No diversion of coal from blocks allocated for Ultra Mega Power Projects: SC

NEW DELHI: The allocations of 12 coal blocks for Ultra Mega Power Projects (UMPP) would be used for it only and no diversion of coal for commercial exploitation would be permitted, the Supreme Court today observed while noting that no challenge was made before it in this regard as "competitive bidding" was held for its allocation.

The apex court also held that the issue was not challenged before it by the petitioners as competitive bidding was held for the "lowest tariff" for power for these UMPPs.

"By way of footnote, it may be clarified and we do, that no challenge was laid before us in respect of blocks where competitive bidding was held for the lowest tariff for power for Ultra Mega Power Projects (UMPPs)," a three-judge bench headed by Chief Justice R M Lodha said.

"Having regard to this, it is directed that the coal blocks allocated for UMPP would only be used for UMPP and no diversion of coal for commercial exploitation would be permitted," the bench, also comprising justices M B Lokur and Kurian Joseph, observed.

Referring to the first counter affidavit filed by Centre in January, the bench said it was the stand of the government that captive blocks were pre-identified for projects and bidders were selected as per the competitive bidding guidelines of the Ministry of Power (tariff-based bidding) and therefore, the 12 allocations to UMPPs were done by a competitive method.

"As a matter of fact, Prashant Bhushan, counsel for Common Cause, submitted since allocation for UMPPs is in accord with the opinion given in Natural Resources Allocation Reference and the benefit of the coal block is passed on to the public, the said allocations may not be cancelled," the bench noted in its verdict.