HC notice to Govt on PSU plea agst coal block allocation norm

Delhi High Court today sought the government's response on a Goa-based PSU's plea challenging Coal Ministry's recent order making it mandatory for state-run corporations to own a thermal unit to be eligible for allocation of coal blocks.
Justice Rajiv Shakdher, while issuing notice to the ministry and seeking its reply by February 26 on the petition of Goa Industrial Development Corporation (GIDC), also allowed the PSU to register for allocation of the Gare Palma sector III block which was earlier allocated to it.
"The matter requires examination. Issue notice. Meanwhile, petitioner is allowed to register its application for allotment document and the allocation would be subject to final outcome of the writ petition," the court said.

GIDC contended that government corporations of smaller states cannot apply for allocation as a result of the ministry's January 21 order.
"They (such PSUs) have tie-ups with other companies which have a end-use specific unit," the counsel for GIDC said and claimed that the last-minute norms issued by the government were arbitrary and violated the 2014 Coal Ordinance.
Additional Solicitor General Sanjay Jain opposed the contention saying the ordinance contemplates that auction would be as per norms prescribed by the government.

He said the ordinance also contemplates that a PSU seeking allocation has to be engaged in the specified end-use.

Also, the end-use plant has to be in 30 per cent readiness so that time is not wasted in setting up a unit and exploiting the mine.
Jain also clarified that while private companies have to participate in an auction for coal blocks, for state-owned corporations there is no auction process and there is only allocation.