Coal scam: Government admits giving CIL blocks to private firms

It justified saying five such blocks were allocated under the Mines and Minerals Act.

3 min readNew DelhiSep 24, 2013 01:02 AM IST First published on: Sep 24, 2013 at 01:02 AM IST

The Centre Monday admitted before the Supreme Court that it provided certain coal blocks to private companies for captive mining although these blocks fell in areas where the Coal India Ltd CIL already had existing leases.

Seeking to justify such allocations,the government,in its affidavit,stated that five such blocks were allocated under the Mines and Minerals Development and Regulation Act.

However,it is a well-known fact that these coal blocks were acquired by the government under the Coal Bearing Areas CBA Act. Hence,the Centre may find itself in trouble on Tuesday when the court examines its explanation.

A Bench led by Justice R M Lodha had to adjourn the hearing last week after the Attorney General sought some time to explain how certain coal blocks belonging to the lease-hold areas of the CIL were allocated to private companies.

If these coal blocks identified by CIL and Central Mine Planning and Design Institute Limited CMPDIL are part of the lease hold area of CIL,then how can further rights could be created in favour of other companies? the Bench had asked G E Vahanvati,who requested for some time to file an affidavit on the issue.

In its affidavit,the Coal Ministry has now conceded: Out of 47 blocks allocated to private parties from 1993 till 2005,five blocks were located in an area where there was a subsisting mining lease or were subject matter of CBA Act notification in favour of CIL subsidiaries.

Further,the government has failed in adducing any information about three out of the five blocks,saying the information was still being sought. On remaining two blocks,it has said in one case,a sub-lease was granted to a private company while in the other,the mining lease was surrendered by the CIL subsidiary and then the private company obtained a mining lease from the state government under the MMDR Act.

The government has also responded to the courts query on how the identification of coal blocks was done for the purpose of allocation to private parties. The query had come after the Bench noted that the role for identification of the coal blocks to be allocated to private companies was given to the CMPDIL but the CIL was in fact doing it.

The government has said the basic identification exercise was conducted by CMPDIL but final decision allowing blocks to be given for captive mining had to be that of CIL since basically the interests of CIL had to be taken into consideration.