New Delhi The government can go ahead and allocate mining leases on a first come, first served (FCFS) basis, attorney general GE Vahanvati has told the government. The AG’s advice, sought by the mines ministry where around 400 requests for mining leases are pending, comes at a time when the larger issue of allocating natural resources through auctions is being heard in the Supreme Court as part of the presidential reference made by the government.

Following the Supreme Court warning that the first-come-first-serve system for granting mineral concessions may be misused “by unscrupulous people,” the mines ministry has sought legal opinion on how to treat the applications, which are being currently processed. It has sought the law ministry’s views on whether to process them on the first-come-first-serve mechanism or to introduce any other system.

New Delhi Just a day before the Election Commission was set to issue the notification for the 2009 general election, the United Progressive Alliance-I government had hurried to allocate large captive coal blocks to the Tata-Sasol combine and Jindal Steel and Power (JSPL) for their respective coal-to-liquid projects in Orissa, which resulted in an aggregated windfall gain of R54,000 crore to the two companies, according to a draft Comptroller and Auditor General of India report.

But company says govt decision to permit use of incremental coal does not result in any loss to exchequer or undue benefit

The draft report of the Comptroller and Auditor General of India (CAG) on coal allocation has alleged undue benefits of Rs 15,849 crore to Reliance Power Ltd (RPL) by way of surplus coal allocation for two of its Ultra Mega Power Projects (UMPPs). The report pegs benefit to RPL from surplus allocation for the Sasan UMPP at Rs 4,875 crore. Another Rs 10,974 crore “may accrue” from the Tilaiya UMPP, it says.

There is still more bad news for coal mining companies, with the mines ministry recommending that coal miners mandatory share 100 per cent royalty with project-affected families. The recommendation, if implemented, could severely dent coal miners’ bottom line.

It would not only increase the annual outgo of monopoly producer Coal India Ltd (CIL) on account of benefit sharing, but also bring captive block holders, including large companies like Tata, Reliance, Essar, GMR, GVK and Aditya Birla Group, under the benefit-sharing net.

The mining industry will have to wait till at least the monsoon session of Parliament for passage of the new Mines and Mineral Development and Regulation (MMDR) Bill. The legislation is being examined by a parliamentary standing committee.

In an interview here with Business Standard, the secretary in the ministry of mines, Vishwapati Trivedi, ruled out earlier passage of the Bill. “The Budget session starts on March 12 and I think the standing committee has not yet completed its deliberations. So, there’s no way we can get it in the Budget session,” he said.

New Delhi THE ministry of corporate affairs has suggested some fine-tuning of the new Mines Bill, which is being examined by a parliamentary panel and provides for profit-sharing by mining firms with project-affected people, among other provisions.

Questioning a clause in the new Bill that provides for issuing at least one share of the mining company to each affected family that will be non-transferable, the MCA in a letter to the panel has said that under the Companies Act, shares of public and private limited companies and those of listed companies are transferable.

Profit-sharing with tribal people and auctioning of mineral concessions are not the only landmark changes proposed in the new mining Bill. The Bill also envisages ushering in a regime of royalty concessions for the first time in the country.

Cabinet approves landmark legislation

The Union Cabinet on Friday approved the landmark Mines and Mineral Development and Regulation (MMDR) Bill, 2011 that provides for mining companies to keep aside 26 per cent of their net profits for a Mineral Development Fund to be used for the development and rehabilitation of project-affected people in tribal areas. For the non-coal companies, the amount will be equivalent to the royalty they pay.

The Union Cabinet is set to clear a slew of important legislation and amendments on Friday. On the agenda is the Mines and Minerals Development and Regulatory (MMDR) Bill, 2010, amendment to the Civil Liability for Nuclear Damage Act, 2010, amendment to the Press and Registration of Books and Publishing Act, 2010, and the LIC (amendment) Bill, 2009, among others.