At least 25 out of the 110 sand mines auctioned in May and July last year by the Punjab government under the new progressive bidding scheme are lying nona-functional. There is either not enough material available in these mines, or, in some cases, the bidders who bagged the mines at exorbitant prices now feel they shall not be able to earn adequate profits. Even for the auction of 51 sand mines that took place Monday, only 16 bidders came forward. In four other sand mines, the government received only single bids. Thus, those were also cancelled.
With a large number of bidders now backing out or not coming to bid at all, the state government that had expected to earn a revenue of over Rs 1,000 crore from the sand mine auctions is not expecting the final amount to be that much. The 25 mines that are yet lying non-functional also include three mines linked to former irrigation minister Rana Gurjit Singh’s former employees. Those are Saidpur Khurd, Mehadipur and Behloor Khurd in Nawanshahr district.
Out of these 25, there are at least 10 such allottees from the May and July auction who have now sought refund of their earnest money, saying “enough material was not available in the mines taken by them”. The government is now in a fix on the next course of action.
For instance, in Sundran village of Mohali, Balaji Minerals that bagged the mine has applied for cancellation stating there was not enough material. The 27.92 hectares of mine area was bagged for Rs 8.6 crore. Similar story is playing out at Mirpur in Mohali where Kamldeep Singh Saini bid for Rs 5 crore but is now seeking withdrawal citing non-availability of the mining material on the site. Citing the same reason, bidders of Kakrali and Pandwala mining sites, also in Mohali, have yet not applied for the permit from the mining department.
There are other sand mines such as Basma in Mohali, Diwari, Manguwal, Majri and Darya Sarsa in Ropar district that are non-functional because of lack of proper demarcation. The contractor is required to get the mine demarcated with the help of sand mining department. This is mandatory to check illegal mining beyond the demarcated area of the mine.
In Khanpur of Amritsar district, Gurvinder Singh Gill, who bagged the mine for Rs 3 crore and paid 60 per cent of the bid amount (including security, first instalment of the four quarterly, and earnest money) has sought a refund. In Chaharpur in Ajnala, contractor Rajiv Bhagat who got the mine for Rs 8 crore has not paid anything after the second instalment.
“These mines have already been over-exploited and there is not much material left. With the change in guard in the state, several new players thought they would make a moolah out of the business and they bid for mines in crores. Now, those mines are non-viable. Hence, they are now withdrawing and seeking a refund of their earnest money”, a senior Punjab government official told The Indian Express.
“As per terms and conditions of the auction, it was the responsibility of the bidders to first check the mines and material available therein on their own and then come for the auction. Going by that, the government does not owe any refund to them now. We are yet examining the issue,” another senior official of Directorate of Mines said. The state government says the appraisal committees headed by sub-divisional magistrate rank officers at the district level had surveyed all the mining sites before clearing them for auction.
The government is again going to auction another lot of 145 mines of sand (2.7 crore tonnes) and 18 mines of gravel (0.2 crore tonnes) on March 15. The total demand for gravel in Punjab is pegged at 2.4 crore tonnes, of which only 16 per cent is currently being met from official supply, while for sand, 35 per cent of the 1.6 crore tonnes demand is similarly being fulfilled. The total demand in the state has been calculated at 4 crore tonnes.