By Vaibhavi Batra from Amity Law School, Noida


The coal allocation scam, popularly known as the “Coalgate Scam” is a political scandal which was surrounded by the UPA Government in the year 2012. It is a political controversy highlighting the irregularities of the nation in handling the national coal deposits. It is affiliated to the Indian Government’s allocation of the nation’s coal deposits to the Public Sector Enterprise (PSEs) and the Private Companies. The scam came into light when the Comptroller and Auditor General of India (CAG) accused the Government of India for allocating 194 coal blocks in an inefficient manner during 2004-2009. 

It was a major mining fraud which involved a loss of almost 1.86 lakh crore to the exchequer. The scam also involved serious allegations against the then Prime Minister Dr. Manmohan Singh and further resulted in a lot of protest by the National Congress Party and asking the former Prime Minister for his resignation.

The Coal allocation scam resulted in the deadlock in Parliament between the Rajya Sabha and Lok Sabha. Late BJP leaders Sushma Swaraj and Arun Jaitley argued that since Dr. Manmohan Singh was the incharge of the coal mining during that period and thus should take the moral responsibility of ‘Coalgate Scam’.


July 1992: The Coal Ministry ordered the establishment of a screening committee to consider proposals from the private companies for captive mining. The guidelines given by the Screening Committee gave more preference to the large projects of power and steel companies and the committee said that coal blocks will be allocated on first-cum first-served basis. Also the number of coal blocks which were not in the production plan of Coal India Limited and Singareni Collieries Company Ltd., were identified and a list of those 143 blocks were prepared.

1993 to 2010: A total of seventy coal blocks were allocated between 1993 and 2005, fifty three in 2006, fifty two in 2007, twenty four in 2008, sixteen in 2009 and one in 2010. Out of them twenty-four coal blocks were taken away at different points in time, effectively leaving the total number of blocks at one hundred and ninety four (194). 

Summer 2012: Argument raised by Comptroller and Auditor General of India – The argument which was put forward by the Comptroller and Auditor General of India was that ‘the exchequer suffered a huge a loss and public and private entities enjoyed windfall gains, because the government’s policy of allocating coal blocks was non – transparent. It alleged that despite having the opportunity to bring in transparency, the government did not introduce the process of competitive bidding. It also found that many politicians lobbied for allotment to certain private players raising questions about stereotyped capitalism. The CAG also said some private entities got more coal blocks than needed for their required operations and several companies sold coal meant for internal use in the open market. The loss stated by the CAG was of Rs.10.6 lakh crore. Then, the two ministers of BJP, Hansraj Ahir and Prakash Javadekar filed a complaint, stating that the allocation of coal blocks was influenced by corruption. This complaint further resulted in the Central Bureau of Investigation (CBI) Inquiry, whether the allocation was influenced by corruption or not.

In a Parliament session, the BJP questioned the government’s way of handling all these charges and asked for the resignation of then Prime Minister Dr. Manmohan Singh.

May 29, 2012: Prime Minister Manmohan Singh, agreed to give up his public life, if found guilty in the scam.

May 31st, 2012: Central Vigilance Commission (CVC), based on complaint of two members of BJP, directed a CBI enquiry. Simultaneously, Income Tax department also started an inquiry.

June 2012: Coal Ministry forms an ‘inter-ministerial panel’ to review the process of allocation of blocks and to decide either on de-allocation or forfeiture of bank guarantees.   

August 2012: The final report was tabled by the CAG in the Parliament, which toned down the loss of Rs.1.86 lakh crore. The Prime Minister replying to the final report said that, ‘the observation of CAG is clearly disputable’.

September 2012: The Supreme Court begins monitoring the CBI probe into the Coal field allocation.

March 2013: The Supreme Court asks the CBI director Ranjit Sinha, to not share the details of the investigation with the Government.

April 23, 2013: Standing Committee on Coal and Steel, slams the allocation process and states that the distribution of coal blocks during 1993-2008 was done arbitrarily and in an unauthorized manner. The committee also said that, where the coal blocks were allocated but the production has not been started, it should be cancelled.

April 26, 2013: CBI director Ranjit Sinha submitted an affidavit stating that the details of the investigation which the Supreme Court strictly ordered to not to share with the Government, was shared with the then Law Minister Ashwani Kumar. In the next month, Ashwani Kumar resigned from his post.

June 2013 to October 2013: CBI registered First Information Report (FIR) against Naveen Jindal, Dasari Narayana Rao, Kumar Mangalam Birla and former Coal Secretary P.C. Parakh.

July 2014 to August 2014: The Supreme Court sets up a Special CBI Court to try all coal field allocation case. In the next month, it also closed cases against Kumar Mangalam Birla and P.C. Parakh.

September 2014: The Special Court asked the CBI to clarify whether the ‘rule of law’ was applied while allocating the coal blocks to the Industrialists Kumar Manglam Birla. Later, the court also asked the CBI why they were hurrying in filing the closure report of the persons against whom they had earlier filed an FIR. To answer the questions of the Special Court, CBI asked time for the reply. Also, the Special Court quashed the allocation of all the coal blocks,

October 2014: Government decided to e-auction coal mines and the CBI filed a revised closure report in Birla’s case.

November 2014: The Supreme Court appointed a special public prosecutor, submits before a special CBI judge that the court can take cognisance of the closure report as there was prima facie evidence. Later, the CBI informed the Special Court that it was not permitted to question the former Prime Minister Dr. Manmohan singh regarding the allocation of coal.

December 2014: The Lok Sabha passed a bill which provided for a new auction of the coal blocks which the court de-allocated. Later, in the same month, after a clear observation that the effort was being made to manipulate the entire government machinery so as to protect the interest of M/s Hindalco (K.M. Birla’s Company), the Special Court ordered the CBI to examine the former Prime Minister Dr. Manmohan Singh as well as asked for further investigation into Hindalco Industries. Later, CBI told the court that it has forwarded a request to the Contempt of Authority to prosecute two public servants who are affiliated with the coal allocation scam.

January 2015: The CBI recorded the statement of Dr. Manmohan Singh and files a progress report of the further investigation before a Special Court in affiliation to the coal allocation scam involving former Coal Secretary P.C. Parakh, Kumar Mangalam Birla and others.

February 2015: CBI wrapped up its investigation and prepared a final report.

March 2015: Special Court summoned Dr. Manmohan Singh, P.C. Parakh and Kumar Mangalam Birla were accused. But later, Dr. Manmohan Singh moved to the Supreme Court regarding the summon which he received.

April 2015:  Supreme Court stays trial court order summoning Dr. Manmohan Singh.

September 2015: CBI was against summoning Dr. Manmohan Singh

October 2015: The court ordered framing of charges against former Coal Secretary H.C. Gupta stated that, ‘he withheld the complete and proper information from the then Prime Minister Dr. Manmohan Singh’ who was also the incharge of Coal Ministry at that time. 


The Delhi Court sentenced former Coal Secretary H.C. Gupta to three years of jail in coal allocation scam. Also, Special Judge Bharat Parashar awarded punishment to two other bureaucrats namely, K S Kropha and K C Samria for three years of imprisonment. Further the three of the accused were also liable to pay rupees fifty-thousand fine each.

Awarding the punishment to the three bureaucrats, the court said, “Such white collar crimes are more dangerous to the society than any other offence because, firstly, they incur huge monetary losses and secondly, affects the morale of the public.”

Later, the bureaucrats were granted statutory bails to file appeals against the judgement before the higher court as the jail term was of three years. However, the court said that, none of them deserves to be given the benefit of probation.


Please enter your comment!
Please enter your name here