The coal blocks case, in which CAG is said to have computed losses at Rs 10.67 crore to the exchequer, has ended in a CAG apology to the PMO

The leak of a draft report of the Comptroller and Auditor General (CAG) on the award of coal blocks to various companies has embarrassed the organisation. It has ended up apologising to the Prime Minister and issued a clarification that more or less denies that the exchequer incurred a Rs 10.67 lakh crore loss due to the award of coal blocks to private and public sector companies without an auction.

The Times of India reported in its Thursday edition that CAG had criticised the coal ministry for extending "undue benefits" to over 100 companies by giving them coal blocks without an auction between 2004 and 2009.

CAG has now written to Prime Minister Manmohan Singh expressing "very deep anguish" over the leakage of the initial draft. The auditor went further and said that "... it is not even our case that the unintended benefit to the allocatee is an equivalent loss to the exchequer." The letter says CAG has changed its views after its spoke to the coal ministry. "Pursuant to clarification provided by the ministry in exit conferences held on 9.02.2012 and 9.03.2012, we have changed our thinking."

"The leak of the initial draft causes great embarrassment as the Audit Report is still under preparation," the letter said.

Calling the figures as quoted in The Times of India story as "exceedingly misleading", the letter pointed out that the observations do not constitute even the pre-final draft.

The newspaper report had referred to the CAG draft report and said that the government gave away 155 coal acreages, areas in which coal could be mined, for five years to a number of corporate houses, a move which allegedly deprived the government of Rs 10.67 lakh crore.

Firstpost has already said that it was too early to call the award of the coal blocks a scam, and the CAG apology and denial of loss confirms that.