CBI accuses Parakh of misusing his position

The CBI on Wednesday accused former coal secretary P C Parakh of abusing his official position even as the retired official questioned the agency's rationale behind naming him and industrialist Kumar Mangalam Birla in coal block allocations scam.

Agency sources said Parakh reversed his decision to reject coal block allocation to Hindalco within months "without any valid basis or change in circumstances" and to show "undue favours".

Parakh denied the allegations and said he overturned the decision of Screening Committee after going through a representation filed by the Aditya Birla Group chairman and finding out that his arguments against not allowing blocks had merit.

The sources said during the 25th Screening Committee meeting, chaired by Parakh, applications of Hindalco and Indal Industries were rejected, "citing valid reasons".

It allocated the blocks to two PSUs Mahanadi Coalfields and Neyveli Lignite Corporation. The competent authority cleared the proposal of the Screening Committee and issued letter of allocation to the PSUs on June 16 and July 15 of 2005.

However, the sources said within days a "personal meeting" took place between Parakh and Birla in which the industrialist requested for the allocation of Talabira II coal block.

However, Parakh said Birla gave a representation to Prime Minister Manmohan Singh and later met the official with a similar representation claiming that the non-allocation of coal block to his company was unfair.

The sources said Parakh ignored the considered deliberations and recommendations of Screening Committee of which he was the Chairman. They also claimed that the retired official recommended formation of a joint venture between Mahanadi Coalfields, Neyveli Lignite and Hindalco.

Investigators said they were looking into the circumstances, which led to sudden change in the position taken by Parakh.