UPA government for ordinance to retain land of NTC's Podar Mills & Dayal Bagh Spinning and Weaving mill

NEW DELHI: Days before its term ends, the UPA government has in principle agreed to use the ordinance route to ensure that it does not have to return prized land of the National Textile Corporation's Podar Mills in Mumbai and Dayal Bagh Spinning and Weaving Mill in Amritsar to its original owners.

Sources said this was being done to deflect the perception that the government had handed over prime land to private parties, while rendering thousands of workers in the two mills jobless. The government has been forced to resort to an ordinance after the Supreme court ordered NTC to return the land to its original owners on expiry of lease.

In 2011, the Supreme Court had asked NTC to hand over the 2.5 acre plot in Mumbai's Chinchpokli area to Seth Hirachand Rupchand Charities Trust while dismissing the argument that the PSU was protected from any rent law as it was a government agent. The NTC mill was a tenant of the Trust. The mill in Amritsar has also been hit by a similar ruling.

NTC executives said the company wanted Podar Mills to continue operations as it had invested heavily in reviving what was until recently a sick unit. Currently, the mill operates 45,000 spindles.

Sources said the decision to back an ordinance was hotly debated in the Cabinet as it concerned an SC order. Prime Minister Manmohan Singh is learnt to have asked if it would be proper to propose an ordinance when the apex court had issued an order.

To this, commerce and industry minister Anand Sharma, who also holds the textiles portfolio, suggested that it could be nationalized, sources said. Finance minister P Chidambaram and urban development minister Kamal Nath then said such a retrospective move would generate adverse opinion, prompting the government to propose an ordinance.

Given that there are just two days left for the election results to be announced, the next government will have to take a call on the contentious issue.