What was the hurry to file closure report against KM Birla, HC asks CBI

New Delhi, Delhi High Court on Friday rapped the Central Bureau of Investigation (CBI) for filing a closure report in the coal block allocation scam case against billionaire Kumar Mangalam Birla and others.

The Delhi High Court, while hearing the matter, asked the CBI to explain what was the hurry to close the case against Birla and others in coal block allocation scam.

The court told the premier investigating agency that original minutes of screening committee meetings, which dealt with Birla-owned Hindalco’s application were missing.

The CBI had filed the case against Birla and former coal secretary PC Parakh last year in relation to a coal block allocated in 2005 to Hindalco Industries (HALC.NS), part of the USD 40 billion Aditya Birla Group led by Kumar Mangalam Birla.

The CBI had booked Birla and the others on charges of criminal conspiracy and corruption in the allocation of coal blocks. The businessman was booked Birla as a representative of the Aditya Birla Group and his group company Hindalco, one of Asia’s biggest producers of primary aluminium.

It is alleged in the FIR that during 2005, the accused in criminal conspiracy with one another and then public servants by abusing their positions (and) as such showed undue favour to an Odisha-based industry in allocation of Talabira-II and Talabira-III coal blocks along with a public sector undertaking of Tamil Nadu.

India’s federal auditor had alleged that the government’s allocation of coal blocks may have cost the exchequer revenues of about USD 33 billion, although industry watchers and the previous government have cast doubts on the figure.

Though the CBI has dropped the name of Birla, the Supreme Court of India this week ruled that allocations of coal blocks since 1993 were illegal. That would include blocks awarded to firms including Hindalco and Jindal Steel and Power Ltd.

The court will hold a further hearing on Monday, after which it will decide whether to cancel the allocations or impose some sort of penalty.