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New UserDelhi HC approved CIL as Custodian of 3 Coal Blocks Denied to JSPL, Balco
30 Mar 2015
The Delhi High Court on Friday approved state-run miner Coal India as the interim custodian of three producing coal blocks for which Jindal Steel & Power Ltd (JSPL) and Bharat Aluminum Co (Balco) emerged as best bidders but were denied the mines as the coal ministry found the bids too low. Coal India will operate the three mines and dispose the coal from April 1 till the next date of hearing on April 13.
The company will operate the mines with the existing infrastructure and manpower, people familiar with the matter said.
However, coal ministry officials said the state-run company might find it difficult to immediately take over the blocks.
The High Court reiterated its observations made a day earlier that there was no evidence of cartelisation in the bids for these three blocks and that the government's decision to scrap bids was unfair.
The court had on Thursday said that comparing bids of different blocks amounted to comparing apples and oranges and had asked the government to work out an interim arrangement for the blocks.
The government told the court on Friday that it had followed specified procedure for deallocation of the coal blocks and it was convinced that the blocks did not receive a fair price.
The government also said that it was bound by the Supreme Court's September verdict and there could be no interim arrangement for the blocks other than giving them to Coal India ( CIL).
The government had disapproved bids for JSPL's Gare Palma IV2&3 and Tara mine and Gare Palma IV1 for which Bharat Aluminum Company emerged as the best bidder.
The coal ministry allotted these mines to Coal India.
Gare Palma IV2&3 are operational mines and as per Supreme Court's September verdict that cancelled 204 captive mine allotments, producing mines have to be surrendered by the previous allottee.
The government is arguing that the price bids received for these blocks were low in comparison to other mines. JSPL won the Gare Palma IV2&3 coal block at a price of Rs 108 per tonne while foregoing the mining cost. The Tara coal block was won by the company at Rs 126 per tonne. Balco won the GarePalma IV1 at a price of Rs 1,585 per tonne.