SC asks if Centre intends to cancel coal blocks allocated after 2005

AllocationThere are more than 100 blocks allocated after 2005.

Putting the government in a tight spot, the Supreme Court on Wednesday asked if it was ready to cancel coal blocks allotted after 2005 and also consider calling off such allocations where either leases have not been executed or "milestones" had not been reached by the beneficiary. There are more than 100 blocks allocated after 2005.

A bench led by Justice RM Lodha asked the Attorney General (AG) to communicate the government's intent to the court, saying consideration of legal issues relating to the allocation of coal blocks will be entirely different if the Centre came forward to cancel all allocation post 2005.

"Are you intending to cancel all the allocation after 2005? The scope of the case will be different in that case. If the allocation of this period is gone, we will have to see only those allocated prior to 2005," said the court.

It also told AG G E Vahanvati that the court was open to issue some directives where the allocation had not resulted into execution of leases.

Noting that there have been instances where no development had occurred even after five years of allocation, the bench also questioned the government for not taking action in case of such allocation where, as the AG put it, "milestones" had not been achieved by the entities regarding at least 32 allocation.

The bench dismissed Vahanvati's contention that around Rs 2 lakh crore has already been invested by the companies after allocation and cancellation of allocation would now cause great harm to their interests.

"How did they invest? Mere allocation did not create any rights in their favour. All such investments, at best, could in contemplation of certain substantial rights which were yet to be created. No law, no equity can help them. All such investments would go in drain and it cannot be a defence and no law would help them," said the court.

... contd.

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