Sale of iron ore in past done in ‘most outrageous manner’: SC

In a blow to the powerful mining barons, the Supreme Court Monday rejected their plea against e-auction of iron ore, saying the sale and purchase of minerals in the past was done in an "outrageous manner" and on "unacceptable terms", causing huge leakage of public revenue. The apex court rejected the plea against e-auction of minerals in Karnataka which was supported by Vedanta Ltd, holding that its "horrific" experience of the past cannot be allowed to resurface. It said that issues of lifting the cap on production of minerals and restoration of ecology and environment through a Comprehensive Environment Plans for the Mining Impact Zone (CEPMIZ) were under active consideration of the court. "We, therefore, for the present, reject the application filed by Federation of Indian Mineral Industries (FIMI) South and consequently do not entertain the support to the prayers made therein by M/s Vedanta Ltd.

"For the same reasons, we do not also accept the suggestions of the Central Empowered Committee (CEC) and the State of Karnataka as made in their respective reports/ affidavits filed before the court," a bench of Justices Ranjan Gogoi, P C Pant and Navin Sinha said. The bench said "the experience of the past has been horrific. It cannot be allowed to come back. "Sale and purchase of iron ore had been conducted in the most outrageous manner and on wholly unacceptable terms resulting, inter alia, in huge leakage of government revenue. Such experiences and events cannot be allowed to resurface." FIMI (Southern Region) in its plea has sought that iron and manganese ore may be sold in Karnataka without recourse to e-auction conducted by the monitoring committee set up by apex court. The plea was supported by M/s Vedanta Ltd, an iron-ore lessee operating within Karnataka through its petition. The bench said what has been suggested by CEC and the in-principle approval of state government would seem to indicate that in place of the monitoring committee, another committee consisting of officials of Karnataka be made to oversee and supervise the sale of iron ore through a hybrid system of long term contracts and sale through an eplatform including payment of taxes, royalty.

"While it is correct that any trading process has to be free and fair, what cannot be ignored are the circumstances which had prompted the Court to conceive of and continue with a departure from the normal rule,” SC said.