Jajpur: The mines department’s move to confiscate the properties of 28 defaulting mine leaseholders has put Mesco Steel in trouble, a report said Saturday.
The steel firm had taken Roida Mines on lease and owes over Rs 900 crore to the state government. In case the firm fails to pay the penalty the department may confiscate its properties. This will affect the over 800 employees in the plant.
The department has initiated the process to confiscate the properties of defaulting leaseholders after the Supreme Court issued a direction.
Meanwhile, the mines department has filed certificate cases against the defaulting leaseholders in the court of the district magistrate and with the Collector. It has also sought details of the properties of the defaulting leaseholders from the revenue department to proceed in the case.
The move might spell trouble for Mesco Steel if the mines department proceeds with its move. Sources said the Mesco group had promised to establish two steel plants, Mesco Kalinga and Mesco Steel, in the area and had acquired around 2000 acres from IDCO in Kalinganagar.
Mesco Steel started operations in August 1996 and acquired an iron ore mine in the Joda mining circle of Keonjhar district. The steel firm, however, did little to increase the prospects of its plant, but made money from the mines by selling the extracted iron ore outside the state.
Noting these irregularities the SC directed Mesco Steel mines to pay penalty. The steel firm is learnt to be trying to escape paying penalty while other firms have already paid. Notably, Mesco has shut down its plant from November 26, 2015 citing losses of Rs 7 crore per month.
Pratap Jena, general secretary of the Kalinganagar Sramik Sangha, said that Mesco grew rich by robbing the mines but has overlooked the interests of labourers and might shut down if it fails to pay the penalty. He demanded that the state government should take over the steel plant.
Baidyanath Swain, human resources head, Mesco Kalinganagar, refused to comment on the issue as the decision to pay penalty rests solely with the group’s authorities in Delhi.
PNN