CUTTACK: The Orissa High Court has sought response from the Central PSU Minerals and Metals Trading Corporation Limited (MMTC) on a petition challenging the disinvestment in loss making Neelachal Ispat Nigam Limited (NINL) steel plant at Kalinganagar in Jajpur district.
The Court issued the direction on the petition filed by Neelachal Executive Association (NEA) seeking intervention against the disinvestment plan which the Union Cabinet had approved on January 8.
The petition was taken up for hearing through video conferencing on Wednesday. The singe judge bench of Justice BR Sarangi asked the MMTC’s counsel to obtain instructions or file counter affidavit and directed for listing of the matter after two weeks.
The association alleged that the decision was illegal and arbitrary. As promoters were not interested to infuse money to run the plant following approval for disinvestment, there was severe liquidity crunch. This resulted in shutdown of the plant and near starvation of the employees during the Covid-19 pandemic.
More than 10,000 families have been adversely affected as salaries of employees had been stopped for more than nine months, the association alleged while seeking direction for payment of salary and merger of NINL with Steel Authority of India.
In the company, MMTC holds majority stake of 49.78 per cent while Odisha Mining Corporation (OMC) and Industrial Promotion and Investment Corporation of Odisha Ltd (IPICOL) have 20.47 per cent and 12 per cent stakes respectively.
Three other CPSUs NMDC, MECON and BHEL hold minor share in NINL. Lack of capital investment by the existing equity holders had forced the management to operate only the coke oven of the plant. Later, the plant was shut down.