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2012 Indian Coal Mining Scam

The Coal Mining Scam or Coal Gate Scandal is alleged corruption in the coal block allocations in India. The Comptroller and Auditor General of India (CAG) has accused the Indian government for providing coal depositions to private and state-run entities in an irregular manner lacking transparency resulting in a loss of approximately Rs. 186,000 crore to the exchequer during the period of 2004-2009.

The allegations led to wide protests from the opposition parties in India, particularly the Bharatiya Janata Party. The monsoon sessions of the Indian Parliament were severely disrupted with BJP demanding the Prime Minister Manmohan Singh to step down in the wake of the allegations. The BJP has said that they would not relent till the Prime Minister steps down and said that India would witness a mid-term poll soon. However, Congress shot back saying that they are not afraid to face a vote of confidence.

Prime Minister's statement

The Indian Prime Minister Manmohan Singh has issued a statement on the coal block allocation issue on August 27, 2012 before he left on a four-day state visit to Iran.

On his way back to the country, Manmohan Singh has ruled out resignation over the coal blocks allocation issue. He said that he would not get into a slanging match with the opposition. The BJP took serious exception to the comments. BJP spokesperson Ravi Shankar Prasad said that the people have made the Opposition custodian of their interest and that they would continue to safeguard it.

Alleged Beneficiaries

Documents of the coal block allocations show that some of the relatives of Ministers in the UPA Government have been allotted coal blocks creating more trouble to the government now. The following names have been mentioned prominently:

  • Son of Union tourism minister Subodh Kant Sahai
  • Congress MP Vijay Darda
  • Relatives of Union minister of state Jagatrakshakan (DMK)
  • Prem Gupta (RJD), corporate affairs minister in UPA-1

AICC spokesman Manish Tewari argued that the allocations to relatives of ministers could not be termed as illegal if no rules were violated. "Being a relative of a politician should not be a qualification for a share in the largesse of the state. But it certainly should not be a disqualification if all the rules are followed to the T," he said.

The following are also allegedly linked to the coalgate scam.


BJP disrupts proceedings in Parliament

The opposition BJP are firm in their demand for the resignation of Prime Minister Manmohan Singh, which was ruled out by the later. BJP said that it would continue to stall the proceedings of the house till its demand is met and also threatened of nationwide agitations from September 8, a day after the Monsoon session in the Parliament ends.

BJP leader and former finance minister Yashwant Sinha criticized Congress chief Sonia Gandhi for asking her leaders to launch a counter-offensive against BJP. He said that the Congress is trying to dilute the coal block issue by seeking debate on the issue.

BJP has asked Trinamool Congress chief Mamata Banerjee to withdraw support to the UPA in the wake of coalgate scam. The party is planning to stage rallies against the government in 40 cities across the country.

Congress president Sonia Gandhi had a telephonic conversation with Sushma Swaraj to end the logjam in the Parliament. Following the conversation, there is no change in BJP state on their demands. However, they agreed to allow the Parliament to function if the government cancels the 142 licenses issued for coal blocks issued from 2006.

Samajwadi Party leader Mulayam Singh Yadav along with representatives of left parties, TDP and other parties staged a dharna outside the Parliament demanding an inquiry into the coal block allocation issue by a sitting judge. TDP demanded the cancellation of coal block licenses.

States have a say in Coal blocks allocation

On September 6, 2012 Union Minister Kapil Sibal has made public a few letters written by BJP Chief Ministers, Chief Secretaries of BJP ruled states, and other non-Congress Chief Ministers who have written to the Prime Minister opposing any changeover to auction of coal blocks. He argued that the letters show that the states have a say in the allocation policy and it is wrong to put the blame on the centre.

BJP leaders meet President

Senior BJP leaders met President Pranab Mukherjee on September 12, 2012 demanding his intervention in the alleged coalgate scam. BJP Parliamentary Chief LK Advani, Leader of Opposition in Lok Sabha Sushma Swaraj, Leader of Opposition in Rajya Sabha Arun Jaitley and PAC chairperson Murli Manohar Joshi met the President and submitted a memorandum. They expressed a deep anguish and profound concern over Prime Minister and Congress questioning the CAG report on coal scam. The President promised the BJP leaders that he would look into the matter and take appropriate action.

Speaking to reporters after meeting the President, Advani said that the BJP delegation met the President as it is his duty to defend the Constitution.

BJP takes fight to grassroots level

The BJP core group has decided to take the fight against corruption to grassroots level. They will lead a campaign at state and district levels demanding the resignation of Prime Minister Manmohan Singh over the coal block allocation issue. The decision was taken at a meeting chaired by BJP president Nitin Gadkari on September 13, 2012.

"From September 17 to 24, we will hold the campaign across the country demanding the Prime Minister’s resignation. Manmohan Singh is the first and the main accused in the coal scam. He should resign," said BJP general secretary Ananth Kumar.

BJP national and senior state leaders will lead “Raj Bhavan Chalo” marches in the capitals of various states to petition state governors demanding the resignation of Prime Minister. The party core group will meet on September 25 again to plan future strategy.

Status of Coal Blocks

Coal Minister Sriprakash Jaiswal has asked for a status report on the coal blocks by September 15. An Inter-Ministerial Group (IMG) will review the status of 58 coal blocks which were allotted to both public and private firms who failed to develop within a stipulated time-frame.

Coal minister Sriprakash Jaiswal ruled out cancellation of coal blocks till the IMG submits its report. The same views are echoed by Finance Minister P Chidambaram who added that the opposition's demand for the resignation of Prime Minister was outrageous.

Inter-Ministerial Group

An Inter-Ministerial Group was formed in July 2012 to review the status of coal blocks allocation of 58 companies, public and private. Notices were served to the companies in April. The group is headed by additional secretary (coal) Zohra Chatterjee.

More Information: 2012 Indian Coal Mining Scam - Inter-Ministerial Group

CBI Investigation

The CBI is investigating the companies who have misrepresented their capabilities to produce coal from blocks to the screening committee.

More Information: 2012 Indian Coal Mining Scam - CBI Investigation

Monsoon session of Parliament ends

The Monsoon session of the Parliament ended on September 6, 2012, without much business being held in 19 days of the session. The Parliament could make use of only six days out of the 19 day session. The BJP has insisted on their demands including resignation of Prime Minister and the cancellation of coal blocks. Meanwhile, Prime Minister Manmohan Singh has criticized the opposition for violating Parliamentary Politics and not agreeing to a discussion in the Parliament and Public Accounts Committee.

Fight to the streets

BJP has vowed to take their first on the coalgate scam to the streets. BJP spokesperson Nirmala Sitaraman said that the party would organize programmes in every corner of the country educating the people on the huge loss caused by allocation of coal blocks to private firms. The top leaders of the BJP would meet on September 13 to finalize their action plan.

On 11 September 2012, Ravi Shankar Prasad alleged that some of the relatives and associations of union ministers were allocated coal blocks after the UPA politicians were made ministers. The allegations were denied by coal minister Sriprakash Jaiswal and challenged the BJP to prove the allegations.

Supreme Court of India

The Supreme court of India, on 13 September 2012 directed the Centre to explain if it has followed the guidelines when allocating coal blocks. The court also rejected the Centre's plea to reject looking into the issue as it is being looked into by a Parliamentary committee. A bench of RM Lodha and AR Dave said that the petition requires explanation from the government. "There is difference in exercise done by the Public Accounts Committee (PAC). Parliament and PAC can proceed with the issue on the basis of the CAG report. We don't want to encroach upon their exercise but the petition raises different things altogether. There are sufficient averments which require explanation from you," the court observed.

Coalgate controversy will be forgotten : Home Minister

Home Minister Sushil Kumar Shinde said that coal blocks allocation controversy will be forgotten in the days to come. Speaking to reporters on the sidelines of a function on September 16, 2012 in Pune, Shinde said, " Such controversies come and go. Earlier, there was the controversy regarding Bofors, but it faded away. No one remembers the petrol pump allotment issue today"


Special court frames charges against Rathi Steel & Power Ltd, its MD Pradeep Rathi, CEO Udit Rathi & AGM Kushal Aggarwal in a coal scam case. Charges framed under sections 120B (criminal conspiracy) read with 420 (cheating) against all accused and section 420 against RSPL. May 19, 2015

2012 Indian Coal Mining Scam in News

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CBI denies the allegations

Parliament disrupted for 11th consecutive day on coalgate scam
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Maharashtra Minister Rajendra Darda denies link with coal scam company
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BJP says Government should take cue from CBI raids and cancel coal blocks allocations

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Cases of cheating and criminal conspiracy filed against five companies and unknown officials in coal ministry

Modi says coal block scam is blackening the country's face
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Parliament headed to be paralyzed for ninth straight day
Both Houses adjourned till 12 noon

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