What stops you, asks SC as centre mulls axing coal block allocations

With the central government Thursday telling the Supreme Court that it was examining the option of withdrawing the coal blocks allocated to private companies after 2006, the court for the second successive day asked what was holding it back from de-allocating coal blocks that are under the scanner.

Attorney General G.E. Vahanvati told a bench of Justice R.M. Lodha, Justice Madan B. Lokur and Justice Kurian Joseph that the court's views on de-allocation were under the government's consideration.

"... I have given my personal views to the government. Government has taken up the matter. This view is being considered by the government," he said.

"So, it is under consideration," Justice Lodha observed as Vahanvati told the court that he will apprise the court of the outcome by Jan 15.

Hearing a public interest litigation (PIL) seeking the cancellation of coal blocks allocated after 2006, the apex court had Wednesday asked the attorney general if the coal blocks that were in conflict with conditionalties in the Mines and Mineral (Development and Regulation) Act could be de-allocated.

The allocation under scanner concerns 32 coal blocks allocated to private companies by the coal ministry's screening committee.

During the course of the submissions Thursday, Vahanvati reiterated that mere allocation of coal blocks does not bestow any rights for mining leases to the allottees.

There are several steps involving environmental and forest clearance before the state government issues mining leases, he added. On this, the court asked what the government was waiting for.

"You yourself are saying that these allocation letters are not enforceable (under law) then what are you waiting for...," Justice Lodha asked the attorney general.

"For cancellation," Vahanvati asked.

As Justice Lodha said "Yes", Vahanvati said, "I am waiting for instructions (from the government)".

As Vahanvati took the court through the process commencing from the identification and allocation of mines, Justice Lodha said that the process of identification and allocation of coal blocks by the central government which in the existing procedure comes first could infact come at later stage when other steps have been complied with.

"Allocation may be important step, but it can't be the first step" as host of the permissions, clearances and considerations have to be satisfied, observed Justice Lodha.

"Every consideration for the development and regulation of coal blocks has to be result oriented. What has happened has not resulted in achieving the objective," he said. At this, the attorney general admitted: "Something has gone wrong."

"We are presently assuming that everything was done bonafide but the entire exercise has not resulted in achieving the laudable objectives," Justice Lodha said adding that in last seven years, nothing has been done for achieving the goal of enhancing power production.

Addressing the court's query, Vahanvati said: "Something better could have been evolved to have transparency..declared policy, I don't know. But the identification and allocation is the first step in national interest."

The attorney general told the court that out of 28 states, only seven have coal reserves. Thus "there has to be national over-view. It (coal) is a national asset."

"In hindsight all the coal blocks for power production could have been identified and then with the available information they could have gone to the State government for allocation letter," he said, adding that some better mechanism could have been developed in consultation with the states.

In early 1990s, the urgency to augment the power production was so great that the government took this route and no state objected to it, Vahanvati told the court.