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Thursday, Jan 20, 2005

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Assets sell-off — Daewoo Motor case may be transferred out of Mumbai

Neha Kaushik

New Delhi , Jan. 19

ALL proceedings related to the sell-off of the assets of Daewoo Motor India are likely to be shifted to the jurisdiction of the Debt Recovery Tribunal (DRT) at Delhi or Uttar Pradesh from DRT Mumbai.

At a hearing at DRT Mumbai, the recovery officer held the view that since the assets of Daewoo are located in the vicinity of Delhi, the case should be transferred to the area. A final decision on this matter will be taken by the presiding officer at DRT Mumbai at a hearing on March 1.

The Daewoo labour union also made a representation today stating that the assets of the now defunct Daewoo Motor India should be sold as a "going concern" and that the workers should be employed by the purchasers of the unit. The 1,400-odd workers at the Daewoo Motor India have not received salaries since March 2003.

General Motors had earlier this year announced that it intends to bid for the car assembly unit of Daewoo India. However, the company has since indicated that its plans to purchase the unit have been delayed due to legal and Government related issues. According to sources, the differences between the customs department and the prime lenders (ICICI Bank, IDBI Bank and Exim Bank) over the sell-off are delaying the process. In fact, a firm interested in purchasing Daewoo's engine-transmission-axle unit is believed to have pulled out of the bidding process stating that it could not wait longer.

The Government's dues from Daewoo India are in the form of customs duty claims amounting to over Rs 1,000 crore and also dues resulting from alleged financial mismanagement at the firm.

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