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Crucial phase for Travancore Rayons

KOCHI: The State government is yet to come out with a concrete proposal for the revival of Travancore Rayons, which has been going through a critical phase following a Kerala High Court order.

In December, the court ordered suspension of the process of liquidation of the company for a month. Accordingly, the government will have to submit a concrete proposal by January 18, sources said.

The Travancore Rayons Samrakshana Samithi (protection committee), a body of trade union representatives, political leaders and workers, is seeking a solution which will not harm the interests of over 1,000 workers rendered jobless for about eight years. Liquidation will not be the ideal solution, a leader of the samithi said.

The industrial unit had incurred a liability of over Rs.100 crore, but liquidation may yield only about one-fifth of the amount.

This is because the liquidator will have no authority to sell the government land where the factory is situated. The building and old machinery will have a limited value. There is an apprehension the workers then will be denied benefits.

The samithi has been favouring the unit’s takeover by a government agency such as the Kerala Industrial Infrastructure Development Corporation (KINFRA), the Kerala State Industrial Development Corporation or Infrastructures Kerala Ltd. (InKEL).

The takeover will enable the government to utilise 30 hectares of the land. The government has a stake of 37 per cent in the unit.

Though a Kochi-based group has come forward to take over the unit, the question of settling the dues has not been sorted out. The liabilities include borrowings from banks and financial institutions, apart from tax and electricity charges. Though a one-time settlement had been suggested, a final settlement could not be reached. A dispute over the share of the promoter and the government could not be sorted out.

The Coimbatore-based NDEE group had earlier evinced interest. The group had signed a memorandum of understanding with the government, but it was abandoned later in the absence of a settlement of the dues.

As the government has not yet come out with a concrete proposal, the name of the Kochi-based group may surface again.

But questions about the credibility of the group have been raised from various quarters and that may come in the way of smooth operations in the event of a takeover.

The Cabinet will have to decide on handing over the unit to the promoter or to a government agency. The decision is expected soon as the government has to file a statement before the court.

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