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Mill worker stalls Dunbar reopening

Kohinoor Mandal

KOLKATA, July 3

THE reopening of Dunbar Mills, a textile unit located at Shyamnagar in North 24 Parganas, West Bengal and closed since 1987, has been stalled by Mr Kedar Singh, a worker, who has moved court against the revival package.

Mr Singh today filed a petition in the Calcutta High Court against the Rs 14-crore revival package submitted by Dr D.P. Sarkhel, a former executive-turned-entrepreneur. The petition was filed before Mr Justice Ashok Ganguly who was to give his verdict in favour of Dr Sarkhel's Capricorns (Enterprise) Pvt Ltd.

Dunbar Mills Ltd, which belonged to Mr L.N. Bangur, and lying closed since May 1987 was referred to the Board for Industrial & Financial Reconstruction in 1992 and in 1997 the liquidation orders were passed. The Official Liquidator of the Calcutta High C ourt took possession of the unit in January last year. Early this year, Dr Sarkhel expressed interest to take over and revive Dunbar.

Following consultations with the West Bengal Government, an agreement was signed between the West Bengal Industrial Development Corporation Ltd and Capricorns.

The workers along with their 10 trade unions also supported Dr Sarkhel. The Calcutta High Court was expected to award the right of acquisition of the property of Dunbar Mills to Capricorns. However, the present petition against the revival package has st alled the reopening process.

Corporate sources said that a section of the State's textile industry was against the take-over of the mill by Dr Sarkhel. Pointing out that vested interests were trying to delay the legal proceedings and thereby discourage Dr Sarkhel, sources clarified that Mr Kedar Singh does not have the resources to fight a case at Calcutta High Court.

Without commenting on the petition, Dr Sarkhel said that the matter would come up for hearing on July 17. ``The matter is pending before the High Court and I would not like to comment on it. However, I must say that the petition has delayed the revival p rocess of Dunbar Mills'', he told Business Line.

Capricorns' revival package has been supported by banks and financial institutions. Indian Overseas Bank has agreed to meet the working capital needs. The West Bengal Government has also agreed to give a soft loan of Rs 7 crore at only 10 per cent intere st under the West Bengal Industrial Renewal Scheme.

As per the revival package, Dunbar should start registering a turnover of Rs 48.37 crore by the end of the first year of operation and generate a net profit of Rs 1.98 crore. By the third year, it is expected to wipe out the losses with a turnover and ne t profit of Rs 56.86 crore and 2.36 crore respectively.

At present, the unit owes Rs 8.76 crore to banks and FIs. This includes Rs 4.7 crore to the State Bank of Bikaner and Jaipur, Rs 2.5 crore to IDBI, Rs 89.6 lakh to IFCI and Rs 57.4 lakh to IIBI. The statutory dues of the workers amount to Rs 5.28 crore.

The unit is located on 43 acres of land and has a capacity of 16 tonnes per day. Capricorns hopes to set up a 15-tpd jute yarn unit in the second phase of the revival process at a cost of Rs 3.5 crore.