Industrial Investment Bank of India (IIBI), the operating agency for Burn Standard Company Ltd (BSCL), has not complied with the ruling made by the Board for Industrial Finance and Reconstruction (BIFR).
The agency had directed IIBI to issue an advertisement for change of management, inviting partners for conversion of BSCL into a joint venture company, within 15 days from the date of issue of the ruling. BIFR further ruled that if the company failed to invoke interest among bidders, BIFR will consider passing further appropriate orders which may include issue of notice for winding up without holding any further hearing.
Officials from IIBI were not available for comments. BIFR delivered its ruling on September 14. BSCL sources pointed out that IIBI did not issue any tender nor any advertisement asking for expression of interest from interested parties.
Meanwhile, the Joint Co-ordination Committee for Trade Union and Associations at BSCL has appealed to the Appellate Authority for Financial Reconstruction challenging the BIFR's ruling.
The committee argued that the draft scheme submitted by the management was made without considering the views of the union. On February 24, BIFR had directed the management of BSCL to submit a revised revival package in consultation with IIBI and the unions. The management had not submitted such a proposal in six months since then.
They further argued that the accumulated losses of Rs 306 crore that was included in the draft rehabilitation scheme was inflated as Rs 278 crore was supposed to be written off by the government.
The Salem unit of BSCL has also appealed to AAIFR for taking a view on the closure of the unit. AAIFR has fixed October 10 as a hearing date for its case. AAIFR, however, did not provide any date for hearing to the appeal made by the committee of workers of BSCL.
Meanwhile, salaries at most of the units at BSCL are due. Employees at Howrah have not received salaries for five months, the ones at its head office and central project division for four months and workers in Burnpur for three months. Nevertheless, the company has recently received fresh orders for wagons, which is equivalent to some three months order.
