 "Partial relief for JSW Steel in Forest Development Tax case")
The Sajjan Jindal-led JSW Steel today said the Karnataka High Court on December 3 gave the steel maker a partial relief in the Forest Development Tax case.
The company through a filing to the stock exchange informed judgement comes in response to a petition filed by mine owners and iron ore purchasers including JSW Steel against FDT levy.
The notification also said parties who have filed the petition are entitled to appeal to the Supreme Court within 90-day stipulated period.
The company is closely monitoring developments and will keep the exchange informed of any material developments affecting the company. Over an above the basic iron ore price, steel mills in Karnataka have also to pay royalty and FDT to Karnataka government which is a cost that is usually borne by the miners in other parts of the country.
JSW Steel has no captive iron ore mines and relies on e-auctioned and some times imported iron ore to meet its requirement for its 10-million tonne steel capacity in Karnataka. For a 10-million tonne capacity plant, a company would normally need about 17-18 million tonne of ore.
"There would be a one-time gain for the company due to this partial relief of FDT, but it is difficult to quantify the benefit the company would get as the exact percentage of relief is not known. Plus, it is also not clear as to how much JSW Steel has already paid to the state government," said an analyst with a local brokerage.
JSW Steel had not responded to the email sent until the time of filing this copy.
JSW Steel has a combined capacity of steel making is 14.3 million tonne and it operates other two steel plants at Dolvi in Maharashtra and Salem in Tamil Nadu.