The Calcutta High Court accepted the TATA steel writ petition, after the Ministry of Steel rejected its appeal for a loan waiver from the Steel Development Fund (SDF). The loan, amounting to Rs 2,751.17 crore including principal and interest, was sought to be waived in accordance with previous court orders.
Kolkata: Today (4 April): The Calcutta High Court accepted a writ petition filed by Tata Steel, contesting the denial of its request for a waiver of a loan obtained from the Steel Development Fund (SDF). The loan amount, including principal and interest, amounted to Rs 2,751.17 crore, as per the last audited balance sheet.
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Justice Aniruddha Roy ruled that Tata Steel, along with other main steel producers, had a clear right over the SDF, which was intended for the utilization of steel producers.
Tata Steel sought the loan waiver under the court’s previous orders issued on August 3, 2022, and January 3, 2023. The Union Ministry of Steel rejected Tata Steel’s appeal, leading to the filing of the writ petition, with the first hearing taking place recently.
The Calcutta High Court admitted a writ petition filed by Tata Steel, challenging the rejection of its prayer for a loan waiver from the Steel Development Fund (SDF). The loan, which amounted to Rs 2,751.17 crore (including principal and interest) according to the last audited balance sheet, was the subject of Tata Steel’s request for a waiver in line with the court’s previous orders issued on August 3, 2022, and January 3, 2023.
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In a letter dated December 29, 2023, the Union Ministry of Steel rejected Tata Steel’s appeal for a loan waiver from the SDF and a refund of the remaining balance in the fund. Consequently, Tata Steel filed a writ petition challenging this rejection, and the first hearing for the case took place recently.
BACKGROUND
The Steel Development Fund was established in 1978 to modernize and upgrade the iron and steel industry in India. Steel producers at that time imposed a steel development surcharge per tonn of steel and deposited the funds into the SDF corpus. The Joint Plant Committee (JPC), under the purview of the Ministry of Steel, was entrusted with managing the SDF on behalf of the central government.
Tata Steel had been contributing to the SDF until 1994, with a total contribution of Rs 1,007.78 crore. During the period from 1981 to 2000, Tata Steel also availed loans from the SDF. The other contributors to the SDF were either refunded their contributions or had their loans written off. For example, the public sector steel maker SAIL received a loan waiver amounting to Rs 5,323.71 crore, as per court records.
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The order further stated that if Tata Steel applied for any form of assistance from the SDF corpus, it would be considered by the appropriate authority of the central government.
Tata Steel approached the Calcutta High Court to challenge the rejection of its loan waiver request. The court will now review the case and consider Tata Steel’s arguments.
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