After having recommended forfeiture of bank guarantee of Jindal Steel and Power ltd's (JSPl) Jitpur coal block in Jharkhand in September last year, the Coal Ministry on Monday issued a show cause notice to the company for delaying the development of its Amarkonda Murgadangal block situated in the same state.
The notice was also slapped on Gagan Sponge, an entity which is also owned by Congress MP Naveen Jindal, the Chairman of JSPl. The missive was issued by the Coal Ministry to the two firms for delays in developing the block in question, which was bagged by them in January 2008. “You are hereby called upon to show cause, on each milestone separately, to this Ministry within a period of 20 days... As to why the delay in the development of the coal block should not be held as violation of the terms and conditions of the allotment...Failing which...Action as appropriate would be taken against your company for deallocation,” the Ministry said in fresh notices to firms. The development comes on the heels of CBI lodging an FIR recently against JSPl and Gagan Sponge Iron ltd, on bagging the Amarkonda Murgadandal coal block in Jharkhand through alleged misrepresentation of facts.
In the notice, the Coal Ministry said that the companies had failed to meet the milestones set for development of mines and production from these blocks. “One of the conditions of allocation was that coal production from the captive block shall commence within 36 months in case of opencast mine and in 48 months in case of underground mines,” it said. The progress was found unsatisfactory in review meetings and an Inter-Ministerial Group (IMG) was constituted by the ministry in June 2012 to look into the matter, it added. It also said that the IMG in its meeting on May 1 found “no significant progress in development of coal block” and “noticed that a number of important/critical milestones are pending”.