BHUBANESWAR: The State-owned Odisha Mining Corporation (OMC) has drawn flak from the Comptroller and Auditor General (CAG) for keeping bulk of its mining blocks inoperative for a period ranging from seven to 37 years while incurring huge expenditure towards dead rent and security service.
Of the 34 mining leases granted to OMC, 26 were inoperative. In case of eight out of 26 inoperative mines, the corporation did not commence any mining operations since inception. Though 18 mines were operated during the lease period, subsequently, these mines remained inoperative for a period ranging from seven to 37 years.
“The mines were out of operations due to lack of statutory clearances and non-assessment of ore reserves. Non-operation of mines resulted in unfruitful expenditure of Rs 57.26 crore towards dead rent and watch ward expenses,” the audit report said.As per the Mine and Minerals (Development and Regulation Act, 1957, a lease holder has to pay dead rent for inoperative mines. OMC had paid Rs 15.14 crore towards dead rent while another Rs 42.12 crore towards watch and ward from 2012 to 2017 on inoperative mines.
The inoperative mines include nine iron ore, eight chromite, four iron and manganese, two manganese and gemstone blocks each and one limestone block.
One iron ore block has remained inoperative for more than 36 years while one chromite block is idle for nearly three decades. Ironically, mining leases are granted for a period not exceeding 30 years. However, the leases are subject to renewal if the Government finds that lessees have fulfilled all conditions.
Audit detected that OMC had paid Rs 580.56 crore towards net present value (NPV) pertaining to 27 mining leases including 21 inoperative mines covering an area of 7,728.90 hectares of forest land on which assessment of ore reserve had not been carried out.
Subsequently, OMC surrendered four mines during 2014 to 2016 for inadequate ore reserve after retaining them for nearly 50 years. The corporation had paid Rs 112.85 crore towards NPV.Further, OMC paid penal NPV of Rs 52 crore for carrying out mining operation in three mines without obtaining forest clearance, it noted.
As per the Forest Conservation Act, 1980, the lease holder has to pay NPV on the entire forest land under lease while penal NPV is charged for using forest land for non-forest activities without obtaining forest clearance.The premier audit agency of the Centre further rapped OMC for not preparing long term corporate plan nor any vision or mission statements. “In the absence of any perspective corporate plan, OMC could not develop strategies to achieve its objectives,” the report said.
Unfruitful expenditure
Rs 15.14 crore paid towards dead rent
Rs 42.12 crore paid towards watch and ward from 2012 to 2017 on inoperative mines
Rs 580.56 crore towards net present value pertaining to 27 mining leases
Rs 52 crore paid towards penal NPV for carrying out mining operation in 3 mines without obtaining forest clearance