LexM/S COAL INDIA LIMITED & ORS. versus COAL CONSUMERS ASSOCIATION & ORS.
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[2010] 11 S.C.R. 533 MIS COAL INDIA LIMITED & ORS. v. COAL CONSUMERS ASSOCIATION & ORS. (Special Leave Petition (C) No. 21959 of 2010 etc.) SEPTEMBER 15, 2010 [ALTAMAS KABIR AND A.K. PATNAIK, JJ.) Interim Orders: A B Coal - Fuel Supply Agreement - Condition - Industrial c consumers not to sell/divert and/or transfer coal for any purpose - FIR registered against G.M., BCCL and ten industrial consumers - BCCL suspending supply of coal to ten suspects as also 45 other industrial consumers against whom no FIR was lodged - High Court staying operation of 0 order suspending supplies to non-accused - HELD: BCCL has the right to suspend supplies of coal where it has doubts that the purchaser may mis-utilize the allotted coal and divert · or sell it in open market because, as it was clear from Clause 4. 4 of FSA and the New Coal Distribution Policy dated E 18.10.2007, the very object of FSA as well as policy decision of the Government is to allot coal to the purchasers for utilization in their plants and not for any other purpose - The FIR lodged by the CBI, which is a premier investigation agency of the Central Government, created serious doubts that the allotted coal may have been diverted or sold in the open market instead of being utilized in the plants of the purchasers and, therefore, BCCL was within its rights to suspend the supplies of coal to the purchasers in these cases F till the doubts were cleared in appropriate proceedings - However, no FIR has been lodged by the CBI alleging that G the supplies of coal made to the 45 industrial consumers have not been utilized in their respective industrial units - Moreover, Para 3. 1 of the New Coal Distribution Policy dated 18.10.2007, clearly states that the State Governments may take appropriate steps to evaluate the genuine consumption H 534 SUPREME COURT REPORTS [2010] 11 S.C.R. A and monitor the use of coal supplied to units in small and medium sector - Sufficient materials have been filed before the High Court by the non-accused to show that the agencies of the State Government, have evaluated the genuine consumption and monitored the use of coal by the industrial B consumers in their respective industries - It also appears that BCCL issued notices dated 3.2.2010 and 8.6.2010 to the 45 industrial consumers to furnish documents in proof of the end- use of coal allotted to them for their respective industries for the financial year 2009-2010 and the respondents furnished c some materials pursuant to the notices, but instead of examining those materials, BCCL has suspended the supplies of coal to the 45 industrial consumers on 1. 7.2010 soon after the CBI filed charge sheets on 28.6.2010 against the then General Manager of BCCL and the ten industrial 0 consumers against whom CBI had lodged the FIR on 7.6.2010- The materials placed before the High Court prima facie show.that the order of BCCL suspending the supplies of coal to the 45 industrial consumers was arbitrary and unfair and the High Court was justified in staying the order dated 1. 7. 2010 as an interim measure - Government of India, E Ministry of Coal, New Distribution Policy dated 18. 10. 2007. Mis Coal India Limited & Ors. v. Alok Fuels (P) Ltd. & Ors. decided by Supreme Court on 15.9.2010; Mis Sushi/a Chemicals Pvt. Ltd. & Anr. v. Bharat Coking Coal Ltd. & Ors. F decided by Supreme Court on 15.9.2010 - relied on. G H Relied on Relied on Case Law Reference: para 8 para 8 CIVlL APPELLATE JURISDICTION : SLP (Civil) No. 21959 of 2010. From the Judgment & Order dated 26.07.2010 of the High COAL INDIA LIMITED & ORS. v. COAL CONSUMERS 535 ASSOCIATION & ORS. Court of Judicature at Allahabad in W.P. (C) No. 42231 of A 2010. WITH SLP (C) Nos. 21972, 21973 & 21974 of 2010. Anupam Lal Das, Abhishek Kumar for the Petitioners. Ranjit Kumar, Jaideep Gupta, Manish Kr. Saran for the Respondents. The Order of the Court was delivered by ORDER B c A. K. PATNAIK, J. 1. These Special Leave Petitions are directed against the interim orders dated 2"6.07.2010 passed 0 by a Division Bench of the Allahabad High Court in Writ Petition C-Nos.42231, 42760, 42229 and 42708 of 2010 by which the orders dated 01.07.2010 of Bharat Coking Coal Limited (BCCL), thepetitioner No.2, suspending supply of coal to 45 industrial consumers for their industrial units had been stayed till the matters were to be taken up for admission/orders by the E High Co
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