Centre seeks early Supreme Court ruling on Hindustan Zinc stake sale

NEW DELHI: The Union government on Monday requested the Supreme Court for an early decision in a five-year-old writ petition challenging the offloading of government equity in (HZL) and said pendency of the petition had stalled the Centre’s plan to disinvest in the erstwhile public sector company.

Solicitor general Tushar Mehta’s request for early hearing on the writ petition filed by National Confederation of Officers’ Association of Central Public Sector Undertakings evoked a sharp response from a bench headed by CJI S A Bobde, who asked, “What is the hurry?”

Mehta said, “There is urgency. The economy needs an infusion of money. But the decision to disinvest government equity in HZL has been unnecessarily stalled.” He requested the court to hear the matter this week. However, the bench agreed to post the PIL for hearing after the Holi break.

In January, the SC had asked Mehta to submit, in sealed cover, the preliminary enquiry (PE) report of CBI on alleged irregularities in the Union government’s decision to divest the Centre’s remaining 29.5% stake in HZL. For the petitioner association, advocate Prashant Bhushan had alleged that most investigating officers in the CBI and top officials had favoured registration of a regular case on the basis of irregularities pointed out in the decision to divest the government’s stake in HZL.

However, Mehta had said the procedure for closure of the case was followed scrupulously. The SG had said he was willing to place in sealed cover the PE report before the SC to dispel any misgivings about alleged irregularities as claimed by Bhushan.

On January 19, 2016, the SC had stalled the government’s proposed sale of its 29.5% equity in HZL, the erstwhile public sector company where Anil Agarwal’s Vedanta now has majority stake. The NDA government had in 2002-03 divested its majority stake in HZL and Bharat Aluminium Company (Balco) and was looking to exit the two companies.

The finance ministry was keen to offload the government’s remaining 29.5% share in HZL and 49% stake in Balco, hoping to raise over Rs 20,000 crore, based on 2016 market prices. The option was to either sell the remaining shares to Vedanta or explore other routes such as auction on the stock exchanges or a public offer. Appearing for Vedanta, senior advocate Harish Salve had told the SC that the company had no objection if the government auctioned its stake in the market, and that Vedanta was ready to participate in the general auction.