Shah panel hearing on Rule-37 on April 3

Panel asks lesses to prepare blueprint for mine area development

The hearing of the M B Shah Commission of enquiry on violation of Rule-37 of Mineral Concession Rules (MCR)-1960 remained incomplete with the Odisha government not getting an opportunity to air its views.

The panel had invited the state government, Odisha Mining Corporation (OMC)- a state controlled miner and mine lesses found guilty of the statutory violation for hearing in Ahmedabad on Saturday.

The state government will place its views before the probe panel on April 3, the next date of hearing. The panel probing into large scale mining of iron ore and manganese without lawful authority, had recently visited Odisha from February 27-March 4.

Separately, the commission has urged the lesses operating in mine rich Keonjhar and Sundergarh districts to prepare a blueprint on CSR (corporate social responsibility) for overall development of the two districts.

“Let there be development in Odisha's mine areas. The lesses need to come out with a detailed plan,” said Justice M B Shah, the commission’s chairman.

On Rule-37 violation, he said, “There were discussions on the matter. But I cannot disclose anything at the moment since the hearing is not yet completed.”

It may be noted that the Central mines ministry which has proposed an amendment to Rule-37 of MCR-1960 had sought comments from mineral bearing states.

The state government which had prepared a draft, currently being vetted by its law department, was in favour of transactions between mine owners and raising contractors to be made transparent.

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

The eight mining lessees that have been found guilty of violating Rule-37 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 lesses 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 Mineral Concession Rules 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%.

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.