NGEF’s outstation assets on the block

NGEF’s outstation assets on the block
Payment of relief to staff once again on hold. Now flats are being auctioned for funds

The woes of New Government Electric Factory (NGEF) never seem to end despite flashes of hope in between.

Three months ago, thousands of employees of NGEF, once the flagship public enterprise of the state government, were thrilled when the official liquidator sent letters stating that the long-pending payment of compensation and other arrears would be carried out. But now it has hit another hurdle as some of the employees protested stating that the arrears which are to be paid are lower than what was initially promised.

The official liquidator of the company, which shut in 2002, has taken the matter back to the court. In the meantime, however, the company's assets are being liquidated and the money is piling up. The latest is the auctioning of out-state assets of the company, including flats and movables in places like New Delhi, Kolkata, Mumbai and Indore.

On October 29, the liquidator, following the High Court’s orders, has put out a sale notice for flats, commercial flats, office furniture, finished and motor parts in places like Kolkata, New Delhi, Ahmedabad, Mumbai, Indore and Kolhapur.

These include four flats in Mumbai, three in Kolkata, two commercial flats/shops in Indore, besides seven electric motors (5.5 to 110KW) and office furniture in these places. The total earnest money deposit for all these put together is Rs 2.71 crore. Thus, the estimated value of the assets is around Rs 27 crore.

However, over 2,000 employees who were thrown out of the company in 2002 are still waiting for their arrears.

They have to be paid ex-gratia as there was no wage revision for years before the factory shut, and also the superannuation money which was deposited with the Life Insurance Corporation (LIC) for five years.

Three months ago, the liquidator sent letters to the old employees that this amount would be paid, but without interest.

Some of the employees objected to it as the money was less than promised earlier. The liquidator is now seeking the court's permission to pay only those employees who have not objected.

The case between the Board for Industrial & Financial Reconstruction (BIFR) and the official liquidator is going on since 2002.

The company's biggest asset – its 240-acre factory campus in Baiyappanahalli – is also being liquidated. The Namma Metro's Baiyappanahalli station now stands on a part of the land and is reported to have paid Rs 116 crore for the same.

The company, started in 1956, was one of the premier electric products manufacturers before a series of corruption allegations involving politicians took it down.

It was once a market leader in transformers, motors, switchgear, power electronics and semiconductor devices and supplied electric components for the Kolkata Metro in the 1980s.