In order to implement provisions of the Coal Mines (Special
Provisions) Ordinance, 2014 promulgated on 21.10.2014 , the Ministry of Coal
has today placed in public domain the draft Rules namely Coal Mines (Special
Provisions)Rules, 2014 . Shri Anil Swarup, Coal Secretary while briefing media on
various aspects of draft Rules here today said that in the spirit of
transparency in Governance, these Rules are proposed to be placed in the public
domain for inviting comments from the public and stake holders before they are
finalized. He said comments & suggestions can be sent by email at firstname.lastname@example.org by 9 AM ,
next Monday i.e 24th November,2014. Shri Swarup stated that these
rules provide a detailed roadmap for auction of coal blocks and allotment to
Government companies by nominated authority under Coal Ordinance . Efficient
utilization of coal assets of the country in the national interest shall be
possible through these detailed rules. Shri Swarup further stated that these
rules will provide a sense of certainty to the business environment and enhance
credibility of the process.
The draft Rules provide for:-
(i) Appointment and conditions of service of the
Nominated Authority, the Commissioner of Payments and the Designated Custodian
as well as officers and staff to be engaged in these offices.
(ii) Engagement of experts by the Nominated
(iii) Process of Allocation through auction and
allotment – The Central Government to issue an order to the Nominated Authority
specifying which coal mines are to be auctioned and which are to be allotted to
the Government Companies. Central Government to also specify the specified end
uses for Schedule II & III coal mines and broad parameter for conduct of
auction and allotment.
(iv) Preparation of a ‘Mine Dossier’ by the Nominated
Authority for each mine containing the particulars of geographical area, coal
reserves, mine infrastructure, approvals, permits, etc. in relation to such
(v) Conduct of E-auction comprising technical and
(vi) Graded application fee has been prescribed based
on Geological Reserves.
(vii) Eligibility to bid for Schedule II & III coal
mines shall be dependent on the status of preparedness of their end use plant-
80% of investment made in the EUP for Schedule II mines and 60% of investment
made in the EUP for Schedule III mines.
(viii) In case of allotment to Government companies, the
progress of development of coal blocks by the applicant in the past, financial
and technical capabilities of the applicant, status of preparedness of end use
plant, per-capita power availability in the State of the applicant, its current
and future requirements etc. will be the factors for selecting the allottee.
Nominated Authority may also specify the maximum number of mines and/or coal
reserves that may be allocated to one or more persons.
(x) The manner of determination of compensation,
priority of disbursal of proceeds arising out of land and mine infrastructure,
determination of claims and manner of disbursement.
(xi) Additional levy with respect to the coal extracted
till September 24, 2014 shall be deposited by the prior allottee with the Central
Government on or before December 31, 2014 and Additional Levy with respect to
the coal extracted from after September 24, 2014 till March 31, 2015 shall be
deposited with the Central Government on or before June 30, 2015.
(xii) A successful bidder or allottee may utilize coal
mined from a particular coal mine in any of its other similar end use plants by
giving a prior intimation to the Central Government in writing and the Central
Government may impose such terms and conditions as may be found necessary.
(xiii) Preparation of a detailed Operation and Management
Plan (O&M Plan) by the Designated Custodian for each mines entrusted to it
for approval of the Central Government.
(xiv) Authorities created under the Ordinance are
subject to C&AG audit
Hon’ble Supreme Court, vide its judgment dated 25.08.2014 in Writ Petition
(Criminal) No. 120 of 2012 (Manohar Lal Sharma vs. Principal Secretary &
Ors.) and Writ Petition (Civil) No. 463 of 2012 (Common Cause vs. UOI &
Ors.) as well as other connected PILs, has held allocation of coal blocks made
through the Screening Committee route and Government Dispensation route as
arbitrary and illegal. Further, the Hon'ble Supreme Court pronounced its order
on 24.09.2014 cancelling allocation of 204 coal blocks. Cancellation in case of
42 coal blocks under ‘Producing’ and ‘Ready to produce’ category shall take
effect from 31.03.2015. Remaining 162 coal blocks stood cancelled with
order to manage and re-allocate 204 cancelled coal blocks as well as to ensure
smooth transfer of right, title and interests in the mine along with its land
and other associated mining infrastructure to the new allocatee to be selected
through an auction or allotment to Government companies, as the case may be,
the Government promulgated the Coal Mines (Special Provisions) Ordinance, 2014