Coalgate: SC refuses to reopen hearing for power companies

The Supreme Court today refused to give any further hearing to the companies which were awarded coal blocks at the government's discretion since 1993, after it reserved an order on the fate of the 218 coal blocks whose allocations were declared illegal and arbitrary.

A bench headed by Chief Justice R M Lodha turned down the pleas of power generating companies that they should be re-heard in case the apex court decides to cancel the allotments.

The 218 coal blocks include about 40 that are producing coal and another six that are ready for production, together having a capacity to produce 50 million tonnes of coal in a year - about 9 per cent of the 566 million tonnes the country produced last year, for which the government has sought some protection.

However, even for the 46 functional blocks the centre wanted to be protected, the affidavit stated that an additional levy at the rate of Rs295 per tonne as suggested by the Comptroller and Auditor General (CAG) could be levied.

Any annulment of the grant of coal mining concessions to power producers would jeopardize an already precarious coal supply scenario and threaten a worsening of the power shortage.

The centre had advocated cancellation of the coal blocks allotted illegally against the wishes of the companies who blame the government for irregularities and demanded setting up of a committee to go into each of the allocations.

The Coal Producers Association, Sponge Iron Manufacturers Association and Independent Power Producers Association of India and some private entities had rued the stand of the government that any ''cancellation of coal block allocation is a natural consequence of the judgement'' by saying that it would lead to total disaster and ultimate suffering for the man on street and rural population, already facing power crisis.

The bench had, however, said: ''Government is only articulating its position'' and it would ''not be a fair way'' of dealing with the matter as ''screening committee meetings speak for themselves that no procedure was followed''.