CIL unit's inefficiency makes it financially unviable: CAG

Coal India's Dankuni Coal Complex (DCC) have not functioned "efficiently" to become financially viable as the unit always operated much below installed capacity, government auditor CAG said today.
In a report on public sector units (PSUs) for 2013-14 fiscal, tabled in Parliament today, the Comptroller and Auditor General (CAG) today said since its inception, the DCC did not operate efficiently to achieve financial viability.
"Moreover, the DCC did not take effective measures to control environmental pollution," it said.
"The unit has been sustaining substantial loss as it operated far below its installed capacity in the absence of capital infusion towards revival, capital rehabilitation of the

plant coupled with outdated technology, poor offtake of gas by customer, non-remunerative price fixed by customer, poor sale of by products and absence of marketing strategy," CAG added.
The Complex was set up at a cost of Rs 147 crore in 1990 as a unit of Coal India Ltd (CIL).

Later, CIL handed over DCC to South Eastern Coalfields Ltd (SECL), a CIL arm, for running the plant on operating lease basis in April, 1995 and the renewed lease subsequently at an annual lease rent of Rs 7.50 crore followed by further renewable of lease w.E.F. April 1, 2010 at Re one per annum, it said.

DCC was set up to produce coal gas, coal tar and other chemicals from low temperature carbonisation of non-coking coal with a view to producing environment friendly coal gas and coke for domestic and industrial use.
"Thus DCC, nor SECL or CIL took any coordinated productive steps to address the core issues pointed out above which would have helped DCC to gets its financial health restored," the apex auditor said.
The objective of setting up DCC, a low temperature carbonisation plant, was to produce environment friendly coal gas/coke/tar and other coal derived by by-product chemicals from non-coking coal for domestic and industrial use.