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Vigilance Officer exposes mining corruption, Minister says fire him

Vigilance Officer exposes mining corruption, Minister says fire him

Author: Sonu Jain
Publication: The Indian Express
Date: August 20, 2006
URL: http://www.indianexpress.com/story/11029.html

Introduction: Chief Vigilance Officer's report on theft and one firm's monopoly in Coal India's most productive mine goes to Supreme Court panel; Court throws out 'fraudulent' PIL against rival firm

Exactly a month ago, Union Coal Minister Shibu Soren sent out a very unusual letter to his Secretary. In a one-para note he signed on an unmarked sheet of paper, he wrote he is "not happy" with Coal India's Chief Vigilance Officer and there is an "imperative need" to remove him.

Confirming he wrote the letter, Soren, asked by The Sunday Express why he wasn't happy with the CVO, said: "I write many notes, I don't remember the exact note."

Soren's memory loss is hard to understand.

For, this very CVO, Sashi Prakash, had filed a report alleging corruption and theft of coal on an unprecedented scale in Coal India's most productive mine, the Dipka-Gevra in Korba, Chhattisgarh. At the root of this, Prakash alleged, was Aryan Coal Benificiation (ACB), run by the Haryana-based Sindhu group.

"The mine management (South Eastern Coalfields Ltd (SECL), a Coal India subsidiary) has virtually surrendered its control to the group which practically has taken over the mine as far as coal-loading and transportation is concerned," said the CVO's report.

This report prompted a CBI inquiry which gave the firm a clean chit but the then Coal Secretary told the Supreme Court that the probe did not get the CBI's "seriousness it deserves."

Prakash, whose term ended three months ago, is still Coal India CVO as the Ministry is yet to find a replacement.

Aryan was back in the news just two months before Soren's letter. The SC's empowered committee found that Aryan had "set up" a fraudulent PIL against another firm, Maruti Coal, that challenged its monopoly in the area. The court fined the petitioner and threw the case out.

"It is true that Sindhu is a monopoly," admitted C L Shrivastav, SECL's Director (Operations). "We are looking at ways to reform this but the process of change could also mean a loss to SECL."

For, the stakes are staggering: at 1.25 lakh tonnes mined every day, this mine is Asia's largest open-cast mine. Each hour, Coal India makes a profit of Rs 12 lakh from this mine. And in four years has shelled out over Rs 350 crore to a network of transporting firms. This network, the CVO report says, is controlled by Aryan, a charge Sindhu denies.

The transport companies carry coal from the 8-square-km pits to giant crushers on the surface. From here, the coal is weighed before being taken to railway sidings or to a washery to be cleaned up before being transported to power plants in Rajasthan, Gujarat and Maharashtra.

The CVO's report claims that both transportation of coal and its cleaning in the washeries are done by Aryan which leaves scope to tamper with both quality and quantity of coal.

Not officially though. As per rules, coal transport companies are meant to be "Ex-Service Men (ESM) companies" as a result of an MoU between the Ministry of Defence and Ministry of Coal. ESMs were meant to rehabilitate unemployed, retired Army officers or widows.

Instead, as the CVO probe found, all the ESM firms are from Delhi, Haryana and Chandigarh, most are financed by Sindhu group and some of the directors are common to both.

Taking note of this report, the Central Empowered Committee set up by the Supreme Court pointed to pilferage of coal because of this ''unholy nexus'' between Aryan and the 14 ESM companies that run 2,500 trucks in the area.

Various Ministerial committees have suggested ways to break Aryan's monopoly. An open tender is one of the most important reforms. The other is to do with modernisation plans on which SECL has been painfully slow - installation of conveyor belts that will obviate the need for trucks in the area, setting up more weighbridges and rationalisation of rates for transport. But it's still on paper.

sonu.jain@expressindia.com


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