Coal India may engage consultants to take over deallocated mines

There is a proposal to allow the company to engage consultants through a competitive selection process for providing handholding support to the PSU

The government is looking at a proposal to allow Coal India Ltd to engage consultants through competitive bidding for assisting the PSU in taking over the deallocated mines following the Supreme Court's verdict on blocks.

The Supreme Court had yesterday quashed 214 allocations and asked CIL to fill the void and take things forward by taking over the operation of 42 blocks which are functional.

"There is a proposal to allow CIL to engage a firm of consultants through a competitive selection process for providing handholding support to PSU in taking over/managing the mines as per the directions of the Court/Central Government," a source close to the development said.

Owing to the legal and procedural shortcoming in allocation of the mines to private sector entities, CIL may have to manage such mines till government auctions the same by observing a transparent and competitive bidding process, he said.

The scope of work of the consultants would be "preparing an inventory/documentation of the coal mines to be taken over by CIL including assets and liabilities, stock/inventory, officers and staff including contractual, geological reports, mines plans etc", the source added.

"The consultants will also assist in designing the process of management of the taken over mines in the interim period till the process of auctioning is over and the mines are handed over to the selected entities," he said.

In a major blow to the corporate sector, the Supreme had quashed allocation of 214 out of 218 coal blocks alloted to various companies since 1993 terming it as "fatally flawed" and allowed the Centre to take over operation of 42 such blocks which are functional.

The apex court had said the beneficiaries of the illegal process "must suffer" the consequences and refused to show sympathy to private companies which submitted that Rs 2.87 lakh crore have been invested in 157 coal blocks and Rs 4 lakh crore in end-use plants.