Former Coal Secretary P.C. Parakh has said the Supreme Court decision holding as illegal allocation of 195 coal blocks to various companies from 1993 to 2008 was on expected lines as there was no legal basis to their allocation.
Speaking to The Hindu after the judgment was delivered, Mr. Parakh, who was in a relaxed mood as the Central Bureau of Investigation (CBI) had decided to drop the case against him and Kumar Managalam Birla, said a transparent system by open bidding was not followed for the allocation. Mr. Parakh said he was not saying that there was no transparency, but the allocations were made within a policy that had no legal authority.
On the course that the Supreme Court might follow on September 1 in deciding the fate of the blocks, Mr. Parakh said it was difficult to predict what would happen, but added that it was not a practical solution to de-allocate the blocks as it would have serious implications on the power sector and the economy. “Wholesale cancellation of the blocks was not the right solution. I hope the court will find a via media,” he said.
Mr. Parakh suggested regularising the blocks by an amendment to the Act or a rule empowering the government.
The country was at least five years behind in coal production and faced a serious shortage of coal. The imports last year were 174 million tonnes, constituting 15 per cent of the demand. It took eight to 10 years to commission coal projects. In these circumstances, perhaps the coal blocks that were awarded on the basis of misrepresentation for undue gains or those that were sold to third parties could be regularised by imposing taxes on beneficiaries to recover money for public use. Of course, blocks where there was no fraud in allocation should be continued, he said.
‘Limited role’When he took over as Coal Secretary in 2004, Mr. Parakh said, he recommended an amendment to the Coal Mines Nationalisation Act to empower the government to make allotments on the basis of open bidding. The Prime Minister approved the move in principle, but it took eight years for implementation. An open bidding system was the best because all interested parties participated in the bidding and the best bidders got the blocks. More important, minerals were explored at public cost. He demanded that all Coal Ministers from 2004 who were responsible for not implementing the transparent system should be investigated.
He said his role was limited in the matter as he could only advice Union Minister of State Dasari Narayana Rao, who held the portfolio when the controversy broke out, but the advice was never followed. So, he allowed the allocations. “In a democracy, the decisions were left to the Minister and not the Secretary,” he said.
