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Reliance Power-owned Sasan Power Ltd received "undue favours" from the Ministry of Environment and Forests, a report by the Comptroller and Auditor General, tabled in Parliament, on Friday said.
It said the Ministry had exempted Sasan Power "from providing non-forest land in violation of the Forest (Conservation) Act 1980" on the basis on an ineligible certificate.
Sasan Power Ltd, a special purpose vehicle created for developing Sasan Ultra Mega Power Project, was a wholly-owned subsidiary of Power Finance Corp until August 2007, when it was transferred to the Anil Ambani-owned Reliance Power.
The report - Compensatory Afforestation in India - noted that according to the guidelines for "diversion of forest land for non-forest purposes under the Forest (Conversation) Act, 1980, Sasan Power had to provide equivalent area of 1,384.96 hectare of non-forest land for the compensatory afforestation."
According to the law, this non-forest land has to be adjacent to or in proximity of the Sidhi district (location of the plant). However, in case land is not available in Sidhi, non-forest land could be found anywhere in Madhya Pradesh.
Non-availability of land for compensatory afforestation can be certified by the Chief Secretary of the State.
However, the report notes that the Chief Secretary issued a certificate only for non-availability of land in Sidhi district, not for the entire State.
"MoEF exempted SPL from providing equivalent area of non-forest land for the compensatory afforestation, on basis of the certificate from the Chief Secretary that no forest land was available in Sidhi District. MoEF did not ask SPL (Sasan Power) to furnish such certificate for entire Madhya Pradesh or make efforts for identification of non-forest land for compensatory afforestation anywhere else in the State," the report said.
The report further added, "MoEF had insisted for compensatory afforestation over the non-forest land in latest project of the same company in nearby location in Madhya Pradesh, which clearly illustrates that in earlier two cases undue favour were extended to Sasan Power."
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