Daily Prelims Notes 26 July 2024

July 26, 2024
Posted by: OptimizeIAS Team
Category: DPN

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Daily Prelims Notes

26 July 2024

Table Of Contents

1. States have unlimited right to tax mineral-rich lands: Supreme Court

Sub: Polity

Sec: Constitution

Context:

A significant judgment delivered in a 8:1 ratio by a nine-judge Constitution Bench on July 25 held that the power of State Legislatures to tax mining lands and quarries is not limited by the Parliament’s Mines and Minerals (Development and Regulation) Act of 1957.

What is the Supreme Court judgment?

In 1989 Supreme court in India Cement Ltd. vs Tamil Nadu Government case ruled that states were permitted only to collect royalties and not impose additional taxes.
The court considered royalties as taxes and imposing any cess on them is beyond state jurisdiction.
The Constitution Bench headed by Chief Justice of India (CJI) D.Y. Chandrachud has overturned the 1989 judgment which ruled that royalties were not a tax.
The majority judgment said the Parliament, through the MMDR Act, cannot limit the power of the State to legislate on the taxation of mines and quarries within their jurisdiction.
The bench ruled that Parliament does not possess the power to tax mineral rights which are under Entry 50 of the List II of the Constitution, which governs state powers and is limited to imposing restrictions and not taxes.
State Legislatures derive their power to tax mines and quarries under Article 246 read with Entry 49 (tax on lands and buildings) in the State List of the Seventh Schedule of the Constitution.
CJI also held that the Parliament does not have the legislative competence to tax mineral rights, with Entry 54 of the Union List (Regulation of mines and minerals development declared by parliamentary law to be expedient in the public interest) being only a general entry.
Power to tax mineral rights is enumerated in List II.

What is royalty?

Royalty is a contractual consideration paid by the mining lessee to the lessor for enjoyment of mineral rights.
It originates from an agreement between parties.
Royalties are the fees paid to the owner of a product in exchange for the right to use that product.
The majority verdict further clarified that royalty paid by those who lease mines to the government is not tax.

2. Panel will look into issues stalling Bill, NE tribal councils told

Sub: Polity

Sec: Constitution

Context:

Chiefs of 10 Sixth Schedule tribal autonomous councils meet Home Minister Amit Shah to push for the Constitution (125th Amendment) Bill, pending in Rajya Sabha since 2019.

125th Constitutional Amendment Bill:

The Constitution (One Hundred and Twenty-Fifth Amendment) Bill, 2019 was introduced in Rajya Sabha by the Minister of Home Affairs, Mr. Rajnath Singh on February 6, 2019.
The Bill amends provisions related to the Finance Commission and the Sixth Schedule of the Constitution.
The Sixth Schedule relates to the administration of tribal areas in the states of Assam, Meghalaya, Tripura and Mizoram.

Features of the bill:

The Bill provides for Village and Municipal Councils in addition to the District and Regional Councils. Village Councils will be established for villages or groups of villages in rural areas, and Municipal Councils will be established in urban areas of each district.
Bill states that the Governor may make rules for devolution of powers and responsibilities to the Village and Municipal Councils.
- The District Councils may make laws on various issues, including:
- (i) preparation of plans for economic development.
- (ii) implementation of land reforms.
- (iii) urban and town planning,
- (iv) regulation of land-use, among other functions.
The Bill provides the appointment of a Finance Commission for these states, to review the financial position of District, Village, and Municipal Councils.
The Bill states that all elections to the District Councils, Regional Councils, Village Councils, and Municipal Councils will be conducted by the State Election Commission appointed by the Governor, for these four states.
The Sixth Schedule provides that the Governor may make rules for the constitution of District and Regional Councils, including qualifications for being elected as members of these councils.
The Bill adds that the Governor may make rules for the disqualification of such members on the grounds of defection.

What is 6th Schedule?

The Sixth Schedule of the Indian Constitution includes provisions for the administration of tribal areas in the states of Assam, Meghalaya, Tripura and Mizoram in northeast India.
It establishes autonomous councils that have legislative, judicial, executive and financial powers to independently govern these areas.
There are a total of 10 autonomous councils under the Sixth Schedule, including three each in Assam, Meghalaya and Mizoram and one in Tripura.
An Autonomous District Council (ADC) is established for each autonomous district while Regional Councils (RC) are established where there are significant populations of other tribes, aside from the main tribe.

3. Why AI’s present and future bring some serious environmental concerns

Sub: Sci

Sec: AWARENESS IN IT and computer

Context:

Google reported a 13% increase in emissions in 2023 compared to 2022.
The rise was mainly due to increased electricity consumption in data centres and supply chains.
Data centres used 17% more electricity in 2023, largely due to the growing deployment of AI tools.

Energy Consumption by AI:

AI tools, such as those used in chatbots, consume significantly more energy than regular Google searches.
Studies show that an AI query can use 10 to 33 times more energy than a typical search, with image-based AI searches consuming even more.
Reasons for Higher Emissions
AI models process and sift through more data, requiring more electrical signals and generating more heat.
The increased heat demands more powerful cooling systems in data centres, further increasing energy consumption.

Global Impact of AI on Energy Consumption:

The widespread use of AI is expected to sharply increase global energy consumption.
Data centres currently account for 1-1.3% of global electricity demand, potentially rising to 1.5-3% by 2026.
In countries like Ireland and the United States, data centres already consume significant portions of national electricity demand.

Concerns for India:

In India, the environmental impact of AI and data centres is expected to grow.
The increased demand for water resources for cooling data centres, noting a lack of adequate data on water consumption.
The need for efficient planning and measures to minimize the environmental impact as AI and data centres expand in India.

Potential Positive Impact of AI:

Some estimates suggest that large-scale AI deployment could reduce global emissions by 5-10% by 2030.
AI can help monitor and optimize existing processes to reduce wastage and inefficiencies, potentially generating significant economic value.

4. MEA tells States not to ‘intrude’ into foreign affairs after Kerala appoints senior officer for ‘external cooperation’

Subject: Polity

Sec: Constitution

Context:

Days after the Kerala government appointed senior IAS officer K. Vasuki as an officer in charge of ‘external cooperation’, the Ministry of External Affairs (MEA) reminded the State governments that they should not “intrude” into domains that are beyond the “Constitutional jurisdiction” of the States.

More on News:

The Constitution of India under the 7th Schedule list 1 – Union list, item 10, clearly specifies that foreign affairs and all matters which bring the Union into relation with any foreign country, are the sole prerogative of the Union Government.
The States of the India are important stakeholders in foreign and security affairs but the ultimate foreign policy formulation takes place at the central level.
It is not a Concurrent subject and definitely not a State subject. Our position is that State governments should not intrude into matters that are beyond their Constitutional jurisdiction.

7th Schedule:

The 7th schedule of Indian constitutionspecifies the allocation of powers and functions between the Union and states.
Article 246, which is under the 7th schedule of Indian constitution, is one such article.
Article 246 divides the subject matter of laws made by the Parliament and the State Legislature under three lists. They are:
- List I – Union List
- List II – State List
- List III – Concurrent List
To amend the 7th schedule of Indian constitution, a special majority of the Parliament and ratification of half of the State Legislatures by a simple majority is required.

Union List of the 7th schedule of Indian Constitution – List 1

Subjects that are of national importance and are handled by the central government.
The Union government has exclusive power to legislate on these subjects.
This means that only the Union government can make laws on these subjects.
The state governments cannot make laws on these subjects.

Constitution of India under the 7th Schedule list 1 – Union list, item 10

Foreign affairs; all matters which bring the Union into relation with any foreign country.

5. Government has ‘usurped’ UGC’s autonomy by curbing financial powers

Subject: Polity

Sec: National Body

Context:

Narendra Modi government for interfering with the autonomy of the University Grants Commission (UGC) by “usurping” its power to sanction funds for higher education.

More on News:

UGC’s functioning of ‘Granting’ funds has been usurped by Higher Education Financing Agency (HEFA) — a venture between Canara Bank and the Ministry of Education.
This will not only compel colleges and universities to introduce more self-financing courses but also increase the financial woes of SC, ST, OBC and EWS students.
The budget for higher education has been slashed by ₹9,600 crore. Similarly, the budget for IITs and IIMs have been cut for the second consecutive year.
The UGC is a statutory body, and was supposed to be the only grant-giving agency in the country, but has snatched its power, thereby trampling upon its autonomy!

University Grants Commission (UGC):

Founder: Maulana Azad
Headquarters: New Delhi
University Grants Commission is a statutory body under Department of Higher Education, Ministry of Education, Government of India.
It was set up in accordance to the UGC Act 1956.
It has six regional centre in Pune, Bhopal, Kolkata, Hyderabad, Guwahati and Bangalore.
A proposal to replace it with another new regulatory body called HECI is under consideration by the Government of India.
The UGC provides doctoral scholarships to all those who clear JRF in the National Eligibility Test.

Higher Education Financing Agency (HEFA):

HEFA was founded in May 2017, and is a joint venture between the Union Ministry of Education and Canara Bank, with agreed-upon equity participation in the ratios of 91% and 09.09%, respectively.
As a non-deposit-taking NBFC and as a Union Government entity. Under the Companies Act of 2013, HEFA is registered with the RBI

Vision:

To enable India’s premier educational institutions to excel and reach the top in global rankings by financing building world class infrastructure including R&D Infra.

Responsibilities:

To finance the demand, it will mobilise market resources in the form of equity from people and corporations, as well as the issuing of bonds.
It offers financial help for the development of educational facilities and research and development in India’s best educational institutions.
Encourages scientific and technical advancements by providing funding for R&D facilities to perform high-quality research.
Channel corporate social responsibility (CSR) contributions and donations for different initiatives aimed at improving higher education.

6. Credit guarantee cover extended to ₹7.5 lakh under revamped Model Skill Loan Scheme

Subject: Schemes

Sec: Employment

Context:

A similar scheme launched in 2015 saw low fund utilisation because individual loans were limited to ₹1.5 lakh, though high-end skilling courses cost much more; new scheme also expands lender network to NBFCs, small banks.

More on News:

The Union Budget announcement hiking the eligible size of loans for high-end skilling courses under the Model Skill Loan scheme from ₹1.5 lakh to ₹7.5 lakh.
The earlier Credit Guarantee Fund Scheme for Skill Development, notified in November 2015 to create a credit guarantee fund for courses aligned to the National Skill Qualification Framework, faced multiple challenges.
Under the new scheme, the lending network has been broadened from only IBA banks to include Non Banking Financial Companies and small finance banks, with access to more skill courses and higher loan limits.

Model Skill Loan Scheme:

It was introduced in July, 2015, to offer institutional credit to individuals pursuing skill development courses aligned with National Occupations Standards and Qualification Packs.
These courses are conducted by training institutes following the National Skill Qualification Framework (NSQF) and lead to certifications, diplomas, or degrees.
The Scheme applies to all member banks of the Indian Banks’ Association (IBA) and other banks and financial institutions as advised by the Reserve Bank of India (RBI) .
Features:
- Eligibility: Any Indian National who has secured admission in a course run by Industrial Training Institutes (ITIs), Polytechnics, or in a school recognised by Central or State Education Boards or in a college affiliated with a recognised university, training partners affiliated to National Skill Development Corporation (NSDC) Sector Skill Councils, State Skill Mission, or State Skill Corporation can avail loan for the purpose.
- No specific restriction with regard to age.
- Courses: Aligned with NSQF.
- Duration of Course: No minimum duration.
- Quantum of Finance: Rs. 5,000-1,50,000. Now, increased to Rs 7.5 lakh.
- Moratorium: Duration of the course.
- Repayment Period:
  - Loans up to Rs. 50,000: Up to 3 years.
  - Loans between Rs. 50,000 to Rs. 1 lakh: Up to 5 years.
  - Loans above Rs. 1 lakh: Up to 7 years.
Coverage: Course fees and expenses for assessment, examination, study material, etc.
Interest Rate: The interest rate to be charged by the bank should not be more than1.5% p.a. over and above repo-linked-lending-rate (RLLR) or any other external benchmark interest rate conforming to RBI guidelines.

Revised Skill Loan Scheme:
- Loan Amount: Increased to facilitate loans up to ₹7.5 lakh.
- Guarantee: Backed by a guarantee from a government-promoted fund.
- Beneficiaries: Expected to benefit 25,000 students annually.
Higher Education Loans for Underprivileged Students:
- Loan Amount: E-vouchers for loans up to ₹10 lakh for higher education in domestic institutions.
- Eligibility: Targeted at students who do not qualify for existing schemes.
- Interest Subvention: Annual interest subvention of 3% of the loan amount.
- Beneficiaries: Directly benefit 100,000 students every year.
Budget Allocation for Education, Employment, and Skilling:
- Total Allocation: ₹1.48 trillion.
- Comparison: Significant increase from the previous allocation of ₹1.2 trillion in the Interim Budget.

7. Digital Personal Data Protection (DPDP) Bill: Key Aspects and Implications

Sub: Polity

Sec: Legislation in news

Consent Notices:

The new DPDP law mandates that firms, including mobile app developers, e-commerce platforms, and social media companies, must issue consent notices to users.
These notices must explain the types of personal data being collected, the purposes for data usage, and how users can withdraw their consent.
Detailed Data Disclosure:
- Data fiduciaries (firms collecting data) are required to obtain explicit consent from data principals (users) for each item of personal data collected.
- For example, firms must clearly state the purpose for collecting data such as a user’s name, email address, credit card details, and residential address.
Increased Compliance Costs:
- Compliance with these regulations is expected to increase operational costs for companies as they will need to create detailed consent notices and ensure transparent and justified data collection practices.
- This requirement is intended to prevent indiscriminate data collection, such as accessing contact lists or location data without clear relevance to the provided service.
User Empowerment:
- The bill ensures that users are informed about the data collection, the risks and benefits of sharing their data, and their rights regarding data retention and deletion.
- Users have the right to request data erasure once its collection purpose is fulfilled, unless legal obligations require retention.
Pending Modifications and Implementation:
- Although the DPDP Act was passed last year, the regulatory framework, including specific rules for processing children’s data and the reporting timeline for data breaches, is still being finalized.
- The delay in finalizing these rules has left users without a comprehensive framework to safeguard their personal data.

Conclusion: The DPDP Bill emphasizes user consent and transparency, aiming to curb the misuse of personal data.

However, the implementation may pose challenges for businesses in terms of compliance costs and operational adjustments. The finalization of the regulatory framework will be crucial in defining the practical implications of the bill.

8. India’s illegal coal mining problem

Sub: Geo

Sec: Eco geo

Context:

On July 13, three workers died of asphyxiation in an illegal coal mine in Surendranagar district, Gujarat.

Background and Legal Framework

Coal in India was nationalized in two phases: coking coal in 1971-72 and non-coking coal in 1973.
The Coal Mines (Nationalisation) Act, 1973, regulates coal mining eligibility in India.
Illegal mining is a law-and-order issue, under state jurisdiction, putting the responsibility on state governments.
Mines and Minerals (Development and Regulation) Act, 1957 (MMDR Act): This central legislation governs the mining sector, detailing processes for acquiring mining licenses and regulating mining activities. It empowers state governments to frame rules to prevent illegal mining.

Factors Contributing to Illegal Coal Mining

India’s high demand for coal, which fuels 55% of its energy needs, often exceeds the legal supply, encouraging illegal mining.
Poverty and unemployment in coal-rich areas drive locals to illegal mining.
Weak enforcement of mining regulations, especially in remote areas, contributes to the problem.
“Coal mafias” and alleged political support complicate efforts to curb illegal mining.
Techniques like surface mining and rat-hole mining are often used in illegal operations, bypassing scientific and safer methods required for legal mining.

Worker Safety Issues in Illegal Mines

The primary cause of worker deaths in illegal mines is the lack of safety equipment and protocols.
Workers face respiratory risks from coal dust and toxic gases like carbon monoxide.
Illegal mines often lack structural support, making them prone to cave-ins and other hazards.
Many workers are untrained and unprepared for the risks, with limited access to emergency response facilities.

Challenges in Addressing Illegal Coal Mining:

The Indian government faces challenges in curbing illegal coal mining due to a mix of economic, social, political, and regulatory factors.
The issue has existed since before the nationalization of coal and continues in coal-rich or abandoned mining areas.
The complexity of the legal framework governing mining can lead to bureaucratic hurdles and inefficiencies, allowing illegal mining to persist.

Source: TH