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New UserGovernment firm on its stand against JSPL’s coal blocks
26 Mar 2015
The government is in no mood to award two coal blocks in Chhattisgarh to Jindal Steel & Power Ltd even if the company wins an ongoing battle in the Delhi high court.
The government will approach the Supreme Court if the high court directs that the blocks be awarded to the company owned by former Congress MP Naveen Jindal, a top government official said. The official said the government was against awarding the coal blocks because the bids were extremely low and could be questioned later.
"If you look at the operational blocks that were auctioned for the power sector and you plot the bids on a graph, you would find out the stark variation in the bids for the cancelled blocks even for naked eyes. We do not want to be questioned later on. We will file a special leave petition in the Supreme Court even if we lose in the Delhi high court," he said. "If you look at other blocks auctioned for power sector, we have accepted variation of 10 per cent-15 per cent between them," he added. JSPL approached the high court on Monday against the government's decision to scrap tendering of the two coal blocks —Gare Palma 2&3 and Tara — that received low bids compared with other auctioned coal blocks.
The Delhi high court asked the coal ministry to respond in two days while listing the matter for hearing on Thursday. The court also restrained the coal ministry from allotting Tara, anon-operational block, to Coal India.
The coal ministry informed the court that it has allocated the Gare Palma 2&3 mine to Coal India, which will operate the block after March 31.
In its counter-affidavit in the Delhi high court, the coal ministry is likely to compare the JSPL bids with prices offered for coal blocks such as Talabira-I in Odisha, which has grade similar to Gare Palma 2&3 and was won by GMR Energy at Rs 378 per tonne, foregoing the mining cost and accepting a Rs 100 per tonne fixed cost. "The difference will run into crores," the official said.
Jindal Power, a unit of JSPL, emerged as the best bidder for the operational Gare Palma IV/2&3 mine, with a price of Rs 8 per tonne, and the Tara block for Rs 26 per tonne, excluding the Rs 100 per tonne floor price payable to the states.