Haldi Petro row: Apex court allows TCG to go for international arbitration

A Division Bench of the Supreme Court on Tuesday allowed the The Chatterjee Group (TCG) to move the ICC International Court of Arbitration (ICA) in Paris to settle a dispute over the ownership of 15.5 crore shares – around 9 per cent of equity capital – in the ailing Haldia Petrochemicals Ltd (HPL).

TCG, led by New York-based venture capitalist Purnendu Chatterjee, is the single largest stakeholder in HPL with around 41 per cent stake. The West Bengal government holds nearly 40 per cent holding (including the controversial 9 per cent). TCG Managing Director Aniruddha Lahiri confirmed the development.

HPL and the Mamata Banerjee-led Trinamool Congress government of West Bengal opposed TCG’s plea.

Disinvestment stalled While West Bengal Commerce and Industry Minister Partha Chatterjee, who’s also the chairman of HPL, did not respond to queries, sources said the apex court order may impact the State Government’s move to disinvest its 40 per cent interest to IndianOil Corp Ltd (IOC) at around Rs 1,700 crore (Rs 25.10 per share). IOC, which already holds around 9 per cent stake in the company, had emerged as the sole bidder for the State’s shareholding at an auction held in October.

IOC sources confirmed that the company received board approval to bid for the entire 40 per cent stake to take management control. Now, the company may not agree to buy the 31 per cent undisputed shareholding of the West Bengal Government at the auction-determined price.

A single-Bench of the Calcutta High Court has already issued a stay on the entire stake sale.

Agreement valid In 2006, the Buddhadeb Bhattacharjee-led Government scraped a private treaty – entered between the two sides on January 12, 2002 – to transfer the 9 per cent stake to TCG.

According to sources, Tuesday’s judgment may prove that the State was wrong. Favouring the TCG’s plea, Justices G.S. Singhvi and V. Gopala Gowda on said the “principle agreement of January 12, 2002 continues to be in force along with the arbitration clauses”.

pratim.bose@thehindu.co.in