CAG indicates non-execution of coal mining leases in UP

There was nothing on record to indicate NCL executed mining lease before mining operations commenced

India's federal auditor Comptroller and Auditor General (CAG) has indicated non-execution of coal mining leases in Uttar Pradesh leading to revenue loss.

The examination of records of Northern Coalfield Limited (NCL) showed that Krishnashila Coal Project of NCL had started mining operation in Sonebhadra from January 2008 in 859.95 hectares of land.

However, there was nothing on record to indicate that NCL had executed mining lease before mining operations were commenced.

Hence, the state mining department was not in a position to enforce or monitor any of the conditions under which the leases were granted.

CAG noticed similar situation in four other coal projects viz. Bina, Kakri, Duddhichua and Khadia of NCL, which were being operated in UP from 1974, 1980, 1991 and 1992 respectively. There was nothing on record to indicate that lease deeds were executed.

CAG’s revenue sector 2011-12 report was tabled in the UP legislature yesterday.

The report said NCL had also confirmed that the leases were not executed.

In addition, the state government had been deprived of Stamp Duty and Registration fees in all such cases.

Besides, the department informed CAG that the information on execution of coal mining leases was not available with them and that leases of coal mining were granted by the Centre.

Coal mining in Sonebhadra contributes around 30% of the mining department’s revenue.

CAG has recommend that lease agreements be executed according to the central terms and conditions and devising of a monitoring mechanism of mining activities in the coal sector.