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SC to hear challenge to coal block ordinance, refuses to re-examine cancellation

The Supreme Court yesterday agreed to hear a plea challenging the recent ordinance on coal block allocations, even as it declined a batch of petitions by private companies seeking that it re-look its Sep 24 order cancelling 214 coal blocks allocated from 1993 to 2011.

The plea challenging the coal ordinance will be heard Dec 16.

The apex court bench of Justice Madan B Lokur, Justice Kurian Joseph and Justice AK Sikri also declined to entertain a batch of applications seeking to be spared of additional levy of Rs.295 per tonne of coal extracted from exempted or operational mines.

The applicant companies including Tata Steel, Rathi Steel, Prakash Industries and the companies having state-owned companies as their joint venture partners have moved the apex court seeking a re-look at the Sep 24 verdict of the court.

The apex court by its Sep 24 verdict had cancelled 214 coal blocks allocated from 1993 to 2011, except four vested with the NTPC, SAIL and Sasan Ultra Mega Power Project. The court imposed an additional levy of Rs.295 per tonne of coal extracted from exempted or operational mines.

Making it clear that it was not going to entertain the plea by the applicant companies, the court said: “We are not going into it. Whether your case was considered by the screening committee or not is not an issue. We have already held that the entire process was flawed and illegal.”

Declining the plea by the companies to be impleaded, the court said that by its earlier order it has already held that the allocation of coal blocks was flawed, and illegal and thus it was cancelled.

The apex court, by its Sep 24 order, while cancelling 214 coal blocks put them in two categories - the one which have not commenced operation notwithstanding the stage of their development and other being the 46 coal blocks which included 40 which are operational and six which can start operation virtually anytime.

The court Sep 24 while addressing the 46 coal blocks which were sought to save by the Centre from the guillotine as 40 of them have commenced production and six are on the verge of commencing production, the court had said: “As these allocations are also illegal and arbitrary they are also liable to be cancelled.”

“As far the six coal blocks are concerned, the allocatees have not yet commenced production. They do not stand on a different or better footing as far the consequences are concerned. These allotments are also liable to be cancelled,” the order said.

However, court made exception in respect of four coal blocks that included “Moher and Moher Amroli Extension allocated to Sasan Power Ltd. (UMPP) and Tasra (allotted to Steel Authority of India Ltd. (SAIL), a Central Government public sector undertaking not having any joint venture)” and said that they will not be cancelled.

The court by its September order had said that the allottees of the coal blocks other than those covered by the judgment and the four coal blocks exempted by it, “must pay an amount of Rs.295 per tonne of coal extracted as an additional levy. This compensatory amount is based on the assessment made by the CAG”.

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