SC seeks details on power to allocate coal blocks

The Supreme Court Wednesday asked the central government to clarify as to who had the power to allocate coal blocks - the centre or the states - and sought details about a committee that vetted applications for the allocation of blocks.

The poser came from a bench of Justice R.M. Lodha, Justice Madan B. Lokur and Justice Kurian Joseph when it was told that coal mines that were not mentioned in the scheduled list of the Coal Mines (Nationalization) Act, 1973 and those that surfaced thereafter were under the control of the states.

The court was told that all the coal mines discovered after the 1973 act belonged to the states and were covered under the Mines and Minerals Development (Regulation) Act and the recommendation for their allocation should come from the concerned States.

The court asked Attorney General G.E. Vahanvati to inform it who had the power to allocate coal blocks and what procedure the government had followed.

The judges said that it was on the "decision making process" and it has to be tested on constitutional provision.

Details related to the constitution and powers of the screening committee which vetted the applications for the allocation of coal blocks and made recommendations were also sought by the court.

As petitioner advocate M.L. Sharma concluded his arguments, the court asked Prashant Bhushan, representing a petitioner NGO, to address the court on the inter-play between Coal Mines (Nationalization) Act and the Mines and Minerals Development (Regulation) Act.

Bhushan was also asked to address the court on the scope of Section 34 of the Coal Mines Nationalizations' Act.

Besides other aspects, Section 34 of Coal Mines (Nationalizations) Act provides for the "manner in which the coal mine shall be managed by a government company or a custodian".

The court said this in the course of the hearing of two public interest litigations - one by Sharma and other by NGO Common Cause - seeking the cancellation of coal blocks which were allocated in an allegedly irregular manner.

Earlier in his four and half hour long submissions, Sharma told the court that the coal that could be extracted from the blocks allocated to the private companies was far in excess of the total requirements of these companies over a period of 30 years.

It is "substantial" and clearly shows that "there is no application of mind", Justice Lodha said pointing to Sharma's submission that the allocation of excess capacity of coal blocks was "unfair, unreasonable and unjustified".

Sharma cited several instance of coal blocks being allocated to State Electricity Boards were passed on to private players in joint venture agreement.