PAC questions basis of coal block recommendations

The panel is also keen to be informed on whether the state government vetted the balance sheets of coal block applicants

Ahead of its Odisha visit scheduled for November 2, a nine-member public accounts committee (PAC) of the Parliament has asked the state government to clarify the basis on which recommendations were made for award of coal blocks to companies.

The PAC is also keen to be informed on whether the state government vetted the balance sheets of coal block applicants. Besides, the committee has asked if there was any end-use plant and the progress achieved by the companies on such plants.

The PAC is scheduled to hold talks with the chief secretary B K Patnaik and other top state officials on November 3. The Parliamentary panel is led by seasoned BJP leader Murli Manohar Joshi.

A team of the office of the Accountant General (Odisha) has already started process of verification of records in respect of recommendations made by the state government for coal blocks.

The team led by audit officer P K Hazary is taking up scrutiny of records relevant to coal blocks.

The visiting PAC will examine the procedure followed by the state government in recommending coal blocks for private as well as PSU firms. Besides, the panel will check the status of coal blocks allocated to Mahanadi Coalfields Ltd (MCL).

The panel will take up scrutiny on the basis of the findings of the Comptroller & Auditor General of India (CAG) on coal block allocations made between 2005 and 2009. It will also take stock of the extent of water pollution in rivers in Odisha.

After CAG pointed out glaring irregularities in award of coal blocks, an inter-ministerial group of ministers of the Centre has recommended de-allocation of the New Patrapada coal block allocated in January 2006 jointly to Bhusan Steel, Adhunik Metaliks, Deepak Steel and Odisha Sponge Iron. The IMG has recommended bank guarantee encashment in case of Radhikapur (east) coal block allocated to Tata Sponge Iron, Scaw Industries and SPS Sponge Ltd in July 2006.

Moreover, the sale of Rampia and dip side Rampia coal block by Navabharat Power to Essar Power had come under the scanner. Chief minister Naveen Patnaik had also courted controversy for recommending coal blocks in favour of Jindal Steel & Power Ltd (JSPL).

The recommendation for coal blocks were made by Patnaik even before the signing of memorandum of understanding (MoU) with the company. As 22 coal blocks were allocated to private firms and state controlled entities in Odisha between 2005 and 2009, including two blocks for implementing coal-to-liquid projects.