Dantewada administration imposes Rs 1,620.5 cr fine on NMDC for violations

The administration in Chhattisgarh's Dantewada district has imposed a penalty of Rs 1,620.5 crore on the National Mineral Development Corporation (NMDC), a central PSU, for alleged violation of mining laws, officials said on Saturday.

The NMDC has termed the move "completely inappropriate" and claimed the penalty was imposed "solely and blindly without considering the facts and circumstances in the case".

The NMDC has mining operations in Bailadila hills in Kirandul and the Bacheli area of Dantewada in the Bastar region.

In a letter dated August 29, Dantewada collector Mayank Chaturvedi directed the NMDC to deposit the penalty amount within 15 days.

The letter stated that iron ore mining leases have been approved for Deposit No. 14 ML in an area of 322.368 hectares, Deposit No. 14 NMZ in 506.742 hectares, and Deposit No. 11 in 874.924 hectares in Kirandul village under Bacheli tehsil of Dantewada to the NMDC.

The collector wrote that the NMDC's clarifications to the show cause notices issued by district administration were unsatisfactory.

The NMDC has violated section (4)(1) of the Chhattisgarh Mineral (Mining Transportation and Storage) Rules, 2009, and as per Rule (5) of the Chhattisgarh Mineral (Excavation, Transportation and Storage) Rules, 2009 and section 21(5) of the Mines and Minerals (Development and Regulation) Act, 1957, a total penalty of Rs 1,620.5 based on market value and royalty of the mineral is imposed, the letter said.

When contacted about details about the show cause notices, Chaturvedi did not respond.

The NMDC, in a statement, claimed the Dantewada collector proposed to levy penalty and compensation to the tune of Rs 1,620.5 crore for alleged transport of iron ore without a railway transit pass (RTP), and thereby alleging contravention of the various provisions of different mining laws.

"It is respectfully submitted that the levy of compensation and penalty by way of impugned notice for demand of penalty and compensation solely and blindly without considering the facts and circumstances in the present case is completely inappropriate," it said.

The NMDC Limited has been operating with a valid mining lease, approved mining plan, CTO (consent to operate), CTE (consent to establish), and environment and forest clearances from the Union Ministry of Environment Forest and Climate Change (MoEFCC), it said.

As per Rule 2, sub-rule 1 (d) of Chhattisgarh Mineral (Mining, Transportation and Storage) Rule, 2009, Kirandul Complex, NMDC Ltd. was paying deposit, grade, and product-wise advance royalty to the state government through the khanij-online portal, and after the payment, e-permit numbers are generated, it said.

Since the NMDC has made advance royalty payment, Kirandul Complex has not violated mining rules for the alleged transport of iron ore without RTP, it said.

It also pointed out that the state government verifies these records every six months at the time of royalty assessment, and it has not raised a single objection so far, which shows that there has been no violation.

The NMDC further said that the finalisation of iron ore grade takes time, causing a delay in the generation of RTP by two to three days. This doesn't make any loss to the state exchequer. The NMDC will submit a suitable reply to the district collector.