the file should show
1	Identify the levy	Capture statute/rule, notification, assessment order, base and period.
2	Classify the legal base	Determine whether the charge is on mineral rights/mineral-bearing land or arises under a different statutory head.
3	Map the date	Separate periods before and after the 2026 amendment; do not collapse historic demands into one conclusion.
4	Check Central conditions	Look for rules/conditions prescribed under the amended framework before taking a definitive position.
5	Tie to accounts	Reconcile demand, payment, provision, contingent liability and recoverability positions to the legal file.

Worked example

A miner receives a State demand calculated as a percentage of mineral value. Finance should not automatically pay, reverse or write back the amount because section 9D exists. The file should identify the charging law, demand period, whether the levy falls within section 9D's subject matter, whether any Central condition applies, amounts already deposited and the litigation/status of the demand. Only then should legal and accounting conclusions be documented.

Common mistakes

Leaving the headline as though section 9D were still only proposed.
Treating every State mining-related receipt or fee as the same kind of levy.
Ignoring the demand period and amounts already collected.
Booking a gain or release before the legal entitlement is sufficiently established.

Frequently asked questions

Does section 9D make all State mining revenue illegal?

No. The amendment is targeted. Analyse the exact levy and its legal base instead of applying a blanket conclusion.

Should a company stop paying a disputed demand immediately?

That is a fact-specific legal decision. Check the demand, applicable law, interim orders, prescribed conditions and litigation strategy first.

What should the audit file contain?

The charging instrument, demand, period-wise computation, payment history, legal opinion where needed and accounting conclusion with approval trail.

Official sources

Disclaimer: Educational and informational content only. Apply the current statute, regulation, circular, contract and facts before acting; obtain professional advice where the issue is material or disputed.

Disclaimer

Educational and professional reference only; confirm the current law, rates and the facts of your case before relying on this page.