AFT Mill to Layoff Staff for 6 Months

The 110-year-old Anglo French Textile (AFT) mills  under the territorial administration has once again declared temporary layoffs in units.

Published: 23rd July 2015 04:08 AM  |   Last Updated: 23rd July 2015 04:08 AM   |  A+A-

PUDUCHERRY:The 110-year-old Anglo French Textile (AFT) mills  under the territorial administration has once again declared temporary layoffs in units A, B and C (except Spinning unit) units for a period of 6 months with effect from July 21. The move came after the government granted permission to the mill to lay off workmen under Section 25-M of the Industrial Disputes Act, 1947, read with rule 75(B) of the Industrial Disputes (Central) Rules, 1957.

The layoff is expected to reduce the financial commitment of the mill on account of salary to workers from Rs 3.25 crore to Rs 1.25 crore a month for the mill, which is now defunct. During the layoff period workers will be paid half wages. The mill has been laying off workers since November 2013, unable to pay wages as well as settle the dues of those who retired.

The net worth of the company Pondicherry Textile Corporation (PTC) running the mill has already been in the negative side as of March 31, 2014, and no funds are available even to meet the day-to-day expenses, said the management of the mill.

The Government has continuously provided funds to the mill by way of share capital and grant-in-aid. The government has released Rs 367.35 crore as share capital and Rs 201.11 crore as grant-in-aid up to May 15, 2015. The grant-in-aid released presently is adequate only to pay the lay-off compensation and wages and is not adequate to run the mill fully.

The machinery are very old and without modernisation it is difficult to run the mill effectively. Labour unrest is prevailing due to non-payment of statutory dues and hence without settling the dues no action can be taken to run the mill.

In the present scenario, production at the mill could not be resumed till the Weaving Preparatory and Warehouse Departments in A unit are shifted to a new building either in B or C units for which sufficient funds are required.

Government, banks and other institutions are not granting any loans to settle both the statutory and non-statutory liabilities which amounts to Rs 130.02 crore. Without settling these dues and modernising the machineries no revival plan can be initiated.

In order to settle the outstanding dues the management proposed to sell the idle 54.64 acres situated in Pattanur village, in Villupuram district.

The management further stated that in this regard a board resolution was also passed for the sale of Pattanur land and the Council of Ministers, Government of Puducherry accorded the approval for sale of land on June 24, 2013 and the proposal was sent to Joint Secretary (Union Territory),  Ministry of Home Affairs, New Delhi, where the proposal is pending.

If the sanction is granted, the land can be sold by an e-auction, which may fetch around Rs 80 crore as per present market value Rs 61 crore GLR value) and the statutory dues will be settled.

Subsequently steps can be taken to revive the company. Till such time, there is no other alternative than to declare a temporary lay-off, said the management of the mill.

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