Employees in the lurch after closure of paper mills in Assam

By 29 Sep 2021

Employees, who are yet to be paid their dues for the past 56 months, fume as liquidator issues auction notice for the sale of the two mills owned by HPCL.

It’s been nearly six years since the two mills in Assam – the Nagaon Paper Mill and the Cachar Paper Mill – were closed in October 2015. Both mills were owned by the central government-controlled Hindustan Paper Corporation (HPCL) and were closed due to a shortage of working capital.

However, the employees of both the mills have not received their salaries and other dues since February 2017 and December 2016 respectively.

As a result, close to 95 of these former employees have died since March 2017; four by suicide. In the latest deaths reported on 24 September, Rajendra Kumar Nath, 60, of Nagaon Paper Mill, who was suffering from diabetes, died of a heart attack, while Shyama Kata Kurmi, 59, of Cachar Paper Mills died of kidney and liver disease.

Meanwhile, in a news report published on 4 September, the liquidator of HPCL had issued eviction notices to 900 employees of the two defunct paper mills asking them to vacate their official quarters within 15 days from 3 September to facilitate sale of the units' physical assets.

A prominent union leader of the mills argued that the staff were not paid their dues for the past 56 months, and the quarters will have to be vacated “over their dead bodies."

The notice stated that to facilitate the sale of the paper mills and to realise maximum value, it is necessary for the liquidator to get vacant possession of the land buildings being put for sale in liquidation.

Cachar Paper Mill at Panchgram in Hailakandi district and Nagaon Paper Mill at Jagiroad in Morigaon district have been non-functional since October 2015 and March 2017 respectively.

The two mills had a combined capacity of around 3,600 employees, 24,000 contractual workers and more than two lakh suppliers and contractors.

The BJP government had promised to revive the paper mills since Sarbananda Sonowal became the chief minister in 2016. Even during campaigning in this year's assembly polls, the party had assured people that steps will be taken to revive the mills.

The National Company Law Tribunal (NCLT), after several rounds of meetings between all stakeholders and a number of hearings, had ordered the liquidator on April 26 to sell all assets of the two closed paper mills of the HPCL as per the decision of the National Company Law Appellate Tribunal (NCLAT).

Accordingly, the HPCL liquidator Kuldeep Verma on 1 June had issued advertisements seeking bids for the eAuction at a reserve price of Rs 1,139-crore but there were no bidders till the last date on 15 June.

Subsequently, on 22 June, a new auction notice for the sale of the two mills was issued by the liquidator at a reserve price of Rs 969-crore, Rs 170-crore lower than the previous price.

It is a travesty that two working paper mills should be closed due to the “shortage of working capital” where there is a clear demand for India-made paper. According to paper expert PrintWeek talked to, the future is great for writing and printing grade mills.

“Right now, the per capita consumption of paper is about 20 kg, if calculated on a 1.3-crore population. The production is 27-million tonnes per annum,” the expert said. “So, the demand for yellow writing and printing paper will pick up gradually.”


(Courtesy Agencies)

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