Nepa asks for sops from MP govt

Nepanagar-based (Burhanpur district) ailing Nepa Ltd has once again asked for concessions from the Madhya Pradesh government.

The state government had refused to waive Rs 50 crore, which Nepa owes as entry tax, electricity duty and cess, and other taxes.

The chairman of the company, SK Mutreja, has met Commercial Tax Minister Babulal Gaur and senior officials of the department of industry on this.

"As a sick company, we have demanded exemptions from these taxes. We have been told to apply afresh for the purpose. Only state cabinet can decided upon it," Mutreja told Business Standard.

The Centre had in August this year approved for stake sale to a strategic investor. Earlier last year the Board of Public Sector Enterprises (BRPSE) had recommended the government-owned newsprint company to convert into a joint venture company or sell of its stake to any private firm.

The state government has 1.67 per cent share in the company. Of the total Rs 50 crore outstanding, the Nepa owes Rs 20.11 crore on state electricity board, Rs 11.68 crore as captive power cess, electricity duty liabilities and Rs 15.34 crore as central sales tax, state sales tax and entry tax.

Established as a private entrepreneur in 1947, the Madhya Pradesh government took over the management control of Nepa Mills in 1949 and it became a Union government entity in 1959.

The company also wants Madhya Pradesh government to enter into a proper lease deed agreement. The Nepa only has rights to use free-hold land 849 acres of land has been pending with the state government since its establishment.

"We have also discussed the matter with the state government and we hope that the lease agreement will take a formal shape shortly," Mutreja said.

Despite an improved performance on production, the company has posted accumulated loss of Rs 389.17 crore during 2006-07 against Rs 344.70 crore in the previous fiscal.

The company has achieved 48 per cent capacity utilisation of installed capacity against 35 per cent in the previous year. Demand of Nepa, a company statement said, remained buoyant in 2006-07.

The company booked orders for supply of 42,863 metric tonnes of newsprint but achieved sales of 42,139 metric tonnes worth about Rs 83.5 crore during the year.