Shah’s golden touch turns milk producer to mining baron

It qualifies to be called a daylight robbery. A company is incorporated in October 2015, starts mining in November 2015 with no prior experience of mining and stands accused of removing stones valued at ₹5,000 crore by November 2017. It had acquired the mining lease by making the highest bid of ₹115 crore and after paying ₹28 crore as earnest money.

A good business deal, one might say. But the mining aroused suspicion because of the unusual patronage it received from the Haryana government at every level. The department of mining, the office of the Advocate General, the Chief Minister’s office seem to have bent over backwards to facilitate mining to this company; regulatory authorities turned a blind eye to the violation of rules and the police went out of their way to restrain villagers who protested. Stones from Dadam, a village in the Bhiwani district of Haryana, are well known among people engaged in construction in the National Capital Region (NCR). They have been famously used in the construction of the Delhi Metro.

The construction material sourced from quarries here are said to produce extraordinarily durable structures. The rocks from Dadam therefore have been in great demand from the first decade of this century, ever since a Japanese geologist discovered their unique composition around the year 2000. But indiscriminate mining has taken a toll. Today the area provides a devastated look. The pit, some 350 feet deep, several 100 feet long and wide look as if it was hit by a massive meteor from outer space. Mining at Dadam, say villagers, was done round the clock and at a frenzied pace. If they are to be believed, 3,000 loaded trucks would emerge from the pit every day. That would mean around 1,50,000 tonnes of quarried rock, three times more than the government-imposed daily limit of 50,000 tonnes. They mined so much that 300-odd stone crushers in the region couldn’t deal with the mined load.

They needed the land belonging to villagers for stockpiling. But the company is accused of mining even the land rented for stocks. They even strayed into the protected Aravali Hills. Abhimanyu Singh, a lawyer representing some of the villagers said, “Farmers approached politicians and sought help. They even met the Chief Minister and complained that they wouldn’t ever be able to cultivate their land again. Then they finally knocked on the doors of the High Court.” That’s when Sunder Marketing Associates (SMA) had the police slap charges against them; even section 307 of the Indian Penal Code was invoked against one of them. Some of the farmers had to spend months behind bars.

One of them, Satyawan, recalls, “The contractor (SMA) had claimed that he had Haryana government in one pocket, the central government in the other and the RSS above both of them” while intimidating him to sell off his land for a pittance. He had rented out his land next to the quarry to SMA for stocking the mined stones. According to him, SMA not only didn’t pay his dues but also dug up his land. Punjab and Haryana High Court is scheduled to hear Satyawan’s case again on December 18.

Satyawan hopes the court will then decide in favour of a probe by Central Bureau of Investigation (CBI) to investigate what he is convinced is a mining scam. The suspicion that a scam of such magnitude could not have taken place without official blessings is strengthened by what other villagers confided. Ishwor Singh, for example, said, “When I discovered that there was illegal quarrying going on, I filed an RTI application and addressed to the Mining Officer.

But I received no response. Then I approached the contractor (SMA representative). He said there was no one more powerful than him there. Then I spoke to the local BJP MP. He said, This is beyond me. This man has influence in high places.” In October 2016, Haryana unit of the Congress had released a list of 34 aides, most of them drawn from the RSS, who were allegedly being paid salaries on par with bureaucrats and made up the de facto government in the state. In Haryana, it is an open secret that RSS loyalists have been appointed to key positions in the government. One of them, SK Narwar, is believed to oversee land/mining issues and reports directly to Amit Shah. The Haryana chief minister apparently has no say in such matters.

Narwar is widely perceived as BJP president Amit Shah’s pointsman in Haryana. The local operations of the company at Dadam were being run by one Shiv Kumar, alias Guddan, and his men ran the show at Dadam quarry for SMA. Hailing from Uttar Pradesh, he was in the news when Police raided a hotel owned by him on Kairana Road, and arrested employees and call girls. Benevolent babus & courts Surprisingly, or not so surprisingly, the daylight robbery was conducted with the knowledge of both the Government and the Judiciary. Two observations, one made by the Punjab and Haryana High Court and the other by the Supreme Court, bear this out.
• “It appears that in brazen violation of the time concession granted by Hon’ble Supreme Court, the fourth respondent (SMA) is indulging in massive mining, apparently far in excess to [sic] the limits and norms imposed in terms of cancelled licence. The heaps of extracted minerals which are looking like manmade mountains as depicted in the photographs appended with the writ petition reveal the great hurry behind extracting maximum raw material before the expiry of the deadline on 30.11.2017. Not only the huge stock but there are hundreds of trucks deployed for transportation of the extracted material, obviously within [sic] the full knowledge and tacit support of Officers of the Mining Department.” (Punjab & Haryana High Court)

• “This is a classic case of someone (the petitioner in this case) apparently having influence in high places, using that influence to violate the law and get a benefit that would ordinarily not be granted to anybody else. We cannot say with any degree of certainty how high is the reach of the petitioner, but it is quite apparent from the facts of the case, that the reach is pretty high.” ( Supreme Court of India)

The timeline will show how the company was allowed extensions by the courts to continue with illegal mining. On paper, there is really nothing to object as the Department of Mining, Government of Haryana, would point out that it had issued orders to stop the mining within two weeks! It was surely not the department’s fault that the company moved the High Court? And then the Supreme Court, which allowed the company four months till November 30, 2017, to wind up the operation. Even more astonishingly, the promoters of SMA, Naveen Goel and Sunita Goel, do not seem to have had any prior experience in the field of mining. They were in fact directors in a New Delhi based company, which specialised in processing and distributing milk and milk products.

Would they have received a mining lease had they applied for it ? It is doubtful. That seems to be the only reason which prompted a Joint Venture (JV) to bid for the mining lease. The majority shareholder in the JV, KJSL (Karamjeet Singh & Co. Ltd.) has been mining coal in Chhattisgarh and perhaps had the required credentials to convince the Government that the JV was equipped to mine the quarry. Once the lease was granted, however, KJSL mysteriously decided to withdraw from the JV and indicated its willingness to transfer its stakes to SMA, the junior partner. Even more mysteriously, KJSL made the offer directly to the Chief Minister Manohar Lal Khattar. Were they pressurised to withdraw from the JV? Under the rules, stakes of a majority shareholder in a JV cannot be passed to the minority shareholder. But in this case there was little delay before the state government gave its approval. The Union Government, which had given environmental clearance to the JV, also agreed quickly to transfer the clearance to SMA. Above all, records in the Corporate Affairs Ministry suggest that SMA was incorporated as a company only on October 6, 2015. But even before the company was registered, both the Goels became directors of SMA, got into a partnership with Karamjeet Singh and Company Limited (KJSL), and in January, 2014 made a successful bid for a 10-year lease from Haryana Government to mine stones at Dadam. A Congress government was of course in power at the time.

A mining mafia

While the JV bid ₹115 crore as ‘dead rent’ (rent for an idle quarry) or royalty per annum, on the day of the auction itself, the Haryana Government assigned HSIIDC (Haryana State Industrial and Infrastructure Development Corporation) the mining lease at Khanak, five times the size of Dadam but at just ₹2.5 crore as dead rent, presumably because it was a government owned company.

The JV promptly challenged the lease to HSIIDC on the ground that it would make mining by the JV unviable. The Punjab & Haryana High Court dismissed the petition in March, 2015. The JV then told the HC that it would like to surrender the lease and sought a refund of its security deposit.

The Government agreed to refund the security and the court set April 30, 2015 as the deadline. But on that day the JV sought a 10-day extension which was granted. But on May 7, KJSL again took a U-turn and informed the court that it would rather withdraw from the deal and again pressed for the refund of security deposit.

A week later, the minority stakeholder SMA wrote directly to the Chief Minister saying that it would like to take up the project on its own. Although rules did not permit the transfer of the lease from, the Chief Minister appears to have approved it. The Advocate General gave an opinion in favour of it and the Director General of Mines and Geology (Haryana) informed in writing of the government’s approval. It is mandatory for a lessee to submit a mining plan within a year of receiving the letter of intent.

While the JV had submitted a plan on the basis of which it received the environmental clearance from the Union Government, it became void once the majority stakeholder withdrew from the JV. But the junior partner SMA managed to get the clearance ‘transferred’ to it without submitting its own mining plan. A PIL, filed before the High Court in April, 2016, set the cat among the pigeons. The petitioner had earlier filed an RTI application to the state government seeking details of the transfer of the lease at Dadam. But the Government replied that the file pertaining to the transfer was not available. Amusingly, once the PIL was admitted by the High Court, the Director General of Mines and Geology sprung into action and issued a showcause notice to SMA asking why the permission to transfer the lease to SMA should not be withdrawn. The permission it had granted a year ago was eventually withdrawn by the government in September 2016. The company first went to the High Court which dismissed its plea but allowed it to continue mining for two months; thereafter the company moved the Supreme Court which too refused to entertain the company’s plea but allowed it four months to wind up mining operation (see timeline). But the SC had also directed the Chief Secretary to supervise and ensure that mining was brought to a close. But local villagers confirm that the mining actually increased manifold after the Supreme Court’s order. Dynamites and detonators were in use, explosions continued non-stop, leading to a sharp rise in respiratory diseases in the area. Accidents were reported and at least three workers are said to have died. Farmers complained that the mining left no grazing ground in the area. Worse, they claimed, “Uteruses of the cows in the village popped out and the farmers had to live with the disturbing sight of cows moving around with their uteruses hanging out.”

An independent survey showed that the ground water was at 18.65 metres below the ground. SMA ended up mining about a hundred metres deeper. Then they pumped out the water contaminated with explosives and let it drain into the fields, rendering them virtually uncultivable. In October 2017, the survey found that large heaps of mined rocks and stones dotted Dadam.

By measuring the area these heaps occupied and their height, surveyors calculated the stockpiles to have been around 11 million tonnes. The JV had environmental clearance for mining only 15 million tonnes in an entire year and for keeping stocks of only 2.5 million tonnes. The survey pegged the value of the stockpiles at more than `300 crore. If this was the value of the stocks piled up in a few days of October, how much more would the company have mined? And where is all this illegally earned cash ending up? No wonder when we met Naveen Goel, SMA’s director, at the Punjab and Haryana High Court, Chandigarh, he claimed he was not Naveen Goel but was simply an employee. Similar was our experience with R.B. Singh, a gentleman from SMA, who we met at the SMA site office in Dadam and was in charge there. He was just an employee and was not authorised to speak, he added.

With inputs from Nawal Kishore Kumar and Pramod Ranjan