The Supreme Court today said that all coal block allocations made between 1993 and 2010, during the rules of both the previous NDA and UPA governments, were done in an arbitrary, "ad-hoc and casual" manner "without application of mind".
The entire allocations, both through the screening committee and allocations by the ministry, made before the start of the auction process, were arbitrary and illegal, the apex court said.
"As we have already found that the allocations made, both under the screening committee route and the government dispensation route, are arbitrary and illegal; what should be the consequences, is the issue which remains to be tackled. We are of the view that, to this limited extent, the matter requires further hearing," the bench observed in its 163-page judgement.
The Supreme Court, which examined the allocation of 218 blocks, said, "Common good and public interest have, thus, suffered heavily" as "there was no fair and transparent procedure, all resulting in unfair distribution of the national wealth."
A bench headed by Chief Justice R M Lodha also held that "no state government or public sector undertakings of the state governments are eligible for mining coal for commercial use".
The bench noted that the screening committee met 36 times since 14 July 1993 and its decisions had never been consistent or transparent. Neither did the committee applied its mind properly. It all resulted in unfair distribution of national wealth, it added.
The bench, also comprising justices Madan B Lokur and Kurian Joseph, said the matter requires further hearing to properly assess the consequences and the remaining issues which remains to be tackled. ''We are of the view that, to this limited extent, the matter requires further hearing.''
The bench also clarified that there was no challenge laid before it for cancellation in respect of blocks where competitive bidding was held for the lowest tariff for power for ultra mega power projects (UMPPs) in accordance with the opinion given in the Natural Resources Allocation Reference.
While delivering the judgement, the judges also observed that the figures of coal blocks given by the attorney general were not verified and even the state governments had raised objections.
These issues have to be gone into, the court said and suggested the setting up of a committee comprising retired Supreme Court judges to give its report on the issue in the shortest possible time.