The Karnataka government is in the process of calling for fresh tenders of Donimali iron ore mines and may go in for auction in case the state-owned NMDC does not sign the contract agreeing for 80 per cent premium in the next three weeks, sources close to the development said.
However, PR Tripathi, former CMD of NMDC says the imposition of 'heavy' premium on a public sector undertaking is not tenable as per law.NMDC has suspended iron ore mining from its Donimalai mine in Karnataka following the state governments decision to impose 80 per cent premium on ore sales from that minewhose lease hasbeen extended by the Karnataka government with effect from November 4 for a period of 20 years.
"Based on the request by the CMD of NMDC (N Baijendra Kumar)the matterwas again referred to the Karnataka Advocate General. But instructions have gone to the officials concerned to prepare fresh tender document for auction of mines allotted to NMDC if they don't execute the lease documents in the next three weeks. Because the AG may not give a different opinion than what he has already given," sources told PTI.
When contacted, Karnataka Mining Secretary Rajendra Kumar Kataria justifying the premium, said the state Law Department gave its opinion and the state cabinet had also approved imposition of the premium.Tripathi alleged the state government became greedy and said the premium is applicable only in case of fresh auctions of mines but not for lease renewals...Read More
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