The CBI has filed First Information Reports or FIRs against five private firms who were allocated coal blocks in Jharkhand and Chhattisgarh. The FIR refers to charges of cheating against JLD Yavatmal, Jas Infrastructure, AMR Iron and Steel, JLD Yavatmal, Vinni Iron and Steel and Navbharat Power.
The CBI is investigating whether companies misreported their financial or technical qualifications to be granted valuable coal fields in possible collusion with government officials.
Two of the five companies booked today are linked to Congress MP Vijay Darda from Maharashtra - he has 7 per cent stake in Jas Infrastructure along with his son, Devendra. The politician was also linked closely to JLD Yavatmal, a company named after his father. Mr Darda says he exited this firm in 2009. The BJP has alleged that Mr Darda used his political influence to lobby for coal blocks for his own family. But last night, Mr Darda told NDTV, "I was not in the driver's seat...my son was leading the show." He added, "Where is the nexus? Everyone has the right to do business. My conscience is absolutely clear. I am very happy," he said. Sources say the MP will be questioned by the CBI about his links with the two companies.
The Congress has already been heavily embarrassed by the revelation that union minister Subodh Kant Sahai in 2008 wrote to the Prime Minister's Office, lobbying for coal blocks for a company that has his brother as a Director.
The CBI is conducting raids in 10 different cities including Kolkata, Patna, Hyderabad, Dhanbad, Nagpur, Mumbai and Delhi.
The CBI's inquiry is rooted in a complaint filed by BJP leader Prakash Javadekar four months ago with the government's anti-graft department or Central Vigilance Commission (CVC). Then, last month, the government auditor or CAG said that 142 coal fields allocated between 2004 and 2009 had allowed private firms to get windfall benefits of upto Rs 1.86 lakh crore because the coal mines were sold at highly undervalued rates, instead of being auctioned. That has led to a huge political crisis, with the opposition BJP demanding the resignation of the Prime Minister and disrupting Parliament every day of this session, ensuring that virtually no business has been transacted. Uproar over the issue forced adjournments in both Houses of Parliament today as well.
The CBI's raids are unlikely to make any headway into breaking the Parliament deadlock, since the BJP is adamant on the cancellation of allocation of all 142 coal blocks mentioned in the auditor's report, which the government has declined. Finance Minister P Chidambaram said yesterday, "The demand for cancellation of all 142 coal blocks allocated after 2004 is not founded on sound logic...It (cancellation) cannot be done through diktat or arbitrary orders. There is a procedure for it and that procedure is underway." At the same time, a government review committee has shortlisted 58 companies whose coal licenses are likely to be revoked for underperformance. The firms have been asked to explain their defence starting Friday. By September 15, the government will share if their permits will be cancelled. Wary of this being seen as an admission of its faulty coal policy, the government has said that these licenses have been under review since April, months before the auditor or CAG presented its politically incendiary report.
The CBI, according to Press Trust of India, has also examined the track record of some of the companies which were allotted coal blocks in Jharkhand, Chhattisgarh and Karnataka. Some firms are being studied for whether they were set up only to land coal fields which were then sublet to other companies at a premium, in violation of all guidelines.
The agency, according to Press Trust of India, has already questioned senior bureaucrats who were overseeing allocation of coal blocks during 2005-09.