SC on the Coal mess

The Supreme Court has asked the Centre to explain in eight weeks its policy guidelines on coal block allocation and the actual process adopted for 194 coal mines which have been faulted by the Comptroller and Auditor General for causing undue gains to private players.
“This is not distribution of state properties in a small way. It is mines of largesse, not even tonnes of largesse. By the way, is it a mere coincidence that so many politicians, their relatives or supporters were benefited in the 194 coal block allotments,” a bench of Justices R M Lodha and A R Dave asked solicitor general R F Nariman.
The remark from the bench, which can potentially add sting to the opposition’s offensive over Coalgate and give jitters to the beneficiaries of controversial allocation of coal blocks, came on a PIL filed by advocate M L Sharma urging the court to cancel the 194 allocations on the ground that the allotment process was arbitrary, illegal, unconstitutional and against public interest.
The justices, who appeared to be aware of not just the magnitude of the “scam” but also the names who have been generating headlines in connection with Coalgate, had some searching questions for the solicitor general: something that led many to wonder whether the stage was being set for a judicial intervention which may surpass in scale the apex court’s monitoring of CBI’s investigation into the 2G scam.
In fact, Justices Lodha and Dave did not agree with Nariman when he argued that while the petitioner had based his PIL on the CAG report, the findings of the federal auditor could not be deemed to be final until those had been scrutinized by Parliament’s PAC and debated by the two Houses.


The coal ministry has scrapped allocations of four coal blocks in its first tough action after the Comptroller and Auditor General’s (CAG) report led to the washout of the monsoon session of Parliament.
The action follows the inter-ministerial group’s (IMG) recommendations cancelling the allocations. Also, it decided to seek forfeiture of bank guarantees of three other blocks. The blocks were allotted to five private companies.
Meetings of the IMG in the past few days focused on legal and contractual fallout of cancelling allocations. But the highest levels in the government were keen that the panel finalizes its views so that damage-control measures are taken.
The de-allocations reflect the thinking in government that largescale cancellations will mean succumbing to a lynch mob. Stringent action against the firms allotted coal blocks came after the IMG found these private companies failed to meet timelines on production and development of coal mines and setting up end-use plants. Four blocks that are to be de-allocated are Bramhadih block allocated to M/s Castron Mining Ltd, Chinora and Warora (Southern Part) blocks allocated to M/s Fieldmining and Ispat Ltd and the Lalgarh (North) block allotted to M/s DOMCO Smokeless Fuels.