New Delhi: Amidst the storm over CAG report on coal block allocation, the Prime Minister's Office (PMO) has expressed displeasure over inaction by the Coal Ministry in cancelling blocks where mining has not taken place and asked it to expedite the matter by September 6.

The PMO communication to the Coal Ministry came ahead of the Inter-Ministerial Group Meeting (IMG) on Monday to take a decision on the fate of 58 coal blocks including 25 blocks allocated to private companies like Tata Power, Reliance Power and ArcelorMittal.

Sources said that the PMO on August 27 conveyed to the coal ministry its concern over inaction with regard to de-allocation of blocks to which show-cause notices have been issued.

The government in April had began the process of slapping notices on companies that failed to develop the 58 coal blocks within the stipulated time. Apart from Tata Power, Reliance Power and ArcelorMittal, notices were issued to firms like Hindalco, Grasim Industries, GVK Power, MMTC and others.

Subsequently, in June, it had formed the IMG to review the progress of coal blocks allocated to companies for captive use. It is headed by Additional Secretary Coal Zohra Chatterji and has representatives of steel, power, law, economic affairs and mines ministries, among others .

Separately, the CBI is investigating criminality in 12 firms which were given licenses under the 'fast track' category but had not yet commenced mining of the allocated coal blocks.

Petri, according to Gao, stated that there was gross violation of the condition of allocation and it would amount to sale of coal by a private contractor which was not allowed under the provisions of the CMN Act.

Gao also alleged that illegal mining of coal was going on in the block by the contractor in nexus with state politicians with illegal coal mining also flourishing in Kanubari area of Longding district.

"Nobody can ascertain the quantity of coal being extracted illegally from the coal block. The state is losing royalty of an approximate Rs 500 crore annually," he said.

The Union Home Ministry in a letter to the coal minister on March 26 had stated that Naga insurgent groups were involved in illegal coal mining at Namchik-Namphul coal block and requested the ministry to consider taking over the entire mining operation in the state.


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