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Option 1 states that the Damuda series of rock system contains all the metallurgical coal in India. This statement is incorrect. The Damuda series of rock system is known for containing non-metallurgical or thermal coal, not metallurgical coal. Metallurgical coal is found in other areas of India, such as the Jharia coalfield.
Option 2 states that Tamil Nadu is the chief producer of lignite coal in India. This statement is correct. Tamil Nadu is indeed the chief producer of lignite coal in India. Lignite is a low-grade coal that is used for energy generation.
Option 3 states that tertiary coal is mainly confined to peninsular India. This statement is also correct. The tertiary coal deposits in India are predominantly found in the peninsular region. Tertiary coal is the youngest form of coal, and it is found in areas where substantial geological changes have occurred.
Therefore, the correct answer is option 2, which states that statements 2 and 3 are correct.