Step 1: Note both claims.
Assertion: about $98\%$ of India's coal production comes from the Gondwana coalfields. Reason: these coalfields are spread across the river valleys of peninsular India.
Step 2: Recall coal types.
India's coal is mainly Gondwana (older) and Tertiary (younger); Gondwana coal is the commercial backbone.
Step 3: Verify the Assertion.
Gondwana fields indeed supply roughly $98\%$ of the coal used in power and industry, so the Assertion is true.
Step 4: Verify the Reason.
These deposits lie in valleys like Damodar, Mahanadi, Godavari, and Wardha, all in peninsular India, so the Reason is true.
Step 5: Link cause and effect.
Because the coal-forming vegetation accumulated widely in these stable river basins, the bulk of production naturally comes from there, so the Reason explains the Assertion.
Step 6: Choose the label.
Both true and Reason explains Assertion, which is option A.
\[ \boxed{\text{Both [As] and [R] are true, and [R] is the correct explanation of [As].}} \]