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Mining Scams in India

Gone are the days when it was so easy for any person or entity to do the scam and just run away from their liability. Nowadays whether it be a person or entity or be government no one can commit a scam and escape from their liability. Now if they commit scam, they’ll have to face the consequences. Thanks to the media and the other bodies for creating awareness about the same. Mining is one of the very important/crucial factors in the GDP of our developing country.

The number of scams happening and that ban which is imposed, it is a major need to revive the mining industries. It is the chief fiscal activity which contributes a lot to our country’s GDP. Although the contribution of the ruining industries is limited up to 2 - 3°/c still it comes up to the mark of 10 to I I°/c when we talk about the total industrial sector.

It is a well-known fact that everything which has a lot of advantages has its disadvantages too. The mining Industries have a number of risks and the lists of issues are endless such as the risk of human life, safety hazards, and a safe working environment. In a developing country like India, mining’s scams are commonly known as Indian Mining Scams. The scams are much likely to happen in the ore-rich area.

Let us know about some cases related to Mining:

  1. The iron metal in the Bellary area, Karnataka is asserted to have been wrongfully mined in the wake of paying a minimal charge to the legislature. It includes mines in Bellary, including those of Obulapuram Mining Company.
  2. The illegal ruining activity was reported in the Aravali Range.
  3. Bauxite ruining in the tribal areas of Orissa has led to conflicts over land rights. On 18.04.2013, the Supreme Court ruled that the Vedanta Group's bauxite ruining project in the hills of Niyamgiri in Orissa will have to obtain authorization from the gram sabha as to whether it affects the cultural and religious rights of the tribes and forest dwellers who live in the districts of Rayagada and Kalahandi.[i]
  4. On November 14, 2011, Rajendra Dixit files a complaint at the Madhya Pradesh Lokayukta office against the mining companies of the Indian National Congress MLA Sanjay Pathak, demanding an investigation by Lokayukta against an alleged mining scam worth Rs 50 billion, allegedly committed in Sihora, Jabalpur.[ii]
  5. The Shah Commission report on mining in Goa accused the State and the Ministry of the Environment and Forestry (MoEF) of allowing illegal ruining in the state, putting the region's environment and ecology at risk.[iii]
  6. Illegal mining on the Ganges river bed of stones and sand for construction has been a long-standing problem in the Haridwar district of Uttarakhand, where it touches the plus for the first time. This is despite the fact that quarries were banned in the area of the Kumbh Mela area, covering 140 km in Haridwar.

The Inter-Ministerial Group (IMG)

Till the end of June 2012, the Ministry of Coal decided to form an Inter-Ministerial Group for deciding to forfeit the bank guarantee of those companies that do not develop the coal blocks allotted to them. As per the records by 26/09/2012, 31 coal blocks were reviewed by the Interministerial Group.

India is not a signatory to the Extractive Industries Transparency Initiative [EITI], a standard developed globally for the extraction of natural resources, in order to promote revenue transparency at the local level. But we have a legal and constitutional structure to manage the sector.

Policy-level guidelines for the mineral sector are provided by the National Mineral Policy, 2008. Mining operates are regulated in terms of the Mines and Minerals (Development and Regulation) [MMDR] Act of 1957, promulgated by Parliament.

State governments, as owners of minerals, grant mineral concessions and charge royalties, dead rent, and fees under the provisions of the Mines and Minerals (Development and Regulation) Act of 1957. Ultimately, the Supreme Court has said that mineral owners should be invested with the landowner and not with the government.

The royalties and dead rent revenues collected by the State Government are accumulated in the Consolidated Fund of the State Government in question and are appropriate for public expenditures through a budget process that must be approved by the Legislative House of the State Government in question.

Mining is a vital part of our country's economy, but the government must take into account how much the financial system suffers due to a lack of accountability for the illegalities of work. Therefore, there must be appropriate policies and amendments from time to time to ensure that there is no commitment from the authorities when it comes to mining activities in the country.

The Minerals Law (Amendment) 2020 is a significant step towards attracting private individuals and providing them with equal opportunities in the mining sector, which will promote the ease of doing business in the country. This will undoubtedly lead to an enormous amount of coal production and reduce dependence on imports, but it will increase dependence on fossil fuels, which is fatal to the environment and will adversely affect people as well.

Everything has its pros and cons, so it is necessary to analyze the current situation with the provisions of the act so that measures are taken to protect the environment and, at the same time, guarantee the country's economic growth. In the past, there have been many scams that our country has suffered, but this "Coalgate coup" was a very big and great farce. This blow was from 2004-2009 and was I .86 lakh rupees crore. This is a very large amount. This is also the biggest scam in 1ndia to date. During the survey, many respondents were also of the opinion that it is the primary responsibility of the Government to keep all these records under control and not to act only when the damage has been done.

  1. last accessed on 24.09.2020
  2. last accessed on 24.09.2020
  3. last accessed on 25.09.2020

Written by: Sandeep Rana, BA+LLB (Hons) student at Chandigarh University, Gharuan

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