Ministry of Coal has decided to de-allocate Coal blocks from Khappa & Extension, located in Maharashtra, from Sunflag Iron & Steel and Dalmia Cement (Bharat). The decision is based on account of slow progress and development of the blocks and late reply to the show cause notice by the companies.
The Khappa and Extension Coal block was allocated to the companies on 29 May, 2009 on the condition to begin production within 36 months in case of opencast mine and 48 months in case of Under Ground mine from the date of allocation. The Ministry had already cautioned of de-allocation in case of unsatisfactory progress noted from the blocks.
On the review meeting held on 11 and 12 January, 2012 it was noticed that the progress of the blocks is unsatisfactory. They then sent a caution letter to the companies on 26 April, 2012 to take care of development in the near future.
IMG recommended for de-allocation after reviewing the report of Coal Controller’s Organization (CCO) as on December 2012 and sent a show cause notice to the companies on 6 June, 2013.
The company then presented a status report to IMG mentioning its investments of INR 154.2 millions on the coal blocks, which was considered unsatisfactory again by IMG.
IMG in its recommendations has mentioned that the Coal block is an underground mine having national highway and Railway line and is located in a densely populated area. Its recommendation for de-allocation has been considered by the Ministry which has sent a notice informing the company about the de-allocation.