Tata Steel has received a notice from the Odisha government demanding ₹1,902 crore. The notice was issued by the Deputy Director of Mines in Jajpur for an alleged shortfall in the amount of minerals Tata Steel dispatched from its Sukinda Chromite mine.
This penalty is related to the company’s mining activities for the year from July 23, 2023, to July 22, 2024. The government claims that Tata Steel did not meet the required mineral dispatch target as per the agreement they signed – known as the Mine Development and Production Agreement (MDPA).
The notice also mentions that Tata Steel may have violated Rule 12A of the Minerals (Other than Atomic and Hydrocarbon Energy Minerals) Concession Rules, 2016. The ₹1,902 crore fine includes the value of the minerals not dispatched and the performance security amount.
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Tata Steel shared this update in a stock exchange filing on Friday. The company said that the amount calculated is based on average sale prices reported by the Indian Bureau of Mines. However, Tata Steel strongly disagrees with the state government’s claims and says they are not based on facts.
The company added that it believes the penalty is unjustified and plans to take legal action to challenge the demand in court or other legal forums.
