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SC notice to Centre, Odisha on coal allocation in 2003

October 15, 2012 19:27 IST

The Supreme Court Monday sought the stands of the Centre and the Odisha government on allegations that authorities had indulged in corruption in giving a coal block, allocated to the state mining corporation in 2003, to a private firm.

The public interest litigation has also sought a Central Bureau of Investigation probe into divesting Odisha Mining Corporation Ltd of the coal block in Talcher coalfield of Angul district and handing over the same to the private firm.

A bench of justices R M Lodha and A R Dave also issued notices to the Ministry of Coal, the Ministry of Environment and Forests, the CBI, the OMC and Delhi-based private mining firm, Sainik Mining and Allied Services Ltd, which was handed over the coal block.

The PIL was filed by Talcher-based social activist Purna Chandra Sahu, who alleged that "while the conduct of the Odisha government was manifestly illegal, that of the Centre remaining silent despite noticing the various acts of omission by the state is equally shocking."

In the petition filed through advocate Suresh Tripathy, the activist has alleged that "due to the non-transparent and arbitrary policy introduced by the Central Government," the coal block allocated in favour of OMC was handed over to a private firm by the state in an "arbitrary and manifestly corrupt manner."

He has said that the coal block was allocated in favour of OMC on December 19, 2003 and the consent letter regarding the same was received by OMC on January 5, 2004.

The petition added that the OMC, meanwhile, on December 29, 2003 OMC had entered into an agreement with M/s Sainik to set up a joint venture, in which the private firm held 74 per cent stake.

It also said the mining lease was acquired by the private firm in "sharp contrast" to the allocation letter which said lease was to be granted to the allottee, OMC.

The petition also said the Memorandum of Understanding between OMC and M/s Sainik was examined by the Central Empowered Committee, which had criticised the MoU and questioned its legality, validity and public interest.

The petitioner said the CEC in its report of February 20, 2009 had recommended that the arrangement between OMC and M/s Sainik regarding shareholding, day-to-day control, checks and balances, etc. be re-visited.

The petition said pursuant to the CEC recommendations, the Centre had written to the Odisha government asking it to modify the Memorandum of Articles of Association in the joint venture, so that the OMC would have 51 per cent stake in the venture. The state government was also told to make the JV a government company.

The Centre, later, had also issued a show cause notice to the state asking it as to why it should not de-allocate the coal block allocated to OMC in view of the delay in development of the block and various other issues, the petition said.

The petitioner said apart from writing to the state and sending show cause notices warning of cancellation of the allocation, the Centre did not take any such action against the state or OMC.

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