India: HC notice to Centre and state over auction of previously prospected areas

The High Court of Chhattisgarh has issued notices to the Centre and the state government on Jindal Steel and Power Ltd and others' petition against the auction of an iron ore area it had once prospected.

While the HC granted Jayaswal Neco last week, technical bids for the iron ore deposits was to be received until Sept 30.

Following the Centre's amendment, canceling all 10(a) 2 (b) cases of the MMDR - or rights promised to those who had successfully explored areas, the state had announced it would auction four iron ore deposits: Kalwar, Lohatter (Sonadehi) and two blocks, A and B in north Bailadila.

The High Court in an order on Jan 21, has decided to hear the petitioner's plea for an interim relief. The steelmaker has also challenged the amendment to the Mines and Mineral (Development & Regulation) Act 1957 through MMDR (Amendment) Act 2021, denying JSPL and hundreds of others claims to areas for which they had been granted Letters of Intent by respective state governments. The amendment offers to repay their expenses from the NMET funds.

The matter will be heard again on 6 October, in the meanwhile the HC bench wants, "that the proceeding for leasing out the subject mining area under the subject Notice Inviting Tender remain subject to the final outcome of the writ petition."

According to a recent report, JSPL's petition says based on its 2005 MoU with the state government the company had invested Rs 2,595 crores in expanding its steel plant at Raigarh, Chhattisgarh. In 2009 it was granted a letter of intent for prospecting license (PL), and in 2013 a two-year grant order to prospect an area of 1162 hectares. JSPL, says the TOI report, has claimed it made "heavy investment to execute the prospecting license facing enormous challenges including the influence of Maoists in the region".