High Court Quashes Rs 4,313 Crore Mineral Dispatch Demands in Chromite Block Dispute
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The Orissa High Court has quashed demand letters totalling over Rs 4,313 crore issued to Tata Steel over alleged shortfall in chrome ore dispatch from its Sukinda Chromite Block.
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The Hon'ble High Court of Orissa at Cuttack has quashed two demand letters aggregating over Rs 4,313 crore issued to Tata Steel Limited in connection with alleged shortfall in mineral dispatch from its Sukinda Chromite Block.
The first demand letter dated July 3, 2025, issued by the Office of the Deputy Director of Mines, Jajpur, sought Rs 1,902,72,53,760 based on a revised assesSMEnt of shortfall in dispatch of minerals for the fourth year (July 23, 2023 through July 22, 2024) under the Mine Development and Production Agreement (MDPA). The demand cited alleged violation of Rule 12A of the Minerals (Other than Atomic and Hydrocarbons Energy Minerals) Concession Rules, 2016, along with appropriation of performance security.
A second demand letter dated October 3, 2025, sought Rs 2,410,89,66,881 for alleged shortfall in dispatch of chrome ore for the fifth year (July 23, 2024 through July 22, 2025), also invoking Rule 12A and consequential appropriation of performance security.
Tata Steel challenged the demands through separate writ petitions. Interim orders restraining coercive action were granted on August 14, 2025, and November 21, 2025, and remained in force until the matters were reserved for judgment on February 2, 2026. On April 20, 2026, the Court pronounced judgment in both petitions.
The Court held that the 2020 amendment inserting Rule 12A(1) is constitutionally valid, while sub-rules (1A), (1B) and (1C), introduced with effect from July 1, 2021, operate prospectively. It further concluded that penal consequences for non-adherence cannot be applied retrospectively and that, in case of inconsistency between the Mining Plan and the MDPA, the Mining Plan shall prevail.
Accordingly, all impugned demand notices, to the extent contrary to the Court's conclusions and directions, stand quashed.
About the Company Tata Steel Limited, incorporated in 1907, is a geographically diversified integrated steel producer with operations in India, the Netherlands, the United Kingdom and Thailand, and raw material assets in India and Canada. The Group has 35 MTPA consolidated crude steel capacity, including 26.6 MTPA in India, and reported consolidated crude steel production of 30.92 million tonnes and deliveries of 30.96 million tonnes in its latest financial year.