Odisha coal mining violations involving 1.17 crore tonnes of coal could make the lessee liable to pay ₹975.57 crore, after the Comptroller and Auditor General found production beyond approved limits or without a valid environmental clearance at two Mahanadi Coalfields Limited mines.
The findings are contained in the CAG’s compliance audit report for the year ended March 2024. The audit examined operations at the Kalinga Open Cast Project under the Talcher mining circle and the Kulda Open Cast Project under the Rourkela mining circle.
The larger violation was recorded at Kalinga Open Cast Project, where the environmental clearance expired in October 2021. After accounting for extensions granted by the Union environment ministry in connection with the Covid-19 period, the clearance remained valid only until October 23, 2021, according to the audit.
Despite the expiry, the mine produced 1.15 crore tonnes of coal between October 2021 and March 2023 without a valid environmental clearance. CAG assessed the value of this production at ₹956.56 crore. The audit said the production was carried out without the environmental authorisation required for the operation.
At Kulda Open Cast Project, the environmental clearance for coal production was increased from 19.6 million tonnes per annum to 21 million tonnes per annum in May 2022. However, the audit calculated that the permissible production for 2022-23 was 20.77 million tonnes on a pro-rata basis, based on the date of approval.
The mine produced 21 million tonnes during the period, exceeding the permissible level by 2.3 lakh tonnes. CAG estimated the recoverable value of the excess production at ₹19.02 crore.
Together, the two cases involved 1,17,96,540 tonnes of coal and a recoverable amount of ₹975.57 crore. Citing provisions of the Mines and Minerals (Development and Regulation) Act, 1957, the audit said the lessee was liable to pay the value of minerals extracted without lawful authority.
The report also raised concerns about the monitoring of environmental clearances and production ceilings by mining authorities. In the Kalinga case, the Deputy Director of Mines, Talcher, “did not check the validity of EC and lawfulness of the production from the mine”, the audit noted.
The audit findings point to a compliance gap at the intersection of coal supply, environmental regulation and mineral revenue administration. Environmental clearance conditions are intended to govern the scale and manner of mining, while production limits determine the volume that can legally be extracted under approved permissions.
After the audit raised the irregularities, the concerned deputy directors of mines stated that compliance would be furnished after verification of records. The government’s response was awaited when the audit report was finalised.
