The decision comes after an expert panel, appointed by the Supreme Court, suggested lifting of ban and capping the production.
The court had imposed ban on mining at all 90 mines in Goa in 2012 to curb alleged illegal mining operations in the state.
A three-judge bench headed by justice AK Patnaik ordered the state government to establish an expert panel within six months and submit a report on capping of output and other issues.
Supreme court in its order has also cancelled mining leases of mining companies who have secured extension of lease after 2007, and completed 20-year renewal periods.
The court has also ordered that no lease will be given to mining activity around one kilometre of national parks and wild life sanctuaries.
