Section 5: Restrictions on the grant of prospecting licences or mining leases.

(1) A State Government shall not grant a 3[reconnaissance permit, prospecting licence or mining lease to any person unless such person―

(a) is an Indian national, or company as defined in clause (20) of section 2 of the Companies Act, 2013 (18 of 2013); and

(b) satisfies such conditions as may be prescribed: Provided that in respect of any mineral specified in Part A and Part B of the First Schedule, no reconnaissance permit, prospecting licence or mining lease shall be granted except with the previous approval of the Central Government. 6[Provided further that the previous approval of the Central Government shall not be required for grant of reconnaissance permit, prospecting licence or mining lease in respect of the minerals specified in Part A of the First Schedule, where,—

(i) an allocation order has been issued by the Central Government under section 11A; or (ii) a notification of reservation of area has been issued by the Central Government or the State Government under sub-section (1A) or sub-section (2) of section 17A; or (iii) a vesting order or an allotment order has been issued by the Central Government under the provisions of the Coal Mines (Special Provisions) Act, 2015 (11 of 2015).]

Explanation.―For the purposes of this sub-section, a person shall be deemed to be an Indian national,―

(a) in the case of a firm or other association of individuals, only if all the members of the firm or members of the association are citizens of India; and

(b) in the case of an individual, only if he is a citizen of India.]

(2) No mining lease shall be granted by the State Government unless it is satisfied that― (a) there is evidence to show the existence of mineral contents in the area for which the application for a mining lease has been made in accordance with such parameters as may be prescribed for this purpose by the Central Government;

(b) there is a mining plan duly approved by the Central Government, or by the State Government, in respect of such category of mines as may be specified by the Central Government, for the development of mineral deposits in the area concerned:] Provided that a mining lease may be granted upon the filing of a mining plan in accordance with a system established by the State Government for preparation, certification, and monitoring of such plan, with the approval of the Central Government.