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BW Businessworld

Coalgate Comes Under Judicial Scrutiny, SC Notice To Centre

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The alleged irregularities in the coal block allocations came under judicial scrutiny on 14 September with the Supreme Court directing the Centre to explain if the guidelines were strictly followed in allotting the natural resource to private companies.

Turning down the Centre's plea that the court should not go into the issue as it is being looked into by a Parliamentary committee, the apex court said "these are different exercises."

A bench of justices R M Lodha and A R Dave said the petition raised serious questions and "it requires explanation from the Government".

"There is difference in exercise done by the Public Accounts Committee (PAC). Parliament and PAC can proceed with the issue on the basis of the CAG report. We don't want to encroach upon their exercise but the petition raises different things altogether. There are sufficient averments which require explanation from you," the court said.

The bench also made it clear that it is confining itself only to the aspect of guidelines formulated by the Centre for allocation of coal blocks.

The court passed the order while hearing a PIL filed by advocate M L Sharma on the alleged coalgate scam.

The bench rejected Solicitor General Rohinton Nariman's contention that the petition based on the CAG report was "premature" and should not be entertained.

Saying that the report of a constitutional body like CAG can be relied upon, the bench directed the secretary of Union Coal Ministry to file a counter affidavit within eight weeks dealing with the several aspects involved in allocation of coal blocks.

The bench said the affidavit shall cover the guidelines framed by the government for the allocation of coal blocks.

It said the secretary should also elaborate the process adopted for allocation of these coal blocks and whether the guidelines had an in-built mechanism to ensure that the allocation of coal blocks does not lead to distribution of largesse unfairly in the hands of few private companies.

The bench also sought to know whether the guidelines for allocation of coal blocks were strictly followed and whether by their allocation, the objectives of policies were realised.

The bench also sought the government's response on as to what were the hindrances for not following the policy of "competitive bidding" adopted by in 2004 for allocation of the coal blocks.

Lastly, the court wanted to know what steps were proposed to be taken against the allottees who have not adhered to the terms of allocation or have breached the agreement.