Unknown fate awaits Cement Corp factories

LUCKNOW: Even after death of 328 workers and 3,500 employees eager to take VRS, the state government is unmoved to privatise three factories of Cement Corporation, allegedly under pressure from a corporate house.
The fear of the corporate house is that if the three factories under Cement Corporation -- Dala, Chunar and Churk -- went into private hands and revived it would adversely affect its sale in Uttar Pradesh.At present, the industrialist is the biggest supplier of a popular brand of cement in the state.
The three loss-making factories hit headlines in 1991 when the then Mulayam government had made an abortive bid to sell them in private hands. About nine workers were killed in police firing during an angry protest in Chunar forcing the then government to scrap the deal.
A lock-out was declared in 1996 when losses crossed over Rs 200 crore. The matter went to the court and the high court in its order dated December 12, 1999 appointed a liquidator and allowed the state government to wind up Cement Corporation under Section 529 A of the Company Act.
Then Rajnath government took a cabinet decision to sell Dala and Chunar factories. Tenders were floated on February 2, 2001 and Grasim Industries offered Rs 241 crore to revive the sick units. But instead of moving an application under Section 466 of the Company Act for seeking permission from the HC, Section 446 was used, allegedly under pressure from the corporate house, which has varied business interests, including hotels and construction.
Section 466 states that "liquidator or any creditor or contributory could approach the court to stay winding up on valid grounds." While Rule 446 curtails such powers: "No suit or other legal proceedings shall be commenced when a winding up order has been made or official liquidator appointed."
Even though the court advised the state to rectify the mistake, the same was not done till date to serve the business interests of the corporate house, which is also in the thick of a land scam in Noida. "The state government can still forward an application under Rule 466 and seek permission from the HC for implementing the cabinet''s decision for the revival of sick units," claims AK Upadhyaya, manager, Churk Cement Factory in Sonebhadra.
Besides Grasim, there are two other buyers -- Jai Veer Cement (for Churk) and Lafarge that have made an ad hoc bid for buying all three sick units for Rs 272 crore.
"Even IDBI, ICICI, LIC, IFCI, State Bank and Allahabad Bank have given their consent to formalise the deal through them. Moreover, about 3500 out of 4500 employees are ready to take VRS to make it a smooth deal for private bidders," points Basudeo Narain, a leader of employees'' union.
Ironically, even the chief minister had given a categorical assurance to employees during Lok Sabha polls to take an early decision on their fate.Samajwadi Party MLA from Robertsganj Parmeshwar Dayal has also sought an audience with the CM to push the matter. But, sources in industries department, confided to TOI that all moves are spiked by well-wishers of the corporate house.