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IMG meeting minutes talk of possible unfair deal to coal block awardees

Asection of the official panel that recommended cancellation of 32 coal blocks this month expressed concern that the decision to impose the maximum penalty may not be fair as companies that lose the mines were not given the chance to present their case to the Inter Ministerial Group (IMG) that reviewed the allocation.

The government decided to de-allocate the blocks after accepting the recommendations of the IMG, which has considered 51 blocks and will look at another 10 on the basis of a statement made by the government to the Supreme Court, which is hearing a case on coal block allocation.

The Central Bureau of Investigation is also looking into the matter. The minutes of the meeting recorded concerns of some of the members of IMG at its 24th meeting. "Concerns were expressed by the representatives of various ministries/departments that the allottees had not been given opportunity to present their case before the IMG, as was being done earlier. An opinion was expressed that not giving such an opportunity might not go along with the principle of natural justice, especially when the stakes were high, substantial investments in end-use plant had been made, the consideration was for maximum penalty of de-allocation and in certain cases allottees had specifically requested for personal hearing," Some members felt that the government's statement submitted before the Supreme Court should have been shared with firms to help them understand the circumstances of the review.

However, the IMG finally took the position that companies had enough time to present their case. "In any case, a full three weeks' time was given to the allottees to put forth all their contentions together with documentary proof which would substantially form the basis for consideration of their cases.

 Besides, in the same notice requiring them to submit their contentions, the criteria for review ... was explicitly mentioned. Therefore, it will be erroneous to interpret that principles of natural justice have not been complied with," read the minutes of the IMG that is chaired by AK Dubey, additional secretary of coal ministry, and has members from ministries of coal, power, law steel, and departments of economic affairs and industrial policy.

Many firms have secured interim orders from various courts against de-allocation. They blame government departments for delays in granting necessary clearances. Companies argue that at times authorities did not act on clearances for years or to sort out minor matters.

Association of Power Producers director general Ashok Khurana said: "The ministry is cancelling blocks just for the heck of it without realising that many issues were beyond the control of these firms. You cannot create a situation for the block awardees just to penalise them for something that they cannot manage.

The ministry should have been considerate enough to review what all prudent developer did to monetize the block in given conditions." He added that the government should not left the upcoming power projects in lurch. "Coal ministry should deal with case by case with the developers to provide them suitable alternative to fuel their soon to be commissioned projects," said Khurana.

Source: The Economic Times