By Ruma Dubey

Market men were all set for a long weekend and had hoped to end the week on a positive note as the day had begun on a good note. But towards mid-afternoon the CAG report on coal, power and aviation was tabled and uproar began, drowning the rising index. The market knew when it began the day today that the CAG report on coal, power and aviation was to be tabled and thus expected a flurry of negative news to come in which is why the markets did not immediately sink into the red abyss; it merely lost some points but remained in the green, albeit on a cautious note.  

Post the tabling of the report, not surprisingly, power stocks sank like dead weight in the sea, with Reliance Power leading the losers, followed by Tata Power, Adani Enterprises. GMR and Adani Power too figure in the top ten losers.

People are bone tired of scams. Every other day there is a new scam which makes headlines only to go into oblivion as another new one breaks. It seems to have become a norm and one wants to see the guilty being brought to book. Reports are published and uproars disrupt parliament but do we ever hear of any one being prosecuted or imprisoned for the crime? Today, as expected, post publication of the CAG report, the Coal Ministry and other related ministries have disagreed to CAG's calculation of windfall gains calling it fallacious and imaginary. When one does not believe a report from the CAG, what can one say about callousness and falling moralities? A CAG or a Comptroller and Auditor General of India is an authority, established by the Constitution of India under Chapter V, who audits all receipts and expenditure of the Government of India and the state governments. CAG is also the external auditor of government-owned companies. And the Govt questions the credibility of its own auditor? If the CAG had posted a very favorable report, praising the Coal Ministry for its honesty and diligence, would they then have pooh-poohed CAG’s report?

The coal scam is indeed the mother of all scams. The coal-gate scam is essentially about huge gains to private players due to the failure of the coal ministry to auction coal blocks. Between 2004 and 209, the Govt allotted 155 coal acreages  to about 100 companies, blocks which had reserves of 33 billion tons, without any fees; companies only needed to pay state governments royalty once they had started production. Any company worth its name in salt was named in the CAG report – NTPC, Essar, Reliance Power, Jindal Steel and Power, Adani Group, Bhushan Power & Steel, ArcelorMittal, Jayaswal Neco, Lanco Group, Aditya Birla Group, Tata Steel, Hindalco, Monnet Ispat, NALCO.

It is huge shame. It is demoralizing that we today live in a country where the leaders are plundering the country for their own benefit. Winston Churchill, 65 years ago had said, “Power will go to the hands of rascals, rogues, freebooters and charlatans; all Indian leaders will be of low caliber and men of straw. They will have sweet tongues and silly hearts. Giving falls promises will be their game with the poor and stupid masses. They shall be shameless and unpatriotic in their ways while handling problems of people. They will fight amongst themselves for power and India will be lost in political squabbles. Justice will be a matter of Joke. A day would come when even air, water..., and even common salt would be taxed in India.”

Churchill forgot to mention corruption and thankfully, our leaders completed the list, not letting down Churchill’s faith.

A quick look at what the CAG report tabled:

On Coal

• Report on coal alleges power companies made gains of Rs.1.86 lakh crore for 17.40 billion tonne of coal. (The previous loss to country released by CAG was pegged at Rs.10.7 lakh crore.)
• Allocation was made without competitive bidding 
• On Coal, stated that bidding process was tweaked by allowing Reliance Power to use excess coal from three blocks allocated to Sasan project, resulting in Rs 11,852 crore gain to Reliance Power. The company thus unduly benefited from a government decision allowing it to use surplus coal from its captive block for another project it was not meant for
• ‘Coal-gate’ loss bigger than 2G scam.
• Tata Group entities, Jindal Steel & Power, Anil Agarwal Group firms, Essar Group's power ventures, Adani Group, Arcelor Mittal and Lanco named as beneficiaries.
• Only 28 captive blocks begin production by Mar 31 against scheduled 86 mines
• Excess coal use dispensation to Sasan UMPP

On Aviation

• Slammed levy of development fee on passengers at Delhi Airport, stating that it vitiated sanctity of bidding process.
• DIAL to get undue benefit of Rs 3,415.25 cr from levy of development fee on passengers at Delhi Airport.
• Has questioned role of the then Civil Aviation minister, Praful Patel for favouring GMR
• DIAL was given land at a highly concessional lease rent - leased 4,799.09 acre by the AAI, of which 239.95 acres were allowed for commercial exploitation for Rs.100 a year. DIAL can potentially earn Rs.1,63,557 crore over a 60-year period.

On Power - UMPPs

• Appointment of bid process consultants E&Y faulty as ICRA submitted the lowest bid
• Bid documents were not vetted by department of legal affairs and were altered several times.
• Equity lock-in requirement was reduced from 12 years after project commissioning to 5 years for Krishnapatnam and Tilaiya UMPPs, both belonging to Reliance Power.
• Weak qualifying norms as networth requirement was kept lower than fixed by finance ministry for PPPs
• Faulty bid evaluation while awarding all 3 UMPPs to Reliance Power as the company did not meet technical expertise clause