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NEW DELHI: The Cabinet Committee on Economic Affairs has approved the union coal ministry's proposal to allow one-time window for central and state public sector undertakings (PSU) to surrender non-operational mines without penalty.
The penalties in such cases were forfeiture of bank guarantee. After this decision, state-run companies can surrender their non-operational mines without citing any reason, the union ministry of coal said in a statement.
On Thursday, Mint had reported on the Union cabinet's decision of allowing this one-time window to government-owned companies.
"This may release several coal mines which the present government PSU allottees are not in a position to develop or are disinterested and could be auctioned as per the present auction policy. A three months’ time will be granted to the allottee government companies to surrender the coal mines from the date of publication of the approved surrender policy," the statement said.
Following the cancellation of coal blocks by the Supreme Court in 2014, the government had allotted many cancelled mines to state and central PSUs on allotment route to prevent immediate disruption of supplies to thermal power plants. The allocation route was expeditious and it was expected that the coal requirement of state power generation companies would be met from those blocks.
The revenue share payable by state and central PSUs is fixed on per tonne basis unlike private sector who have to bid. Given the context of allocation of coal blocks at that point of time, conditions for times lines for operationalisation of coal blocks were stringent, leaving no wriggle room either for the successful allottee or the nominated authority, said the statement, adding that penalisation for delay in operationalisation of coal mines has resulted in disputes and court cases.
Till December 2021, 45 mines of 73 allotted to government companies, remained non-operational and the due date of commencement of mining operations in case of 19 coal mines was already over. Delays were due to reasons beyond the control of allottees, such as law and order issues, enhancement in the area of forest from what was declared earlier, resistance of land-holders against land acquisition and geological surprises in terms of availability of coal resources.
Good quality coal blocks which were allotted early can be quickly recycled back after removing technical difficulties and adjusting boundaries and offered to interested parties under the recently launched commercial coal mines auction policy. Early operationalisation of coal blocks will provide employment, boost investment, contribute to economic development of backward areas in the country, reduce litigation and promote ease of doing business leading to reduction in import of coal in the country, according to the government.
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