‘Will have adverse effects’: Jharkhand moves SC against Centre’s decision on commercial coal mining

Shortly after Prime Minister Narendra Modi started the process of auctioning coal blocks for commercial mining, the government of Jharkhand has moved the Supreme Court to postpone the commercial auction of coal mining, legal news website BarandBench.com has reported.

The plea challenging the process of commercial mining states that there is a need for fair assessment of the social and environmental impact of commercial mining "on the huge ‘tribal population’ and vast tracts of ‘Forest lands’ of the State and its residents which are likely to be adversely affected."

The plea states that the process of commercial mining at the moment would be dampened by the negative ‘Global Investment Climate’ prevailing due to ‘COVID-19’ which is "unlikely to fetch reasonable returns proportionate to the value of the scarce natural resources."

The plea categorically notes that the Mineral Laws Amendment Act, 2020 lapsed on May 14 and thus the process of auction has begun in the face of the "legal vacuum" created in the absence of the amendment act.

The petition, which is accompanied by a letter for urgent listing, states this in the backdrop of the August 2019 decision of the Union Cabinet where a decision was taken to allow 100% FDI in Coal Mining.

The Mineral Laws Amendment Ordinance 2020, promulgated in January, permitted foreign companies in commercial coal mining through auctions. This provision was retained in the Mineral Laws (Amendment) Act, 2020. However, this provision also lapsed with this Act, which was to remain in force for a period of 60 days only.

Thus, after May 14 lapse, Section 11A of the MMDR Act, 1957 was restored as it stood before the amendments brought about on January 10 by the 2020 Ordinance and the Act until it lapsed.

The Centre’s decision to start the process for auctioning 41 coal blocks for commercial mining is open for domestic as well as global firms under the 100% FDI route and is aimed at making India self-reliant in the energy sector.

The plea now challenging the Centre's decision questions as to what happened between August, 2020 - when Union Cabinet decided to allow 100% FDI in commercial coal mining - and 13th March, 2020 that necessitated the Mineral Laws (Amendment), 2020, to be a temporary law.

Further it questions whether the flip-flop policy on a strategically and economically important ingredient of the energy basket of the country, that too within such a short span of time, would boost investors confidence, especially when, in. the post-COVID-19 scenario, countries are looking away from China and towards India.