In a significant ruling in the coal block allocation cases, a special court in Delhi has convicted former Rajya Sabha MP Vijay Darda, his son Devendra Darda and businessman Manoj Kumar Jayaswal in connection with irregularities in the allocation of the Bander coal block in Maharashtra, while acquitting former coal secretary HC Gupta, holding that the allocation process was manipulated through misrepresentation and concealment of facts.
The
judgement, delivered by a special CBI court at Rouse Avenue, comes in one of the many cases arising from the controversial coal block allocations made between 2006 and 2009. The court held that the central bureau of investigation (CBI) had successfully established that the allocation of the Bander coal block to AMR Iron & Steel Pvt Ltd was secured through a criminal conspiracy involving false claims and misleading disclosures.
According to the court, AMR Iron & Steel, promoted by the Jayaswal group, falsely stated in its 2007 application to the ministry of coal that none of its group companies had previously been allotted coal blocks. This was found to be untrue, as group entities had already received such allocations. The court noted that this misrepresentation went to the root of the screening process.
The company also exaggerated its financial and technical credentials during presentations before the 36th screening committee. It projected itself as a special purpose vehicle backed by the Lokmat Group and IL&FS (Infrastructure Leasing and Financial Services), thereby overstating its financial strength. In reality, the company’s net worth was negligible, a factor that the court said materially influenced the allocation decision.
The role of Devendra Darda came under scrutiny for participating in presentations and signing documents on behalf of AMR Iron & Steel without formally being a director at the relevant time. Vijay Darda, the court noted, had written to the then prime minister recommending allocation of the coal block to the company, portraying it as part of his group.
The court also took note of financial transactions exceeding ₹24 crore, allegedly routed from entities linked to the Abhijeet group to companies controlled by the Darda family. These transactions were seen as indicative of a quid pro quo arrangement connected to the coal block allocation.
Despite red flags within the ministry of coal regarding the links between AMR Iron & Steel and the Jayaswal group and concerns over prior allocations to related entities, the screening committee proceeded with the recommendation. The court observed that officials relied heavily on representations made by the applicant company, which were later found to be misleading.
The Bander coal block was eventually allocated to AMR Iron & Steel along with two other companies, with approval at the highest levels. However, the court held that the recommendation was based on distorted facts and incomplete disclosures.
The judgement also noted that the company failed to operationalise the project for which the coal block had been allotted. The proposed end-use plant was never set up, and required clearances were not obtained, ultimately leading to deallocation of the block in 2014.
After examining extensive documentary and oral evidence, including testimonies of government officials and financial records, the court concluded that the accused had conspired to secure the allocation through deceitful means.
At the same time, the court acquitted former coal secretary HC Gupta, observing that the allocation of coal blocks was a policy decision taken in line with directions from the prime minister’s office, and there was insufficient evidence to establish criminal intent on his part.
The ruling marks another important milestone in the long-running coal block allocation cases, underlining judicial scrutiny of discretionary allocation processes and holding both corporate entities and individuals accountable for fraudulent practices.
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