The administration in Dantewada district of Chhattisgarh has imposed a whopping fine on the National Mineral Development Corporation (NMDC), which is a central public sector unit, for alleged violation of mining laws. NMDC has termed the decision as “wholly unjustified” and argued that it is blindly exercised by imposing a huge penalty “without considering the facts & circumstances on record of this case”.
NMDC runs operations in the Bailadila hills region of southern Dantewada, specifically at Kirandul and Bacheli areas situated in Bastar district. On August 29, Dantewada collector Mayank Chaturvedi had asked NMDC to deposit the penalty amount within 15 days.
As per the letter, iron ore mining leases had been granted for Deposit No. 14 ML (322.368 hectares), Deposit No. 14 NMZ (506.742 hectares) and Deposit no11(87-4.This t24 km2s notified by Kirandul village in Bacheli tehsil). The Collector said the mines major’s reply to the show cause notices issued by them was not proper.
The fine pertains to an alleged contravention of section 4(1) of the Chhattisgarh Mineral (Mining, Transportation and Storage ) Rules, 2009and17/5of Mines & Minerals Development Regulations Act. A case has been lodged against the NMDC for dispatching iron ore without a railway transit pass (RTP) violation of various mining laws.
On the issue of mining operations, NMDC said it has been operating with a valid approval for its mine lease alongwith approved mining and environment plans; consent to establish (CTE) for ₹225 mtpa from Chhattisgarh Pollution Control Board until September 2020 being renewed quarterly in view of pandemic; CTO permissions up-to-date within environmental clearance limits as granted by MoEFCC.
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The company mentioned paying advance royalties deposit, grade-wise and product wise to the state online through khanij-online portal against which it has generated e-permit numbers after payment. NMDC, however argued that as it has paid advance royalty backtrack payments there was no mining rules violation in the transport of iron ore without RTP.
It also said the state government verifies these records every six months during royalty assessments and it has not raised any objection till now, suggesting that there is compliance with regulations.
The company also detailed delays of two to three days in finalising the grade of iron ore often causing time lag in generation RTP but there is no financial loss to state exchequer. NMDC to give reply for their clarification on the letter of KTR punt forest issue
To get somewhat of a more detailed sense, NMDC is one of the leading players in India’s mining industry with its core production from iron ore. The Bailadila hills, where NMDC operates have some of the richest iron ore deposits in India and hence this is a crucial development for the steel industry.
The company’s business in this area has been an important pillar of its total production tactics. If the recent penalty is imposed, it seems that NMDC may be faced to shell out some financial risk impacting on its operations and overall health.
Indeed, the row serves as another reminder of the continuing struggles with mining practices in India, where there has been an increasing focus on compliance and environmental issues for several years.
The result of this case may prove to be a model for similar cases in the future, and it could have broader implications on western mining. Industry stakeholders and investors will now watch NMDC’s response, along with the actions of the district administration.
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