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CBI files fresh FIR in coal scam, names Hindalco, former coal secretary

The Central Bureau of Investigation (CBI) on Tuesday filed FIRs against industrialist Kumar Mangalam Birla and former coal secretary PC Parekh for alleged irregularities and criminal conspiracy in allocation of two coal blocks in Orissa in 2005.

Coordinated searches were carried out at offices of the Aditya Birla group in Mumbai, New Delhi, Hyderabad and Bhubaneswar on Tuesday.

The FIRs against Kumar Mangalam Birla, the chief of the Aditya Birla group, and Parekh are under the Prevention of Corruption Act. The CAG, whose report on the allocation of coal blocks in 2012 led to the CBI investigation, had named Parekh as the whistleblower.

The CBI has now filed 14 FIRs in the case.

"CBI has registered a fresh case in alleged irregularities in coal scam against the then coal secretary, Hindalco, representative of Adita Birla Group, unknown persons and officials," CBIspokesperson Kanchan Prasad said.

A Hindalco spokesperson said the company had not received a copy of the FIR. The spokesperson denied any wrongdoing by the company.

Hindalco informed the Bombay Stock Exchange: "We wish to state unambiguously that we have followed every process required for allocation of coal completely, as stipulated by the government policy." The company's shares closed 1.45 per cent up after falling initially.

According to the CBI FIR, in 2005, the "said persons in criminal conspiracy with one another (and a public servant) showed undue favour to an Odisha-based industry in allocation of Talabira II and III coal blocks, along with a PSU (Neyveli Lignite Corporation) in Tamil Nadu".

Kumar Mangalam Birla is the second major industrialist after Naveen Jindal, chief of the JSPL group, to be named in the coal FIRs.

The two blocks for which Birla is expected to be questioned were allocated to Aditya Aluminium — a division of Hindalco Industries — jointly with two other firms on November 10, 2005, for generating 750 MW electricity.

"But till 2010, the company did nothing credible to make it operational and was failing to meet all milestones and had not even furnished the required bank guarantee," a senior official of an inter-ministerial group, which monitors the progress of the allocated blocks, told The Indian Express.

The CAG report that raised questions on the allocation of coal blocks said: "The secretary coal (Parekh) submitted in the draft note on competitive bidding... the desirability of taking decisions in respect of all pending applications on the basis of competitive bidding" in September 2004.

Parekh had written to the then minister of state for coal Dasari Narayana Rao to begin auctioning blocks to ensure transparency. Prime Minister Manmohan Singh held charge of the coal ministry at the time.

Source: The Indian Express