CAG report be damned; IDCO issues fresh NOC to Visa Steel

Reported by Chinmaya Dehury
Bhubaneswar, May 25:

Unfazed by the rap of the Comptroller and Auditor General (CAG) for issuing ‘No Objection Certificates’ (NOC) to several industries enabling them to raise more than Rs 52,000 crore in the form of loan from financial institutions by mortgaging the land allotted to them, the Odisha government owned land acquisition agency IDCO has approved the proposal of Visa steel Limited for grant of mortgage permission over the lease hold land allotted to it at Kalinga Nagar industrial complex for availing loan with a financial institution.

IDCO has already approved the proposal of the steel making company, which is setting up a plant in the industrial complex and has assured the company to issue NOC soon for mortgaging the land to avail loan from Consortium lead bank State Bank of India CAGB, Reliance House, Kolkata.

“The proposal of mortgage of land measuring 82.98 acres allotted to your favour for establishment of steel plant has already been approved by the board of directors of IDCO and NOC will be issued in your favour for creation of mortgage after execution of supplementary deed between Collector and IDCO in respect of the said land,” said a letter of IDCO issued on Tuesday to the executive director of Visa steel.

The land acquisition agency has been issuing NOCs to several industries armed with the letter of Revenue and Disaster Management, which had allowed IDCO on July 9, 2013 to issue NOCs to the land lessees allowing them to mortgage the land allotted to them to avail loan from financial institutions for establishment of their industries.

The question, however, is how IDCO issued NOCs to the companies years before the issue of the letter?

Till date, 102 companies have applied for NOC for mortgaging the allotted land, out of which 93 proposals have been approved in the 97th and 98th meeting of board of directors of IDCO. As the matter of exemption of supplementary deed is pending at the government level, the supplementary deed in respect of allotted land could not have been registered, said a letter of IDCO to R & DM department.

So far, IDCO has issued NOC in respect of five industries which have born the registration fee for execution of supplementary deed in respect of the allotted land, said the letter.

Notably, the CAG, in its report, has come down heavily on IDCO for issuing NOCs to 26 MoU based industries for mortgaging 13846.238 acres of land allotted to them in order to raise loans from financial institutions, even though it was not authorised to do so.

The audit report noted that on the basis of NOCs issued by IDCO, loans of Rs 52423.50 crore was sanctioned by financial institutions in case of 12 promoters of MoU based industries, against mortgage of 8489.828 acres of allotted land.