Nagpur: Odisha-based Yazdani International Private Limited has emerged as highest bidder for the Marki-Mangli II coal block in environmentally sensitive area of Yavatmal district, after the auction concluded earlier this month.
The block has been in controversy on account of concerns of damage to the environment if the area was mined. Yazdani has outbid Andhra Pradesh Mineral Development Corporation, and Reflex Industries, offering 30% revenue share for the coal reserves.
Earlier, state tourism and environment minister Aditya Thackeray had written to the ministry of coal requesting that Marki Mangli II and Bander, which is also a environmentally sensitive coal block, should be removed from the auction. The ministry struck off Bander from the list, but Marki Mangli remained. Marki Mangli has thick forest cover.
TOI had reported that the block was not only in the middle of a tiger corridor, but falls in the notified Tiger Conservation Plan by the National Tiger Conservation Authority (NCTA).
Amid concerns raised on the environmental front, a quick look at the company’s financials also raise a doubt over Yazdani International’s capacity to fund the project through its own resources.
The relaxed eligibility norm for the current coal block auction has paved the way for almost any company to take part in the bidding process. The participant need not have any prior qualification on financial parameters or earlier experience in coal mining, said sources related to the process.
Despite repeated attempts, Yazdani International did not respond to TOI’s questionnaire seeking details about its financial standing, investment plans, employment projection and its stance over the concerns raised by Thackeray.
TOI accessed the company’s balance sheet, profit and loss account, and other details from the Ministry of Company Affairs (MCA) website. The company’s balance sheet as on March 31, 2019, shows that it has negative net worth of over Rs20 crore. This indicates that the company has suffered massive or continuous losses due to which its reserves and share capital have been wiped out.
The profit and loss account for the year shows a loss of Rs1.99 crore. The company’s revenue from operations stands at Rs2.5 crore, which is barely 22% of the total revenue. As against this nearly 80% of its revenue comes under the head ‘other income’. “This again raises questions about its financials. In normal course, the income from operations for any company has to be higher than that from any other source. Even the ‘other income’ aspect needs further explanation,” said a financial expert who examined the balance sheet.
The company has no subsidiary. “Starting the coal mine would need substantial investment and given the balance sheet available at the MCA website, the company does not seem to be in a position to fund the venture on its own,” the expert said.
The coal ministry’s website and also a press release by PIB also names Yazdani International as the qualified bidder. The management’s representative at Bhubaneswar also confirmed that it was the same company.
Documents in the public domain show Yazdani International as an export house dealing in minerals like iron ore, chrome and manganese apart from owning mines in Odisha.
The company’s directors are Mohammed Yusha, Sarosh Yazdani and Seraj Yusha, with Meraj Yusha as managing director.
Yazdani International’s directors are also on the boards of over 20 other companies. These companies are in a whole gamut of businesses ranging from steel, power, real estate consultancy to even media and education. Some of these companies — are Yazdani Steel, Megastone Estates, Straight Iron Private Limited, Kriti Dealers, and Yazdani Educraft Private Limited.
Back in Odisha, Mohammed Yusha, who is at the helm of affairs of the company, is known to be an influential man. The businesses have a long standing in the state.
However, despite its ventures in Odisha, Yazdani did not bid for the Radhikapur East and West blocks. The mines have been bagged by Aditya Birla Group’s EMIL Mines and Minerals, and Vedanta Group respectively. If Yazdani offered an over 30% revenue share for Marki-Mangli II, Radhikapur East and West went for 16.50% and 15.75% revenue share.
