Why has’nt Odisha govt collected fine for excess mining yet, asks activist

Odisha Sun Times Bureau

Bhubaneswar, June 30:

Accusing the Odisha government of a maintaining a ‘cosy relationship’ with mining companies, green activist and member of the Tansparency International India Dr Biswajit Mohanty has questioned the inordinate delay in collecting the huge outstanding penal demand of Rs.68,700 crores for excess mining .

Dr Mohanty said an amount of Rs.1,153 crores cannot be collected at present due to stay orders issued by the Revision Authority of the Ministry of Mines, Govt. of India. However, the rest of the demand of Rs.67,547 crores can be collected as there is no existing legal bar.

The stay orders were obtained by the lessees as the state government did not file counters and took time to file para wise comments.

Stating that the government is yet to file counters even though more than 18 months have elapsed since the stay orders were issued, he has alleged that  the state govt. officials have connived with the miners not to pursue the cases in Revision Authority so that the stay order continues.

The following is the text of his press statement issued today :

“In September,2012, the State government had raised demands against miners for illegal over extraction of millions of tonnes of minerals like iron ore, manganese and chromite. The state government wanted to hoodwink the Commission where it claimed that credible action was being against illegal mining in the state.

“U/s 21(5) of the MMDR Act,1957 the state government has the power and right to recover the minerals extracted by any lessee without lawful authority. In case the extracted minerals have been sold, then the market price of such minerals is recoverable. Any miner who extracts excess of minerals than that permitted under the approved Mining Plan issued by IBM or under the limits provided under the Environment Clearance/ Consent to Operate is liable to return to the government the excess mineral so mined or refund to the govt. the value of such minerals if already sold

“Mines are leased out to lessees for a specific time period with specific and binding conditions which incluces how much they can extract. It belongs to the state and the state govt. can re- lease out the mines by cancelling the current lease . Mining is a highly regulated activity with mandatory and multiple government clearances since it involves extraction of a scarce and exhaustible natural resource apart from having irreversible long term effects. Mining causes huge impacts on the local environment, people and livelihoods . Every mine requires pollution control clearance, revenue clearance for approved surface rights, forest clearance (for mines in forest areas), IBM (Indian Bureau of Mines) clearance for mining plan and environmental clearance.

“The Secretary of Steel and Mines of the Odisha Govt., Sri D.K. Singh was transferred after he passed orders on 23rd July,2012 to recover the cost of such excess extraction of minerals from the minerals. The mining lobby was upset with his move as they had to give up a part of their mega profits earned during the mining boom of 2002-2010. Shri Singh held office only for two months and his illegal transfer revealed the huge influence of the mining lobby with the Chief Minister.

“The Director of Mines, Mr. Deepak Mohanty issued orders to his subordinate officers on 1st September,2012 to issue letters of demand for levy of fine u/s 21(5) of the MMDR Act,1957 from the miners but recovery is elusive though 21 months have passed. (A copy of the letter issued by him is attached.)

“198 mining lessees were identified by the Director of Mines in Odisha who had produced excess minerals unlawfully in violation of the terms of the lease deed, or mining plan or approved limits under the Consent to Operate issued by State Pollution Control Board. A total of Rs.65,492.73 crores was demanded u/s 21(5) from these lessees from all mining circles for excess mining of minerals like iron ore, manganese, chromite, bauxite, limestone, quartzite, dolomite and limestone for the period from 2000-01 to 2009-10. Not a single rupee has been collected even after 21 months.

“For more than 18 months, the state government did not pursue the collection of the demand. Only in April,2014, the Secretary Mr. G. Srinivas issued orders to review the pending dues under section 21(5) in a prescribed proforma alongwith follow up action and status of the Revision Application cases/stay orders regarding this demand.

“Some of India’s top companies owe the state government thousands of crores of rupees as mining fine demand u/s 21(5) and are yet to pay up though 21 months have passed. A total demand of Rs.4,798.37 crores has been raised against the thirteen chromite mines lessees working in Sukinda area for illegal raising of 165.42 million tonnes of chrome ore during the period from 2000-01 to 2011-12.

“The lessees have filed revision applications in the Revisional Authority of Mines Ministry of Govt. of India and the Mines Department claims that as the matter is sub judice , the amounts cannot be collected. There is no stay order against these demands which are lying unrealized since 21 months and the state govt. officials being hand in glove with the miners do not take steps to cancel the lease.

“An amount of Rs.1,153 crores cannot be collected at present due to stay orders issued by the Revision Authority of the Ministry of Mines, Govt. of India. However, the rest of the demand of Rs.67,547 crores can be collected as there is no existing legal bar. There are no stay orders from High Court or Supreme Court as per RTI replies given by the department in June,2014.

“The stay orders were obtained by the lessees as the state government did not file counters and took time to file para wise comments.  They have yet to file counters even though more than 18 months have elapsed since the stay orders were issued. It is clear that the state govt. officials have connived with the miners not to pursue the cases in Revision Authority so that the stay order continues.

“A list of some prominent lessees including government run corporations who owe large amounts as fine demand (upto 31.3.2010) is given below .

Name of the Company	Amount of fine claimed for excess mining as per demand notice u/s 21(5)
TATA STEEL	Rs. 3,453 crores
Rungta Group	Rs. 4,213  crores
Essel Mining (Aditya Birla Group)	Rs. 4,368 crores
KJS Ahluwalia	Rs.3,223 crores
OMC Ltd. (PSU of State govt.)	Rs. 8,881 crores
SAIL  (PSU of Central Govt.)	Rs. 3,990 crores
MESCO	Rs.2,221 crores
OMDC Ltd. (PSU of Central Govt.)	Rs.8,695 crores
Serajuddin & Co.	Rs.1,985 crores
Sarda Mines	Rs.2,845 crores
R.P.Sao	Rs.3,872 crores
BPMEL (PSU of Central Govt.)	Rs.2,002 crores

“Even if one calculates the interest due on the outstanding fine collection it comes to a whopping Rs. 14,427 crores @ rate of 12 % interest. The pending amount is enough to finance at least 90 % of the entire state’s annual budget .

“The state government had several methods to collect the demand. It could have issued closure orders for the mines . It could have also cancelled the mining lease itself on account of outstanding government dues. It could have directed the District Collectors to collect the demand under the Orissa Public Debts Recovery Act (OPDR) as arrears of land revenue. OPDR dues can be collected by auctioning the assets of the debtor as well as arrest and detention of the Lessee who operates the mines.”