Government decides to deduct bank guarantee of Chaman Metallics for mine delays

NEW DELHI: The government today said it has decided to deduct bank guarantee of Chaman Metallics Ltd to the tune of Rs 14 lakh for delays in the development of a coal block in Maharashtra allocated to it for captive use.

The decision was taken by the coal ministry following the recommendations of an inter-ministerial group ( IMG) on coal blocks.

"The company has failed to develop the same (coal block) as per the milestones prescribed without any valid reasons for the delay, and it has been decided to deduct and encash appropriate bank guarantee (BG) of Rs 0.14025 crore (Rupees fourteen lakh two thousand two hundred only)," the coal ministry said in a letter to the Managing Director of the company.

"Taking into account the facts placed before it (IMG) including the fact that all requisite clearances have been obtained except execution of the mining lease by the state government and keeping in view delay in achievement of the milestones, IMG recommends deduction and encashment of proportionate BG," it said.

The recommendations of the IMG has since been considered and approved by the government, it added.

Kosar Dongergaon coal block in Maharashtra was allocated to the company in February 2007.

The IMG was formed in 2012 to look into the development of captive coal mines and make recommendations. The IMG chaired by additional secretary coal has members from ministries power and steel.