By Our Correspondent
BHUBANESWAR/JODA/NEW DELHI: Several social, forest rights and wildlife activists were on Thursday demanded a CBI probe into mining lease given to New Delhi headquarters Prakash Industries Pvt Ltd.
“The entire process leading to grant of mining lease need CBI probe as the Prakash Group has very poor track record and in a very mysterious manner, the Prakash Industries Pvt Ltd run by Ved Prakash Agarwal,Vikram Agarwal and Kanha Agarwal obtained mining lease and all statutory clearances, on November 4, it has commenced mining operations at Sirkagutu iron and manganese ore mine in mineral rich Keonjhar in Odisha,” said Dasarath Patra , a leading industry watcher in Bhubaneswar.
The Company’s shares rose more than six percent intraday on November 4 after the company commenced mining operation in Odisha. At 14:12 hours the mining commencing day, Prakash Industries was quoting Rs 56.00, up Rs 2.20, or 4.09 percent on the BSE.
It may be noted here that early in 2018, Enforcement Directorate (ED) had attached movable and immovable properties worth Rs 117 crore of steel manufacturer Prakash Industries.
According to ED, an investigation by the enforcement agency into a case of misrepresentation of assets and net worth by Prakash Industries to get a coal block allocated had also revealed that the New Delhi-based company had filed a false declaration with the Bombay Stock Exchange (BSE) on 17 November 2007 that it has been allocated the coal block.The coal block was actually allocated in February 2018 jointly to Prakash Industries and SKS Ispat Power Ltd.
The ED investigation revealed that as a result of the false ‘filing’, share prices of Prakash Industries jumped 10 times from Rs 31 on 2 April 2007 to Rs 351 on 4 January 2008. The investigation further revealed that to take advantage of the ‘artificially created rise in the share value’, the company issued 62,50,000 preferential shares on a premium of Rs 180 per share and sold these shares to five companies making a gain of 118.75 crores.
“The amount of Rs 118.75 crores, which was generated as a result of the schedule offence as committed on the date of filing of application for allocation of coal block by giving false net worth details and further false declaration to BSE, is the proceeds of crime, which are liable to be provisionally attached under PMLA,”
The ED had also found that the aforesaid proceeds of crime had been generated and used in the continuous expansion related to manufacturing activities, therefore the value of Rs 117.09 crores was attached in the form of movable and immovable properties of the company under the provisions of PMLA.
Prior to ED, the Central Bureau of Investigation (CBI) had earlier registered a case against Prakash Industries Ltd, alleging it applied for allocation of Coal Block in January 2007 on the back of false net-worth claims and on the basis of such misrepresentation, the company got allocated Fatehpur Coal Block on February 2008, which was later de-allocated in 2014.
Prakash Industries Pvt Ltd, which has no major stakes in Odisha, surprisingly got mining lease to operate the Sirkaguttu Iron & Manganese Mines under Joda mining circle of State’s mineral rich Keonjhar district and also started operations.
Sirkaguttu Iron & Manganese Mines under Joda mining circle of State’s mineral rich Keonjhar district in Odisha has geological reserves of around 9.9 Million tonnes. “We demand a CBI probe into the entire process leading to mining lease to Prakash Group,” said an activist in Bhubaneswar. He also added that Prakash Group had come under scanner several times for its illegal work.
The Prakash Group involved in business like Mining, Sponge Iron, Steel, Power, Ferro Alloys, Wire Rod & HB Wires, TMT & Structurals,Wind Power and runs an Integrated Steel Plant at Champa in Janjgir districts of Chhattisgarh, it also runs a Rolling Mill Division at Gogaon Industrial Area in Raipur in Chhattisgarh and a Wind Mill Division at Kanyakumari in Tamil Nadu.
But without any plant and any major contribution to Odisha, Prakash Industries got the lease , which surprised many industry watchers.
“The Prakash Group has majority of stake in undivided Madhya Pradesh, particularly in Chhattisgarh but it has nothing to do with Odisha but surprising got the lease and started operations,” added a source in Joda in Keonjhar.
This is an important mile stone for the company and the extraction of Iron Ore will result in significant cost reduction in the iron ore cost, which is a key input for steel making, thereby improving the operating margins of the company, Ashwini Kumar Company Secretary said in a press statement issued on Monday. The statement never mentioned about Odisha, the minerals from Odisha, will be used for Company’s plants in Raipur and Champa in Chattisgarh.
Locals in Joda, Barbil in Odisha’s Keonjhar district however expressed concerns over the dwindling of the wild animals and the increasing man-animal conflict in human habitations due to water and fodder scarcity in jungles and hills. “The residents of Joda-Barbil will suffer acute water scarcity in near future due to illegal mining work of Prakash Industries Pvt Ltd.
Meanwhile, several wildlife and social activists have sought a court-monitored probe into the mining lease and allotment mines to Prakash Industries Pvt Ltd.94 of the 192 iron ore mining leases in Odisha do not have the mandatory environmental clearances. And of the 96 that have them, 75 have mined far beyond their permitted levels over the past several years, says the Justice M.B. Shah Commission report.
The company has violated pollution control act of 1986, air pollution control act of 1981, water pollution control act of 1974 and forest rights act of 1980. Companies were supposed to extract mining with clearance of air and water pollution control under various acts like Environment (Protection) Act, 1986 and consent to operate under the Water (PCP) Act, 1974 and Air (PCP) Act, 1981.
Company which operating without valid consent to operate should have been issued closure directions or will be prosecuted as per the provisions in Water (PCP) Act, 1974 and Air(PCP) Act, 1981.While granting “consent to operate”, it will be ensured that the proponent has obtained all other statutory clearances under Forest (Conservation) Act, 1980 and Environment (Protection) Act, 1986.The Company has no respect to labour laws, they said.
With no political parties raising the issue of corruption and irregularities in Odisha, apprehensions are being raised if culprits will ever be brought to book. Probes into Rs 3 lakh crore Odisha mining scam have slowed down in the last couple years, raising doubts about a tacit understanding among the leaders.