SC questions Centre’s power to allocate coal blocks

NEW DELHI (TIP): The Supreme Court today raised doubts over the Centre’s authority to allocate coal blocks, pointing out that coal was a state resource under the Mines and Minerals (Development and Regulation) Act, 1957 and as such only the states had the power to execute mining leases. A Bench comprising Justices RM Lodha and J Chelameswar said that since both the MMDR Act and the Coal Mines (Nationalisation) Act 1973 had not vested any power with the Centre to allocate coal blocks, it could not have undertaken this exercise.

The Bench made the observations while hearing PILs pleading for quashing the allotment of 194 coal blocks allotted by the Centre to private companies during 2004-11 “in a pick and choose manner” thereby causing a “huge loss” to the country. Noting that the coal blocks had been allotted either by the Union Coal Ministry or the Centre’s Screening Committee exercising their powers under executive orders, the Bench observed that such powers “can’t override the statutory provisions.” Acknowledging that the states had to take the “prior approval of the Central Government” for granting mining leases, the Bench asked Attorney General GE Vahanvati as to whether this provision could be extended to mean that coal block allocations could be done by the Centre. “All this requires a lot of legal explanation from the Centre as through the allocations it was “preempting” the execution of mining leases by the states with companies, the Bench said. The allocations by the Screening Committee were “extralegal” as the rules of business had no provision for this.

The screening committee could only assess the applications and make recommendations, it felt. “The issue strikes at the root and raises fundamental legal questions,” the Bench remarked. Pointing out that all the legal provisions had been explained in the affidavit filed by the Union Coal Secretary in response to the court notice on the PILs, the Bench wanted to know as to how the Centre was still going ahead with the allocations. At this, the AG said he did not want to give an off the cuff response and sought time to explain the position through an affidavit. Granting time to the Centre, the Bench posted the case for next hearing on March 12. Advocate Prashant Bhushan, appearing for the PIL petitioners, said the CBI had registered three cases – one on the basis of a complaint filed by BJP MP Prakash Javdekar on the alleged irregularities during the UPA regime, another on a complaint by Congress MP Sandeep Dikshit covering the NDA period and the third on allocations done under the publicprivate scheme. The probe was on for about eight months now and wanted to know what had been done so far. Appearing for the CBI, Additional Solicitor General Harin Raval said the investigation was “comprehensive and broad-based” and no one was being spared. In another four months, the agency would be able to complete the “fair and thorough” probe.

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