Coal Scam

Coal Scam — Mother of all Scams

CAG Value — Rs 11.5 Lakh Crores

Magnitude of CoalScam

There were leaks of the report in media in March 2012 which claimed the figure to be around 10,600 billion (US$190 billion).[49] It is called by the media as the Mother of all Scam. “‘The CWG scam is (to the tune) of Rs 700 billion, 2G scam is Rs 1.76 trillion (short scale). But, now the new coal scam is Rs 10.67 trillion (short scale). It is a government of scams… from airwaves to mining, everywhere the government is involved in scams,’ party spokesperson Prakash Javadekar told reporters .CAG in its Draft Report estimated windfall gains was 10,673.03 billion.

Companies of Crony Businessmen who have received Coal Blocks

Jindal Steel and Power- JSPL

Bhushan Power & Steel Ltd & others

Ram Swarup & others

JSPL & Gagan Sponge Iron Ltd

MCL/JSW/JPL & others

Jindal Steel & Coal Co Ltd

CESC Ltd & J&S Infrastructure

Gagan Sponge Iron Limited’s

Vandana Group

Hinduja Electro Steel Casting

JAS Infrastructure

JLD Yavatmal Energy

Jayswals Neco,

Navbharat Iron and Steel

Vini Iron and Steel –owned by Vijay Joshi, close aide of former chief minister Madhu Koda

All Coal Blocks distributed between 1993 and 2008 were done in an unauthorized manner and allotment of all mines where production is yet to start should be cancelled. . It has pointed out that the allocations between 1993 and 2004 were done without any advertisement or public information. It accused both the UPA and NDA for perpetrating massive corruption.

Role of Sonia Gandhi

On August 31, Manmohan Singh met UPA chairperson Sonia Gandhi and communicated to her that his office had cleared the coal block allotment on the recommendation of her political secretary Ahmed Patel. Washing his hands of the tainted coal block allotment, Dr Singh made it clear to Sonia Gandhi that he had no role or interest in determining who the beneficiaries should be. PM explained that his then principal secretary T K A Nair had merely coordinated the allotment decision as desired by Ahmed Patel. Ahmed Patel is one of Sonia Gandhi’s closest aides — he has been her political secretary since 2000, and she is known to rely on him greatly in the running of the Congress Party

Allegations against Subodh Kant Sahai

In September 2012, it was revealed that Subodh Kant Sahay, Tourism Minister in the UPA government sent a letter to prime minister Manmohan Singh trying to persuade him for allocation of a coal block to a company, SKS Ispat and Power which has Sudhir Sahay, his younger brother, as honorary Executive Director. On the very next day, Prime Minister’s Office (PMO) sent a letter to the coal secretary on 6 February 2008, recommending allotment of coal blocks to the company.[32][33]However, Sahay denied these allegations, citing that the coal block was allocated to SKS Ispat, where his brother was only an”honorary director”.[34]

Allegations against Vijay Darda and Rajendra Darda

Vijay Darda, a Congress MP and his brother Rajendra Darda, the education minister of Maharashtra, have been accused of direct and active involvement in the affairs of three companies JLD Yavatmal Energy, JAS Infrastructure & Power Ltd., AMR Iron & Steel Pvt. Ltd, which received coal blocks illegally by means of inflating their financial statements and overriding the legal tender process

Allegations against Premchand Gupta

UPA partner Rashtriya Janata Dal’s leader Premchand Gupta’s sons’ company, new in the steel business applied for a coal block when Premchand Gupta was the Union minister for corporate affairs and bagged it about a month after his tenure ended along with that of his government. The company in question is IST Steel & Power — an associate company of the IST Group, which is owned and run by Premchand Guptas two sons Mayur and Gaurav. IST Steel, along with cement majors Gujarat Ambuja and Lafarge, was allocated the Dahegaon/Makardhokra IV block in Maharashtra. The company, which applied for a block on 12 January 2007, and was awarded it on 17 June 2009, is sitting on reserves of 70.74 million tonnes. The reserves it controls are more than the combined reserves held by much larger companies — Gujarat Ambuja and Lafarge. Gupta, who belongs to the Rashtriya Janata Dal headed by Bihar leader Lalu Prasad Yadav, was the minister of state for corporate affairs in UPA-I when his party was a constituent of the Congress-led coalition with 21 seats in Lok Sabha. However Mr Gupta maintains he had no involvement in IST Steel and denies influencing the coal-block allocation process.

Allegations against Naveen Jindal

Congress MP, Naveen Jindal’s Jindal Steel and Power got a coal field in February 2009 with reserves of 1500 million metric tones while the government-run Navratna Coal India Ltd was refused.

On 27 February 2009, two private companies got huge coal blocks. Both the blocks were in Orissa and while one was over 300 mega metric tones, the other was over 1500 mega metric tones. Combined worth of these blocks was well over Rs2 trillion (short scale) and these blocks were meant for the liquification of coal. One of these blocks was awarded to Jindal. Naveen Jindal’s Jindal Steel and Power was the company which was allotted the Talcher coal field in Angul in Orissa in 2009, well after the self-imposed cut off date by the Centre on allocation of coal blocks.

The Opposition alleged that the Government violated all norms to give him coal fields. Naveen Jindal, however, denied any wrongdoing

Understand : Underestand Coal Scam in a very simple manner , UPA government allocated Coal Blocks , each worth Lakhs Of Crores , FREE of COST to Congress MPs & Congress Leaders across Jharkhand , chattisgarh and Orissa , taking advantage of a Well meaning Policy decision by Dr Manmohan Singh as Coal Minister.

As coal minister Dr Manmohan Singh and his coal ministry understood that many power plants needed coal but could not afford to either purchase or lease coal blocks since they lacked the finances. Even very big companies like HINDALCO belonging to Birlas cannot afford to purchase coal blocks worth Lakhs of crores , without undergoing huge capital costs. Total Start up capital for HINDALCO was no more than 11,000 crores , how can it afford to purchase a single coal block for Rs 1,00,000 Crores — Rs 1,50,000 Crores..without going into huge losses ?

Point is that no big Indian company can afford to purchase coal blocks legally , they simple don’t have the finances.

But then india needed power plants to produce electricity , so there needed to be some solution.

The solution was to allocate coal blocks to deserving companies that qualified and fulfilled certain number of parameters , and HINDALCO fulfilled all the necessary parameters. So they were allocated coal blocks.

Sonia Gandhi decided to take advantage of this new policy decision — to reward her loyal Crony Businessmen , industrialists And Congress Leaders.

One such crony business was

1. Jindal Steel and Power- JSPL ,

2. JSPL & Gagan Sponge Iron Ltd

3. Hinduja Electro Steel Casting

4. Jayswals Neco,

Jindals are known crony businessmen who have been amply rewarded by congress high command , ofcourse you find the name of Hindujas ( BOFORS infamy ). Naveen Jindal is Congress MP.

Just 10 years ago , Jindals were manufacturing Plastic buckets and mugs / plastic wares were Very Small Time Businessmen. Today Savitri Jindal Is India’s Richest Business Woman.