LUCKNOW: The Uttar Pradesh State Mineral Development Corporation (UPSMDC) has become the first PSU in India to be winded up under company law by the National Company Law Tribunal without having to go for insolvency and bankruptcy.
The decision to wind it up was taken in 2000 and its completion included settlement of 563 legal cases out of the total 565 that the company had in courts across the country. In all, 488 employees were given VRS while 318 were given dues as per the provisions for layoff, including payment of provident fund..
“All assets and liabilities were calculated and each transaction was done transparently and meticulously,” said Madhukar Singh, who retired as the general manager of UPSMDC and was looking after the wind-up of the PSU. Devraj Gupta was the company secretary.
Some of the major steps taken for winding up were a state loan of ₹13,0075000 to pay the salaries and settle VRS claims and this load was repaid by selling assets of UPSMDC later. “There were no objections or pending claims. This is an example how companies can wind up without leaving any dues by following a fair practice,” said Singh.
Reasons for winding up of the corporation include closure of Lambhidar mining project in Dehradun, due to which the UP Carbide And Chemicals Limited too had to be closed. Later, the Lalitpur rock forest mining project and UP Cement Corporation in Sonebhadra were also shut down. Appointment of excess staff too was a reason and with closures, salary of the then existing staff became a burden for the corporation.
{{/usCountry}}Reasons for winding up of the corporation include closure of Lambhidar mining project in Dehradun, due to which the UP Carbide And Chemicals Limited too had to be closed. Later, the Lalitpur rock forest mining project and UP Cement Corporation in Sonebhadra were also shut down. Appointment of excess staff too was a reason and with closures, salary of the then existing staff became a burden for the corporation.
{{/usCountry}}“But with the method adopted there have been no complaints and despite a public notice there were no claims regarding dues,” said Singh.