The Enforcement Directorate (ED) has filed a prosecution complaint against five accused persons in connection with illegal mining, transportation, and sale of coal in the Durgapur-Asansol belt of West Bengal.
The accused were also involved in the use of forged documents and extortion. Among them are Chinmoy Mondal and Kiran Khan, who were arrested by the agency in February.
The ED initiated an investigation under the Prevention of Money Laundering Act based on 54 cases registered at various police stations in the region. These cases stemmed from complaints by the Eastern Coalfields Limited (ECL), Central Industrial Security Force, and local police authorities.
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₹275-₹1,500 Per Tonne Gunda Tax Extortion
According to the agency, accused Chinmoy Mondal, Kiran Khan, and their associates were part of an organised coal syndicate operating in the Durgapur-Asansol region and adjoining areas. This syndicate was involved not only in illegal coal-related activities, which included dealing in coal procured through illegal means and illegally transported from Jharkhand into West Bengal, but also in the systematic extortion of levies from valid Delivery Order holders, transporters, and coal purchasers.
“Such illegal levy, commonly referred to as ‘GT’, ‘Gunda Tax’, or ‘Rangdari Tax’, was collected to permit coal lifting and transportation and was disguised as lifting charges, handling charges, donations, etc…the extortion rates varied from about ₹275 per tonne to ₹1,500 per tonne, which amounted to an exorbitant 20-25% of the actual value of the auctioned coal,” said the agency.
₹650 Crore Proceeds + ₹17 Crore Assets Seized
“Due to such forceful levies, a significant amount of allocated coal remained unlifted, causing substantial financial loss to ECL as well. As of date, the Proceeds of Crime generated by this syndicate in the form of such extortion alone over the last five years have been estimated at more than ₹650 crore,” said the ED.
The ED had earlier conducted searches at multiple locations and seized “incriminating documents, digital devices, WhatsApp chats, records of coal lifting, levy collection sheets, bank account details and other material.” The searches also led to seizure of cash, bank balances, and valuables amounting to about ₹17.57 crore, in addition to the huge physical stock of coal and coke from the premises of the accused persons and their accomplices, said the agency.
Political Protection + WB Official Bribes Exposed
The ED said that the accused persons used a number of proprietorship concerns and companies as fronts for routing, layering and projecting of Proceeds of Crime as untainted. Analysis of bank accounts revealed “substantial cash deposits and large fund movements” among closely connected persons and entities.
“The investigation also uncovered evidence regarding payment of bribes to various officials of the government of West Bengal and local political functionaries for facilitating movement of coal and continuation of the activities of the syndicate,” alleged the ED.
54 Police Cases Trigger Money Laundering Probe
ED investigation triggered by 54 FIRs across Durgapur-Asansol police stations based Eastern Coalfields Limited complaints documenting systematic coal theft, illegal transportation Jharkhand border, forged delivery orders enabling legitimate coal traders forced pay mafia protection money accessing rightful allocations.
Industrial Scale Coal Smuggling Operation
Syndicate represented sophisticated criminal enterprise: Jharkhand illegal mining → cross-border smuggling → Durgapur-Asansol distribution hubs → legitimate traders forced buy smuggled stock OR pay crippling levies accessing ECL allocations. 20-25% Gunda Tax rates crippled coal economy creating parallel ₹650 crore shadow revenue stream.
Forceful levy collections paralyzed legitimate coal lifting operations leaving substantial auctioned allocations unlifted rotting stockpiles. ECL faced dual losses: direct theft revenue + stranded inventory unable reach markets due mafia stranglehold transportation corridors.
Political-Bureaucratic Nexus Alleged
ED evidence suggests systematic bribery network protecting syndicate operations: WB government officials facilitating illegal coal movement + local political functionaries ensuring police inaction despite 54 FIRs. Prosecution complaint represents first formal linkage exposing protection racket scale.
Cash seizures, bank freezes, physical coal stocks represent tip massive iceberg. ₹650 crore proceeds concealment through layered proprietorships demands comprehensive asset reconstruction tracing beneficiary networks potentially implicating dozens syndicate associates, facilitators, protectors.
Investigation exposes region’s emergence coal smuggling hub leveraging proximity Jharkhand mines, industrial demand corridors, political influence networks. ED crackdown signals comprehensive purge dismantling entrenched mafia ecosystem threatening national coal economy integrity.
Money laundering prosecution elevates beyond theft/extortion toward sophisticated financial crime architecture. Syndicate transformation illegal proceeds legitimate businesses demands asset forfeiture representing potentially largest coal scam confiscation Indian enforcement history.
About the author – Ayesha Aayat is a law student and contributor covering cybercrime, online frauds, and digital safety concerns. Her writing aims to raise awareness about evolving cyber threats and legal responses.
