The issue had been referred to finance ministry by prime minister Atal Bihari Vajpayee after it was raised by West Bengal chief minister Jyoti Basu during an hour long meeting. West Bengal has been protesting against being repeatedly exempted from the revision of royalty on coal.

Dasgupta said due to the low royalty, West Bengal was incurring losses to the tune of Rs 260 crore annually. Though the matter had been raised with various Central governments since 1991, the state government had not got any reply. "We are given to understand informally that the royalty had not been revised since west Bengal was collecting coal cess," he said.

Dasgupta said west bengal should not be discriminated for defending its constitutional right. Coal cess in other states had been struck down by the courts but the statae of West Bengal had beensuccessful in defending its cess.