The Centre’s troubles in the coal scam were compounded on Wednesday after the Supreme Court (SC) asked it to explain how private parties were allocated coal blocks in areas already leased out to public sector undertaking, Coal India limited (CIl).
“You (Centre) emphatically said that these coal blocks were not part of areas available with CIl,” the bench of Justices RM lodha, Madan lokur and Kurian Joseph said referring to the submissions made by the Centre.
After going through the documents of the Coal Ministry produced by the Attorney-General, the bench found that blocks handed out to private entities for captive mining actually existed in CIl’s sphere of operation.
“This goes against the statement made by you,” the bench pointed out to Attorney- General GE Vahanvati and sought an explanation for the same.
Vahanvati sought time to check the facts and to report back by Tuesday since the CIl was headquartered at Kolkata and Coal Mining Planning and Design Institute limited (CMPDIl) at Ranchi. Nonetheless, the dichotomy between the Government’s submission in court and the factual position on paper has raised questions on the legality of the allocations.
Pointing to this, the bench said: “If the coal blocks identified by CIl or CMPDIl (predecessor of CIl) are part of CIl leasehold areas, CIl is already a lessee of these coal blocks.”
The bench further observed that under the circumstances, the Centre could at best have executed a sub-lease agreement with the private companies instead of creating fresh rights. “Much would depend on this fact,” the bench remarked, referring to the statement of the Centre recorded on the previous occasion stating that coal blocks allocated to private persons existed in the unexplored (virgin) land.
In view of the contradictory position, the SC sought an affidavit from the Centre by Tuesday explaining the correct position with regard to the status of land on which each allocated coal block existed.
On his part, the Attorney-General argued that such an objection was never taken on any allocation in the past.“From 1992-93 this policy (to privatize captive mining of coal) is in force. No State Government has challenged this. Nobody has said I am being excluded.”
He pointed out that the decision in 1992 to invite private players in captive coal mining was a combination of many existing factors. The country faced a huge gap in availability of coal, CIl had limited resources for exploration, ongoing projects failed to be executed, and the huge deficit in coal supply could not be met by importing coal, Vahanvati said.
However, the SC said this issue was crucial for its consideration of “checks and balances” in the broad decision making of the Government in allocation of a natural resource of the State. Further, the bench wanted to ensure that the process of identification of coal blocks and applicants to whom it was allotted was “fair and transparent,” since the two PIls filed by advocate Ml Sharma and NGO Common Cause questioned the coal allocations on this ground.