Why the Corporate Giant Faces Allegations of Ecological Damage over Mine Closure
India’s second-largest coal-producing state, Jharkhand, has long been mired in coal-related controversies. While coal mining generates substantial revenues for both the state and the Centre, it has also left a trail of environmental damage and social disruption, ranging from pollution and land grabs to theft and organised crime. These darker externalities of the coal economy have also seeped into popular culture, most notably in the cult Hindi film Gangs of Wasseypur, which brought national attention to the nexus between coal mining and organised crime in the state.
In the past few months, however, a petition filed before the National Green Tribunal (NGT) has sought legal redress for a less-discussed but increasingly serious problem associated with coal mining in Jharkhand in recent years: the environmental fallout of improperly abandoning a coal mine after extracting only a limited quantity of coal.
Gaurav Singh, a resident of Palamau district, moved the NGT in December 2025. In his application, Singh alleged that Hindalco Industries, the aluminium and copper manufacturing major of the Aditya Birla Group, failed to comply with the conditions of Environmental Clearance (EC) when it surrendered its Kathautia coal mine in October 2024. The “failures” included:
- failure to backfill mining pits with overburden and topsoil, leaving behind deep, unstable and hazardous highwalls;
- dumping overburden outside the lease area and carrying out plantation on overburden dumps instead of undertaking afforestation on de-coaled land following proper reclamation;
- violation of safety norms through the creation of near-vertical highwalls, unsafe slopes and inadequate fencing;
- cessation of mining operations without stacking overburden at designated dump sites within the lease area, as mandated under the EC conditions.
Overburden (OB) is the technical term used in mining regulations to describe soil, stone and other material lying above coal seams, which are typically located deep underground. Since coal can be extracted only after removing these layers, the scientific handling, storage and redeployment of overburden during and after mining is a critical environmental obligation.
The petitioner alleged that Hindalco’s non-compliance with EC conditions governing overburden management at the Kathautia coal mine resulted in extensive land degradation across mined-out pits. This, he argued, occurred because the company left excavated pits open instead of backfilling them with overburden and restoring the land through plantation of native species after rendering it cultivable and safe for future use. Singh further alleged that the Union environment ministry and the Jharkhand government failed to initiate effective enforcement action against Hindalco, thereby allowing continued environmental degradation and posing serious safety risks in the mining area.
While the tribunal is yet to deliver its verdict on these allegations, it has already conducted two hearings and called for responses from Hindalco and the government authorities responsible for regulating coal mining and pollution control. In its order dated January 27 this year, the tribunal observed: “Prima facie, the averments made in the application raise substantial questions relating to the environment arising out of the implementation of the enactments specified in Schedule I to the National Green Tribunal Act, 2010.”
In effect, the tribunal held that Singh’s claims merit judicial scrutiny as they raise serious and substantive environmental concerns. New Delhi Post reached out to Hindalco, the Union environment ministry and the Jharkhand state government, seeking their responses to the allegations raised by the Palamau resident. This report will be updated if and when responses are received.
Spread over nearly 900 hectares, the Kathautia coal mine is located in a remote district occupying Jharkhand’s north-western edge. When coal excavation began at the site in the early 2000s, the lease area encompassed at least seven villages.
Hindalco Industries entered the picture after it emerged as the successful bidder in a central government auction for mining rights in 2014-15. The auction was notable. It formed part of the Union government’s effort to reallocate coal blocks whose earlier allotments were cancelled by the Supreme Court following the exposure of the infamous coal allocation scam. Before the court’s intervention, the Kathautia mine had been allotted to Usha Martin Limited, which operated it from 2008.
The bidding for Kathautia in 2014-15 was reportedly competitive. Apart from Hindalco, companies such as Ultratech Cement, Monnet Ispat & Energy and Rungta Mines also submitted bids, underscoring the mine’s perceived commercial value. The mine carried a rated production capacity of 0.80 million tonnes per annum.
At the time, both industry and government officials expressed optimism about Kathautia’s revenue-generating potential. Media reports cited exceptionally high expected revenues following Hindalco’s successful bid. “Kathautia closed at Rs 2,860, which means Rs 228 crore per annum and Rs 6,800 crore for 30 years,” The Hindu reported in February 2015.
Hindalco also incurred substantial upfront expenditure, spending over Rs 350 crore in the initial phase on statutory clearances and compliance. Additional amounts were paid as compensation to private landowners whose land was to be acquired for mining. At this stage, the company appeared confident of making the mine fully operational and commercially viable.
More than a decade after the auction, however, both the company’s plans and the government’s expectations have unravelled. Hindalco surrendered the mine after extracting coal from limited portions over nearly six years and, according to Singh’s application before the NGT, “left behind dangerous pits, overburden dumps and ecological imbalance in violation of environmental law, endangering life, ecology and public safety.”
To support these claims, Singh submitted photographs and video footage to the tribunal depicting the condition of exposed coal pits within the lease area. These images were recorded in June 2025 and submitted to the NGT in December of the same year. In his application, Singh explained the environmental significance of what the visuals reveal: “Despite surrender proceedings, Hindalco has not complied with the conditions of the EC, particularly the specific condition no. (iv), and has left pits unfilled, overburden dumped outside the lease area, with no ecological restoration undertaken.”
In the context of coal mining, ecological restoration refers to a set of scientifically prescribed measures aimed at restoring hydrology, stabilising landforms and improving groundwater recharge on previously mined land. In a written response to the Rajya Sabha last year, Union minister G Kishan Reddy outlined how public sector coal companies were implementing such measures: “Extensive plantation in and around mine areas has been adopted to control soil erosion, manage runoff and enhance water retention capacity. Reclaimed mine pits are also developed as water storage structures.”
At this reporter’s request, Singh recorded fresh photographs and videos of the abandoned pits in February 2026. A comparison with the material recorded in June 2025 suggests a further deterioration in the condition of the exposed pits, reinforcing concerns that no meaningful reclamation work has been undertaken in the intervening period.
A review of Hindalco’s correspondence with government authorities sheds light on the company’s stated reasons for surrendering the Kathautia mine. In June 2025, Hindalco informed the Union coal ministry that it had been unable to access the full mining lease area, which had been “transferred and vested” in its favour on paper.
“Most of the vested land has not been made available for mining to us despite the lapse of over 10 years since the purported absolute transfer and vesting of the above land,” wrote Dr Vinod K Verma, President and Head of Regulatory Affairs at Hindalco Industries Limited, to the Nominated Authority of the Ministry of Coal on June 6, 2025.
Verma stated that over 1,783 acres of land within the lease area—comprising freehold, government-owned and privately owned parcels—had been notionally transferred to Hindalco in 2015. However, actual possession never followed. More than 344 acres were subsequently classified as deemed forest land by the Jharkhand government, rendering them inaccessible for mining and triggering prolonged litigation in the Jharkhand High Court. The dispute remains unresolved.
Additional parcels exceeding 165 acres, identified as state government land, were never handed over to the company. Meanwhile, more than 859 acres of privately owned land remained mired in legal disputes that predated the auction and came to Hindalco’s attention only later. In effect, of the 1,783 acres earmarked for mining, more than 1,369 acres were rendered unavailable due to unresolved legal impediments.
Against this backdrop, Verma wrote: “We are unable to deploy equipment and conduct operations as per the Mining Plan and are constrained to operate on an ad hoc basis on whatever land is available.” Notably, the correspondence does not refer to the company’s responsibility for ecological restoration of already mined-out areas.
(Akshay Deshmane is a Delhi-based environmental journalist)
