Odisha wants lessee-contractor deals to be made explicit

The Odisha government which is gearing up to air its views before the Shah Commission of enquiry on March 16 pertaining to violation of Rule-37 of Mineral Concession Rules (MCR)-1960 wants financial transactions between lessees and raising contractors to be made explicit.

"We have prepared the draft containing our views on violation of Rule-37 of MCR. The draft is being examined by the law department. What we feel is that financial investments need to be made explicit. But I cannot share the details as the matter is still under scrutiny," said mines director Deepak Mohanty.

"The state government will present its views before the Shah panel in Ahmedabad with respect to Rule-37 violation on March 16," he added.

The recent meeting of the central coordination cum empowered committee (CEC) convened by the Union mines ministry to discuss amendment proposed to Rule-37 of MCR-1960 remained inconclusive with mineral bearing states yet to submit their comments.

The amendment to Rule-37 of MCR-1960 assumes significance in the context of Odisha where eight miners have been served show cause notices on the statutory violation.

The eight mining lessees are Indrani Patnaik, KJS Ahluwalia, RP Sao, Sarada Mines, Aryan Mines (Koira), Mala Ray mines (Keonjhar), Kabita Agrawal (Koira) and Mideast Integrated Steel's (Mesco) Barbil mines. Six of these eight lessees have already moved the revision authority under the Central mines ministry and secured orders that have barred the state steel & mines department to pass any order in their cases.

Presently, Rule-37 of MCR debars any lessee to assign, sub-let, mortgage or in any other manner transfer the mining lease or any right, title or interest therein without previous written consent of the state government.

According to the proposed amendment, a bonafide arrangement, contract or understanding between the lessee and any other person or body of persons or a company shall not be construed as financing to a substantial extent or substantial control of lease if four conditions are fulfilled.

First �" the arrangement between the lessee and any other person or body of persons is duly registered. Second �" any financing by a person or a body of persons other than lessee in the arrangement does not exceed 50 per cent.

Third �" the arrangement for undertaking any mining or exploration activities does not allow sale or consumption of the minerals won in mining operations by such person or body of persons or a company in the arrangement. Lastly, the person or a body of persons or a company who has entered into the arrangement with the lessee is paying service tax.