Coal scandal: 60 coal blocks up for review today, licences at stake

New Delhi: An Inter-Ministerial Group is likely to meet today to review the status of 60 coal blocks which both public and private firms failed to develop within a stipulated time-frame.

These companies were sent show cause notices in April this year and Coal Minister Sriprakash Jaiswal has asked for a status report on the coal blocks by September 15. Sources say the panel is reviewing 90 blocks allotted to private firms since 1993. These include the seven coal blocks allotted during the NDA regime. The committee may, sources say, in the next few weeks recommend that a slew of licences be revoked for non-performance. Coal ministry sources also clarify that these coal blocks, barring a few, are different from those mentioned in the national auditor’s report on coal allocation that has created a political storm, with the BJP holding up Parliament proceedings for the last nine days as it demands the Prime Minister’s resignation.

The Comptroller and Auditor General or CAG has said that that private companies had a windfall gain of about Rs. 1.86 lakh crore from what it calls non-transparent allocation of 142 coal fields.

The recommendations of the inter-ministerial panel that meets today are not binding upon the Coal Ministry. But the Prime Minister’s Office appears keen for action against defaulters.
Two companies that could be affected, according to documents accessed by NDTV, are Jindal Steel and Power Limited, owned by Congress parliamentarian Navin Jindal, and Usha Martin, owned by the Jhawar family. They were each assigned coal blocks in Jharkhand.

The ministerial review committee, on July 25 recommended to the Coal Ministry that the licences of these firms be cancelled. Nearly a month later, on August 21, Coal Secretary SK Srivastava asked why a recommendation for action was being made at a time when guidelines for revoking licences have not yet been formalised. On August 23, the head of the ministerial committee, Zohra Chatterji, who is also the Additional Coal Secretary, responded that the existing terms for licences allow for cancellation if a company does not show satisfactory progress in developing mines. Ms Chatterji also pointedly said that it was upto the Coal Ministry to accept or ignore recommendations.

Four days later, the Coal Secretary seemed to take a U-turn and stressed in a letter dated August 27 that the Prime Minister’s Office had expressed concern over “not initiating action in the respect of de-allocation where show cause notices have been issued.” He also wrote that the PMO had asked the ministry to expedite all matters on a priority basis.

The Coal Secretary is unhappy that the inter-ministerial panel did not give the companies concerned an opportunity to defend themselves, sources said. Mr Srivastava raised a similar point with Ms Chatterji in similar correspondence. She responded by saying in a note that a detailed report of the companies’ responses to their show cause notices has not been readied because the concerned department within the Coal Ministry is “overburdened with work related to a CBI inquiry”.

However, officials from the concerned companies said this is not a valid reason for recommending de-allocation. They said they had replied to the show cause notice that was sent to them in April by the government but their answers had not been taken into account by the committee that had recommended the cancellation of licences.

The ministerial panel’s recommendations to revoke licences will boost the Opposition BJP which has faulted the government for a coal policy that was not in the best interests of the country. It is the last week of the Monsoon Session, but the BJP has made it impossible for Parliament to transact any business. Parliament has been paralysed because of noisy disruptions by the BJP demanding the PM’s resignation. On Friday, the PM said there was no question of him quitting. He accused the BJP of violating democratic processes by not allowing Parliament to function.

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