India coal
A laborer carries a basket filled with coal at a railway yard in Chandigarh. Reuters

The Indian government is attempting to extinguish a $211 billion coal scandal, claiming that a leaked report from a state auditor was only a rough draft.

On Thursday, the Times of India obtained a report from the Comptroller and Auditor General that claimed the government had lost hundreds of billions of dollars in revenue by selling coal contracts too cheaply to private and state-run companies between 2004 and 2009.

Why were the coal blocks allotted without auction? Prakash Javedkar, leader of the main opposition Bharatiya Janata Party (BJP), demanded during a session of parliament. It is a government of scamsters that is involved in knee-deep corruption.

But the government is downplaying the scandal, saying that the reported losses were exceedingly misleading, and on Friday the auditors office joined in by rejecting its own draft and saying it changed our thinking on the scale of the revenue loss, according to Reuters.

Additionally, Indian Coal Secretary Alok Perti told Bloomberg that the report “way off the mark,” adding that the methodology used was “very rough and does not take into account the technicalities and cost of mining in different blocks.

While there is no legal requirement for the government to sell coal plots through an auction, the report has still sent shock-waves throughout the country that just last year went through a telecom scandal that sent ministers and other officials to jail for corruption.

This is the mother of all scams, said MP Venkaiah Naidu, also of the BJP. The prime minister should reply.

By Thursday morning, Prime Minister Manmohan Singh had responded, but not in a way that is likely to satisfy his opponents.

Singh, who oversaw the Ministry of Coal during part of the period in question, said that there was no justification for him to have to explain the report, according to India's NDTV.

In the extant case the details being brought out were observations which are under discussion at a very preliminary stage and do not even constitute our pre-final draft and hence are exceedingly misleading, Singh said in a statement sent from his office.

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