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Firms with cancelled mines can bid in auction by paying levy

Firms with cancelled mines can  bid in auction by paying levy
The companies engaged in specified end use plants like steel, cement and power, including ones having a coal linkage, also qualify to participate in the e-auction, said the Coal Mines (Special Provisions) ordinance 2014, which got Presidential nod on Tuesday.

‘A prior allottee shall be eligible to participate in the auction process subject to payment of the additional levy within such period as may be prescribed and if the prior allottee has not paid such levy, then, the prior allottee, its promoter or any of its company of such prior allottee shall not be eligible to bid either by itself or by way of a joint venture,’ said the ordinance made public on Wednesday.

Any prior allottee, convicted for an offence relating to coal block allocation and sentenced with imprisonment for more than three years, would not be eligible to participate in the auction, it said.
The apex court had last month quashed the allotment of 214 coal mines to various companies since 1993 on the ground that they were done in an illegal manner by an ‘ad-hoc and casual’ approach ‘without application of mind’.

It had determined additional levy of Rs 295 per metric tonne of coal extracted. The ordinance was brought to allocate coal mines and ‘vesting of the right, title and interest in and over the land and mine infrastructure together with mining leases to successful bidders and allottees with a view to ensuring continuity in coal mining operations and production of coal, and for promoting optimum utilisation of coal resources consistent with the requirement of the country’.

The Centre will appoint an officer not below the rank of Joint Secretary as the ‘nominated authority’ for the ordinance, who may engage any expert to make recommendations for conducting auction and execution of the vesting order for transfer and vesting of coal mines. The authority will collect proceeds of the auction which will go to the kitty of states where the mines are located.

‘The nominated authority shall, in consultation with the Central Government, determine the floor price or reserve price ... The successful bidder shall, prior to the issuance and execution of a vesting order, furnish a performance bank guarantee,’ the ordinance said.
PTI

PTI

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