Firms ‘squatting’ on coal blocks? | business | Hindustan Times
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Firms ‘squatting’ on coal blocks?

business Updated: Sep 02, 2012 21:36 IST
Vivek Sinha

The Inter Ministerial Group (IMG) — expected to meet on Monday to deliberate upon the progress report of captive coal blocks — is likely to mention “squatting on coal blocks” as the principal reason for de-allocation of coal blocks.

The group, which has representatives from the ministries of coal, steel, power and finance, has been studying the progress report of 57 captive coal blocks allocated to various steel and power-producing firms that require coal for their captive use.

“A whole bunch of owners of these captive coal blocks have not made any progress that could guarantee coal production in the coming months. This only points to the fact that firms have been squatting on their respective coal blocks,” a government official told HT. The IMG has taken a strong exception to the phenomenon of “squatting” on coal blocks despite repeated reminders from the coal ministry to start production, he said.

Initially, 16 blocks are likely to be recommended for de-allocation as the owners have neither obtained environmental clearance nor acquired the land. “The recommendations may be made to forfeit bank guarantees of the companies for delaying the mining operations in their captive coal mines,” he added, without divulging further details.

If the IMG’s recommendation passes the government's muster, it would give some reprieve to coal block allotee firms that are currently facing a CBI enquiry for corruption and “windfall gains” from allocations of such blocks.