102 Iron, Manganese Lessees to pay about 17,500 crores penalty for mining violations in Odisha

Report by Malaya Mohapatra; Keonjhar: After the Supreme Court’s decision on 2nd August to recover 100% penalty from Odisha Mining companies towards mineral raised without Forest and Environment clearances, the order has shaken the mining companies as the penalty is likely lead to closure and crash down of most mining firms. Out of 187 iron and manganese mines in the state, only 41 mines are working while the others remained closed due to lack of statutory clearances and other problems since 2009. Instead of mining lease renewal leases operating under deemed extension will expire by 2020 and these will be put for auction. While most mining leases will expire in next two years and on the other hand heavy penalty to be paid within 31st December is tough for the mining sector. In a meeting of the East Zone Mine Owners Association in Bhubaneswar, all lessees have expressed their inability to pay such huge penalty as they have invested the money in value addition and expansions. It is like a death sentence served on mine owners, a member lessee remarked. During the MB Shah commission of enquiry 55 lessees were issued show cause notice by the State for violation of EC and FC Act. While the State Govt had initially slapped penalty notice of 61,705 crores on the erring lessees after a preliminary assessment basing on the sale price of ores in public sector mines, it later slightly came down in its figure after the lessees objected against it in the court. The CEC working under the Supreme court was assigned to make an independent inquiry and assessment on the violation and illegal excavation of ores in 2010. The CEC in its report to the Supreme Court has made an assessment of 17,041 crore rupees value of iron ore and 484.92 crore rupees of manganese excavated since the year 2000 onwards without clearance basing on the IBM bench mark price during the concerned period. However the CEC recommended to recover 30% penalty of this cost price from the lessees which was turned down by the court. According to the court order, 100% value i.e 17526.16 crore rupees is to be recovered as penalty from 102 lessees. According to sources, in a High power meeting of the state mines dept recently, it is proposed to collect additional penalty for excess mining beyond approved mining plan and Forest conservation Act which may add a few more crores to the penalty assessment. State govt undertaking OMC has been advised to get prepared for paying the penalty. Lured by the prospect of earning a huge revenue, officials at the State mining dept are excitedly working on the modalities to calculate the penalty on different lessees and pursue its collection at earliest.