New Delhi/Bhubaneswar, May 10: The Supreme Court today set aside the Orissa High Court order that had quashed the state government’s decision of allotting iron ore prospecting licence to South Korean steel major Posco in Khandadhar mines of Sundergarh district for its Rs 52,000 crore project in Jagatsinghpur district.

The apex court directed the Centre to examine “afresh as soon as possible” the applications of various claimants for prospecting of iron ore in the mineral rich state.

A bench of Justice R.M. Lodha and Justice S.J. Mukhopadhyaya passed the order while disposing of the cross appeals filed by the Odisha government, Posco and Geomin Minerals & Marketing, a mine and mineral company, after the Orissa High Court had on July 14, 2010, set aside the government’s decision to allot iron ore licence in Khandadhar hills in Sundergarh district to Posco for its proposed steel plant on the ground that many other contenders were overlooked.

Geomin Minerals and Marketing had contended before the high court that it had applied for the prospective licence for Khandadhar iron ore mines much before Posco.

“You (state) say give it to him because he is a big player. How about others who are competent and capable. If the umpire becomes obsessed with the big player, the match is over. Umpire has to see the game impartially, not get obsessed by personalities. It requires objectivity. Objectivity is something subjective and requires fairness. How can you assess the matter like this? You must explain,” the judgement said.

The bench ticked off the state government with the following remarks: “The sum and substance is that Posco is a blue-eyed boy. Competence and merit were not evaluated. Even a small player can play a big game. Unless you give a chance, how is it possible? There has to be application of mind.”

Chief minister Naveen Patnaik said: “We are waiting for the court’s order. Once we get, we will follow it.”

Since the fate of Posco’s proposed plant is intrinsically linked to the mines, the decision of the court is likely to delay the project further.

The state had, however, defended its decision to grant iron ore prospecting license in the Khandadhar mines to Posco over Geomin Minerals saying it was the “most suitable” player for the project.

The Naveen Patnaik government had questioned Geomin’s credentials on several grounds, saying that the company had neither offered to put up a plant till 2007 nor had any firm commitment on the investments.

On the other hand, Posco had claimed that its entry would provide employment to about 18,000 locals and an overall employment of 2.7 lakh besides bringing an investment of Rs 52,000.

During the arguments, Geomin Minerals opposed the apex court’s suggestion to ask the Centre to make an assessment of all potential contenders for the licence, as under the Mines and Minerals Development Act, it was the Union government that had the power to determine such contentious issues.

Posco-India hoped the judgment would significantly help expedite the project.

“We welcome the judgment by the honourable Supreme Court on Khandadhar mining case. Once we receive the copy of the full judgment, we will be in a better position to comment upon,” said Posco-India CMD Y.W. Yoon.