Correspondent

It is an uncalled-for concession, says a journalist

Notices issued to the company and the banks concerned

Why is IMFA not registered under BIFR, he asks

CUTTACK: The Orissa High Court has admitted a PIL challenging the action of nationalized banks in waiving Rs 2,300 crore of loan to a single business family of Orissa.

A city-based journalist Gyanaguru Das has challenged this "uncalled for concession" to Indian Metal and Ferro Alloys (IMFA) Limited urging the court for CBI enquiry into the role of banks and to appoint a judicial commission to monitor the investigations.

The petition has also urged the court to direct the IMFA to deposit the arrear dues without prejudice to the outcome of the writ pending final disposal.

Counter in 3 weeks

A division bench of the HC comprising Chief Justice A K Ganguly and Justice Indrajit Mohanty on Wednesday issued notices to the IMFA and to all the concerned banks including the Banking Secretary of the Union Government and to the RBI. The bench asked the opposite parties to file counters within three weeks.

The petitioner has questioned as to how the Nationalized Banks and financial institutions have waived such a huge amount of loan of a company whose net worth (as per its own admission in March 2003) had been completely eroded and pegged at negative Rs 2712.12 crore.

"This is nothing but a broad daylight robbery of public money by the banks done at the behest of official power and political patronage", the petition said alleging that several influential persons also benefited from this deal.

The petition has also questioned that why IMFA was not registered under the Board of Industrial and Financial Reconstructions (BIFR) under the provisions of Sick Industrial Companies (Special provision) Act when its entire net worth was eroded in 2003.

It has also expressed doubt over the merger of the other family-owned company Indian Charge Chrome Ltd (ICCL) with IMFA.

The petition further said that even as there was a One-Time Settlement (OTS) in favour of ICCL that merged with IMFA for an amount of Rs 638.84 crores, the said amount has not been paid yet. "The banks have allowed IMFA to pay the OTS amount over a period of 18 years while in all other cases the OTS amount is normally paid between one year and 18 months," the petition alleged.

The banks that have waived loans running into Rs 2300 crores to IMFA are: 1.Industrial Development Bank of India waived Rs 1525.86 cr out of Rs 2002.55 cr 2.Industrial Finance Corporation of India waived Rs 138.59 cr out of

Rs 188.36 cr 3.ICICI Bank limited has waived Rs 136.23 cr out of Rs 173.55 cr 4.Indian Overseas Bank has waived Rs 89.69 cr out of Rs 102.33 cr 5.Punjab National Bank has waived Rs 83.87 cr out of Rs 96.45 cr 6.Vijaya Bank has waived Rs 103.30 cr out of Rs 115.88 cr 7.Canara Bank has waived Rs 99.92 cr out of Rs 114.27 cr 8.Andhra bank has waived Rs 49.45 cr out of Rs 58.24 cr 9.Central Bank has waived Rs 59.11 cr out of Rs 67.59 cr 10.Union Bank has waived Rs 51.87 cr out of a loan of Rs 56.73 cr.