Coalgate: CBI files closure report against Kumar Mangalam Birla, ex-coal secy

The CBI has filed a closure report in a case related to the coal block allocation scandal in which industrialist Aditya Birla Group chairman Kumar Mangalam Birla, former coal secretary PC Parakh and other persons were accused.

The CBI has told the court it will file some documents related to the case before it after which Special CBI Judge Bharat Parashar fixed the closure report for consideration on 1 September.

The closure report was filed in the court yesterday.

The FIR related to allocation of Talabira II and III coal blocks in 2005 and CBI had booked Birla, Parakh and other officials of Hindalco under various IPC sections, including criminal conspiracy and criminal misconduct on the part of government officials.

The FIR against Birla and former Coal Secretary PC Parakh was registered in October last year by CBI which had alleged that Parakh had reversed his decision to reject coal block allocation to Hindalco within months "without any valid basis or change in circumstances" and shown "undue favours".
The CBI had earlier confirmed that it would file a closure report in the case.

The case had sparked widespread condemnation from industry leaders and politicians alike given Birla's stature as a leading Indian entrepreneur.

Hindalco had denied any wrongdoing and even the then Prime Minister Manmohan Singh, who was in charge of the coal ministry when the allocation took place, defended the decision to award the block to Hindalco.

During the investigation, CBI, however, had found that there was no "quid pro quo" on the part of Parakh and there was no wrongdoing in allocation of coal blocks to Hindalco.

In its FIR, the agency had alleged that during the 25th Screening Committee meeting, chaired by Parakh, applications of Hindalco and Indal Industries were rejected for mining in Talabira II and III "citing valid reasons".

On the recommendations of the Screening Committee, the coal blocks were allocated to Mahanadi Coalfields and Neyveli Lignite Corporation, both public sector undertakings.

These recommendations were placed before the "Competent Authority" which agreed with Parakh, who later issued letters of allocation to the PSUs on 16 June and 15 July of 2005.

Within days, a "personal meeting" took place between Parakh and Birla in which the industrialist requested for the allocation of Talabira II coal block, CBI had said.

"Pursuant to these letters and personal meeting between Parakh and Birla, Parakh, by abusing his official position as a public servant recommended the allocation of Talabira II along with Talabira III coal block to Hindalco Industries Ltd, along with other two companies without any valid basis or
change in circumstances and with the sole intention to show undue favours to Hindalco Industries Limited," the agency had alleged in its FIR.

CBI had alleged that Parakh recommended formation of a joint venture between Mahanadi Coalfields, Neyveli Lignite and Hindalco with equity share holding of 70 per cent, 15 per cent and 15 per cent respectively.

The FIR had alleged that inclusion of Hindalco reduced the share of Neyveli Lignite in the coal field.

"Due to this arrangement, the proposed power project of the NLC could not take off as planned," it had alleged.

Defending his decision, Parakh had said, "There is absolutely nothing wrong with the decision. It was a very fair and correct decision that we took. I don't know why CBI thought that there is a conspiracy."

with inputs from agencies

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Updated Date: Aug 29, 2014 16:40:39 IST