Coalgate: Arbitrariness on part of Screening Committee,says SC

Arbitrariness in the allocation of coal blocks through Screening Committee route was apparent as there was failure to consider capability and capacity of the applicant and important requirement of end-use project at the time of allocation was given a go by, the Supreme Court today said.
"The entire exercise of allocation through Screening Committee route thus appears to suffer from the vice of arbitrariness and not following any objective criteria in determining as to who is to be selected or who is not to be selected," a bench headed by Chief Justice R M Lodha said.
It said not only there was no evaluation of merit and no inter se comparison of the applicants, but also no chart of evaluation was prepared.

Observing that the determination of the Screening Committee was apparently subjective as minutes of its meetings do not show that selection was made after proper assessment, the bench said, "The project preparedness, track record etc, of the applicant company were not objectively kept in view."
Elaborating on the laws for grant of coal blocks, the bench, also comprising justices M B Lokur and Kurian Joseph, said the company that was applying for the coal block must have set up an iron and steel plant, power plant or cement plant and be engaged in the production of steel, power or cement.

Further, the bench said the prospective engagement by a private company in the production of steel, power or cement would not entitle such private company to carry out coal mining operation.

However, on these aspect there was fault by Screening Committee, the bench said, adding, "most of the companies, which have been allocated coal blocks, were not engaged in the production of steel, power or cement at the time of allocation nor in the applications made by them any disclosure was made whether or not the power, steel or cement plant was operational".
The bench noted that the companies only stated that they proposed to set up such plants.

"Thus, the requirement of end-use project was not met at the time of allocation," the bench said, holding that the allocation of coal blocks from 1993 t0 2010 was illegal.