10. Utilisation of movable property used in coal mining operations.––(1) A successful bidder or
allottee in respect of Schedule I coal mines, may negotiate with prior allottee to own or utilise such
movable property used in coal mining operations on such terms and conditions as may be mutually agreed
to by them.
(2) Where a successful bidder or allottee is not vested with any movable property of a Schedule I coal
mine, then, he is not bound by any liabilities or obligations arising out of such ownership or contractual
rights, obligations or liabilities which shall continue to remain with the prior allottee.
(3) In the event that the successful bidder or allottee is unable to satisfactorily negotiate with the prior
allottee or any third party who has a contract with the prior allottee for the movable property, it shall be
the obligation of the prior allottee or the third party to remove such movable property within a period not
exceeding thirty days from the date of the vesting order, or the allotment order, as the case may be, and
the successful bidder or allottee shall not be liable for any damage to such property.
1. Ins. by Act 2 of 2020, s. 12 (w.e.f. 10-1-2020).
2. Subs. by s. 13, ibid., for the portion beginning with the words “The proceeds arising out of land” and ending with the
words “as may be prescribed” (w.e.f. 10-1-2020).
3. Subs. by s. 13, ibid., for “compensation payable” (w.e.f. 10-1-2020).
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(4) A successful bidder or allottee which has elected not to purchase or transfer or continue to use the
movable property referred to in sub-section (1), shall prior to the execution of the vesting order or the
allotment order, as the case may be, declare to the nominated authority that he intends to move and store
such movable property of the prior allottee or such third party and after the date of the vesting order or the
allotment order, as the case may be, the successful bidder or allottee shall be entitled to move and store
such movable property, so as not to cause any impediment for coal mining operations.
(5) If a prior allottee or such third party which has contracted with the prior allottee for its movable
property, fails to remove the movable property which the successful bidder or allottee has elected not to
purchase or use in accordance with sub-section (4), then, after the period of seventy-five days from the
vesting order or the allotment order, as the case may be, a successful bidder or allottee shall be entitled to
dispose of such movable property which may be physically located within Schedule I coal mine, the
successful bidder or the allottee, shall, in such event be entitled to appropriate the sale proceeds of such
movable property disposed of to pay for any cost incurred by the successful bidder or allottee, for the
removal, storage, sale and disposal of such movable property, as a first charge over the sale proceeds of
such movable property:
Provided that the remaining sale proceeds after appropriation of costs, shall be paid by the successful
bidder or allottee to the Central Government towards any compensation that may be payable to the owner
of such movable property sold, upon establishment of title to such movable property in accordance with
such rules as may be prescribed:
Provided further that if a third party contractor to the prior allottee owns such movable property, then,
such third party shall be entitled to prove its right to receive compensation from the sale proceeds of the
movable property sold as per this sub-section, in accordance with such rules as may be prescribed.
11. Discharge or adoption of third party contracts with prior allottees.––(1) Notwithstanding
anything contained in any other law for the time being in force, a successful bidder or allottee, as the case
may be, in respect of Schedule I coal mines, may elect, to adopt and continue such contracts which may
be existing with any of the prior allottees in relation to coal mining operations and the same shall
constitute a novation for the residual term or residual performance of such contract:
Provided that in such an event, the successful bidder or allottee or the prior allottee shall notify the
nominated authority to include the vesting of any contracts adopted by the successful bidder.
(2) In the event that a successful bidder or allottee elects not to adopt or continue with existing
contracts which had been entered into by the prior allottees with third parties, in that case all such
contracts which have not been adopted or continued shall cease to be enforceable against the successful
bidder or allottee in relation to the Schedule I coal mine and the remedy of such contracting parties shall
be against the prior allottees.
12. Provisions in relation to secured creditors.––(1) The secured creditors of the prior allottees
which had any security interest in any part of the land or mine infrastructure of a Schedule I coal mine
shall be entitled to––
(a) continue with such facility agreements and security interest with the prior allottee if such prior
allottee is a successful bidder or allottee; and
(b) in the event that the prior allottee is not a successful bidder or allottee, then the security
interest of such secured creditor shall only be satisfied out of the compensation payable to such prior
allottee, to the extent determined in accordance with such rules as may be prescribed and the
outstanding debt shall be recoverable from the prior allottee.
(2) The Central Government shall, taking into consideration the provisions contained in section 9,
prescribe the manner in which the secured creditor shall be paid out of the compensation in respect of any
prior allottee.
13. Void alienations and permitted security interests.––Any and all alienations of land and mine
infrastructure and creation of any encumbrances of whatsoever nature thereon which relate to Schedule I
coal mines, made by any prior allottee after the 25th day of August, 2014 shall be void, save and except
any registered security interest and charge over the land and mine infrastructure as registered by a bank or
a financial institution or any other secured lender.
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14. Liabilities of prior allottees.––(1) Notwithstanding anything contained in any other law for the
time being in force, no proceedings, orders of attachment, distress, receivership, execution or the like,
suits for the recovery of money, enforcement of a security or guarantee (except as otherwise provided for
under this Act), prior to the date of commencement of this Act shall lie, or be proceeded further with and
no remedies shall be available against the successful bidder, or allottee, as the case may be, or against the
land and mine infrastructure in respect of Schedule I coal mines.
(2) The proceedings as referred to in sub-section (1), shall continue as a personal remedy against the
prior allottee but shall not be maintainable or continued against the land or mine infrastructure of
Schedule I coal mine or the successful bidder or allottee, pursuant to this Act.
(3) Every liability of any prior allottee in relation to a Schedule I coal mine in respect of any period
prior to the vesting order or allotment order, shall be the liability of such prior allottee and shall be
enforceable against it and not against the successful bidder or allottee or the Central Government.
(4) All unsecured loans shall continue to remain the liability of the prior allottee.
(5) The additional levy imposed against the prior allottees of Schedule II coal mines shall continue to
remain the liability of such prior allottees and such additional levy shall be collected by the Central
Government in such manner as may be prescribed.
(6) For the removal of doubts, it is hereby declared that—
(a) no claim for wages, bonus, royalty, rate, rent, taxes, provident fund, pension, gratuity or any
other dues in relation to a Schedule I coal mine in respect of any period prior to the date of vesting
order or allotment order, as the case may be, shall be enforceable against the Central Government or
the successful bidder or the allottee, as the case may be;
(b) no award, decree, attachment or order of any court, tribunal or other authority in relation to
any Schedule I coal mine passed prior to the date of commencement of this Act, in relation to the land
and mine infrastructure of Schedule I coal mines, shall be enforceable against the Central
Government or the successful bidder or the allottee, as the case may be;
(c) no liability for the contravention of any provision of law for the time being in force, relating to
any act or omission prior to the date of vesting order or allotment order, as the case may be, shall be
enforceable against the successful bidder or allottee or the Central Government.
15. Commissioner of payments to be appointed and his powers.––(1) For the purposes of
disbursing the amounts payable to the prior allottees of Schedule I coal mines, the Central Government
shall appoint an officer not below the rank of Joint Secretary to the Government of India, to be the
Commissioner of payments.
(2) The Central Government may appoint such other officers and staff as it may think fit to assist the
Commissioner and thereupon the Commissioner may authorise one or more of such officers also to
exercise all or any of the powers exercisable by him under this Act.
(3) Any officer authorised by the Commissioner to exercise any powers may exercise those powers in
the same manner and with the same effect as if they have been conferred on him directly by this Act and
not by way of authorisation.
(4) The salaries and allowances and other terms and conditions of service of the Commissioner and
other officers and staff appointed under this section shall be such as may be prescribed.
(5) The Central Government shall, within a period of thirty days from such date as may be notified,
pay to the Commissioner for payment to the prior allottee, an amount equal to the compensation
determined by the nominated authority.
(6) Separate records shall be maintained by the Commissioner in respect of each Schedule I coal mine
in relation to which payments have been made to him under this Act.
16. Valuation of compensation for payment to prior allottee.––(1) The quantum of compensation
for the land in relation to Schedule I coal mines shall be as per the registered sale deeds lodged with the
nominated authority in accordance with such rules as may be prescribed, together with twelve per cent.
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simple interest from the date of such purchase or acquisition, till the date of the execution of the vesting
order or the allotment order, as the case may be.
(2) The quantum of compensation for the mine infrastructure in relation to Schedule I coal mines
shall be determined as per the written down value reflected in the statutorily audited balance sheet of the
previous financial year in accordance with such rules and in such manner as may be prescribed.
(3) If the successful bidder or allottee is a prior allottee of any of the Schedule I coal mines, then, the
compensation payable to such successful bidder or allottee shall be set off or adjusted against the auction
sum or the allotment sum payable by such successful bidder or allottee, as the case may be, for any of the
Schedule I coal mines.
(4) The prior allottee shall not be entitled to compensation till the additional levy has been paid.