Central legislative competence over mineral regulation affirmed; royalties characterised as compensation for resource depletion, limiting state levies.

The Court concluded that the central legislative framework occupies the field of mineral regulation and that royalties are compensation for depletion of state-owned natural resources, not conventional taxes; consequently the Centre may impose such levies while States remain constrained from imposing royalties in the nature of compensation that would encroach on the Centre's exclusive regulatory domain.

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