All coal blocks allocated since 1993 illegal: Panel

The parliamentary standing committee said  the licences of all the coal blocks allocated should be cancelled and those responsible for the allocation should be investigated.

Published: 23rd April 2013 03:27 PM  |   Last Updated: 24th April 2013 08:40 AM   |  A+A-


Calling coal mine allocations done in 1993 to 2010 as "unauthorised and illegal", a Parliamentary panel on Monday suggested scrapping of mines that have not started production.

The Standing Committee on Coal and Steel in its report tabled in Parliament today said the mines were allocated in "most non-transparent" manner and natural resources were distributed to "few fortunates" through "abuse of power" by the then ruling dispensation.

"Distribution of mines was done in a most unauthorised manner," said the panel Chairman Trinamool Congress MP Kalyan Banerjee seeking scrapping of mines where production is yet to start besides investigating role of officials involved in the allotment process.

"Most non-transparent procedure was adopted from 1993 to 2010 for allocation and supply of coal blocks. The natural resources and state largesse were distributed to few fortunates for their own benefit without following any transparent system, was total abuse of power by the Government," the Committee said.

Noting that "the government cannot give largesse on its arbitrary discretion or its sweet will," it said the allocations were illegal and amounted to huge losses to the state exchequer.

However, on the quantum of losses Banerjee said, "Despite our repeated queries, Coal Ministry could not give us information in respect of quantity of coal or its value. We are not investigating agency and thus not in a position to assess the losses."

The report said: "It is unfortunate that for allocating coal blocks neither any auction was held nor the Central Government earned any revenue."

When asked whether Trinamool Chief Mamata Banerjee, who was Coal Minister in the NDA government was also involved, Banerjee said, "Every Coal Minister is not party of the allocation process."

The Committee said it was "surprised" to note that between 1993 and 2004 no data was maintained by the Coal Ministry regarding number of applications received seeking mines while no "bidding process or auction was held."

"Since Committee have come to conclusion that entire procedure for distribution of coal was unauthorised, no one should enjoy the benefit of illegal auctions and therefore, all coal blocks allocated, at least where coal production has not yet started, should be cancelled immediately," it said.

Terming no auction as unfortunate, it said the entire decision-making process for distribution of coal blocks needs investigation and that necessary penal steps should be taken against everyone who was directly or indirectly a party. to such a decision-making process.

Citing delays in development of blocks by private firms, the Committee also sought an explanation from the Ministry on and demanded a list of such companies, which were alloted mines without any end-use projects.

"Out of 195 coal blocks allocated so far for captive mining, 30 blocks have started coal production and out of 160, captive coal blocks allocated during 2004 to 2008, only 2 have started production," it said.

Saying that such allocations have not generated any revenue and only helped private firms, the panel said: "The commencement of coal production only from 30 coal blocks out of total allocated 218, puts a question mark over the performance and efficiency of allocatee companies, especially private companies which have a major share in allocation."

The Committee said it was "astonished" to find that although 195 blocks with 44.23 billion tonnes of reserves were allotted, no estimates for the value of coal extracted was made by the government. It stressed the need for introducing a proper mechanism for correct evaluation.


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