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TMI Blog2000 (3) TMI 1069X X X X Extracts X X X X X X X X Extracts X X X X ..... ed other units in the steel industry is arbitrary, discriminatory, unconstitutional, illegal and bad in law; c) A Writ of Mandamus do issue commanding the respondents not to convert the loans, granted to the fifth respondents and others out of the Steel Development Fund, into equity share capital in any manner whatsoever; d) A Writ and/or in the nature of Mandamus do issue commanding the respondents to grant financial assistance and/or loans to the petitioners out of the said Steel Development Fund; e) A Writ and/or in the nature of Mandamus do issue directing the concerned respondents and each of them to forthwith recover the loans granted by them to the fifth respondent, TISCO and Rashtriya Ispat Nigam Ltd. so that such funds, upon realisation may be utilised for the new projects of the petitioner company and similarly situated other new entrants in the steel industry; f) Writ of Prohibition prohibiting the concerned respondents and each of them, their men, servants and agents, from converting any part of the loans and/or interest owned by the fifth respondent, TISCO and Rashtriya Ispat Nigam Ltd. into equity share capital in any manner whatsoever and also from granting any f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or. 3. Steel plants/industries in public sector can be treated differently than the plants/industries in the private sector, including the matter of loan advanced from the Steel Development Fund. 4. In case of Public Sector Industries (SAIL) Government can waive the interest or even can write off the loan itself. 5. If Government decides to extend any financial help to Private Sector Industries out of the amount available in the Fund (amount available out of the Fund means corpus of the fund excluding loan advanced to SAIL and TISCO). The representation of the petitioner for loan/financial assistance from the Steel Development Fund may be considered along with other similarly situated steel plants/industries in Private Sector. The appeal is accordingly stands disposed of." Looking at the prayer in the writ petition, we were at a loss to know as to why TISCO was not made a party. We have not been able to get any satisfactory reply from the petitioners as to why it did not think it necessary to implead TISCO as the respondent when the relief is sought against it. It cannot be just an error. Omission of the name of TISCO from the array of respondent is deliberate. One expects a p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in the desired categories and grades by the main steel plants. In the matter of operation of this fund, the Committee shall perform its functions in accordance with and subject to such regulations or directions so may be issued by the Central Government from time to time. 9(B) The Committee may also add any other element to the ex-works prices determined under sub- clause (8) to enable it to discharge its functions and to implement specific scheme entrusted to it by the Central Government." There was further amendment to this notification by another notification dated January 16, 1992. All paragraphs 1 to 13 under the heading "Functions" in the original notification were substituted by the following paragraphs: - (1) The Joint Plant Committee shall be responsible for carrying out generally the functions of co- ordinating the demand and the supplies of all or any of the categories of iron or steel produced by the members of steel plants in respect of Defence. Small Scale Industries Sector, the Exporters of Engineering Goods and the North Eastern Region, and shall also assist the Development Commissioner for Iron and Steel in ensuring supplies thereof on priority in terms of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... shall be omitted and such omission shall not affect the action taken or things done under that item on or before such omission. (b) after paragraph 4 the following paragraphs shall be inserted namely: (5) The Committee shall be responsible for the management and operation of the corpus of the Steel Development Fund and interest received and accrued thereon in accordance with and subject to such orders or directions as may be issued by the Central Government in this behalf from time to time. (No.SC-II(5) 93-D-II) S. NAUTIYAL, JR. SECRETARY." It will thus be seen that SDF has no statutory backing. SDF has been created by administrative orders. Contribution has been from the SAIL and TISCO. The question is what of the petitioner has in the SDF when it was not even born and fund was created and how the petitioner, a competitor, would have any right to claim the fund. Fund has not passed into the hands of the Government. It finds mention in the books of SAIL and TISCO as credited to the Central Government. Joint Plant Committee itself has no role to play in the utilisation of SDF as such. It acts as per the directions of the Central Government. The purpose for which the SDF has be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... proposals considered by it involving an amount of over Rs.8000 crore and financial restructuring alone was not a long term solution, Government has directed that Ministry of Steel sign an MOU with SAIL for implementation of a business restructuring plan with detailed milestones. It has been further decided that a Committee of Secretaries must examine and review at appropriate intervals the business restructuring plan with reference to detailed milestones and submit a progress report on a six-monthly basis to the Cabinet Committee on Economic Affairs (CCEA)." As seen above, SDF was created by notification issued under clause 17(B) of the Control Order. Main steel plants form the primary units of the Joint Plant Committee. It were only the member steel plants or the main steel plants who were subjected to add an element of their ex- works-price and remit the same towards the SDF. SAIL and TISCO were the member steel plants. SAIL was having four plants at Bhilai, Bokaro, Durgapur and Rourkela. Indian Iron and Steel Company Ltd. subsequently got merged with SAIL. By Notification dated January 16, 1992 the Central Government withdrew the price restrictions under the Control Order and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ot in fact remitted to the Central Government but was shown as credit to the Central Government in the books of SAIL and its members steel plants. This proposal of SAIL, it would appear, has since been accepted by the Central Government by its letter dated February 18, 2000 which we have reproduced above. While there was price control under the Control Order during the period 1978-1994 when the remittance to SDF were made by main steel producers, the petitioner was nowhere in the picture and was not subjected to any price control like the main steel producers. The petitioner and other steel producers were free to produce and sell the iron and steel products in the market on the prevailing prices. It has been pointed that price fixed by the petitioner of its products was much higher than the control price which included elements of SDF. While the collection and remittance to SDF has been discontinued w.e.f. April 1994, the petitioner made its claim for the first time in 1999 which would appear to be rather incongruous. It is submitted that the claim made by the petitioner is not bona fide and writ petition has been filed with ulterior motives, which are not difficult to fathom. SAIL ..... X X X X Extracts X X X X X X X X Extracts X X X X
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