Hindalco, Tata Power face IMG wrath

Sep 17 2012, 21:04 IST
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SummaryGovt today decided to de-allocate one more mine and deduct bank guarantees of two others.

Moving ahead with action against erring coal block allottees, the government today decided to de-allocate one more mine and deduct bank guarantees of two others even as the ministerial panel recommended forfeiture of bank guarantee of a block allotted to Hindalco and Tata Power.

The decision to deallocate Gourangdih ABC coal block, jointly given to JSW Steel, a company owned by Sajjan Jindal, brother of Congress MP Naveen Jindal and Himachal EMTA was taken on the recommendation of the Inter-Ministerial Group (IMG).

The panel is scrutinising 29 out of 58 cases that were served show cause notices for non-development of mines during prescribed timeline.

"I have approved the IMG's recommendations given on Friday and will take a call on others," Coal Minister Sriprakash Jaiswal said.

The IMG, on Friday had recommended deallocation of the Gourangdih ABC mine, given jointly to JSW Steel and Himachal EMTA, in 2009, having an extractable reserve of 61.54 million tonnes (MT).

With this the total number of blocks approved for deallocation has gone up to five out of total seven recommended by the IMG so far. Government has also approved deducting bank guarantee (BG) in case of five mines out of total eight recommended by the IMG so far.

Meanwhile, the panel decided to recommend deduction of bank guarantee in the case of a mine jointly allotted to Aditya Birla Group's flagship firm Hindalco and Tata Power due to delays in development of the block.

"The IMG today recommended deduction of bank guarantee of Tubed coal block in Jharkhand, allotted to Hindalco and Tata Power in August 2007," an official source said.

The panel could take up only Tubed block for scrutiny today and would meet again tomorrow to scrutinise another six of seven cases, which failed to adhere to the timeframe for developing the mines given to them, sources said.

The Tubed mine, which finds mention in CAG report, has an extractable reserve of 130 million tonnes (MT) and the coal from it was meant to be used for a power project.

The five mines approved by government for deallocation are - Gourangdih ABC-- jointly given to JSW Steel and Himachal EMTA, Bramhadih in Jharkhand allocated to Castron Mining in 1996, Chinora and Warora (southern part) blocks in Maharashtra given to Fieldmining and Ispat in 2003, Lalgarh (North) block in Jharkhand allotted to DOMCO Smokeless Fuels in 2005.

As far as deduction of BG is concerned, government has accepted the IMG recommendation in case of

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