Reliance Power Ltd (RPL), facing allegations of having received undue benefits in the surplus coal diversion issue, has requested the national auditor Comptroller and Auditor General of India (CAG) to drop its observations on the matter. The government’s latest decision not to review an earlier approval given to the company to divert surplus coal from Sasan project has reaffirmed the permission, RPL said in a letter written to the CAG earlier this month.
“In view of the action taken by the power ministry to review Sasan coal permission at the highest levels of the government as recommended by the CAG and the decision of the EGoM that the Surplus coal permission for Tilaiya would be governed by a comprehensive policy, we would request you to kindly consider dropping the para on undue benefits,” the letter said.
A draft report of the CAG on coal allocation had alleged undue benefits to the tune of Rs 15,849 crore extended by the government to Reliance Power Ltd (RPL) by way of surplus coal allocation for two of its Ultra Mega Power Projects (UMPPs). The report pegged benefit to RPL from surplus allocation for Sasan UMPP at Rs 4,875 crore. Another Rs 10,974 crore “may accrue” from Tilaiya UMPP, it said.
The draft report was quoted in a Times of India news report on March 22 as finding undue benefits through allotments of 155 coal blocks to various companies. Later, in a letter to Prime Minister Manmohan Singh, CAG had downplayed the draft report, saying “the details being brought out were observations under discussion at a very preliminary stage and do not even constitute our pre-final draft and, hence, are exceedingly misleading”.
In a brave move, the government had on 28 April this year decided not to review an earlier decision to allow RPL to divert surplus coal from mines allotted for Sasan Ultra Mega Power project (UMPP) to another nearby project. After a meeting of the Empowered Group of Ministers (EGoM) in April, law minister Salman Khurshid had said that the government cannot review decisions taken in the past. “The Attorney General (AG) had interpreted the EGoM’s decision taken in 2008 and had said that the decision was correct. Obviously we will go by the opinion as it explains and fortifies the 2008 decision,” he had said.
Asked whether the decision would set a precedent and be used by the government for allowing surplus coal diversion in all similar cases going forward, Khurshid had said a comprehensive policy on surplus coal would be finalized soon, based on AG’s recommendation, to avoid ambiguity in future. The AG had opined that the government has the right to permit allocatees to use surplus coal for other projects and that the EgoM’s approval to diversion was a well considered decision.
