Show-cause notice issued to 58 coal block allottees

Even as 58 companies face cancellation of their coal blocks for norms violation, the Inter-Ministerial Group (IMG) on coal blocks will begin a three-day hearing from Thursday against the show-cause notice issued to these companies.

Officials of the Coal Ministry said that in the first phase, 10 companies, including Usha Martin, Monnet Ispat & Energy, and Corporate Ispat Alloys Ltd. have been asked to present their views on why they had failed to develop the coal blocks within a deadline of around 42 months. Jindal Steel and Power Limited (JSPL), owned by Congress MP Naveen Jindal, has been asked to make a presentation against the show-cause notice issued to it on Saturday.

Although notice was issued to 58 companies, only 35 were asked to appear before the IMG and make a presentation.

“The idea is to follow the whole procedure for de-allocation in a legal manner so that no opportunity is provided to the companies or the aggrieved parties to get the process stalled in the court. All procedures will be followed in the case and the IMG will make necessary recommendations. It will be the Coal Ministry which will take the final call on cancellation of the coal blocks,’’ a senior Ministry official said.

The IMG, headed by Zohra Chatterji, Additional Secretary, Coal, was set up in July to recommend action against coal block allottees for not meeting the time lines set for beginning production. B.K. Jhawar-promoted Usha Martin was allocated the Lohari coal block in Jharkhand in 2005 for producing steel. The IMG had recommended its de-allocation since there has been negligible progress on ground, including nil investment as reported by the Coal Controller of India.

Monnet Ispat and Energy was given the Utkal B2 block in Odisha way back in 1999, with the aim of using coal mined from it as raw material for producing sponge iron. Corporate Ispat and Alloys got the Chitarpur block in Jharkhand in September 2005 for producing sponge iron.

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