The Apex Court pronounced its much awaited verdict on a bunch of public interest petitions on the patent illegalities in the allocation of coal blocks for captive mining, popularly referred to as Coalgate, on August 25, 2014.
The machinations leading to this scam of epic proportions were exposed in a writ petition filed by Common Cause and six distinguished former public servants in October 2012. Our petition, extracted in the January-March 2013 issue of this journal, highlighted the brazenness with which successive Central governments during the period from 1993 to 2010 went about allocating precious reserves of coal to a privileged group of private entities in an arbitrary and opaque manner.
The allocation procedure, adopted on the pretext of meeting the critical needs of the power sector and other infrastructure industries, was in complete disregard of the provisions of the Coal Mines (Nationalisation) Act, 1973 and the Mines & Minerals (Development & Regulation) Act, 1957. This largesse occasioned a staggering loss to the public exchequer. The Comptroller & Auditor General of India has arguably estimated it at Rs. 1.86 trillion. It will be much more difficult to quantify the far graver loss of public confidence in the capacity of the governance system in place to husband the nation's resource endowments in its best interest.
Our petition showed how the Central government scuttled its policy of 2004 vintage to adopt a transparent system of competitive bidding for attribution of captive coal blocks to core industries, and how it proceeded at breakneck speed to allocate them to a motley group of influential rent seekers, many of whom had no real need of coal.
Under the circumstance, the Court was requested to cancel the allocations made during the period from 1993 to 2010, and order a thorough, Court-monitored investigation into the scam by a special investigation team. This course of action became necessary since the suo motu action initiated by the Central government against some of the allottees for violation of the terms of allocation, as well as the investigation being carried out by the Central Bureau of Investigation at the instance of the Central Vigilance Commission did not inspire confidence.