SC rejects plea seeking quashing of coal auction

By: | Published: February 24, 2015 1:20 AM

Petitioner alleged the auction process was ‘corrupt, illegal & unconstitutional’

The apex court on Monday rejected a plea seeking quashing of auction of coal blocks to all power companies under reserved category, including Gare Palma IV/ 2 and 3 in Chhattisgarh that was won by Jindal Power, allegedly at a low price.

A special bench headed by Justice MB Lokur while refusing to entertain the petition filed by advocate ML Sharma said: Auction is an auction… you may have a substantive objection, but it is not maintainable.”

Sharma, based on whose petition the apex court had de-allocated 204 coal blocks in September last year, had alleged the auction process adopted by the government was “corrupt, illegal and unconstitutional” and had resulted in “cartelisation.”

Requesting for a direction to the government to ascertain the floor price of blocks at the market rate, Sharma said the auction process created a serious financial loss to the exchequer as the floor price ranging between Rs 100 a tonne to Rs 150 tonne was less than the market price of about Rs 3,000-6,000 a tonne. He alleged the government sold five parts of Gare Palma block in Chhattisgarh at different rates. While the Gare Palma 2 and 3 coal blocks, reserved for power sector, were retained by Jindal Power at a winning price of Rs 108 per tonne, Gare 5, earmarked for steel and cement sectors, was allocated to Hindalco Industries at Rs 3,502 per tonne.

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