In a fresh blow to Jindal Steel and Power Limited (JSPL), promoted by Naveen Jindal, the Central Bureau of Investigation (CBI) has registered a case for alleged cheating and criminal conspiracy related to one of its largest functional coal mines in Chhattisgarh.
The investigative agency lodged a First Information Report (FIR) against JSPL and unknown public servants for illegal mining beyond the approved area and excess coal mining, along with other charges in the Gare Palma IV/1 block, allocated to JSPL in June 1996 for production of sponge iron.
CBI further said it found irregular permission for consumption of coal in expansion of kilns.
“JSPL reiterates that all of its actions are in keeping with the legal framework of the country and that it complies with the law in letter and in spirit. JSPL continues to cooperate with all the authorities in a responsive manner,” a spokesperson said on Sunday.
The case is based on a preliminary investigation (PE) registered by the CBI in September last year, looking into the allocations of coal blocks during 1993-2005.
Of the 42 operational coal blocks cancelled by the Supreme Court, JSPL owns one of the largest in Chhattisgarh, called the Gare Palma IV reserve, which also achieved the highest production by the time SC verdict came.
The block against which CBI has filed the fresh case is Gare Palma-IV- 1, allotted to JSPL in 1996 for captive sponge iron production and has an annual capacity of 2.16 million tonnes. The block, having a geological reserve of 123 million tonnes, commenced production in 1999. The agency conducted searches at four places in Raigarh, Chhattisgarh, which led to recovery of incriminating documents, a CBI spokesperson said.
The company, along with unknown public servants, has been booked under Sections 120 B, 409 and 420 of the Indian Penal Code (IPC)Act and 13 (1) (C), 13 (1) (D) of the Prevention of Corruption Act.
This is the second time CBI has registered an FIR against JSPL in the coal scam. In June last year, the CBI had carried out raids and filed a case against JSPL and its Chairman, Jindal, on alleged charges of cheating, criminal conspiracy and misconduct in securing the Amarkonda Murgadangal block in Jharkhand in 2008.
It was also the first case where the CBI had named a public servant in the FIR related to coal block allocations and alleged Jindal had routed Rs 2.25 crore to a company owned by Dasari Narayana Rao, former minister of state for coal.
According to the FIR filed by CBI last year, Gagan Sponge Iron Limited, in which majority shares were held by Jindal, made an investment of Rs 2.4 crore in the equity of another Jindal group firm, Jindal Realty in 2008-09. Then, Jindal Realty had given an unsecured loan of Rs 2.25 crore to New Delhi Exim, which had a meagre capital of Rs 1 lakh during that time. New Delhi Exim had invested this sum towards acquiring 200,000 equity shares of Sowbhagya Media (Rao was one of the directors of this firm). JSPL had told Business Standard last week that the unsecured loan of Rs 2.25 crore was duly returned.
Investigations revealed the Jindal group companies had bought shares of Sowbhagya Media at Rs 100 apiece, against the quoted price of Rs 28.
This is the 36th case registered by the CBI into the coal block allocations.
As the apex court has imposed a penalty of Rs 295 per tonne on all the operational mines, JSPL would have to pay the highest penalty of Rs 2,950 crore, out of the cumulative Rs 7,672 crore imposed on all operational mine owners.
The coal blocks allotted to JSPL and now cancelled by SC, are namely Gare Palma-IV 1, 2 & 3. They had achieved a cumulative production of 100 million tonne up to FY 2014.
The surplus coal produced from these blocks was supposed to be sold at market price by JSPL.
In its judgement on 24 September, Supreme Court cancelled all but four coal block allocations made to private companies over past two decades. A month before, the apex court has deemed all allocations as illegal and unconstitutional citing breach of Coal Mines Nationalisation Act, 1973 and Mines and Mineral Development Act.