Something went wrong, Centre tells apex court

Attorney General G E Vahanvati told a bench comprising of Justice R M Lodha, Justice Madan B Lokur and Justice Kurian Joseph, hearing the case of alleged irregularities in coal block allocation, that ideally coal block allocation should have been a consultative exercise with the state governments and it could have been done in a better way. He said that the decision to allocate was taken in good faith but something turned out to be wrong.

Vahanvati said, ‘Everything could have been done in a more refined and better manner. I accept my lordships’ view’. The AG said that everything could have been done in a better way but in 1991-92, the power situation was different and the critical need of the time was to increase power generation and ‘what we did was in national interest’.

Senior BJP leader Arun Jaitley on Thursday, reacting to the government statement and while blaming prime minister Manmohan Singh for the controversy, demanded that such ‘dubious’ allocations should be scrapped immediately. ‘AG’s admission in the Apex Court questioned that had the PM chosen to assert himself at the right time would the situation had been different today?’ he said.

On the government’s stand on de-allocation of certain coal blocks, the attorney general submitted before the bench that the government would make its stand clear on the issue next week. He said that he has suggested cancellation of all post-2005 coal block allocation where licenses had not yet been granted. He said that the allocation letter is not bankable and it does not create any right in favour of any company.

The apex court bench on Wednesday had pulled up the central government for not cancelling the allocation of coal blocks to the private sector companies on the grounds that they had made huge investment in the projects albeit without getting clearance. The court had asked from the central government whether it intends to de-allocate those blocks. The court had said that huge investment made by companies in coal blocks without getting all clearance cannot be a ground for not cancelling licenses, adding the companies which invested money on blocks without getting proper clearances took the decision at their own risk. Vahanvati had told the court that around Rs two lakh crore has been invested in such blocks and it will be difficult to cancel the license for want of clearances.

The central government was responding to the affidavits of the governments of mining states over the coal block allocation. These seven mining sates – Maharashtra, Andhra Pradesh, West Bengal, Madhya Pradesh, Jharkhand, Odisha and Chhattisgarh – have said they have no role in allocation and put the blame squarely on the central government.
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