A three-judge bench said the Indian policy of allocating 218 mines for captive use to companies without auctioning them didn’t follow transparent norms. The court on September 1 will hear arguments regarding termination of the mining licenses, according to Bloomberg.

Inadequate coal output in India has prompted companies such as Jindal and Adani to seek supplies overseas, as the government-owned producer Coal India lags with slow land acquisition and government approvals.

Jindal recently bailed out Gujarat NRE Coking Coal in Australia and renamed the company Wollongong Coal.

“The ruling has brought in uncertainty and if the situation prolongs, it could severely strain coal supplies to customers,” K R Choksey Shares & Securities managing director Deven Choksey told Bloomberg.

“I would expect the government to act on this matter in urgency and allow companies to retain coal mines on the basis of merit.”