IMG on coal asked to give report at the earliest

New Delhi: The Inter Ministerial Group (IMG) going into coal block allocations was on Wednesday clearly directed by the Finance and Coal Ministries to conclude its work without delay and give its recommendations at the earliest.

The direction was given after Finance Minister P Chidambaram and Coal Minister Sriprakash Jaiswal met on Wednesday when Secretaries from both the Department of Economic Affairs and Coal Ministry were also present.

Rejecting reports of differences between the two ministries in the media on the basis of letter written by a Joint Secretary in the Finance Ministry to Coal Ministry, a Finance Ministry statement said late tonight that the letter was only a routine administrative matter.

The letter had asked the Chairman of the IMG that all the documents and facts relating to each case be provided to all the members of IMG without which IMG will not be in a position to take any view or make any recommendation.

"Letter issued by Ministry of Finance (MOF) is only a routine administrative matter which asked the Chairman of IMG that all the documents and facts relating to each case be provided to all the members of IMG without which IMG will not be in a position to take any view or make any recommendation," the Finance Ministry said tonight in its response.

It said subsequent to this letter, the Coal ministry has provided complete information to all its members.

"Representative of MOF has participated in every meeting of IMG and there is no difference of opinion between the two Ministries.

"The Union Finance minister and the Coal Minister met today in which the Secretaries from both Department of Economic Affairs and the Coal Ministry were also present.

"There is clear direction from both the Ministers that IMG must conclude its work without delay and give its recommendation's to the Government at the earliest," the Finance Ministry response said.

The IMG, under the Chairmanship of Zohra Chatterji, Additional Coal Secretary, has been mandated to review the progress of development of 58 coal blocks allocated to both public and private sector companies between 2005 and 2009.

It has been asked to give its recommendations by September 15 including whether the allocations to companies can be cancelled.

The IMG, which met on Wednesday for the fourth time in the last one week, examined the responses to its notices to 29 coal blocks.

Indications are that the IMG may not be in a position to give its final recommendations by the deadline of September 15 as it could have at least a couple of more sittings.

The IMG could also recommend deallocation and encashing bank guarantees of some of the allottees as a punitive measure for non-development of the mines.

"Finance Ministry has communicated to the Coal Ministry today that the IMG (Inter-Ministerial Group) can go ahead with its task of making recommendations of coal blocks de-allocation," a top official said.

Earlier, the Finance Ministry had written to the Coal Ministry saying that de-allocation of blocks might have financial and legal implications.

Seeking to downplay the matter, Department of Economic Affairs Secretary, Arvind Mayaram said, "there is no difference of opinion as far as Finance Ministry is concerned or the Coal Ministry is concerned on the fact that IMG must conclude deliberations and give its recommendations."

He said the letter sent by the Finance Ministry to the Coal Ministry was "only procedural in nature".

Earlier, the Coal Ministry had fixed a deadline of September 15 to take a decision on coal blocks in the backdrop of uproar over irregularities in allocation of mines after CAG estimated undue benefits of Rs 1.86 lakh crore to private firms on account of allocation without auction.

Representatives of 29 allottees were given a chance to put up their cases before the IMG on September 6,7 and 8.

The allottees gave progress reports of their mines and several of them said delays in starting the production resulted due to lack of various clearances from different state governments.

Tata Steel, Reliance Power, JSW, Grasim Industries, Kesoram Industries, IST Steel & Power, SKS Ispat and Power, Bihar Sponge Iron, among others, had appeared before the IMG.

Rest of the 58 coal block allottees which have been issued showcause notices for delaying production are with public sector firms, including MMTC, Chhattisgarh Mineral Development Corporation and Jharkhand State Mineral Development Corporation.