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Govt de-allocates 4 coal blocks, to deduct guarantee of 3 others

Last Updated: Friday, September 14, 2012 - 09:53

New Delhi: Under attack over coal block allotments, government on Thursday decided to de-allocate four blocks and encash bank guarantees of three others belonging to private companies for failing to meet timelines on production and development of mines.

The government decision came shortly after an Inter- Ministerial Group (IMG) made such a recommendation after evaluating the performance of each of the cases in respect of factors like approval of mining plan, grant of environment clearance, status of forest clearance and land acquisition.

The IMG, in its meeting held yesterday, had deliberated upon the cases of five companies which were allocated eight coal blocks, a statement issued by the Coal Ministry said.

The statement noted that the IMG had recommended de-allocation of four blocks -- Bramhadih Block in Jharkhand allocated to Castron Mining Ltd in 1996, Chinora and Warora (southern part) blocks in Maharashtra given to Fieldmining and Ispat Ltd in 2003, Lalgarh (North) block in Jharkhand allotted to DOMCO Smokeless Fuels Pvt Ltd in 2005.

The IMG also recommended deduction of Bank Guarantee (BG) in case of Marki Mangli-II, III and IV Blocks in Maharashtra allocated to Shri Virangana Steels Ltd, the statement said.

The Group also recommended that in the case of Utkal B2 Block in Odisha allocated to Monnet Ispat & Energy Ltd in 1999 "where there was substantial progress but no provision for BG, the allocattee may be asked to submit BG amounting to three years royalty within a period of one month from date of letter in this regard failing which the block may be deallocated", it said.

Sources said the BG in case of Shri Virangana Steel, now Topworth Urja and Metals Ltd, is Rs 2 crore, while that for Monnet Ispat is Rs 90 crore.

"Recommendations (of IMG) have been accepted by the government," the Ministry statement said.

The eight blocks are among 58, which are under scrutiny of the IMG. It has so far taken up the cases of 29 allocated to private companies.

While these eight blocks were reviewed yesterday, 10 more cases will be taken up tomorrow.


First Published: Thursday, September 13, 2012 - 15:23
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