Jharkhand Mining Office Sends ₹1,755 Crore Notice To Tata Steel

Tata Steel Ltd said it has received a demand notice of ₹1,755 crore from the mining office in Jharkhand, linked to alleged excess coal extraction in earlier years. The company disclosed in an exchange filing that the notice, dated 30 March, was received on Friday, 3 April. It was issued by the District Mining Office, Ramgarh.

The demand pertains to the alleged extraction of about 1,62,40,399 metric tonnes of coal from the West Bokaro Colliery. The period under review spans from FY2000-01 to FY2006-07.

Impact On Share Price

There has been no visible impact of the development on Tata Steel share prices. At 11:24 am, Tata Steel shares were trading at ₹194.22 per share on the National Stock Exchange (NSE). However, analysts believe that the issue could have an impact on the company’s share prices in the near-term.

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Basis Of Demand And Company Response

The company said the demand has been raised on grounds similar to those cited by the Common Cause vs Union of India, which dealt with issues related to illegal mining and excess production.

Tata Steel said the demand lacks justification and a substantive basis and indicated it will challenge the notice. The company plans to pursue legal remedies before appropriate forums, it said in the filing. No financial impact has been quantified at this stage. The company has not indicated any provisioning related to the demand.

Sources:

The Economic Times

The Hindu Business Line

Moneycontrol