Coal deal: Raman govt faces CAG heathttps://indianexpress.com/article/news-archive/web/coal-deal-raman-govt-faces-cag-heat/

Coal deal: Raman govt faces CAG heat

A CAG report tabled in the Chhattisgarh Assembly last Friday has led to a bitter tussle between the ruling BJP government and the opposition Congress.

A CAG report tabled in the Chhattisgarh Assembly last Friday has led to a bitter tussle between the ruling BJP government and the opposition Congress.

The Congress has launched a mahadharna in all districts demanding Chief Minister Raman Singh’s resignation after the CAG pointed out that his government abruptly amended tender conditions of mining a coal block to favour Adani Enterprises Ltd and caused a “potential loss” of Rs 1,549 crore to the exchequer.

Singh’s office claimed that the condition was changed before Adani Enterprises Ltd was assigned the contract,and the government also restored the condition later and hence there was no actual loss.

The Congress pointed out that the condition was restored only after the CAG brought the issue to the notice and this is the second consecutive instance of the Chhattisgarh government helping coal mining companies linked to top BJP brass. While Adani Group is considered close to Gujarat Chief Minister Narendra Modi,last year CAG has pointed at over Rs 1,000 crore loss to favour Nitin Gadkari’s aide Ajay S Sancheti’s company over coal blocks in Bhatgaon. The Coal Ministry had later cancelled the allocation of these coal blocks.

The latest matter pertains to the 150 million tonnes Parsa coal block allotted by the Coal Ministry to Chhattisgarh State Power Generation Company Ltd. The company decided to form a joint venture company to mine the block and linked the mining fee to be paid to the JVC with the price of F grade coal (lowest quality). During a pre-bid conference on May 19,2009,Adani Enterprises Limited asked if the government would increase the fee if better quality coal was found after mining. Next day,the power company changed the criteria and linked mining fee with the actual coal found.

This amendment,CAG says,was “unwarranted and against the interest of the company”. “The company was aware that actual grade of coal available in Parsa was D or E,costlier than F grade. Passing of the benefit of the higher grade coal to the JVC was not justifiable as the company is the owner of the mine. Because of this amendment,the company is likely to lose Rs 1,549 crore,” the report says.

Raman Singh’s office countered: “In all the 119 holes made so far by the Adani Mining Private Ltd in the block only F grade coal was found. The area only has inferior coal.”

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The CAG report refutes it and points that AMPL’s own geological report mentions the presence of higher grade coal.