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Govt may cancel licences for 41 coal blocks

17 January, 2014

The government has informed the Supreme Court that it will scrap as many as 41 coal blocks allocated to private companies between 1993 and 2009 if environment clearances for such blocks are not obtained in the next six weeks.

This is reminiscent of the cancellation of telecom licences on the direction of the apex court two years ago in light of the massive scam unveiled in the sector.

The blocks are awaiting environment and forests clearances at various stages and if the firms are not able to obtain the clearances in the mentioned time, the authorities will proceed with cancellation of the licences, the Attorney General Goolam E Vahanvati told reporters on Wednesday after a court hearing.

The government has sent show-cause notices to the companies, asking why licences for the coal blocks allocated to them should not be cancelled.

Notably, the Cabinet Committee on Economic Affairs had met on Monday to discuss the de-allocation criteria for the blocks named in coalgate scam. The meeting came in the wake of the Central Bureau of Investigation (CBI) submitting a fresh status report in the coalgate scam before the Supreme Court.

In the report, CBI said that it has completed investigations in six FIRs so far, of the total 16 FIRs filed in the coal blocks allocation made illegally to private companies. It also said that it did not find any wrongdoing in some cases of mines allocation, thus these can be removed from the probe. 

CBI also said it has found all the missing files on the coalgate scam.

The CBI is investigating 195 coal block allocations between 1993 and 2009.

Meanwhile, the apex court has asked the government about the parameters the screening committee followed to allocate these coal blocks.

In a report in 2012, the federal auditor Comptroller and Auditor General alleged that the government allocated coal blocks to private and public companies in arbitrary manner, rather than through auction, which resulted in the exchequer suffering a loss of over $30 billion.

The government, in its defence, argued that the objective to allocate coal blocks was to increase coal production quickly so as to resolve the key raw material shortage in the country.

If the government goes ahead with its decision to quash coal blocks too, it will be second such move in recent times.

Earlier in February 2012, the government had scrapped 122 telecommunication licences of various operators issued under the 2G spectrum sale by the government in January 2008 at very low prices favouring some companies, and thereby causing a loss of billions to the exchequer.

(Edited by Joby Puthuparampil Johnson)


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Govt may cancel licences for 41 coal blocks

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