Media reports have said the Odisha government has levied a fine of 55 billion rupees against India's largest private steelmaker for exceeding the annual limit on iron ore extraction from its mines in the state.
Tata has not disclosed the amount of the fine.
Several mining companies have been hit with fines, totalling nearly 680 billion rupees, in the mineral-rich eastern state. Odisha holds a third of the country's iron ore reserves, a quarter of its coal, and half its bauxite.
"We are confident of resolving the issue with the government amicably," the steelmaker said in an emailed statement, without providing further details.
"Tata Steel has received notice from the government and we will revert with our submission. We reiterate that we have always undertaken mining in Odisha and also in other states where we operate with strict conformity with the existing laws."
Tata Steel currently operates captive iron ore mines in Odisha and neighbouring Jharkhand state to feed its 10 million-tonnes-a-year steel plant at Jamshedpur.
Tata is building another 3-million-tonnes steel plant in Odisha, down from its earlier plan of 6 million tonnes initial capacity after facing protests from settlers on the allocated land. It expects to start the Odisha plant in 2014.
India's federal government has cancelled allocation of coal blocks to several steel and power companies recently after accusations the government allocated coal blocks to private companies at below market prices.
At 12:20 pm (0650 GMT) Tata Steel shares were trading 1.4 percent higher at 404.75 rupees in a firm Mumbai market.