The Coal Mines (Special Provisions) Act, 2015

Summary of the Coal Mines (Special Provisions) Act, 2015
Key Components
Allocation, Management, and Acquisition
Auction Process for Schedule I Mines:
• Competitive bidding with eligibility norms.
• Fees structure (not exceeding ₹5 crore).
Direct Allotment to Government Entities:
• For public sector undertakings or joint ventures.
• Private sector participation limited to ≤26% in joint ventures.
Designated Custodian's Role:
• Manages unallocated or terminated mines post-auction.
• Powers include operation, financial control, and manpower direction.
Acquisition and Development (per The Coal Bearing Areas Act, 1957):
• Central Government's power to acquire land/rights for coal development.
• Compensation and procedural safeguards for affected parties.
2. Rights, Obligations, and Compliance
Prior Allottees:
• Conditional participation in auctions with additional levy.
• Ineligibility under specific criminal conviction criteria.
Successful Bidders/Allottees:
• Comprehensive rights via vesting orders.
• Mandatory utilization of funds for coal conservation and development.
Non-Compliance Penalties:
• Up to 2 years imprisonment or significant fines for obstruction or non-compliance.
• Extended liability to company officers for corporate offences.
Mining Lease and Permit Conditions (per Mines and Minerals Act, 1957 Amendments):
• Specification of coal mines/coal bearing areas, their location, and minimum size.
• Other conditions for rationalized mining operations.
3. Governance, Oversight, and Judicial Framework
Central Government & Nominated Authority:
• Oversight of auctions and allotment processes.
• Management of auction proceeds.
Dispute Resolution:
• Exclusive jurisdiction of the Tribunal under the Coal Bearing Areas (Acquisition and Development) Act, 1957.
• Limited role for civil courts; Supreme Court and High Courts retain jurisdiction.
Regulatory Compliance (Mines and Minerals Act, 1957):
• Terms and conditions for auction by competitive bidding.
• Detailed mine specifications and minimum sizes for operational efficiency.
4. Financial Provisions, Protection, and Development
Financial Management:
• Net proceeds allocation for coal sector development.
• Priority payment to secured creditors and prior allottees.
Protection Clause:
• Immunity for actions taken in good faith under the Act.
Development Alignment:
• With The Coal Bearing Areas (Acquisition and Development) Act, 1957, for coordinated development.
• Compliance with Mineral Concession Rules for operational standards.

Legislative History:

The Coal Mines (Special Provisions) Act, 2015

Short Title - The Coal Mines (Special Provisions) Act, 2015

Act Number / Year - Act No. 11 of 2015

Act ID (India Code) - 201511

Introduced In - Parliament

Presidential Assent Date - March 30, 2015

Official Gazette Publication - March 30, 2015 (Extraordinary Gazette Part II, Section 1)

Enforcement Date - Deemed to have come into force on October 21, 2014

Nodal Ministry - Ministry of Coal

Precedent & Statutory Rationale

1. The Supreme Court's Landmark Coal Cancellation Judgment (2014):

o For decades, coal blocks in India had been allocated via administrative screening committees or government routes dating back to 1993. In the landmark judgment Manohar Lal Sharma v. Principal Secretary (2014), the Supreme Court of India declared allocations made via these non-transparent routes arbitrary and illegal, resulting in the cancellation of 204 out of 218 coal blocks.

2. Restoring Legal Certainty and Ensuring Energy Security:

o The mass cancellation threatened nationwide power generation, steel production, cement manufacturing, and critical industrial operations. The legislation was urgently enacted to create a secure, transparent, and competitive statutory framework to reallocate the cancelled coal mines, protect national energy security, and ensure uninterrupted fuel supply.

Parliamentary Trajectory & Enactment

• Formulation: Developed and piloted by the Ministry of Coal to establish a permanent legislative architecture following judicial intervention.

• Parliamentary Passage: Initially promulgated as an emergency Executive Ordinance on October 21, 2014 (re-promulgated in January 2015), the provisions were subsequently formalized into a Bill, debated extensively, and passed by both Houses of Parliament in March 2015.

• Presidential Assent: Received formal Presidential Assent on March 30, 2015, entering the statute book as Act No. 11 of 2015.

• Enforcement: Retroactively brought into active operational force from October 21, 2014 to maintain continuity with the preceding ordinances

Source: India Code Official Repository and Ministry of Coal Official Records.