To find a solution to the long running legal battle, the Purnendu Chatterjee-led firm, The Chatterjee Group, has approached the International Court of Arbitration, under the International Chamber of Commerce.
On the other hand, stamping its supremacy on the board, the state government made industries and commerce minister Partha Chatterjee, a board member and the new chairman of east India's largest petrochemical company.
Purnendu Chatterjee, the deputy chairman, was made meeting-to-meeting chairman last July.
"TCG has filed an arbitration at the ICC, headquartered in Paris, early this month. The charges levelled against the state government is the violation of past agreements - which is an international deal - not being followed," said an official source close to TCG.
The ICA is the world's leading institution for resolving international commercial and business disputes. The total number of cases handled by the court since it was founded in 1999 is more than 17,000. In 2010, 793 cases were filed, involving 2,145 parties from 140 countries.
The cases are filed under this body if the parties are from different national, cultural and legal backgrounds and want to avoid litigation, as they fear bias in a separate country.
According to sources, TCG has approached the court as it came as a non-resident Indian investor and the agreement is of international standard.
At present, the disputed shares between both the parties are 155 million, which is about 10 per cent of the total 1,560 million of the firm.
Last year, the Supreme Court had dismissed the TCG petition against a decision of the Calcutta High Court.
The group had challenged a high court verdict that set aside a Company Law Board directive, asking the state government to exit the project by selling its stake to TCG.
However, the apex court verdict did not specify the shareholding pattern.
Recently, the West Bengal Industrial Development Corporation had sent back a cheque by TCG of Rs 17 crore (Rs 170 million), which cited an agreement of March 2002, based on which the state had to sell 155 million shares to the group.
If WBIDC had accepted the cheque, it would have marked TCG's dominance in HPL.
Meanwhile, Partha Chatterjee said he had been elected as the chairman of the company, based on majority votes.
"The government's preference is to take all the stakeholders on board," he said.
It was expected that after the Trinamool Congress government coming to power, things will turn better for HPL, as far as the shareholding dispute is concerned.
TCG had dragged the previous Left Front, as well. The state was looking to auction the controversial stake and the commerce minister has shown interest to take the auction route, though he said TCG would get priority if it was ready to pay according to the new valuation.
Companies such as Reliance, Indian Oil Corporation and the prospective equity partners, with whom the firm is in talks with, may enter the fray in case of an auction.
However, the company management kept mum on the battle.
"The induction of the minister as the chairman will give more confidence to the workers and he has promised to meet the HPL workers soon," the firm's managing director Partha Bhattacharyya said.
Converts debt to equity
The HPL board cleared the proposal to convert Rs 128 crore (Rs 1.28 billion) debt into equity in at par basis (Rs 10), Now the lenders will jointly own "about eight per cent of stake" in the company.
"Through this, we may be able to avoid reporting to BIFR," Bhattacharyya said.
There were speculations that the company might have to report to the Board for Industrial and Financial Reconstruction as a potentially sick company by the end of this financial year, as it has accumulated a huge loss of more than Rs 1,000 crore (Rs 10 billion), against a peak networth of Rs 2,844 crore (Rs 28.44 billion).
Main lenders of HPL are IFCI, IDBI Bank, ICICI Bank, PNB, SBI, Allahabad Bank and Union Bank of India. The total debt of HPL is about Rs 3,700 crore (Rs 37 billion).
A decision on the representation in the board from SBI and Indian Oil, another important shareholder, will be taken up in the next board meeting.
In yet another development, sources said WBIDC will provide preferential equity to the Rs 200 crore (Rs 2 billion butiene-1 project planned by the company.