New Delhi: The Ministry of Coal has amended policy guidelines for coal PSUs to allow them to lease parcels of land and grant mining rights to commercial coal miners in case the area of the coal block secured by the latter under the commercial coal mining regime overlaps with land whose ownership rests with these Central Public Sector Enterprises (CPSEs). In an official order dated July 29, the Coal Ministry said, “Ministry of Coal has found that several coal mines/blocks which have been allocated by Ministry of Coal are under allocation overlaps with lands acquired and vested in government companies… Since the ownership over such overlapping lands acquired under the CBA/CMN Act cannot be transferred or vested to private allocatees of coal mines/blocks, it creates an impediment for the private allocatees to undertake mining operations.” In order to resolve this impediement, the Ministry of Coal has chosen to amend the policy guidelines for land use by coal PSUs issued in April 2022.
The change in policy guidelines is significant as it will pave the way for faster operationalisation of coal blocks auctioned for commercial coal mining. The new amendment ensures that the ownership of such parcels of land rests with coal PSUs while they also get revenue.
The ministry said that it received approval from the Union Cabinet on July 18 to amend the policy guidelines. The original policy guidelines covered land acquired by coal PSUs only under the Coal Bearing Areas (Acquisition & Development) Act, 1957, known as the CBA Act. With the new amendment, the purview of the policy guidelines extend beyond land acquired under the CBA Act to cover land whose ownership is vested with coal PSUs through Coking Coal Mines (Nationalisation) Act, 1972 (or CCMN Act), Coal Mines (Nationalisation) Act, 1973 (or CMN Act) and Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013 (RFCTLARR Act). The amendments also apply to land purchased or acquired by coal PSUs through any other means and which overlap with coal mines/blocks auctioned or about to be auctioned under the Coal Mines (Special Provisions) Act, 2015 (CMSP Act) or the Mines and Minerals (Development and Regulation) Act, 1957 (MMDR Act).
According to the amended policy guidelines, mining and surface rights in such parcels of land (where there is an overlap) can be leased by coal PSUs only to successful bidders who have secured the auctioned coal block. For surface rights, coal PSUs can grant a lease or a sub-lease on their own terms and conditions to the commercial coal miner. “Surface leases so granted by the government companies shall be long-term leases, ie, for up to 50 years,” the amended guidelines said.
For land whose ownership is vested in coal PSUs through CCMN Act or CMN Act, the government company can grant a sub-mining lease to the successful bidder or surrender the mining lease to the state government for granting it afresh to the entity that has acquired the block. For lands covered under CBA Act, a mining lease may be executed between the coal PSU and the successful commercial coal mine bidder. In case of lands covered under RFCTLARR Act or acquired by coal PSUs through any other means, the mining lease will be granted by the state government.
The commercial coal miner who acquires surface rights and mining lease from a coal PSU for such land will pay rent for the surface lease to the PSU at the rate of Rs 1,000 per hectare of land per annum. They will also pay the cost of land acquisition, cost of rehabilitation and resettlement, cost of employment against land, other incidental or ancillary costs/expenses etc borne by the coal PSU at present market rate, the guidelines said.
All the other charges, including royalty, dead rent, proceeds of auction, surface rent or any other statutory amount, payable to the state government and the District Mineral Foundation and National Mineral Exploration Trust, will have to be paid as specified under the MMDR Act.
Commenting on the policy change, Additional Coal Secretary M Nagaraju told PSU Watch, “The amendment in the policy guidelines will help operationalise commercial coal mines quickly. It will remove difficulties faced by successful bidders. And coal PSUs will also get revenue.”
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