Govt extended mining leases instead of auction process to benefit 'friends': Cong

New Delhi: The Congress on Monday accused the government of extending the leases for mining iron ore from 358 mines instead of going for auctions to benefit "friends", weeks after the Supreme Court asked the Centre to respond to a plea seeking quashing of the lease extensions.

Congress spokesperson Pawan Khera demanded there be an inquiry into the matter, the loss caused to the exchequer be fixed and auctions for the mines be held. There was no immediate response from the government to the allegations.

In January 2015, the Modi government introduced a new amendment by way of Ordinance -- Section 8A -- to the Mines and Minerals (Regulation and Development) Act, 1948, he said. "This amendment, Section 8A, allowed the Modi government to extend the leases of existing mines (captive and non-captive for both iron ore and other minerals) without going through the auction route and without having to pay any premium on the renewed leases some of which have been extended till 2030," Khera alleged. Asserting that there should have been auction for the mines as it would have resulted in revenue for the states, Khera said: "You snatched that right...You want to benefit friends."

He claimed that according to estimates the extension of leases had caused a loss of over Rs 4 lakh crore to the exchequer. The Supreme Court in April asked the Centre to respond to a plea seeking quashing of allotment, extension or continuation of leases to firms for mining iron ore from over 358 mines across the country without any fresh evaluation. On August 2, the Supreme Court granted three weeks' time to the Centre to respond to the plea.

Five months have passed since April but the government has failed to give an answer to the Supreme Court on the allegations raised in the petition, Khera alleged.