SC to decide fate of coal blocks today, top companies keep fingers crossed
India's top private and government companies in key industries - power, steel and cement - are keeping their fingers crossed, fearing cancellation of coal mines allotted to them years ago.india Updated: Sep 24, 2014 13:20 IST
India's top private and government companies in key industries - power, steel and cement - are keeping their fingers crossed, fearing cancellation of coal mines allotted to them years ago.
The Supreme Court will deliver on Wednesday its verdict on how 193 coal blocks "illegally" allocated between 1993 and 2010 should be treated.
The apex court had said last month the coal blocks were allocated illegally and arbitrarily since by various regimes at the Centre on the recommendation of a bureaucrats' panel.
The court, which had condemned the procedures adopted by 36 screening committee meetings, however, had stopped short of cancelling them, saying, "what should be the consequences, is the issue which remains to be tackled".
Now, the fate of 193 mines, some of which were given about two decades ago and haven't started hauling coal yet, hang in balance.
The potential investments that may get affected together could top Rs 2 lakh crore.
Companies that could take a hit include Vedanta, Essar, Jindal Steel and Power, JSW, NTPC, SAIL and Hindalco, among others.
The government's top lawyer, attorney general Mukul Rohatgi, had told the court earlier this month that if all blocks are cancelled, state giant Coal India be allowed to take over active mines, or companies be allowed to continue production until the blocks are re-auctioned, in order to avoid supply disruptions.
The apex court's verdict will make it clear whether these blocks would be re-allocated or will be just asked to pay a penalty.
States such as Jharkhand, Odisha, Chhattisgarh and Madhya Pradesh have written to the Centre, requesting it not to consider re-allocation of coal blocks in its suggestions to the court, as it would lead to escalation in the cost of mining.
(With Agency inputs)