Sale of Shipping Corp, Hind Copper put off

"Financial bids for SCI and HCL have been deferred indefinitely," a government official said.

The last date for submission of bids for SCI was October 20. For HCL, bidding was earlier scheduled to close on October 14, but was extended to the end of this month as the parties in the fray, Sterlite and Birla Copper, wanted clarifications on the liabilities and other assets of the company.

The SCI employees' union had filed a petition in the Bombay High Court on October 1 challenging the privatisation on the ground that Jayanti Shipping Company was merged with SCI in 1971 by an Act of Parliament. Hence they said the proposed sale could take place only after legislative approval.

Similarly, the Ghatshila copper complex of HCL was acquired through nationalisation in 1969.

"The Supreme Court judgment on HPCL and BPCL has made us take a cautious approach on these two companies, which get directly influenced by the September 16 judgment," an official said.

The apex court had stalled the disinvestment of the oil majors, which had also been nationalised through legislation. The court had said that parliamentary approval was a pre-requisite for sale of the two companies.

Earlier this week, during a hearing on the sale of Jessop to Ruia Cotex, Attorney General Soli Sorabjee had sought a reconsideration of the order.

The Cabinet Committee on Disinvestment (CCD) had cleared the transaction documents for sale of the government's 98 per cent stake in HCL in its meeting on July 10. While for SCI, the documents for strategic sale of 51 per cent stake were frozen last year.

The government, however, went for a fresh round of bidding after removing the 25 per cent cap on foreign equity for the prospective bidders.

Since, the main parties in the fray remained unchanged after the policy relaxation, the government decided to call the financial bids in October this year. The government had fixed a target of Rs 13,200 crore as realisation from disinvestment during the current fiscal. It has, however, managed to mop up less than Rs 1,000 crore so far.