Coal blocks allocation arbitrary, says parliamentary panel

Wants probe into screening committees’ decision-making process

April 23, 2013 03:18 pm | Updated November 17, 2021 04:37 am IST - New Delhi

A parliamentary committee probing irregularities in coal block allocation has held both the NDA and UPA governments responsible for the "abuse of power."

A parliamentary committee probing irregularities in coal block allocation has held both the NDA and UPA governments responsible for the "abuse of power."

The Union government had abused power and handed out natural sources to a few fortunate ones without following a transparent system, the Parliamentary Standing Committee on Coal has said. It demanded an investigation into the screening committees’ decision-making process in coal blocks allocation and penal action against those involved in such arbitrary process.

In a report on the ‘Review of allotment, development and performance of coal/lignite blocks,’ tabled in Parliament on Tuesday, the committee, headed by Trinamool Congress member Kalyan Banerjee, concluded that the coal mine allocations from 1993 to 2010 were unauthorised and illegal, and sought the scrapping of all the mines that had not started production yet.

“The most non-transparent procedure was adopted from 1993 to 2010 for allocation… The government cannot give largesse at its arbitrary discretion or sweet will. It is surprising to note that [for the period] between 1993 and 2004, no data was maintained by the Ministry of Coal in respect of the number of applications received… and only the minutes of the Screening Committee [meetings] held to consider… the application of a particular company were made available…” The report noted that since the committee concluded that the entire process was unauthorised, none should enjoy the benefits of illegal auctions. Therefore, all coal blocks allotted — at least wherever production was not started — should be cancelled immediately. The committee felt that there was a “wilful” delay on the part of private firms in developing the blocks, and the review/monitoring committees ignored the question of end-use projects, giving credit to the perception that the entire exercise was not objective and transparent.

Pointing to the delay in the development of blocks by private firms, the committee sought an explanation from the Ministry and a list of companies that were allotted mines without any end-use project. “Out of the 195 coal blocks allocated so far for captive-mining, 30 have started coal production, and out of the 160 captive coal blocks allocated during 2004-2008, only 2 have started production.”

The committee said it was surprised to find that though 195 blocks with 44.23 billion tonnes of reserves were allotted, the government made no estimate of the value of the coal extracted. It wanted a proper mechanism introduced for correct evaluation. It blamed the delay in the development of blocks on the monitoring committee’s lackadaisical approach. Though the screening committee to identify and approve the allottees was headed by the Secretary (Coal), the Inter-Ministerial Group (IMG), constituted to review the allocations and recommend de-allocation of coal and lignite blocks, was headed by the Additional Secretary (Coal).

On the IMG’s recommendation, the government has so far de-allocated 21 mines given to private firms, while bank guarantees were forfeited or deducted in the case of 19 blocks.

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