The Central Bureau of Investigation (CBI) has booked 25 companies including those of Adani group, Vedanta Limited and Jindal group among others, and four officials of Mahanadi Coalfields Limited (MCL), a subsidiary of Coal India Limited on corruption charges relating to supply of coal from MCL. The investigating agency has alleged that the corruption caused the public sector unit a loss to the tune of Rs 97 crore. Following the levelling of corruption charges, experts have raised questions on how the Adani group is being able to grab new power projects despite several allegations of coal-related corruption.
According to the CBI FIR, during 2012 to 2017, the MCL officials allegedly entered into “criminal conspiracy with the 25 accused coal consumers and unknown others with an intention to defraud in the matter relating to supply of coal by MCL through rail rake under Fuel Supply Agreements (FSA) between MCL and the consumers.”
For Adani Group, this case comes as a double whammy as one of its subsidiary, Adani Enterprises was booked in a case by the CBI in January this year, along with a former chairman of National Consumer Cooperative Federation for alleged irregularities in floating tenders for supply of coal to Andhra Pradesh Power Generation Corporation (APGENCO) in July 2010.
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Commending the CBI for acting upon the coal supply-related scandals, Padamjit Singh, chairman of the All India Power Engineers’ Federation, told NewsClick, “Corruption in coal supply to power stations results in increasing the cost of electricity to power consumers while filling corporate coffers.” He added that it is anomalous that the same Adani group with two FIRs to its credit has recently secured a power project of 1,320 MW from Madhya Pradesh government. In this respect, Singh demanded that the Madhya Pradesh government should cancel its power purchasing agreement in the Chhindwara project with Adani group.
The FIR, which was filed based on information from reliable sources, has further alleged that the accused public servants abused their respective positions by allowing supply of coal to these consumers without adhering to the provisions of the FSAs, falsified the records of MCL and did not recover the due performance incentives.
Among the companies accused in this case are Adani Power Limited, two units of Adani Maharashtra Power Limited, two companies of Vedanta Limited, Talwandi Saboo Power Limited and two companies of Jindal group, among others.
As per relevant provisions of FSA under new coal distribution policy of India, “coal consumers lifting coal by rail have to submit financial coverage bank guarantee (FCBG) for 15 days of coal supplied which is their acquired contracted quantity (ACQ) subject to minimum amount equivalent to one rake load. However, coal consumers have to deposit 100% in advance of the coal value intimidated by the seller within 48 hours of placement of rake.”
“By not adhering to the provisions of FSA,” Padamjit Singh alleged, “these companies have not only paid advances to the MCL for supply of coal but could have made profits from distribution companies by selling power at inflated coal rates to get higher tariffs.”
The CBI has booked the accused MCL officials and the coal consumer companies on charges of cheating, criminal conspiracy and under relevant provisions of the Prevention of Corruption Act.
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