coalgate scam manmohan singh order

8/9/2019 Coalgate Scam Manmohan Singh Order

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which are alread& su8mitted in the Court.

6eard. Perused.

#n iew o! the su8mission made !or the a!oresaid purpose

documents !iled 8& the #$ ma& 8e returned 8ac' 8& the Ahlmad to the

#$ against receipt. A!ter preparation o! copies o! the documents #$

shall deposit all the documents 8ac' with the Ahlmad.

Ahlmad is directed to register the present case as a

regular case.

Case s no a,ourne, or appearance o all the

accuse, person to 0.04.201.

*Bharat %arashar+ )pecal u,e *%C &ct+

*CBI+-5 N""/%$C 11.03.201

CBI Vs. P.C. PARAKH & Ors. (RC No. 220 2013 E 0011) Page No. 2 of 75


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IN 6$E COUR6 O7 )$. B$&R&6 %&R&)$&R )%ECI U"8E *%C &C6+ *CBI+-5 NE! "E#$I "I)6RIC6

%&6I& $OU)E COUR6) NE! "E#$I

Closure Report No. 03/14

RC No. 220 2013 E 0011Branch:CBI/EOU-IV/EO-II NE! "E#$ICBI Vs. %.C. %&R&'$ ( Ors.U/s.120-B I%C )ecton 13 *1+ *c+/13 *1+ *,+ *+ r/ ). 13 *2+ %C&ct 19

O R " E R

*. Vide detailed order dated *


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Chairman-cum-Managing %irector 7LC. Some other documents were

also !iled alongwith the statement o! the a!oresaid witnesses.

+. #n the order dated *


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1. The present order is thus 8eing passed in continuation o! the

said earlier order. 6oweer in order to present a comprehensie

picture in the present order itsel! and !or the sa'e o! 8reit& # shall 8e

reproducing releant portions o! the said order dated *


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./// $# capacit being situated alongside Talabira-II Coal Block" Accordingl &C applied to $!C for allotment of Talabira-II Coal Block for its captive use in the proposed power plant on/0"/0"/2"

*9. Thus after $!C put up various Coal Blocks for allocationto private parties for their captive use, different companiessubmitted applications to $!C for allocation of the said Coal

Blocks" owever, in 'ecember .//6 pursuant to the orders of the then ecretar Coal, h" 4"C" 4arakh, the applicant companies were told to submit information on a prescribed format known as 9Agenda :orm;" The said form sought information from the applicant companies regarding variousaspects such as Coal Blocks applied for, track record of theapplicant compan, end use pro5ects, pro5ect status, earlier allocation of the Coal Blocks to the applicant compan etc" In all < Coal Blocks namel =tkal-A, >adhikapur, Bi5ahan, =tkal-: and Talabira-II Coal Blocks were on offer" The various applications soreceived b the $!C were thereafter compiled and were put upfor consideration before the .


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I&'A ma be considered smpatheticall if it comes up with a proposal for an other suitable block" The report of the sub-Committee was communicated to the Chairman, creening Committee and ecretar Coal on .epresentative of the companies gave a detailed background of their track record and stated that the

reuire coal block of Talabira II and Bi5ahan for their proposed .// $# C44 e7pansion at their e7isting facilit at irakud and the proposed @reenfield Adita Aluminium4ro5ect with 1./ $# C44 at apanga in !rissa" !ut of the1./ $#,


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9 13. Ne'e"! +!g!te Cororat!o +t,.>epresentative from &C stated that $inistr of 4ower and $inistr of Coal have identified a ./// $# power pro5ect for &C at irma in !rissa" The pro5ect has been granted mega power status b $inistr of 4ower" An advance action

plan has also been submitted to $inistr of Coal, thelocation has been selected, feasibilit report prepared, land and water arrangements have been made" Talabira-III, ablock with $C is ad5acent to Talabira-II and the two could be operated b $C as one mine which would ield up toepresentative from @ovt" of !rissa further stated that while the power plant of &C is being supported, it is the

Aluminium pro5ect of $%s I&'AC! that would add ma7imum value and encourage downstream industrieshaving greater emploment generation and beneficial multiplier effect" e stated that the e7isting &T4C and !4@&C! could add capacit to their e7isting power

plants" #ith increase in economic growth, the countr islikel to have aluminium shortage and, therefore, the $%s

I&'AC! pro5ect should be considered for allocation of Talabira II in preference to &C" $oreover, aluminium

production is highl energ intensive and ver sensitive tocost of power and, therefore, the captive block becomes amust for the C44" Chairman%creening Committeeobserved that energ intensive processes should be takenup where the power tariffs are lower and energ intensive

pro5ects should not be encouraged in places like Indiawhere power tariffs are high" nerg intensive part of thealuminium pro5ect could be outsourced and onl the lessenerg intensive parts of the process should be taken up in

India" This would also bring the socio-economic e7pectationto fruition in the countr";

( E%$as!s s-"!e, )



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*. At a later stage of the minutes it was further observed asunderD

9 4. IN*A+ a, 22 s HIN*A+CO$%s" I&'A had been allocated Talabira I for their proposed *6/ $# power plant at irakud and aigarh" owever, the were mining coal from Talabira I and using it for their e7isting power plant of 1"< $# at

irakud which was linked with $C for coal suppl" &ow the were asking for Talabira II for a .// $# e7pansionfrom 1"< $# to .1"< $#" ince Talabira I had alread been given to them for *6/ $# E


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subseuentl it is revealed that Adita Aluminium alread has a long-term linkage of 2"/ million tonnes per annumfrom $C and would reuire no supplies from Talabira II and III)" Therefore, some other companies could be

supplied coal from Talabira II and III at market price";

+. In its .


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guidelines for allocation of captive coal blocks were approved b 4rime $inister%$inister of Coal on /+"/"/


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so a reminder was sent b 4$! to ecretar $!C on *"/"/


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+4. In the meantime h" 4"C" 4arakh held meetings with the8oint ecretar Coal h" "" ropha and h" u5it @ulati, thethen 'irector $!C" 4ursuant to the said meetings h" u5it @ulati made the following note in the fileD

9The matter of Talabira-II has now acuired a new hue inview of the discussions with ec (C) on *0 th ? .*st 8ul /


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I&'AC! and $%s !rissa ponge Iron td" to developTalabira-II ? III as a single mine and each will take Coal in

proportion to its entitlement"

(ii) Talabira II could be allotted to $C to be developed as a single mine along with Talabira-III through outsourcing"$%s I&'AC! and $%s !rissa ponge Iron td" could also participate in the bid as mine operators" ach of thethree parties will take coal in proportion to their share";

1*. Though the aforesaid note was put up to h" 'asari &araan >ao, the then $inister of tate (Coal ? $ines) but it was found that a cop of the note dated /0%**"/0"/< was alsoreceived directl in the 4$! and wherein the note was

processed b h" "3" 4ratap vide his noting dated *."/0"/ao, the then $inister of tate (Coal and $ines) madefollowing note dated *"/0"/


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was endorsed to ecretar (Coal) for consideration"ubseuentl, hri umaramangalam Birla also discussed the issue with me following which I have discussed thematter with ecretar (Coal)" $ suggestion was that sincethe creening Committee which considers the applicationsfor allocation of captive coal blocks has alread recommended allocation of this block in favour of &C, the

possibilit of making coal available from the said block to$%s" I&'AC! at transfer price ma be considered"

In this conte7t the report of the ub-Committee of the creening Committee to consider allocation of Talabira-II coal block (p"1-**%c" in the linked file &o" *2/*0%*


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5oint venture with other companies" Talabira-II block isreported to have *2/ $T of e7tractable reserves" In theallocation of captive blocks, the creening Committee intheir recent series of meetings was guided b the new

principle of ensuring onl ao, the then $o (Coal ?$ines) proposed to consider suppl of Coal to $%s I&'AC!from Talabira-II at a transfer price"

1. In the meantime a letter dated *1"/0"/< from h" &aveen4atnaik, Chief $inister !rissa was received in the 4$!addressed to the 4rime $inister on the sub5ect of allotment of Talabira-II Coal Block to $%s I&'AC! Industries td" In theconcluding lines of the letter it was mentioned 9I would strongl urge ou to have the matter e7amined e7peditiousl so that thisvitall important pro5ect is provided with the reuired coal linkageat an earl date;" The said letter was also forwarded b the 4$!to ecretar $!C directing it to take the letter on record, re-e7amine the matter in light thereof and re-submit the file"

19. Thereafter on /0"/+"/


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stated that the satisfaction level in $C area for other blocks isabout 0


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mined as one mine" The mining would be done b a 5oint venture compan to be formed between $C on one part and &C and $%s I&'AC! on the other" The coal saved in the barrier (22 million tonnes) would be kept in the shareof &C-$%s I&'AC! in order to accord them reasonablesatisfaction level" In the 5oint venture $C would have aneuit shareholding of 1/G which is appro7imatel eual toTalabira IIIHs e7tractable reserves in the total e7tractablereserves in Talabira II and Talabira III combined" $%sI&'AC! and &C would own the remaining 2/G euit euall between them i"e" *


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between $C, &C and $%s I&'AC! with euit shareholding of 1/G, *


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would not be appropriate to preclude &C fromconsideration altogether, particularl because thisrecommendation and its approval b 4$ is in the public domain";

(E%$as!s :-"!e,)

1/. Thereafter h" T""A" &air, the then 4rincipal ecretar tothe 4rime $inister and the 4rime $inister, approved the

recommendation of $!C on .1"/+"/< and /*"*/"/< respectivel"ubseuentl h" "3" 4ratap communicated the approval of the 4rime $inister to the aforesaid note to ecretar $!C on/6"*/"/


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the said meeting held on ."/"/ interalia mentions as underD

9The Talabira-II coal block combined with Talabira-III coal block has been allocated in &ovember, .// 5ointl to the$ahanadi Coalfields td" ($C), &eveli igniteCorporation (&C) and $%s I&'AC! Industries td"(I) for working through a 5oint venture compan witheuit holding in the ratio of 1/D*


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statement o! witnesses or documentar& as produced 8& C"#.

CIRCU;)6&NCE) #E&"IN8 6O RE8I)6R&6ION O7 6$E%RE)EN6 C&)E INVE)6I8&6ION C&RRIE" OU6 &N" 6$E"OCU;EN6) RECOVERE" "URIN8 )E&RC$ &6 6$E O77ICE%RE;I)E) O7 &B;%C#.

OR*ER *AE* 16.12.2014 (ara No. 42 to 56)

96." I have first chosen to give the aforesaid factual matri7 of theentire development which took place in the allotment of Talabira-II Coal Block to $%s I&'AC! as in the light of the aforesaid facts the various circumstances in which $%s I&'AC! cameto be allotted the impugned Coal Block and the variousdocuments which later on came to be seiFed during the courseof investigation can be better understood" At this stage it will bealso worthwhile to mention that after allegations of wrong doing and illegalit came to be levelled with regard to the Coal Block allocation process adopted b $!C the various files weree7amined b Central 3igilance Commission (C3C) and pursuant to it a reference was made b C3C to CBI for investigating therole of public servants involved" CBI accordingl chose to initiall register a preliminar enuir in the matter"

62" owever, after sufficient evidence cropped up during thecourse of preliminar enuir warranting a detailed investigationthat a regular case bearing &o" **%./*2 was registered against

h" umar $angalam Birla, h" 4"C" 4arakh, $%s" I&'AC!Industries td" and other unknown persons%officials for theoffence u%s *./-B I4C and ection *2 (.) r%w ection *2 (*) (d)4C Act, *+00" 'uring the course of inuir searches wereconducted at different office premises of Adita Birla @roup in'elhi as well as $umbai besides conducting searches at thehouse of h" 4"C" 4arakh" 3arious files of $!C were also seiFed during the course of investigation"

66" I! '4 "" $oses recorded statements of a number of officers of $!C beside that of 4$!" 3arious officers of Adita

Birla @roup including h" umar $angalam Birla himself werealso e7amined during the course of investigation"

6


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committed b an of the persons involved in the entire processof allocation of impugned Talabira-II Coal Block to $%sI&'AC!" A closure report dated .1"/0"./*6 was accordingl filed in the Court" ubseuentl, CBI chose to file a revised final report dated .*"*/"./*6 stating it to be detailed and comprehensive in nature but the final conclusion remained thesame that no offence was committed b an of the personsinvolved" The case was thus praed to be closed"

6" It was in these circumstances that arguments on the closurereport were heard as addressed b d" pecial 4"4" h" >""Cheema being dul assisted b r" 4"4" h" 3"" harma" I!'4 "" $oses was also heard at length"

61" 'uring the course of arguments crime file and the case diar file being maintained b the investigating agenc during thecourse of investigation were also called for b this Court" Thesame were produced in a sealed pulanda b the I!"

60" I have carefull perused the record as well as the crime fileand the case diar file"

6+" At the outset it will be worthwhile to mention that during thecourse of arguments d" pecial 4"4" h" >"" Cheema stated at the bar that he does not agree with the conclusion drawn in thefinal report that no criminal offence has been committed in theentire process of allocation of Talabira-II Coal Block to $%sI&'AC!" Infact the submission of d" pecial 4"4" h" >""Cheema appears to be a logical conclusion flowing out not onl from the various documents which were seiFed during the

course of investigation but also from the manner in which theentire process was undertaken b the $!C and the 4$!"!rdinaril in view of the said submissions made b d" pecial 4"4, h" >"" Cheema" I would have gone straight awa toanalFe the matter to ascertain as to what offences were madeout ua which cogniFance ought to be taken b this Court or asagainst which persons the cogniFance is to be taken"


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even though it alread stood approved" It also needs to beclarified as to under what circumstances the settled procedure of making the allocation of various Coal Blocks through thecreening Committee route was not adhered to in the present matter" It also need to be noted that in his letter dated *1"/0"/eference to Talibara-II Coal Block in the letter was

merel with reference to the proceedings of .


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A,!ta B!r"a aage%et Cororat!o +!%!te,Cororate Affa!rs & *e'e"o%et Ce""

Ne *e"$!

8anuar ./, .//


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B A,!ta B!r"a aage%et Cororat!o+!%!te,

Cororate Affa!rs & *e'e"o%et Ce""

Ne *e"$!

?anuar& +, +9

*

$%s I&'AC!:-#.; Coa" +!egards,

d%-

:$-#$e,- A%!ta#$

cc toD r. :. a"- C +a,,$a= B$-#aes$ar

(It will be worthwhile to mention that in the order dated *"*."./*6, it was stated that

on ./"/*"/< a meeting of creening Committee had taken place" owever to set therecord correct, it will be pertinent to mention that the meeting held on ./"/*"/< was afollow-up meeting chaired b 8oint ecretar (Coal) h" "" ropha in pursuant tothe .


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9. In et one other document recovered the following factswere found interalia recorded under the heading 9@enesis of the4roblem;N

ENE:I: O? HE PROB+E=ntil the upreme CourtHs verdict in the .@ case, thingswere going smoothl"owever, in the !rder passed b the C in the .@ case,some scathing remarks were made about the procedure

followed in the allocation of natural resources through themechanism of mining leases"The bureaucrac in $o$ were taken off the guard and wanted to be careful in dealing with the cases even at thecost of delas" A strateg was adopted for 5ustifing thedela b making a reference to the upreme Court about the appropriateness of the present procedure adopted for grant of $ining eases"The upreme CourtHs guidelines for disposal of the pending applications for $ining eases on the basis of first comefirst served were also not ver clear" This gave a handle to

the officials to make a reference to the Attorne @eneral for a clear cut directive"ubstantial time was lost in cross references and adecision was at last taken to process the cases"The observations made b the CA@ about grant of mining leases to parties beond their reuirements much to thedisadvantage of some others came as a bolt from the blue"!nce again a sudden break had to be applied in so far as

processing of the cases is concerned" Added to the above is the on-going CBI investigations intothe coal block allocations"

'uring the earlier times, the $inister was able to e7ert his powers in getting things done right from the ground level"owever, the situation has now undergone a change wherethe officials are asserting their authorit and are not willing to budge from the stated positions" The present mindset isto find out fallacies contained in the proposals in order tofind an escape route and dela matters" A need has thusarisen to knock at each of the connected desks where thefiles get stuck" A situation has thus emerged where the

processing of the cases is being done selectivel"

(E%$as!s :-"!e,)

a


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$as rea/$e, t$e !!ster for $!s asset. $e ot$er f!"ere"at!g to 150.906$a !s o a to t$e !!ster t$ro-g$/$ae"s. @e are -rs-!g t$e %atter to see t$at a"" t$e /ases !/"-,!g *$ar get ro/esse, asa.

99. In et another document recovered a need of networking with 4olit, networking with Bureaucrac etc" was emphasiFed"The following facts were interalia found mentioned over thereD

• get 5obs done in difficult times,

• build effective ? long lasting relationships with

ke plaers in the $inistries,

• eeping an ee on competition movement

through 4olitical% Bureaucrac particularl in highstake areas like Coal ? $ines, Te7tiles, Industr? Commerce, 4ower etc"

• targeting oung bureaucrats from future

perspective,

•

ensure that @overnment polic and politicalefforts are aligned with overall business goals"

9


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& BRIE7 "I)CU))ION &N" &N=)I) O7 6$E

CIRCU;)6&NCE) #E&"IN8 6O #OC&6ION O7 6&BIR&-II

CO B#OC' 6O ;/s $IN"CO &) ;&"E IN OR"ER "&6E"

1.12.2014.

OR*ER *AE* 16.12.2014 (Para No. 57 to 61)

9" ubramanam, 4 to 4rime $inister whileforwarding the second letter dated *1"/"/< of h" umar $angalam Birla to $!C needs reiteration over here" The note



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read as underD

9 A letter handed over to the 4rime $inister b hri umar $angalam Birla on the issue of allocating an additional coal block for captive mining in !rissa is placed below" The4rime $inister desires that this matter be pursued on

priorit so that a decision is arrived at on this long pending matter at the earliest so that the emploment and revenue

potential of the pro5ect is full achieved";

(E%$as!s s-"!e,)


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$angalam Birla to h" 4"C" 4arakh for accommodating $%sI&'AC! in the allotment of Talabira-II Coal Block and whichreasons were reproduced b h" 4"C" 4arakh in his note dated /0%**"/0"/


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circumstances no such $!= could be signed between@overnment of !rissa and &C, a Central @overnment =ndertaking or as to the circumstances which compelled &C board to drop its proposed power pro5ect of ./// $# capacit as the same is not reuired over here at this stage of the matter"It will be however also worthwhile to reproduce a portion of theadditional set of guidelines which were put into force b thecreening Committee in its ..nd meeting and as have been also

reproduced b me at the initial stage of the present order" 4ara 6of the additional set of guidelines read as underD

B. &o Coal block for captive mining of coal would beallocated which would result in replacement of coal linkagefrom CI%CC e7cept under the following special circumstancesD

i) If no other suitable block having e7tractable reserves tomatch with the reuirements of the proposed end use

pro5ect (e7pansion) is available and sub-blocking of theblock sought, against the interest of mineral conservation

and sound mining principles, is thereb rendered necessar then in such cases the entire block can be considered for allocation with part or full replacement of the linkages"

ii) If the subsidiaries of CI or CC are not in a position to meet with the reuirement of the alread linked part of the end use pro5ect then the shortfall, based onempirical historical data and the future firm pro5ections,could be met with production from the captive blocks and tothat e7tent replace the paper linkage";

(E%$as!s s-"!e,)


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6#7%ALC$, the important ;uestion which comes up !or consideration

is whether the entire e5ercise as discussed a8oe to accommodate

M)s 6#7%ALC$ in Tala8ira-## coal 8loc' prima !acie amounts to a

criminal conspirac& entered into 8& arious pla&ers who were

inoled in the impugned coal 8loc' allocation process. #! it is prima

!acie !ound that a criminal conspirac& was indeed hatched so as to

accommodate M)s 6#7%ALC$ in Tala8ira-## coal 8loc' while 8&-

passing all rules)regulations and guidelines much less, rule o! law,

then the ne5t ;uestion to 8e considered will 8e as to who all were

prima !acie inoled in the said criminal conspirac&.

4. 6oweer 8e!ore aderting on to !urther discuss the eidence

so 8rought on record, it will 8e worthwhile to ;uote certain

o8serations with regard to the o!!ence o! criminal conspirac& made

8& 6on8le Supreme Court in the case E.8. Barsa> Vs. )tate o

Bo?@a> &IR 191 )C 152, the iew whereo! was affirmed and

applied in several later decisions, such as Aa Aggara" Vs !o

of I,!a 1993 (3) :CC 609 as$a" !tta" Vs. :tate of P-a#

1977 (4) :CC 540 :tate of a$arastra Vs. :o% Nat$ $aa 1996

(4) :CC 659 ?!roD-,,! Bas$eer-,,! Vs. :tate of Kera"a= (2001)

7 :CC 596 D

9OThe gist of the offence is an agreement to break the law" The parties to such an agreement will beguilt of criminal conspirac, though the illegal act agreed to be done has not been done" o too, it is not an ingredient of the offence that all the parties should

agree to do a single illegal act" It ma comprise thecommission of a number of acts" =nder ection 62 of the Indian 4enal Code, an act would be illegal if it isan offence or if it is prohibited b law" =nder the first charge the accused are charged with having



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conspired to do three categories of illegal acts, and the mere fact that all of them could not be convicted separatel in respect of each of the offences has norelevanc in considering the uestion whether theoffence of conspirac has been committed" The areall guilt of the offence of conspirac to do illegal acts,though for individual offences all of them ma not beliable";

/. In et another case i"e" A)tate o 6a?l Na,u Vs. Naln (

Ors.= 1999 Crl. #.. 3124, the onHble upreme Court summariFed

the broad principles governing the law of conspirac as underD

9


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evidence" =suall, both the e7istence of theconspirac and its ob5ects have to be inferred from thecircumstances and the conduct of the accused"

6" Conspirators ma, for e7ample, be enrolled in achain - A enrolling B, B enrolling C, and so onN and all will be members of a single conspirac if the sointend and agree, even though each member knowsonl the person who enrolled him and the person

whom he enrolls" There ma be a kind of umbrella-spoke enrollment, where a single person at the center doing the enrolling and all the other members being unknown to each other, though the know that thereare to be other members" These are theories and in

practice it ma be difficult to tell whether theconspirac in a particular case falls into whichcategor" It ma, however, even overlap" But thenthere has to be present mutual interest" 4ersons ma be members of single conspirac even though each isignorant of the identit of man others who ma have

diverse role to pla" It is not a part of the crime of conspirac that all the conspirators need to agree to

pla the same or an active role"


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evidence not onl to show that each of the accused has knowledge of ob5ect of conspirac but also of theagreement" In the charge of conspirac court has toguard itself against the danger of unfairness to theaccused" Introduction of evidence against some ma result in the conviction of all, which is to be avoided"B means of evidence in conspirac, which isotherwise inadmissible in the trial of an other substantive offence prosecution tries to implicate theaccused not onl in the conspirac itself but also inthe substantive crime of the alleged conspirators"There is alwas difficult in tracing the precisecontribution of each member of the conspirac but then there has to be cogent and convincing evidenceagainst each one of the accused charged with theoffence of conspirac" As observed b 8udge earned and that Pthis distinction is important toda whenman prosecutors seek to sweep within the dragnet of conspirac all those who have been associated in an degree whatever with the main offendersP"

0" As stated above it is the unlawful agreement and not its accomplishment, which is the gist or essence of the crime of conspirac" !ffence of criminal conspirac is complete even though there isno agreement as to the means b which the purposeis to be accomplished" It is the unlawful agreement,which is the graham of the crime of conspirac" Theunlawful agreement which amounts to a conspirac need not be formal or e7press, but ma be inherent inand inferred from the circumstances, especiall

declarations, acts, and conduct of the conspirators"The agreement need not be entered into b all the parties to it at the same time, but ma be reached b successive actions evidencing their 5oining of theconspirac"

+" It has been said that a criminal conspirac is a partnership in crime, and that there is in eachconspirac a 5oint or mutual agenc for the

prosecution of a common plan" Thus, if two or more persons enter into a conspirac, an act done b an of them pursuant to the agreement is in contemplation

of law, the act of each of them and the are 5ointl responsible therefore" This means that everthing said, written or done b an of the conspirators ine7ecution or furtherance of the common purpose isdeemed to have been said, done, or written b each



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of them" And this 5oint responsibilit e7tends not onl to what is done b an of the conspirators pursuant tothe original agreement but also to collateral actsincident to and growing out of the original purpose" Aconspirator is not responsible, however, for acts doneb a co-conspirator after termination of the conspirac"The 5oinder of a conspirac b a new member doesnot create a new conspirac nor does it change thestatus of the other conspirators, and the mere fact that conspirators individuall or in groups perform different tasks to a common end does not split up a conspirac into several different conspiracies"

*/" A man ma 5oin a conspirac b word or b deed" owever, criminal responsibilit for a conspirac reuires more than a merel passive attitude towardsan e7isting conspirac" !ne who commits an overt act with knowledge of the conspirac is guilt" And onewho tacitl consents to the ob5ect of a conspirac and goes along with other conspirators, actuall standing

b while the others put the conspirac into effect, isguilt though he intends to take no active part in thecrime";

( E%$as!s s-"!e, )

*. Thus i! the oerall !acts and circumstances in which M)s

6#7%ALC$ came to 8e accommodated in Tala8ira-## coal 8loc' are

seen and especiall& in iew o! the nature o! communication which

was underta'en 8etween arious o!!icers o! Adit&a "irla groupregarding re=ection o! the claim o! M)s 6#7%ALC$ ;ua allocation o!

Tala8ira-## coal 8loc' then it is !ound that a concerted e!!ort was made

at all leels in the Adit&a "irla group to somehow tap all their

resources 8e it in the 8ureaucratic circle or political circle so as to

procure allotment o! impugned Tala8ira-## coal 8loc' in !aour o! M)s

6#7%ALC$. As alread& mentioned the letter dated +.*.9 written

8& Sh. Shu8hendu Amita8h, roup D5ecutie President M)s

A"MPCL to Sh. %. "hattachar&a, M.% M)s 6#7%ALC$ clearl& states

that we need to now !ocus on 8oth polit& and 8ureaucrac&. #t was also



40/75

re;uested that a meeting with Secretar& Coal Sh. P.C. Para'h ma&

8e arranged in %elhi and as regard polit& it was stated that the same

shall 8e discussed on phone. Another document titled B@enesis of the

4roblemE which also has 8een reproduced a8oe !urther shows as to

how the !iles are getting stuc' in the oernment 8ureaucratic

channels and what e!!orts are 8eing made to get those !iles cleared

!rom the des' o! di!!erent o!!icers. #n &et another document also

discussed a8oe, the !uture course o! action !or the compan& has

8een mentioned. A need o! networ'ing with polit&, networ'ing with

8ureaucrac& etc. was emphasi(ed. A special mention o! high sta'e

areas such as coal 0 mines, power etc. was also made with a iew to

target &oung 8ureaucrats !rom !uture perspectie and to also ensurethat goernment polic& or political e!!orts are aligned with oerall

8usiness goals.

**. Though one ma& sa& that i! an industrial house ma'es e!!orts

to !urther its 8usiness interests then nothing wrong can 8e read into it.

6oweer such an argument can not 8e ta'en on its !ace alue. The

8usiness interests either that o! an& 8ig industrial group or een that

o! a small 8usinessman can not 8e allowed to 8e pursued in the

manner it has 8een done in the present case.

*+. #! the impugned correspondence underta'en 8& arious

o!!icers o! Adit&a "irla group is seen is-a-is the su8se;uent action

ta'en 8& them in pursuing their case than it is clear that the& le!t no

stone unturned in their e!!orts to secure allotment o! Tala8ira-## coal

8loc' in !aour o! M)s 6#7%ALC$. Fpon coming to 'now that M)s

6#7%ALC$ has 8een le!t out in the entire coal 8loc' allocation



41/75

process much less ;ua Tala8ira-## than prima !acie it appears, a plan

was chal'ed out to tap the 8ureaucratic and political channels. Sh.

Kumar Mangalam "irla, Chairman Adit&a "irla roup accordingl&

made a written re;uest to Prime Minister)Minister o! Coal ide letter

dated .9.9. Sh. %. "hattachar&a, M.%. M)s 6#7%ALC$ and Sh.

Shu8hendu Amita8h, roup D5ecutie President M)s A"MPCL also

assisted him in this regard. Sh. Kumar Mangalam "irla thus

su8mitted a written re;uest to the Prime Minister see'ing allocation o!

Tala8ira-## coal 8loc' in !aour o! M)s 6#7%ALC$ and there8&

proiding a ground to re-open the matter. 6oweer when things still

did not moe to their satis!action then Sh. "irla alongwith his o!!icers

as a8oe also met Sh. P.C. Para'h, Secretar& 2Coal3 and Sh. %asari7ara&an Rao, Minister o! State 2Coal 0 Mines3. Letters written 8& Sh.

%. "hattachar&a and Sh. Shu8hendu Amita8h to Secretar& 2Coal3 and

Minister o! State 2Coal 0 Mines3 Sh. %asari 7ara&an Rao clearl&

supports this !act. 6oweer Sh. "irla again met Prime Minister %r.

Manmohan Singh and su8mitted to him &et another identical letter

dated *.


42/75

support the claim o! M)s 6#7%ALC$ !or allocation o! Tala8ira-## coal

8loc' in its !aour.

*1. The receipt o! letter !rom Sh. 7aeen Patnai', acted li'e a

!resh lease o! li!e to M)s 6#7%ALC$ and to the M$C and PM$

o!!icers as till then notes 8eing prepared either 8& Section $!!icer, Sh.Prem Ra= Kuar in M$C or 8& Sh. K.V. Pratap, %eput& Secretar&, PM$

were negating the claim o! M)s 6#7%ALC$. The two o!!icers were in

!act proing to 8e a spo'e in the wheel 8eing grinded 8& di!!erent

o!!icers either in the M$C or in the PM$ in order to !aour M)s

6#7%ALC$. Soon a!ter the letter dated *.4.9 !rom Sh. 7aeen

Patnai', Chie! Minister $rissa, was receied then Sh. T.K.A. 7air,

Principal Secretar& to Prime Minister directed to re-e5amine the

matter in light thereo!. The note dated +/.4.9 prepared 8& Sh. K.V.

Pratap, %eput& Secretar&, PM$ clearl& shows the turn-around sought

to 8e made in the processing o! the proposal o! M)s 6#7%ALC$ soon

a!ter the receipt o! letter !rom Chie! Minister, $rissa. Ghile mar'ing

the letter dated *.4.9 o! Chie! Minister, $rissa to Secretar& Coal

Sh. K.V. Pratap stated that as directed he is re;uesting M$C to ta'e

the letter o! Chie! Minister, $rissa on record and to re-e5amine the

matter in light thereo! and to re-su8mit the !ile. # shall 8e discussing at

a slightl& later stage as to how the !ile came to 8e re-e5amined in

M$C.

*. Moreoer i! the oer all !acts and circumstances o! the case

are seen then the issuance o! the said letter 8& Sh. 7aeen Patnai'

also can not 8e termed to 8e a mere co-incidence. Admittedl& the +9 th

Screening Committee had decided on *.*.9 to allocate Tala8ira-##,



43/75

coal 8loc' to 7LC. The representatie o! oernment o! $rissa was

er& much present in the said meeting and een though he

supported the case o! M)s 6#7%ALC$ ;ua allocation o! Tala8ira-##

coal 8loc' 8ut as is eident !rom the minutes o! +9th Screening

Committee the representatie o! oernment o! $rissa also

supported the case o! 7LC. The a!oresaid !acts hae 8een dul&

recorded in the minutes o! +9th Screening Committee.

*9. Therea!ter the minutes o! +9th Screening Committee came to

8e !inall& approed in the +th Screening Committee meeting held on

*.1.9. As per the !iles sei(ed 8& the #$ !rom the %epartment o!

Steel and Mines, ot. o! $rissa, cop& o! the minutes o! +9th

Screening Committee were receied 8& them on ..9. Thus not

onl& the oernment o! $rissa was well aware !rom *.*.9

onwards 8ut also upon receipt o! cop& o! minutes o! +9 th Screening

Committee in the !irst wee' o! April + that Tala8ira-## coal 8loc'

has 8een allocated to 7LC and not to M)s 6#7%ALC$. The& were

also well aware that 7LC intends to esta8lish a power pro=ect in their

State whereas M)s 6#7%ALC$ wanted to esta8lish an aluminium

plant. Thus i! oernment o! $rissa was so much interested in

allocation o! Tala8ira-## coal 8loc' to M)s 6#7%ALC$ as an aluminium

plant was stated to 8e central to the growth o! the State instead o! a

power plant then the& could hae represented to the Prime

Minister)Minister o! Coal soon a!ter the deli8erations o! +9th Screening

Committee were oer or at least a!ter +th

Screening Committeemeeting approing the minutes o! +9th Screening Committee was

oer. Silence on their part in this regard clearl& goes to show that



44/75

irrespectie o! their support to M)s 6#7%ALC$ regarding allocation o!

Tala8ira-## coal 8loc' the& had no e!!ectie opposition een ;ua

allocation o! Tala8ira-## coal 8loc' to 7LC. The oernment o! $rissa

continued to remain silent een till the month o! ?une +9 when the

minutes o! +9th Screening Committee recommending allocation o!

Tala8ira-## coal 8loc' to 7LC were approed 8& Prime

Minister)Minister o! Coal. #n !act the !ile o! %epartment o! Steel and

Mines, ot. o! $rissa clearl& shows that a!ter the receipt o! cop& o!

minutes o! +9th Screening Committee in the !irst wee' o! April +9,

no !urther proceeding)noting was made in the !ile. #t was onl& in the

month o! ?ul& +9 that when two letters 8oth dated *+..9 !rom

Sh. S. "ontha, CD$ M)s Adit&a Aluminium as addressed to Chie! Secretar&, $rissa and Principal Secretar&, %epartment o! Steel and

Mines $rissa were receied that !resh notings 8egan to 8e made in

the !ile so as to process the case in !aour o! M)s 6#7%ALC$. @inall&

on *.4.9 a letter was sent 8& Sh. 7aeen Patnai', Chie! Minister

$rissa to Prime Minister in support o! M)s 6#7%ALC$. Apparentl& till

*+..9 no such e!!orts !or o8taining recommendation !rom

goernment o! $rissa were made as prima !acie it appears that till

that time the representaties o! M)s 6#7%ALC$ and the o!!icers in

M$C and PM$ were con!ident that on account o! the two letters

written 8& Sh. Kumar Mangalam "irla to the Prime Minister and the

meetings held with Prime Minister, Secretar& Coal or with Minister o!

State 2Coal3, Sh. %asari 7ara&an Rao, things will 8e settled in their

!aour. #t is thus also prima !acie clear that the letter !rom Chie!

Minister $rissa had to 8e procured primaril& in order to scuttle the

aderse notes 8eing made 8& the =unior o!!icers in the M$C and PM$



45/75

as discussed a8oe.

*


46/75

Secretar& 2Coal3 Sh. K.S. Kropha and %irector C.A. Sh. Su=it ulati.

Therea!ter Sh. Su=it ulati initiated a note dated /./.9 proposing

interalia a =oint enture compan& 8etween MCL, 7LC and M)s

6#7%ALC$. 2The note dated /+"/+"/< of h" u5it @ulati and its

further processing in $!C vide note dated /+"/+"/< of h" ""

ropha and note dated *."/+"/< of h" 4"C" 4arakh has alread been

reproduced above b me in para &o" 2< to 2+ of m order dated

*"*."*6"3

*4. 6oweer, i! the note dated *+./.9 o! Sh. P.C. Para'h is read

then it prima !acie gies an impression that all e!!orts were 8eing

made to accommodate the claim o! M)s 6#7%ALC$. #t clearl&

mentions that the scheme 8eing now proposed has also 8een

discussed with the representaties o! M)s 6#7%ALC$ and the& are in

agreement with the proposed arrangements. 6oweer not onl& wrong

!acts were mentioned in the note regarding !ormation o! a =oint

enture compan& 8etween 7LC and MCL !or setting up the power

plant 8ut the note was also silent as to whether an& consent o! either

7LC or o! MCL ;ua the proposals 8eing now propounded 8& him was

o8tained or not. Den though 8oth 7LC and MCL were Pu8lic Sector

Fnderta'ings 2PSF3 8ut admittedl& the& were haing their

independent e5istence. #t is 8e&ond comprehension as to how

Secretar& Coal can ta'e an& action on their 8ehal! een i! M$C was

haing some administratie control oer them. #n !act a!ter the

approal o! the recommendations o! +9th

Screening Committee 8&Prime Minister)Minister o! Coal and conse;uent orders o! Secretar&

Coal to issue allotment letters to the allottees, a right stood ested in



47/75

7LC ;ua Tala8ira-## coal 8loc'. Thus the least that M$C or PM$

could hae done 8e!ore accommodating M)s 6#7%ALC$ in Tala8ira-##

coal 8loc' and in Tala8ira-### coal 8loc' which alread& ested in MCL,

was to at least discuss the proposal with them also.

*/. Moreoer the note states that the proposal put !orward 8& Sh.Su=it ulati appears to 8e reasona8le. $nce again such a noting

gies an impression that the said noting got initiated with a new idea

put !orth 8& %irector M$C. 6oweer the note dated /./.9 o! Sh.

Su=it ulati clearl& states at the 8eginning itsel! that the matter was

discussed with Secretar& 2Coal3 on 4./.9. Thus apparentl& the

note containing the impugned proposals was initiated 8& Sh. Su=it

ulati as per the discussion he had with Secretar& 2Coal3. #t is

altogether another matter that the note dated /./.9 o! Sh. Su=it

ulati was completel& silent that the proposals 8eing put !orth 8& him

were in contraention o! the alread& approed guidelines.

+. #t will 8e also worthwhile to point out that a!ter the letter o!

Chie! Minister, $rissa was receied in the M$C then the !ile was notsent to Sh. Prem Ra= Kuar, the Section $!!icer who till then was

processing all the documents in the !ile. The initial noting itsel! started

!rom the des' o! Sh. Su=it ulati, %irector, C.A. This !act again

supports the prima !acie iew as alread& mentioned that till then the

notes 8eing made 8& Sh. Prem Ra= Kuar were scuttling all the e!!orts

8eing made 8& the representaties o! M)s 6#7%ALC$ and the other

M$C o!!icers or that o! PM$.

+*. 6oweer Sh. K.V. Pratap in the PM$ ide his note dated



48/75

+*./.9 though stated his agreement with the proposal 8eing now

put up 8& Sh. P.C. Para'h ide note dated *+./.9 o! !orming a =oint

enture 8etween MCL, 7LC and M)s 6#7%ALC$ 8ut still o8sered

that giing a share o! H, *9H and *9H respectiel& to the three

companies will entail rela5ation in the guidelines approed 8& the

Prime Minister on /.


49/75

approing whateer has 8een mentioned a8oe 8ut the said

conclusion has a conse;uential e!!ect o! also drawing a prima !acie

presumption that the said Senior $!!icer or the !inal authorit& must

hae gone through the matter 8eing put up 8e!ore him ide the said

detailed note. #n !act Sh. ".V.R. Su8raman&am who was wor'ing as

Priate Secretar& to the Prime Minister clearl& stated in his statement

to the #$ that as the notes o! Sh. K.V. Pratap and o! Sh. ?aed

Fsmani hae 8een highlighted and underlined so the same must

hae 8een perused 8& the Principal Secretar&, Sh. T.K.A. 7air and

the Prime Minister, %r. Manmohan Singh 8e!ore approing them.

++. At this stage, # am also not deling into the issue as to

whether the status o! Sh. T.K.A. 7air in the entire process when the

!ile was to 8e put up 8e!ore Prime Minister through him will also !all in

the categor& o! those Senior $!!icers who merel& signs a note 8eing

put up to them without ma'ing an& comment)o8seration o! their own.

#n the present matter Sh. T.K.A. 7air was though a er& senior o!!icer

8ut certainl& was not the competent authorit& himsel! to approe the

proposal 8eing put up in the !ile. The !ile through him was to 8e put to

the Prime Minister)Minister o! Coal. #n !act as is eident !rom the

entire processing o! the !iles in the PM$ Sh. T.K.A. 7air was the

person who was consistentl& inoled in the entire processing and

prima !acie it appears that he ought to hae put his own

o8serations)comments regarding the proposal 8eing put up 8e!ore

him 8e!ore su8mitting it to the Prime Minister)Minister o! Coal. #t will8e howeer purel& a guess wor' to presume that Sh. T.K.A. 7air

consciousl& chose to not ma'e an& o8seration while !orwarding the



50/75

!ile to the Prime Minister)Minister o! Coal and in which area # am not

attempting to enture out.

+1. At this stage, # ma& also mention as a mar' o! caution that # am

not at all suggesting as to how the !iles ought to 8e administratiel&

processed. 6oweer what # am simpl& tr&ing to highlight is theconduct o! arious pu8lic serants inoled in the entire coal 8loc'

allocation process which is prima !acie eident !rom the !acts and

circumstances o! the case.

+. #t is also 8e&ond comprehension as to how Sh. P.C. Para'h

who had dealt at length the issue o! allocation o! Tala8ira-## coal 8loc'

is-a-is the claims o! 7LC and M)s 6#7%ALC$ in the Screening

Committee headed 8& him onl& came to oer-turn the said decision

on his own without re!erring the matter to the Screening Committee

and that too without an& plausi8le logic either in !aour o! M)s

6#7%ALC$ or 8& wa& o! an& logic which could negatie the earlier

reasons mentioned in the minutes o! +9 th Screening Committee in

!aour o! 7LC and as against M)s 6#7%ALC$.

+9. Certainl& at this stage o! the matter when the Court is onl&

con!ronted with the issue as to whether an& o!!ence is prima !acie

!ound to hae 8een committed or not so a detailed deli8eration or

anal&sis o! the documents produced or that o! the statement o!

witnesses is not re;uired. The Court is onl& re;uired to !orm a prima

!acie opinion as to whether some o!!ence has indeed 8een committed

or not and i! &es then who all are the persons inoled in the

commission o! the said o!!ences. # ma& once again mention that # am



51/75

!ull& conscious o! the seriousness o! the matter as it inoles o!!icers

not onl& o! M$C 8ut also that o! PM$ including the Prime

Minister)Minister o! Coal 8eside Chairman o! a leading industrial

house o! the countr&.

+espondent * had been apprised of the true factual and legal position

regarding the representation made b the appellant,he would have surel taken appropriate decision and would not have allowed the matter to linger for a

period of more than one ear";

+. As regard the Chairman o! a large industrial house also the

6on8le Supreme Court recentl& in the case )unl Bhart ;ttal Vs.

CBI n Crl. &ppeal No. 34/201 ,ec,e, on 09.01.1, while dealing

with the role and responsi8ilit& o! Chairman o! a leading industrialhouse 8eing icariousl& inoled, o8sered that a person ought to 8e

not dragged in the Court merel& 8ecause a complaint has 8een !iled.



52/75

#! prima !acie a case has 8een made, the Magistrate ought to issue

process and it can not 8e re!used merel& 8ecause he thin's that it is

unli'el& to result in a coniction. The 6on8le Court howeer

cautioned that 8e!ore !orming een a prima !acie opinion to proceed

against an accused there must 8e due application o! mind that there

is su!!icient 8asis !or proceeding against the said accused and

!ormation o! such an opinion is to 8e stated in the order itsel!. #t was

!urther o8sered that the order is lia8le to 8e set aside i! no reason is

gien therein while coming to the conclusion that there is prima !acie

case against accused, though the order need not contain detailed

reasons. A !ortiori, the order would 8e 8ad in law i! the reason gien

turns out to 8e e5-!acie incorrect. #t was !urther o8sered that aproper satis!action in this 8ehal! should 8e dul& recorded 8& the

Special ?udge on the 8asis o! material on record.

+4. Coming to the case in hand # ma& howeer state that !rom the

oer all !acts and circumstances o! the case including the manner in

which the entire e5ercise to accommodate M)s 6#7%ALC$ in

Tala8ira-## coal 8loc' was underta'en, it is prima !acie clear that the

same was the result o! a well-planned and well-designed e5ercise

initiated 8& the representaties o! M)s 6#7%ALC$ and therea!ter

inoling arious pu8lic serants at di!!erent leel i.e. in M$C and

PM$. Such a well-planned e5ercise and which # ma& also sa& was so

meticulousl& carried out can 8e prima !acie termed onl& as a criminal

conspirac& and the o8=ect o! the same was onl& to do an illegal acti.e. to secure allotment o! Tala8ira-## coal 8loc' in their !aour and in

the process nulli!&ing the recommendation o! the +9th Screening



53/75

Committee 8& adopting a procedure contrar& to the approed

guidelines and rule o! law.

+/. At this stage o! the matter # also need not to deal with the

aspect as to whether all the participants who too' part in the

impugned criminal conspirac& were aware o! the role o! each o! theother participant or not since what is important to 8e ta'en note o! is

that in a well planned manner persons at di!!erent leel and positions

were roped in and each o! them was aware o! the ultimate o8=ectie

sought to 8e achieed i.e. to accommodate M)s 6#7%ALC$ in

Tala8ira-## coal 8loc'.

1. #t also does not re;uire an& detailed discussion or anal&sis as

to what 8ene!it M)s 6#7%ALC$ ultimatel& got 8& irtue o! allocation o!

Tala8ira-## coal 8loc'. #t has clearl& come on record that the cost o!

production o! aluminium a!ter haing a captie coal 8loc' is much

less as compared to when coal is procured otherwise i.e. 8& wa& o!

import or procuring at trans!er price under a coal lin'age. Admittedl&

M)s 6#7%ALC$ was alread& haing a coal lin'age and thus the&were eager to hae a captie coal 8loc' in order to reduce their cost

o! production o! aluminium. The 8rie! note dated *4.4. prepared

8& Sh. Su=it ulati, %irector M$C regarding Bcoal blocks allocation for

captive mining-e7isting arrangements and proposed changesE clearl&

mention this !act.

1*. Prima !acie at this stage, it also need not 8e gone into an&

!urther detail that the e!!ect o! accommodating M)s 6#7%ALC$ in

Tala8ira-## coal 8loc' had the conse;uential e!!ect o! negating the



54/75

pro=ect o! 7LC to esta8lish a + MG power plant. This !act is

eident !rom a num8er o! communications which were underta'en 8&

Sh. S. ?a&araman, Chairman and M.%. 7LC to M$C a!ter the

decision to accommodate M)s 6#7%ALC$ also in Tala8ira-## coal

8loc' was ta'en. 6e clearl& stated in the said communications to

M$C that in the a8sence o! su!!icient coal lin'age the power plant will

not 8e a8le to achiee /H PL@ 2Plant Load @actor3 and thus it will

not 8e possi8le to sustain the pro=ect. #n!act during the course o!

!urther inestigation when Sh. S. ?a&araman was again e5amined

then it was also highlighted 8& him that een the o8seration made 8&

Sh. P.C. Para'h ide his note dated *+./.9 that the impugned

power plant is 8eing =ointl& esta8lished 8& 7LC and MCL was wrong.#t was pointed out that there had neer 8een such a proposal 8& 7LC

or MCL to set up a =oint enture !or power plant out o! coal deried

!rom Tala8ira-## and Tala8ira-### coal 8loc's.

1+. #t will 8e also worthwhile to mention oer here that initiall&

8e!ore the +9th meeting o! Screening Committee when Sh. S.

?a&araman isited $rissa then the Chie! Secretar&, $rissa strongl&

supported their pro=ect and he een directed his o!!icers to render all

help to 7LC in esta8lishing their power plant. Therea!ter Sh. S.

?a&araman alongwith o!!icers o! goernment o! $rissa een identi!ied

suita8le land !or esta8lishing the said power pro=ect and discussed all

other aspects such as arrangement o! water lin'age etc. !or

esta8lishing the power plant. 6e was thus assured o! all necessar&help in esta8lishing the power plant. Sh. ?a&araman accordingl&

wrote a letter to Secretar& Coal on 4.4.1 intimating a8out all these



55/75


56/75

8& illegall& dierting coal !rom Tala8ira-#, coal 8loc', which was

allotted to them !or e5pansion o! their e5isting plant. 6oweer # am

not entering into an& !urther discussion on the said aspect as it has

8een in!ormed that a separate @#R in this regard has alread& 8een

registered against M)s 6#7%ALC$ 8& C"#. 6oweer a re!erence to

the a!oresaid issue is 8eing made onl& to highlight the !act that the

earlier lin'age proided to M)s 6#7%ALC$ !rom MCL was not 8eing

ta'en use o! as it was not cost e!!ectie to M)s 6#7%ALC$. #t was in

these circumstances imperatie !or M)s 6#7%ALC$ to o8tain &et

another captie coal 8loc' !or their use. Thus the claim o! M)s

6#7%ALC$ as noted 8& Sh. P.C. Para'h in his note dated

4)**.4.9 that in iew o! the current shortage o! coal in MCL area,MCL will not 8e in a position to honour earlier lin'ages gien !or their

aluminium plant was also wrong. #n this regard a letter dated +1.1.//

written 8& Sh. %.K. "iswas, CM 2CP3, Coal #ndia Ltd. to Sh. ".L.

%ass, the then Fnder Secretar& M$C is worth mentioning. #n the said

letter it was stated that MCL will 8e in a position to suppl& re;uired

;uantit& o! coal to M)s Adit&a Aluminium Pro=ect proided the part&

enters into a Long-Term @uel Suppl& Agreement with MCL)C#L !or

!inali(ing coal lin'ages. Admittedl& M)s Adit&a Aluminium Pro=ect did

not enter into an& such agreement and thus the coal lin'age !acilit&

with MCL did not materiali(e. #n !act PG-+ Shashi She'har, .M.

MCL also stated in his statement to the #$ that there was su!!icient

coal production to meet the said lin'age.

1. Thus in iew o! m& a!oresaid discussion, # am o! the

considered opinion that o!!ence u)s *+-" #PC is prima !acie made



57/75

out as haing 8een committed 8& the representaties o! M)s

6#7%ALC$ and the pu8lic serants inoled in the impugned coal

8loc' allocation process. Moreoer the M$C o!!icers not onl& in their

capacit& as o!!icers o! M$C 8ut also as mem8ers o! Screening

Committee were responsi8le !or recommending allocation o! di!!erent

coal 8loc's to arious applicant companies a!ter assessing their

eligi8ilit& and suita8ilit&. The& were thus acting as trustees o! the

nationali(ed natural resources i.e coal o! the countr& haing dominion

oer its allocation. Similarl& Minister o! Coal 8eing the competent

authorit& and also haing dominion oer the said resources was also

the person responsi8le !or the proper allocation o! said natural

resources o! the countr& in an o8=ectie manner and with due processo! law.

19. #n this regard re!erence can 8e had to the o8serations o!

6on8le Supreme Court in the case Relance Natural Resources

#t,. Vs. Relance In,ustres #t,. 2010 *5+ )CC 1. #n the said case

while dealing with another natural resource o! the countr& i.e. gas,

the 6on8le Court o8sered as under:

9@as is an essential natural resource and is not owned b either >I or >&>" The @overnment holdsthis natural resource as a trust for the people of thecountr" The constitutional mandate is that the natural resource belong to the people of the countr" Thenature of the word 9vest; in Article .+1 must be seenin the conte7t of the public trust doctrine (4T')" venthough that doctrine has been applied in cases

dealing with environmental 5urisprudence, it has itsbroader application" The public trust doctrine is part of Indian law and finds application in the present case aswell" It is thus the dut of the @overnment to providecomplete protection to the natural resources as a



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trustee of the people at large". . . . .. . . . .. . . . .

The Constitution envisages e7ploration, e7traction and suppl of gas to be within the domain of governmental functions" It is the dut of the =nion to make sure that these resources are used for the benefit of the citiFens

of this countr" 'ue to shortage of funds and technical know-how, the @overnment has privatised suchactivities through the mechanism provided under 4C";

Re!erence can also 8e made in this regard to the case

V.). &chuthanan,an Vs. R. Balarshna %lla an, Others *2011+

3 )upre?e Court Cases 315.

1


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o!!icers o! PM$ had pointed out in their notes dated +*./.9 and

+


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+


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PM$ did so in complete disregard to the pu8lic interest inoled. #n

the name o! saing coal l&ing 8eneath the 8arrier 8etween Tala8ira-##

and Tala8ira-### coal 8loc', a priate compan& i.e. M)s 6#7%ALC$

was een allotted a coal 8loc' which was not een 'ept open !or

allocation to priate companies. Admittedl& Tala8ira-### coal 8loc' was

with MCL and was e5clusiel& resered !or PSF.

. Thus at the cost o! repetition # ma& state that 8eside the

dishonest inclusion o! M)s 6#7%ALC$ in Tala8ira-## 0 Tala8ira-### coal

8loc's, e5cess amount o! coal was also allotted to the compan&.

$nce again all these acts were done in iolation o! the well

esta8lished procedure and guidelines much less against rule o! law

and in complete disregard to the pu8lic interest inoled.

*. The oerall !acts and circumstances thus clearl& proes the

initial proposition propounded 8& me that the !actual matri5 o! the

present case shows as to how M)s 6#7%ALC$ was accommodated

in Tala8ira-## Coal "loc' 2and een in Tala8ira-### coal 8loc'3. There is

also nothing on record to show as to wh& the matter was not re!erred8ac' to the Screening Committee i! at all the re;uest o! M)s

6#7%ALC$ was to 8e considered. Moreoer this Court has come

across a num8er o! Coal "loc' allocation matters where arious Coal

"loc's hae 8een allotted to di!!erent companies 8& di!!erent

Screening Committees o! M$C een though there was no

recommendation in !aour o! those companies either 8& the

concerned State oernments where the Coal "loc's were situated

or the proposed end use pro=ects were to 8e esta8lished or een

when the concerned Administratie Ministr& did not ma'e an&



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recommendation in !aour o! the compan&. Thus the claim o! M$C

o!!icers or that o! PM$ that in iew o! the strong recommendation 8&

the Chie! Minister o! $rissa, the case ;ua M)s 6#7%ALC$ was

reisited is also clearl& an e&e-wash and a lame e5cuse.

+. #n !act # ma& also state that a perusal o! the M$C !iles sei(edduring the course o! inestigation also shows that aderse

o8serations were 8eing made ;ua M)s #7%AL 2later on ac;uired 8&

M)s 6#7%ALC$3 een ;ua Tala8ira-# coal 8loc' earlier allotted to

them. Certain documents recoered !rom the o!!ice o! M)s

6#7%ALC$ also shows that the o!!icers o! M)s 6#7%ALC$ were also

conscious o! this aderse position o! their ;ua Tala8ira-# coal 8loc'

and the& had stated it to 8e a negatie !actor wor'ing against them

;ua allocation o! Tala8ira-## coal 8loc'.

1. Thus the pu8lic serants inoled in the process who were

haing dominion oer the nationalised natural resources o! the

countr& i.e. coal acted in complete disregard to the direction o! law,

rules)regulations and guidelines as per which the propert& entrustedto them was to 8e disposed o! 8& them. "& irtue o! their acts o!

omission and commission as discussed a8oe the& dishonestl&

allowed M)s 6#7%ALC$ to misappropriate the nationalised natural

resources o! the countr& and the pu8lic serants so acted in complete

disregard to the pu8lic interest inoled.

. The pu8lic serants inoled in the process thus mani!estl&

!ailed to o8sere those reasona8le sa!eguards against detriment to

the pu8lic interest, which haing regard to all circumstances, it was



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their dut& to hae adopted. The a!oresaid conclusion 8eing drawn 8&

me also !ind support !rom the statement made 8& Sh. K.S. Kropha in

the meeting he held with the representaties o! M)s 6#7%ALC$ to

discuss the pro8lems 8eing !aced in !ormation o! the =oint enture

compan& 8etween MCL, 7LC and M)s 6#7%ALC$. 6e stated that

'eeping in iew the special circumstances under which M)s

6#7%ALC$ was made a partner in the ?V, the compan& should ta'e

the lead in ironing di!!erences and conclude the ?V. 6e also o8sered

that it should 8e appreciated that the goernment had gone out o! the

wa& to accommodate M)s 6#7%ALC$ in Tala8ira-##. 6e also adised

M)s 6#7%ALC$ representaties that as the matter has alread& drawn

pu8lic attention so it will 8e in the interest o! M)s 6#7%ALC$ toconclude the ?V without an& !urther dela&.

2The aforesaid deliberations of the meeting were

mentioned b me earlier also in para &o"


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The o8serations o! 6on8le 6igh Court o! %elhi as made in the case

Runu 8hosh Vs. CBI Crl. &. 42/2002 are worth reproducing in this

regard. #t has 8een o8sered in the said case that i! the other

re;uirements o! the proisions o! section *1 2*3 2d3 2iii3 PC Act are

!ul!illed then there is no re;uirement o! mens rea or guilt& intention to

proe the said o!!ence. The 6on8le Court while discussing the

proisions o! Preention o! Corruption Act in detail inter alia o8sered

as under:

91+" #hat then is the behaviour or act which attractssuch opprobrium as to result in criminal responsibilitQIt is not ever act which results in loss of public interest, or that is contrar to public interest, that is a

prosecutable offence" There can be no doubt that all acts pre5udicial to public interest, can be the sub5ect matter of 5udicial review" In those cases, courtsconsider whether the decision maker transgressed theFone of reasonableness, or breached the law, in hisaction" owever, it is onl those acts done withcomplete and manifest disregard to the norms, and manifestl in5urious to public interest, which wereavoidable, but for the public servantHs overlooking or disregarding precautions and not heeding thesafeguards he or she was e7pected to, and whichresult in pecuniar advantage to another that are

prosecutable under ection *2(*) (d) (iii)" In other words, if the public servant is able to show that hefollowed all the safeguards, and e7ercised all reasonable precautions having regard to thecircumstances, despite which there was loss of public interest, he would not be guilt of the offence" The

provision aims at ensuring efficienc, and responsiblebehaviour, as much as it seeks to outlaw irresponsibilit in public servantHs functioning whichwould otherwise go unpunished" The blameworthinessfor a completel indefensible act of a public servant, is

to be of such degree that it is something that noreasonable man would have done, if he were placed in that position, having regard to all thecircumstances" It is not merel a case of making awrong choiceN the decision should be one such as no



65/75

one would have taken"0/" In this conte7t, it would be useful to notice thefollowing passage from the work rrors, $edicine and the aw b Alan $err and Ale7ander $cCall mithD

9Criminal punishment carries substantial moral overtones" The doctrine of strict liabilit allows for criminal conviction in the absence of moral blameworthiness onl in ver limited circumstances"

Conviction of an substantial criminal offence reuiresthat the accused person should have acted with amorall blameworth state of mind" >ecklessness and deliberate wrongdoing, levels four and five areclassification of blame, are normall blameworth but an conduct falling short of that should not be thesub5ect of criminal liabilit" Common-law sstems havetraditionall onl made negligence the sub5ect of criminal sanction when the level of negligence hasbeen high -- a standard traditionall described asgross negligence"

R R RBlame is a powerful weapon" #hen used appropriatel and according to morall defensiblecriteria, it has an indispensable role in human affairs"Its inappropriate use, however, distorts tolerant and constructive relations between people" ome of lifeHsmisfortunes are accidents for which nobod is morall responsible" !thers are wrongs for whichresponsibilit is diffuse" Set others are instances of culpable conduct, and constitute grounds for compensation and at times, for punishment"

'istinguishing between these various categoriesreuires careful, morall sensitive and scientificall informed analsis";0*" As noticed previousl, the silence in the statute,about the state of mind, rules out applicabilit of themens rea or intent standard, (i"e" the prosecution doesnot have to prove that the accused intended theconseuence, which occurred or was likel to occur)"aving regard to the e7isting law ection *2 (*) (e)(which does not reuire proof of criminal intent) aswell as the strict liabilit standards prevailing our

sstem of law, therefore, a decision is said to bewithout public interest, ( if the other reuirements of the provision, i"e" ection *2 (*) (d) (iii) are fulfilled) if that action of the public servant is the conseuence of his or her manifest failure to observe those



66/75

reasonable safeguards against detriment to the public interest, which having regard to all circumstances, it was his or her dut to have adopted"0." It would be useful to in this conte7t, take recourseto certain e7amples" :or instance, in not adopting an discernible criteria, in awarding suppl contracts,based on advertisements calling for responses,

published in newspapers having ver little circulation,two das before the last date of submission of tenders, which result in a ma5orit of suppliers being left out of the process, and the resultant award of

permits to an unknown and untested supplier, would result in advantage to that individual, and also bewithout public interest, as the potential benefit fromcompetitive bids would be eliminated" ikewise,tweaking tender criteria, to ensure that onl a few applicants are eligible, and ensure that competition (tothem) is severel curtailed, or eliminated altogether,thus stifling other lines of euipment suppl, or banking on onl one life saving drug supplier, whowith known inefficient record, and who has a histor of suppling sub-standard drugs, would be acts contrar to public interest" In all cases, it can be said that the

public servant who took the decision, did so b manifestl failing to e7ercise reasonable proper careand precaution to guard against in5ur to public interest, which he was bound, at all times to do" Theintention or desire to cause the conseuence ma or ma not be presentN indeed it is irrelevantN as long asthe decision was taken, which could not be termed b an ardstick, a reasonable one, but based on a

complete or disregard of the conseuence, the act would be culpable"02" 9The test this Court has indicated is neither doctrinaire, nor vagueN it is rooted in the Indian legal sstem" A public servant acts without public interest,when his decision or action is so unreasonable that noreasonable man, having regard to the entiret of circumstances, would have so actedN it ma also bethat while deciding or acting as he does, he ma not intend the conseuence, which ensues, or is likel toensue, but would surel have reasonable foresight

that it is a likel one, and should be avoided" To put it differentl, the public servant acts without public interest, if his action or decision, is b manifestl failing to e7ercise reasonable precautions to guard against in5ur to public interest, which he was bound,



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at all times to do, resulting in in5ur to public interest"The application of this test has to necessaril bebased on the facts of each caseN the standard however, is ob5ective" ere, one recollects thefollowing passage of 8ustice olmes in =nited tatesv" #urFbach *+2/ (.0/) = 2+D

9#herever the law draws a line there will be casesver near each other on opposite sides" The precise

course of the line ma be uncertain, but no one cancome near it without knowing that he does so, if hethinks, and if he does so it is familiar to the criminal law to make him take the risk";; ( E%$as!s s-"!e, )

. The most important ;uestion which now crops up !or

consideration is as to who all are the persons who prima !acie

committed the impugned o!!ences.

4. As discussed a8oe !rom the nature o! correspondence which

was e5changed 8etween Sh. Shu8hendu Amita8h, roup D5ecutie

President 2A"MPCL3 and Sh. %. "hattachar&a, M.%. M)s 6#7%ALC$,

it is clear that the initial acts o! criminal conspirac& o!!-shooted !rom

them. Therea!ter in order to tap the 8ureaucratic and political

channels, Sh. Kumar Mangalam "irla who was the Chairman, o!

Adit&a "irla roup o! which M)s 6#7%ALC$ was a group compan&

also =oined. Sh. Kumar Mangalam "irla 8eing the Chairman o! a

leading industrial house o! the countr& thus alongwith Sh. %.

"hattachar&a and Sh. Shu8hendu Amita8h started e5ercising his

in!luence oer the political and 8ureaucratic channels in order to

secure allocation o! Tala8ira-## coal 8loc' in !aour o! M)s 6#7%ALC$.

Since the role pla&ed 8& them has 8een e5tensiel& dealt with in the

earlier part o! the present order and this 8eing the stage o!



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cogni(ance onl& so # do not deem it appropriate to deal with their role

in an& !urther detail at this stage o! the matter. 6oweer prima !acie it

is clear that the impugned criminal conspirac& which was initiall&

conceied 8& Sh. Shu8hendu Amita8h and Sh. %. "hattachar&a and

Sh. Kumar Mangalam "irla and M)s 6#7%ALC$ was carried out

!urther 8& roping in Sh. P.C. Para'h who was Secretar& 2Coal3 and

therea!ter the then Minister o! Coal, %r. Manmohan Singh. Though

the role o! Sh. P.C. Para'h and that o! %r. Manmohan Singh has

alread& 8een discussed at length 8& me in the present order 8ut it will

8e still worthwhile to reiterate some acts o! their omission and

commission, though not all, in order to prima !aice show their

complicit& in the impugned conspirac&.

/. Sh. P.C. Para'h who was not onl& Secretar& 2Coal3 8ut also

Chairman o! +9th Screening Committee while proposing the new

options o! accommodating M)s 6#7%ALC$ in Tala8ira-## 0 ### Coal

"loc' did not mention an&thing a8out the alread& approed

guidelines. 6e chose to remain silent as regard the e5cess coal

allocation to M)s 6#7%ALC$ een a!ter the new proposal to

accommodate M)s 6#7%ALC$ in Tala8ira-## 0 ### Coal "loc' was

approed 8& the Minister o! Coal. This act o! silence on his part

prima-!acie appears to 8e a conscious decision. 6e een made a

wrong noting in the !ile 8& stating that 8oth 7LC and MCL intends to

esta8lish the Power Plant =ointl& 8& !orming a =oint enture compan&.

6e mentioned the reasons put !orward 8& M)s 6#7%ALC$ in their support without stating an&thing in the note a8out the eracit& or

otherwise o! the said claims and which reasons as discussed a8oe



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were in !act contrar& to record. This again prima-!acie appears to 8e

a conscious decision on his part. There is nothing on record as to

wh& letter o! allotment to 7LC was not issued 8& his Ministr& till

*9..+9 as was directed 8& him ide his noting dated *


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Minister o! coal allowed the matter pertaining to allocation o! Tala8ira-

##, coal 8loc' reopened een though he himsel! had permitted the

approal o! the minutes o! +9th Screening Committee recommending

allocation o! allocating the said coal 8loc' to 7LC. The repeated

reminders !rom PM$, written as well as telephonic, to M$C to

e5peditiousl& process the matter in iew o! the letters receied !rom

Sh. Kumar Mangalam "irla also prima !acie indicate the e5tra undue

interest shown 8& the PM$ in the matter. Again his approal o! the

proposal put-!orth 8& Sh. P.C. Para'h ide his note dated *+./.9 to

accommodate M)s 6#7%ALC$ in Tala8ira-## and ### coal 8loc' while

ignoring the words o! caution put-!orth 8& Sh. K.V. Pratap and Sh.

?aed Fsmani, the two o!!icers o! PM$ in their notes dated +*./.9and +


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iolation o! the esta8lished procedure and alread& approed

guidelines clearl& resulted in de!eating the e!!orts o! 7LC to esta8lish

a + MG Power Plant in $rissa. 6is action thus prima !acie

resulted in loss to 7LC which was a PSF and !acilitated wind!all

pro!its to a priate compan& i.e. M)s 6#7%ALC$.

9*. # ma& once again reiterate that !or the o!!ence o! criminal

conspirac& it is not re;uired that each o! the persons inoled in the

conspirac& need to 'now the other persons inoled in the said

conspirac&. The present conspirac& in ;uestion was o! the nature o!

Bumbrella-spoke enrollment E with M)s 6#7%ALC$ at the center and

ma'ing enrollment in the conspirac& at di!!erent stages, o! all those

releant persons who were crucial to attain their desired o8=ectie o!

securing allotment o! impugned Tala8ira-##, coal 8loc'. 6oweer !rom

the nature o! action o! the a!oresaid persons, it is also prima !acie

clear that though Secretar& Coal and Minister o! Coal were pla&ing

di!!erent roles 8ut there was a concerted =oint e!!ort to some-how

accommodate M)s 6#7%ALC$ in Tala8ira-##, coal 8loc'. #t was the

central common o8=ectie o! the impugned criminal conspirac& 'nown

to all concerned.

The 8road principles goerning the law o! conspirac& as

enunciated 8& 6on8le Supreme Court in the BNaln case *)upra+

s;uarel& coers the acts o! the accused persons in the present case.

9+. At this stage # ma& once again state that # am !ull& conscious o!

the o8serations made 8& me herein-a8oe as the then Minister o!

Coal was none else 8ut the then Prime Minister o! #ndia i.e. %r.



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Manmohan Singh. #t will 8e also not wrong i! # sa& that while coming

to such a conclusion a8out prima !acie inolement o! the then Prime

Minister in the present matter this Court had to act with a hea&

conscience and with !ull reali(ation, the present order or the

o8serations)conclusions 8eing made here will hae oer the morale

o! the countr& as a whole.

91. As alread& mentioned, # am also !ull& conscious o! the

o8serations made 8& 6on8le Supreme Court in the case

:-#ra%a!a :a% Vs. a%o$a :!g$ a, Ar. (:-ra)

a8out the role o! Prime Minister o! the countr&. # ma& howeer state

that the present case stands on a di!!erent !ooting as here %r.

Manmohan Singh did not act in the capacit& o! a Prime Minister 8ut

as a Minster o! Coal. Fndou8tedl& !rom the er& nature o! o!!ice held

8& him, the Prime Minister o! a countr& can not personall& loo' into

the minute details o! each and eer& case placed 8e!ore him and has

to depend upon his adisors and other o!!icers. 6oweer in the

present case, %r. Manmohan Singh chose to 'eep the coal port!olio

with him and thus prima !acie he can not claim that 8eing Prime

Minister he could not 8e e5pected to personall& loo' into the minute

details o! each and eer& case. Moreoer as regard the o!!icers and

adisors wor'ing in the PM$ to assist him, # ma& mention that their

role has also 8een discussed in detail 8& me and # ma& also state that

the role o! arious o!!icers in the PM$ or een in M$C has also not

8een prima !acie completel& a8oe 8oard. 6oweer # ma& once againmention that in the present matter, # am not concerned as to how the

!iles ought to hae 8een administratiel& processed 8ut onl& with the



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!act as to how the !iles were actuall& processed and what could 8e

the intention o! doing so. Since all the o!!icers who were wor'ing in

the PM$ and M$C were highl& e5perienced and senior 8ureaucrats

so it can not 8e een prima !acie presumed that the& were lac'ing in

an& manner in their administratie e5periences. This Court also does

not intend to draw an& such in!erence ;ua their a8ilit& or capa8ilit&.

6oweer at this stage o! the matter, the eidence as aaila8le is

clearl& not su!!icient to put other o!!icers o! PM$ or M$C on trial.

Moreoer as regard the role o! Prime Minister)Minister o! Coal, the

statement o! Sh. ".V.R. Su8raman&am, the then PS to Prime

Minister %r. Manmohan Singh would 8e again releant to re!er. #n his

statement u)s *


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e5ercise o! an& discretion een i! an& such discretion ested in

Minister o! Coal can not 8e ar8itrar& in nature. #n iew o! the alread&

laid down procedure !or allocation o! coal 8loc's and the conse;uent

guidelines which also alread& stood approed # ma& een state that

no such discretion contrar& to the esta8lished procedure and

guidelines at all ested in the Minister o! Coal and thus e5ercising an&

such power in contraention o! well laid down procedure or guidelines

was clearl& 8ad in law. #n !act such ar8itrar& and su8=ectie e5ercise

o! power in disregard to the settled procedure or guidelines prima

!acie ma'es out a case o! transgressing that !ine line o! distinction

which ma'es such an act to 8e criminal in nature.

9. As regard Sh. Kumar Mangalam "irla also, # ma& once again

reiterate that een as regard him 8eing the Chairman o! Adit&a "irla

roup # am !ull& conscious o! the o8serations made 8& 6on8le

Supreme court in the case )unl Bhart ;ttal 2)upra3. # am howeer

o! the considered opinion that the !acts o! the present case can not

8e put on par with the said case as in the present case Sh. Kumar

Mangalam "irla pla&ed an actie role 8& tapping his 8ureaucratic and

political channels in order to secure allocation o! Tala8ira-##, coal

8loc' in !aour o! M)s 6#7%ALC$. The actie role pla&ed 8& him has

alread& 8een discussed 8& me at length and thus at this stage # am

not reiterating it.

99. Thus in iew o! m& a!oresaid discussion, # here8& ta'e

cogni(ance o! the o!!ence u)s *+-")/ #PC ) *12*32c3 and *12*32d3

2iii3 P.C. Act */44 against *1+ M)s 6#7%ALC$, *2+ Sh. Shu8hendu

Amita8h, roup D5ecutie President A"MPCL, *3+ Sh. %.



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"hattachar&a, M.%. M)s 6#7%ALC$, *4+ Sh. Kumar Mangalam "irla,

Chairman Adit&a "irla roup, *+ Sh. P.C. Para'h, the then Secretar&

2Coal3 and *+ %r. Manmohan Singh, the then Minister o! Coal. # also

ta'e cogni(ance o! the su8stantie o!!ences i.e. S. / #PC and S.

*12*32c3 and *12*32d32iii3 PC Act, */44 against Sh. P.C. Para'h and

%r. Manmohan Singh.

9

coalgate scam manmohan singh order

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