Odisha govt collects Rs 7,962 cr penalty from mining companies

Tata Steel, OMC, Rungta Mines key contributors

The Odisha government has collected Rs 7,962 crore so far from mining companies as compensation for illegally extracted iron and manganese ore between 2000-01 and 2010-11.

With the Supreme Court deadline of December 31 inching closer, miners are making payments hurriedly to save their operating leases.

"The penalty payment of Rs 7,962 crore is reflecting in our head of account. We expect this figure to rise to Rs 9000 crore by December 30. The exact amount paid by the lessees can be known on January 1 as the final figure will take some time to reconcile in our account", said a senior government official.

Most of the key miners with huge penalty burdens have paid their share of compensation. Tata Steel, Essel Mining, Rungta, state-run Odisha Mining Corporation (OMC), Jindal Steel & Power Ltd (JSPL), Indrani Patnaik, Kaypee Enterprises, Aryan Mining & Trading Corporation and Tarini Minerals and K N Ram have made payments (as on December 29), the official said. All these companies were slapped with demand notices where the payable amount exceeded Rs 100 crore.

Mining companies are saddled with Rs 17,576.17 crore compensation which they need to pay for extracting excess iron and manganese ore beyond the limits approved under environment clearance (EC). After the Supreme Court recently ruled out any extension in deadline and also foiled their bid for staggered payments, miners are making frenzied efforts to shell out the penalties.

Odisha's steel & mines minister Prafulla Mallick said Thursday that the government was hopeful of collecting the whole amount.

OMC faced the biggest penalty burden at Rs 2,177.97 crore. There were other leaseholders saddled with significant penalties- Sarda Mines (Rs 1,983.86 crore), Essel Mining (Rs 1,102 crore), Mesco Steel (Rs 924.75 crore), Orissa Minerals Development Corporation (Rs 642 crore) and Tata Steel (Rs 614 crore).

The central empowered committee CEC, an apex court-appointed panel to probe illegal mining in Odisha, had calculated the figure for excess mining beyond the limits approved under EC), at Rs 17,576.17 crore. Its report says miners illegally extracted 215.5 million tonnes of iron and manganese ore between 2000-01 and 2010-11.

The Supreme Court in a judgment dated August 2 this year, had directed the Odisha government to extract the cost of excess production from the defaulting miners. The apex court called for the recovery of 100 per cent compensation compared to 30 per cent recommended by the central empowered committee (CEC), a panel appointed by the court to probe into allegations of large-scale illegal mining in the state. The court was adjudicating in a case relating to rampant illegal mining in Odisha filed by the NGO Common Cause.

Complying with the Supreme Court order, the Odisha government raised a demand notice for EC violations on 150-odd iron and manganese ore leases.