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Corporate Oct 18, 2013

CBI’s coal scam FIR: Chidambaram to meet KM Birla today

By Firstbiz Staff

Aditya Birla Group Chairman Kumar Manglam Birla is likely to meet Finance Minister P Chidambaram today over a CBI inquiry in the coal block allocation case.

The proposed meeting comes after CBI named Birla in its 14th FIR pertaining to the coal allocation scam.

Central Bureau of Investigation (CBI) has registered a case against industrialist Kumar Mangalam Birla and former coal secretary PC Parakh on charges of criminal conspiracy and misuse of official position over alleged irregularities in the allocation of coal blocks.

The CBI had booked Birla as a representative of Aditya Birla Group and his group company Hindalco, one of the biggest producers of primary aluminium in Asia, for alleged corruption in the allocation of the Talabira II coal blocks in Odisha which was allotted to it on November 10, 2005.

Birla has been implicated in the 14th FIR filed by the CBI. Reuters

Birla has been implicated in the 14th FIR filed by the CBI. Reuters

However, corporate India has been extremely upset afterBirla, HINDALCO and NALCO were named by the CBI in the coal scam FIR andraised the question of whether India is returning to the 1980s, when industrialists were hounded by the government.

They say it is becoming impossible to do business in India.

In an interview with Karan Thapar, Chairman of Godrej group, Adi Godrej, said on Friday that the objection to a particular coal block being allotted to Hindalco instead of to a public sector enterprise is absurd. "Dragging a well-known industrialist into this will certainly be seen as a deterrent for investment," he said.

"Hindalco owns only 15 percent of that company. It doesn't control that company. And just because some coal block reserved for public sector is partially allocated to private sector, there's nothing wrong with that. It was done by the government. So I think it's a bit ridiculous. It spoils sentiment, it spoils perception," added Godrej.

Little wonder that thegovernment has been in damage control mode after the CBI named Kumar Mangalam Birla in the coal scam.

Sources told CNBC-TV18 that Prime Minister Manmohan Singh has told Commerce Minister Anand Sharma to reassure corporates, in an indication of how worried the government is after CBI's latest FIR.

India Inc and the IAS Officers' Association has hit out at the government for naming the Aditya Birla group chairman and former coal secretary P C Parakh in the latest Coalgate FIR.

HDFC Bank chairman Deepak Parekh and country head of HSBC India Naina Lal Kidwai also came out in support of Hindalco.

by Firstbiz Staff

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