The Government is set to be richer by Rs 80,000 crore as according to the Supreme Court’s order, all the 40 operational blocks which have been given six months’ time to wind up their operations, are to pay a fine of Rs 295 per tonne on the quantity of coal extracted by them date. Also with the court having further directed that the fine be levied on the quantum of dry fuel which the companies holding these blocks will mine till March 31, 2015, the Government ultimately is likely to receive much more than the aforementioned amount.
According to sources, till now 274 million tonnes of coal has been mined from these 40 blocks and taking into account the fact that the apex court has levied a fine of Rs 295 per tonne on coal already extracted, this will bring Rs 80,000 crore in the Centre’s kitty.
The three-judge Supreme Court bench headed by Chief Justice R M lodha, Madan B lokur and Kurian Joseph, on Wednesday cancelled 42 out of the 46 coal blocks (which the Centre had earlier requested to be spared from de-allocation).
Though the apex court had on August 25 declared that all the 218 coal blocks allotted between 1993 and 2010 as “illegal”, on Wednesday it mainly decided the fate of 46 blocks out of which 40 are operational while the remaining six are to yet to start their operations.
The Centre had pleaded before the bench to spare these 46 blocks as these consist of blocks already in use and some waiting to become operational. The Supreme Court however spared only four out of these blocks and cancelled the rest.
Out of the 218 blocks, 22 had already been de-allocated by the Centre over the last two years, while on 150 blocks both the Supreme Court and the Centre were unanimous that these be cancelled, sources said. On the remaining 46 blocks, the Government had sought relief from the Supreme Court.
The four blocks which were lucky to escape the axe include Steel Authority of India ltd’s (SAIl) Tasra block, NTPC’s Pakri Barwadih block, and two blocks allotted to Reliance Power’s Sasan ultra mega power project (UMPP) namely Moher and Moher Amlori Extension.
Of these four blocks, except for NTPC’s reserve, all the remaining three blocks are under operation. However the aforementioned fine will have to be paid by these four blocks also, as experts pointed out that the court in the first place has termed all the 218 blocks as “illegal”.
Though yet to come under production, NTPC’s block was spared as it belongs to a central PSU and was not under a joint venture with any other private entity. Similarly SAIl’s Tasra block too was exempted on the same grounds.
Reliance Power’s two blocks linked to its Sasan UMPP were however let off as these had been allotted through competitive bidding based on tariff and the fact that the project was under operation.