The Maharashtra government has appealed against the Debts Recovery Tribunal - II order relating to attaching two of its office properties located in Mantralaya, the state government headquarters.
"We have our appeal against the DRT ruling pending before the Debt Recovery Appellate Tribunal. While this itself is pending, the recovery officer has passed the attachment order," maintained a senior state government official.
He however, added the government had not applied for a stay on the DRT order, pending its appeal, which resulted in the current scenario.
Informal discussions have already been held with the Industrial Development Bank of India. IFCI has so far refused to negotiate directly with the state government on the settlement issue.
"After a series of informal meetings, IDBI, the financial institution, has offered to settle the issue of total outstandings worth Rs 500 crore (Rs 5 billion) owed to it by the cooperative sectors in Maharashtra."
The government is keen to work out a similar model which it adopted in settling a claim with ICICI, paying Rs 25 crore on December 31, 2002, as final settlement against total outstandings of Rs 125 crore (Rs 1.25 billion).
ICICI has begun withdrawing all cases that it filed. The ICICI dues were on account of loans taken by seven cooperative sugar factories and 12 spinning mills.
IFCI had moved DRT for recovering Rs 50.69 crore from the Sindkheda sugar factory, for which the court had passed the attachment orders.
An asset valuation of the factory conducted by the DRT revealed that only Rs 5 crore would be realisable, resulting in the onus of repayment falling upon the state government which is the guarantor for the loan.
The government plans to impress upon the Mumbai High Court that although the Sindkheda sugar factory began operations over a decade ago, it operated only in the first year of commissioning at a very low level of production.
"The fact is that while 400,000 tonnes of sugarcane needs to be crushed annually, the factory has only crushed 25,000 tonnes. Of this 11,000 tonnes had to be procured from Madhya Pradesh owing to the unavailability of cane in local markets. IFCI's appraisal was faulty and hence the liability of the outstandings should not fall only on the guarantor," the official pointed out.
© 2026