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Rediff.com  » Business » CCD to mull Hind Copper sale on Fri

CCD to mull Hind Copper sale on Fri

October 03, 2003 09:39 IST

The divestment of the government's 98 per cent stake in Hindustan Copper Ltd hinges on Friday's meeting of the Cabinet Committee on Divestment.

The financial bids for HCL had been called before the Supreme Court stayed the divestment of Hindustan Petroleum Corporation Ltd and Bharat Petroleum Corporation Ltd, which had been set up by Acts of Parliament.

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The court's contention was that these two companies, which had been set up by nationalisation of assets of Esso and Burmah Shell, could not be sold without a sanction from Parliament.

HCL's complex at Ghatsila, Jharkhand was nationalised in 1969. Thus the Supreme Court ruling on the sell-off of the oil PSUs has a bearing on HCL also since a part of its assets was acquired through nationalisation.

The Ministry of Divestment has prepared a list of six options, to be taken up at the CCD meet on Friday, to solve the logjam over the sale of the oil PSUs.

These include enactment of an appropriate legislation that would empower the government to sell equity in all PSUs that have been set up through Nationalisation/Acquisition Act, partially or wholly.

This option could be pursued through an ordinance and would avert any probable obstacle to divestment of HCL.

Another option is the passing of a comprehensive legislation, which will empower the government to privatise any PSU as long as the procedure adopted for the sale is consistent with the rules framed under the legislation.

A third option to break the impasse over the sale of the oil PSUs is to reopen the issue through a Presidential reference under Article 143 of the Constitution.

The government could also wait for a third party to file a case as a result of the Supreme Court's ruling and then re-open the issue before a larger bench.

The fifth option is to sell the two oil giants through an ordinance. The other course of action would be a review by the same bench that delivered the September 16 verdict.

However, officials said that these two methods were not likely to hold water at Friday's CCD meet.

Sources said the CCD was likely to pursue the options of the omnibus legislation for divestment in general or for nationalised PSUs so that enterprises like HCL, which were directly affected by the apex court's ruling, could be hived off smoothly.

The last date for submission of price bids for the copper company is October 14.
BS Economy Bureau in New Delhi