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Crimes of endearment


As Coalgate rocks India, an inside account of Jharia-Dhanbad reveals just how high the stakes are. Anando Bhakto reports
ANANDO BHAKTO | Issue Dated: May 4, 2013, New Delhi
Tags : BCCL | Coal | CIL | Jharia | coalfields | Scams | XLRI |

The nondescript houses in coalfields and the roofless, dilapidated collieries dotting the dusty landscape of Jharia-Dhanbad in Jharkhand, the country’s mineral rich belt, give you no clue that this could be the breeding ground of 24x7 scams involving hundreds of crores of rupees made right under the nose of the administration, often with its connivance.

How does the racket work? Since it is dangerous in open cast mines to dig coals beyond prescribed limits, the Bharat Coking Coal Limited (BCCL) and CIL (Coal India Ltd) do not mine after a point and it is here that illegalities begin.

According to estimates, there are over 2,000 open cast mines in Jharkhand. The coal mafia employs labourers, sometimes those working for coal companies, and then smuggle coal through an organised and elaborate network of cycle carriers.

Apparently, everyone knows. ``Illegal mining and its transport in Jharkhand have become a booming racket for the mafia to reap in huge chunks of black money. This involves everybody, from top officials of the BCCL to the police and politicians,” candidly admits Niraj Singh, Dhanbad Deputy Mayor.

According to information provided by the Ministry of Coal to the Standing Committee of Coal and Steel in 2010, there are 49 illegal mining sites. They include Katras, Baroda, Govindpur, Sijua, Kusunda, Kustore, Bastacolla, Lodna, EJ Area and Chach Victoria under the BCCL.

Coal companies seem to be hand in gloves with the mafia. What else can explain why they do not fill voids created after mining by way of sand stowing, an obligatory duty under the Mine Closure Plan - thus paving the way for illegal mining of coal?

Despite the Ministry of Coal admitting the presence of predominant illegal mining sites in eastern regions before its own Standing Committee, no definitive government study has so far been conducted to assess financial losses suffered by exchequer. And there is a good reason why – the losses are enormous.

Interestingly, the Jharkhand government did instruct Jamshedpur-based Xavier Labour Research Institute (XLRI) to conduct a study with a limited reference point. Says Professor Tata L Raguram, the man behind the study, “The study we did was on small scale, artisanal coal extraction and cycle-based coal supply chains that operate in coal tracts of Jharkhand. The study did not trace large scale illegal coal operations.”

Even so, their findings were alarming. It revealed that 1.37 million tons of coal (estimated to be worth Rs 207 crores) is mined from abandoned sites around Jharkhand every year. Experts mention that due to this the exchequer in the state suffers an annual loss of Rs 34 crore as royalty per annum. What would be the magnitude of revenue losses caused by this organised coal racket? In the lack of any definitive study, such losses are neither assessed nor any attempts made to make changes appropriately.

In view of the XLRI findings, the Standing Committee accused responsible officials of “either indifference or too scared to stop the menace.”

Such is the dominance of the coal mafia that the transport of coal and coke by unlicensed cycles is a regular sight on the Ranchi-Hazaribagh road: there are a total of 616 FIRs which have been lodged in Ramgarh, the sub-divisional headquarters.

Cases against illegal coal operators can be lodged by anyone, government officials or coal companies. Then there are major security lapses at many points when coal is transported from mines to railway sidings. Observed the Standing Committee, “The complicity of some insiders of coal companies with the coal mafia cannot be ruled out… Generally large chunks of coal are thrown off from uncovered wagons and trucks along their routes.” Just one sign of this malignancy.

Add to it vast amounts of illegal monies made by the mafia in loading and transport of coal. According to Deputy Mayor Singh, one lakh ton coal is transported everyday, of which 20,000 tonnes are transported by road on trucks and 80,000 ton by railways. “While Rs 160 per ton is charged for loading of coal to be transported by road, only Rs 80 is paid to labourers who are hired on contractual basis. The remaining Rs 80 goes unaccounted. This means in loading 20,000 tons of coal, around Rs 16 lakh worth of black money is generated everyday. The first part goes to the police who, understandably, refrain from taking any action against culpable parties. The second goes to ‘babus’ in collieries, the third to middle men controlling labourers and the fourth part to conniving officers in BCCL,’’ alleges Singh.

Significantly, contractual labour is prohibited in the coal industry. The BCCL which in 2005 had sought exemption from the Labour and the Coal Ministry to outsource labourers, has not abolished the contract system even though exemption ended in 2010.

It is common knowledge in Jharia that a sizeable part of the money to be paid as wages to labourers is swindled by a closely knit group of coal mafia and officials. “While outsourcing labourers, the least the BCCL could do is to credit their wages directly to their bank accounts, thus ending any scope of foul play. Why do they insist on paying in cash?” questions Deepak Dutta, member of Jharia Coal Field Bachao Samiti (JCFBS).

Then comes in an essential ingredient of the coal industry – the rangdari tax or extortion. According to a dealer at Rajapur colliery at Katras Mod, who naturally prefers anonymity,  anything between Rs 1000 to Rs 3000 is taken for every truck by bahubalis (muscle-men) who work for mafias.

“This works out substantially on a daily basis as there are about 1,300 trucks engaged in transporting coal,” Datta told this magazine.

The Deputy Mayor explains how this chain works: once loading is done, Rs 100 as bribe is taken at check points to pass each truck; Rs 150 is charged for assuring good quality coal and another Rs 500 is meant for the ‘kaanta babu’ or the man at weighing bridge – yielding the mafia a whopping Rs 8 lakhs per day!

In the case of transport by racks, it is alleged the racks carry a mix of 70 per cent coal and 30 per cent stones. This means 24,000 of the 80,000 tons of coal has already been smuggled. Although the BCCL denies such practices, the fact that an Income Tax raiding party in November 2011 recovered Rs 70 crore from coal contractor Lal Babu Singh’s residence in Jharia, provides weight to the various allegations.

Jharia-Dhanbad became the land of the mafiosi soon after coal was nationalised in 1971 and BCCL, a subsidiary of CIL, was handed over jurisidiction of around 396 collieries.

Surajdeo Singh from Balia – the man who inspired many celluloid hits – was the original Don. An associate of coal workers union leader B P Sinha, he started to wield more influence on coal workers than his mentor, grabbed the opportunity and entered into the business of illegal mining. (see box)

At the present moment, the subject of discussion in the Dhanbad-Jharia coal belt is the fire raging underneath the coal fields. In September 2008, the BCCL was sent an official letter (a copy of which is available with TSI) by the Mines and Mineral Department of the Government of Jharkhand, with instructions to immediately control this fire and send a report. But all that the BCCL did was construct three boreholes, fill some sand, and then simply stall the process. There are many other evidences which throw light on the willful inaction of authorities in stopping coal field fire.

For example, the Union of India in the civil writ petition number  381 of 1997 had issued a statement to the Supreme Court that it had reduced coal field fire from 17 sq km in 1972-73 to 8.9 sq km in 1997.

When the Jharia Coalfeild Bachao Samiti (JCBS) filed an additional affidavit the same statement (that coal field fires have been reduced to 8.9 sq km) was made in a reply on behalf of Union of India.

Yet again in the updated Master Plan 2008, the same statistics were repeated. “This clearly indicates that no progress has been made in stopping coalfield fires after 1997,” points out Ashok Agarwal, president of JCBS. He alleges:``The truth is BCCL has purposely not doused the fire as it serves their interest. They want to render Jharia uninhabitable so as to use the entire town for open cast mining, which paves the way to outsource labourers and swindle massive amounts of money.” A pretty serious charge.

The fires are a direct outcome of open cast mining which BCCL has been carrying out in preference to underground mining which is recommended for Jharia. It may be noted that Tata Collieries which are in the very midst of the BCCL leasehold, have had no fire since they do not use open-cast mines.

The BCCL has made questionable shifts in its position on Jharia’s stability as a habitable area owing to coal field fires. While in its observations vis-a-vis Action Plan of 2005, the BCCL/CIL had initially said there was no urgency to evacuate people from Jharia and that stabilising efforts be made for an interim period of 15 to 20 years, this statement was misconstrued in the Master Plan 2008 for Dealing with Fire, Subsidence and Rehabilitation in the Leasehold of BCCL. The BCCL now said: “…there are no scientific methods available to check long term stability.In view of the above, sites (including Jharia) which were proposed for stabilisation have now been considered for rehabilitation.”

Agarwal reiterates BCCL’s sudden shift of position to its hidden agenda of grabbing Jharia’s land. “How have they jumped to the conclusion that evacuation is the only option? Why has an important part of the statement, which talks of 15 to 20 years interim period to be used for stabilisation, been deliberately omitted,’’ he queires.

There are other examples too where BCCL’s reluctance to extinguish coalfield fires has become apparent. Says Agarwal: “A trench that was to have been cut between Rajapur Open cast project and the main water tank in order to save Jharia town form the fire approaching it from Rajapur, and was sanctioned in 2006 with a budget of Rs 5 crores, was deliberately delayed up to 2012 on various pretexts, until forced into action by the inhabitants of Jharia. But it has again been stopped now.”

Niraj Singh too believes BCCL is using the fires as a pretext to recommend evacuation of Jharia. “The BCCL wants more and more land for open-cast mining and make unscrupulous money,” he fumes. It appears like Dhanbad-Jharia is the place to be be in, if you are a racketer. You would have imagined that such vitriol would have brought anti-corruption activists right at their doorsteps. Maybe, they will.

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Issue Dated: Feb 5, 2017