BHUBANESWAR: Even as Dalmia Bharat group is set to acquire Birla Tyres after creditors approved their resolution plan, the fate of hundreds of employees and workers hangs in balance due to alleged discrepancies and controversies regarding their claims and the resolution process.
The Balasore unit of Birla Tyres, a division of the BK Birla flagship Kesoram Industries Limited, known for its commercial and two-wheeler segment products, is undergoing insolvency proceedings at the National Company Law Tribunal (NCLT).
Sources said the Birla Tyre Workers’ Union (BTWU) representing 307 workmen had submitted a collective claim of Rs 31.47 crore to the company’s Resolution Professional (RP) in May 2022. However, subsequent developments ahead of the proposed acquisition have left the workmen disheartened. The RP’s issuance of a list of admitted claims has raised eyebrows as only 8.48 per cent (around Rs 2.67 crore) of the total claimed amount was acknowledged leaving the majority of the claim unaccepted.
General secretary of the union Dilip Kumar Panda said this significant gap between the claimed amount and the admitted portion has raised questions about the transparency and accuracy of the claim evaluation process.
“Furthermore, a contentious issue has arisen from the RP’s unilateral rejection of claims from 191 contractual workers, despite a directive from the industrial tribunal, which had made it clear that the claims of all workmen would be settled. The RP’s decision on the basis of lack of regularisation appears to be an illegal move that will jeopardise the legal validity and fairness of the decision,” he pointed out.
The workmen have approached various government authorities and filed a writ petition seeking justice. They said the acknowledgement by the divisional labour commissioner about the ‘no work no pay’ principle is inapplicable due to the corporate debtor’s failure to provide employment.
The union’s claims of unmet benefits stem from the corporate debtor’s acknowledgement of the union as a recognised entity in 2008. However, its failure to fulfil the promised benefits and facilities has led to the workmen’s claims for their rights.
The BTWU has filed an application under section 60(5) of the IBC, 2016 before the NCLT, Kolkata and the hearing is scheduled for October 4. Meanwhile, the Dalmia Bharat Group’s resolution plan to acquire Birla Tyres has gained approval from creditors. Approximately Rs 300 crore of Birla Tyres’ debt is set to be repaid as part of this resolution.