The Supreme Court’s rejection of Government’s petition last week - of seeking to bring various pending cases being heard in various High Courts, challenging the Coal Ordinance under the apex court’s jurisdiction - may put a spanner in its efforts of wrapping up the ongoing auction process before March 31, 2015.
Any delay in auction process could put a strain on power and steel plants across the country, a scary prospect, considering that the peak demand season is just round the corner. The apex court’s order in a way has opened the way for other entities to challenge the Coal Ordinance, and according to sources privy to the development within the Government feel that if more cases are filed, then the ongoing auction process of coal blocks may get delayed.
The petition, which had been filed by the Coal Ministry, had argued that it would be convenient to contest all the cases at one place, as they have similarities and also travelling to various High Courts puts a strain on the Government.
A bench led by Chief Justice H l Dattu while refusing the Centre’s petition, said that it was open for all the parties to challenge the provisions of the ordinance and if they opt to do so, high courts could adjudicate. The Government was also directed to defend its ordinance in the concerned High Courts.
Though official sources indicated to The Pioneer that the Government could consider the option of approaching the apex court again with a similar prayer, this can be done only after the concerned High Courts deliver their judgements in the pending cases.
While now the Centre will have to wait for all the cases to end before it can decide on its next step, sources closely associated with the auction process, expressed confidence that it will be completed as per schedule, i.e. before March 31, 2015. A claim which for now looks a bit ambitious, considering the fact that several cases are simultaneously being heard by various High Courts, and their dispensation could take time.
The Coal Ministry had in December last year started auctioning all the 204 blocks which had been cancelled by the Supreme Court, in a phased manner and plans to wrap up the process by March 31, 2015. It initiated the process by promulgating the Coal Mines (Special Provisions) Ordinance or in other words, the Coal Ordinance. While cancelling the blocks, the apex court had given time till the aforementioned date to 42 mines to wind up their operations, as they are still under operation.
During the same time however, many cases were filed by different companies against the Coal Ordinance. Currently, a total of five petitions are being heard by various High Courts.
Two petitions each have been filed by Jindal Steel & Power ltd (JSPl) and BlA Power in the Delhi High Court and Madhya Pradesh High Court respectively. In addition to this, a petition by Sova Ispat is pending before the Calcutta High Court. These companies have challenged the provisions of the Coal Ordinance and the standard tender document in three HCs on the ground that they are “arbitrary and unconstitutional”.
There is also concern among companies involved in steel production, that with a large majority of coal blocks being given away to power producers, their steel plants are literally stranded owing to lack of coal mines availability.
While sources said that with a large number of blocks yet to be offered for bidding, requirements of all the sectors (namely steel and cement apart from power) will be fulfilled, for the time being, the strain is telling on the industry.
In case there is a delay in the auction process, then the strain could also be felt on the power sector, to which the Government has lend top most priority. With the peak season fast approaching, the Centre’s anxiety to wrap up the process, is understandable.