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SC cancels 214 coal block allocations; spares 4

24 Sep 2014 Evaluate

In a landmark verdict which would have significant impact on the energy sector, the Supreme Court cancelled 214 coal blocks that were illegally allocated to private firms by various governments between 1993 and 2011 and exempted 4 coal block owned by the government. The blocks exempted were way less than that sought by the government, which asked the court to exempt 46 coal blocks that have either started production or are near it.

Further, the court also directed the allottees to pay a fine of Rs 295 per tonne from the time the coal was mined and allowed the government to auction or allot the blocks to central firms, though it did give six months breathing time to the private companies for winding up their blocks.

The bench headed by Chief Justice RM Lodha, summed up that entire coal block allocation that was made as per recommendations by the Screening Committee from July 14, 1993 in 36 meetings and through the government dispensation route suffered from the vice of arbitrariness and legal flaws. It also ruled that Screening Committee has never been consistent, transparent, and acted on no material in many cases and that relevant factors seldom had been its guiding factors for the Committee.

Earlier, the Supreme Court on August 25, held that all coal blocks allocations since 1993 by various regimes at the Centre have been made illegally and arbitrarily and used almost all terms to condemn the procedures adopted by 36 screening committee meetings since 1993, but, it then had stopped short of cancelling them saying, 'what should be the consequences, is the issue which remains to be tackled'.

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