The state government has asked the Mahanadi Coalfield Ltd (MCL), a subsidiary of Coal India Ltd (CIL), to pay a fine of Rs 1,306 crore for mining coal without environment clearance in the Ib valley area.

It said, MCL had resorted to illegal extraction of coal in the absence of statutory clearances and therefore, is liable to pay the penalty amount. Earlier, the Deputy Director of Mines (DDM), Sambalpur circle, had issued a demand notice to MCL for payment of Rs 862.58 crore as fine.