Montek backs PM, Parakh on coal allocation to Hindalco

Says India Inc should have been reassured after PM owned responsibility on Saturday

Justifying the decision of Prime Minister Manmohan Singh and then coal secretary P C Parakh to allocate the Talabira-II coal block in Odisha to Hindalco in 2005, the Planning Commission on Monday said India Inc should have been reassured after the prime minister took responsibility for the move.

The commission added the Central Bureau of Investigation (CBI) hadn’t charged Aditya Birla Group Chairman Kumar Mangalam Birla but merely filed a First Information Report (FIR) against him in the case. “One should not be declared guilty unless proved. Then coal secretary and the prime minister did no wrong in allocating blocks to Hindalco,” Planning Commission Deputy Chairman Montek Singh Ahluwalia told reporters in New Delhi.

He said the CBI hadn’t said it had charged Birla. “It has filed an FIR, and is continuing with that.” On the impact of the FIR on India Inc, Ahluwalia said the mood of the industry wasn’t very good and its reaction to the FIR against Birla showed it was under pressure. “At the same time, the response from the Prime Minister’s Office should be reassuring to it, as it shows the central government is responsible for all its decisions.” He added the government wanted to work with the industry, but at the same time, India Inc should also ensure it was transparent.

On Saturday, the Prime Minister took full responsibility for the allocation of the Talabira coal block. “The prime minister approved the proposal on October 1, 2005,” said a statement issued by the Prime Minister’s Office. At that time, the prime minister had held the charge of the coal ministry.

Earlier in the day, Ahluwalia told CNN-IBN, “We need a system where if investigating agencies want to investigate, there must be a way in which they can do that without damage to reputation, without the presumption ‘innocent until proved guilty’ washed away in some way...We need to develop a civilised approach to the whole business of investigation.”

He added the prime minister’s decision wasn’t against anybody. “It was not something taken away from the public sector and given to Hindalco.”

CBI had filed an FIR against Birla and Parakh on charges of criminal conspiracy and abuse of official position in connections with the alleged Rs 1.86 lakh crore coal block  allocation scam. The CBI had alleged that Birla had met Parakh to push for the allocation of the Talabira II coal block in Odisha to Hindalco in 2005.

Parakh had said if he was a conspirator in corruption in the alleged coal scam, so was the prime  minister.  He had said the PM should be named  in the CBI chargesheet as well.

The FIR had mentioned "Competent Authority", leaving it open to interpretations. The PMO statement confirmed that the PM was indeed the decision-making "competent authority in Talabira coal allocation.