Coal news and updates

Coal scam: CBI yet to get coal ministry’s reply on sale of equity

Central Bureau of Investigation (CBI), which is probing irregularities in coal block allocations, is yet to get coal ministry’s final reply on whether an alleged irregularity by a few private firms -- sale or transfer of equity shares pursuant to allocation of a coal block -- was illegal.

The coal ministry has communicated to the CBI that its terms for allocation was silent on the issue and had no specific stipulation prohibiting the sale or transfer of shares by a coal-block recipient, said an agency source.

“The ministry cited a copy of the Rampia and Dip Side of Rampia coal blocks, which had no stipulation prohibiting sale or transfer of shares by a coal block allocatee,” said the source.

The ministry’s stand could weaken the CBI’s case against a few firms — at least three identified so far — who were allocated during 2006-09 and had allegedly sold or transferred equity shares afterwards, said the source.

The cases include of a Hyderabad-based private firm that had been allocated the Rampia and Dip Side of Rampia coal blocks. The CBI in 2012 September had lodged a first information report (FIR) registered against the Hyderabad-based firm and accused it of allegedly earning illegal profits of over R200 crore by selling their entire holding in July 2010 after allocation of the two coal blocks in January 2008.

The trial in the case is underway currently. When asked, CBI director Ranjit Sinha told HT, “We are not concerned with the terms of the allocation, let the coal ministry consider them. CBI is only concerned with criminality in the process of coal block allocations.”

Source: Hindustan Times