State to move SC on Posco PL case

After facing the flak of the Orissa High Court over the case of recommendation of prospecting license (PL) in favour of Posco India, the state government has decided to approach the Supreme Court of India on the issue.

"We would challenge the order of the Orissa High Court in the Supreme Court of India. The state government will make an appeal in two to three weeks”, a top official in the state steel and mines department told Business Standard.

It may be noted that in a verdict dated July 14, the Orissa High Court had set aside the recommendation of the state government for providing PL in favour of Posco India for Khandadhar iron ore mines in Sundergarh district.

The court verdict on July 14 had come as a as a dampener for the South Korean steel major which had got a reprieve of late after the finalization of the compensation package for the project affected families at the meeting of the Rehabilitation and Peripheral Development Advisory Committee (RPDAC) held last month.

Disposing of a writ petition of Geomin Minerals and Marketing Ltd, a Bhubaneswar-based company, a two-member division bench of the High Court comprising Justice B P Das and Justice B P Ray had directed the state government to take a fresh decision on the recommendation of PL in favour of Posco, giving preferential right of consideration to the petitioner.

The High Court had directed the state government to conduct a fresh hearing of all the 226 applicants for the Khandadhar mines.

Earlier, in January 2009, the Orissa government had recommended to the Government of India for grant of PL in favour of Posco over an area of 2500 hectares of Khandadhar mines.

The recommendation was made in favour of the company as per Section 11 (5) of Mining and Minerals (Regulation and Development) Act.Subsequently, several companies had challenged the state government's decision to recommend PL in favour of Posco India.

Terming the decision of Orissa government as 'arbitrary' and 'illogical', Geomin Minerals had challenged the government's recommendation in the High Court claiming that it had made the first application for mining lease in the area way back in August 1991.