Allow Birla Corp in second phase of coal auction: HC tells govt

The Delhi High Court on Friday asked the government to allow Birla Corporation to participate in the bidding in the second phase of allocation of a coal block in Madhya Pradesh, for which it was disqualified in the first phase due to its failure to attach relevant documents.

The relief was given to the company after it gave the assurance that the relevant documents would be attached in the bidding for the second phase of auction for the coal block in Birchapur.

A Bench said the government should not take any coercive steps against the company till May 15.

It also restrained the coal ministry from forfeiting the Rs 2 crore deposited during the first phase of bidding, till the next date of hearing.

Birla Corporation Ltd has moved the high court, saying that if it is held to be technically disqualified then it will have to forfeit its Rs 2-crore deposit and be barred from participating in the auction for one year. It has challenged its disqualification.

The bench also sought response from the Coal Ministry on the plea of Electrosteel Castings Limited challenging provisions of the 2014 Coal Ordinance on the grounds that it was aggrieved at the "arbitrary" determination of compensation for its mining infrastructure which was much lower than it expected.

The provision pertains to the computation of compensation payable towards mining infrastructure of operators of functional coal blocks.

Electrosteel is aggrieved by the government's January 28 decision by which it "arbitrarily" determined quantum of compensation at Rs 38 crore, while the company claims it should have been around Rs 1,189 crore.

The company also sought a direction to the ministry for making payments of compensation towards land and mine infrastructure for expenditure incurred from April 1, 2014 to March 31, 2015 within a period of 30 days, thereafter based on the audited balance sheet as on March 31.