The Prime Minister`s Office (PMO) sent a directive in this regard to the Mines Ministry about two months back, sources said here on Saturday.
The Mines Ministry was advised that since the Mines and Minerals (Regulation and Development) Bill 2011 had not been passed by Parliament yet, the issue of allocation of mines needed to be examined legally before any step could be taken in this direction, the sources said.
The PMO missive came at a time when the Mines Ministry was planning to allocate mines in the same way as was done in the case of coal block allocation, the sources said.
Allocation of certain coal blocks without auction has come in for criticism with CAG contending that it had caused loss to the tune of Rs 1.86 lakh crore.
The Mines Ministry has sought the Law Ministry`s advice which is likely to come anytime, Mines Secretary Viswapati Trivedi told reporters on Friday.
The Bill, being examined by Parliamentary Standing Committee after being introduced in Lok Sabha last December, has provisions for introducing a transparent mechanism for granting mining lease through the competitive bidding process.
The Bill proposes that wherever there is confirmed known mineralisation, auction should be the way. But where the mineralisation is not known, it is difficult to auction. There are provisions for both kinds of concessionary systems.