The Comptroller and Auditor General of India observed that Mine Department did not move to realise the cost of unlawfully raised iron ore.
The CAG report which was tabled in the State Assembly on Thursday suggested the government lost revenue to the tune of Rs. 216 crore as the Mine Department was said to be callous on recovering the cost of illegally raised iron ore.
Under the MMDR Act, 1957, no person shall undertake any mining operation in any area except under and in accordance with the terms and conditions of the mining lease granted.
“Whenever any person raises without any lawful authority, any mineral from any land, the government may recover from such person the mineral so raised or where such mineral has already been disposed of, the price thereof along with rent, royalty or tax for the period during which the land was occupied by such person without any lawful authority,” CAG said.
According to latest CAG report, during test check (July 2010) of lease deeds, mining plan, production and removal register and monthly returns in the office of the Mining Officer, Keonjhar, it was noticed that Putulipani Iron Ore Mines was operated over an area of 100.1632 hectares by M/s Gandhamardan Sponge Iron (P) Limited with effect from April 5 1993 by virtue of transfer of a mining lease deed executed with the original lessee (Manilal Brothers).
“Although the original lease of the mine expired on April 7, 1994, the company continued mining operations under the deemed provisions of MC Rules, 1960 with a production capacity of 1.20 lakh tonnes per annum up to 1998-99,” it says.
The CAG report maintains, “in October 2004 the Ministry of Environment and Forest clarified that a project cannot increase its production even if it has the IBM or Ministry's approval for the enhanced production until environment clearance is obtained for the enhanced rated capacity.”
“However, we observed that the lessee produced 15.38 lakh tonnes of iron ore during the period 2004-05 to 2006-07 against its total permitted production capacity of 3.60 lakh tonnes during that period at the rate of 1.20 lakh tonnes per annum without EC from the Ministry.
This resulted in raising of 11.78 lakh tonnes of iron ore valued at Rs. 70.02 crore in excess of the permitted production capacity in violation of instructions,” the central auditor says.
“Further, we noticed that the lessee applied (September 2006) for environment clearance for enhancement of its production capacity from 1.20 lakh tonnes to 3.60 lakh tonnes per annum which was allowed by MoEF in August 2007; but in fact, the lessee raised 22.05 lakh tonnes of iron ore during April 2007 to August 2009 as against the permitted EC for production of 8.70 lakh tonnes that resulted in excess raising of 13.35 lakh tonnes of iron ore valued at Rs. 146.67 crore,” it says.
Due to the unlawful raising, the lessee is liable to pay Rs. 216.69 crore, the CAG points out.
Experts say the detection could be just an indication of huge scam mining sector as several lessees were alleged to have been involved in excess production of ore during past one decade.
