Steel ministry not to renew MoU of Deepak Steel

Firm owner accused of illegal mining

The steel and mines department of the Odisha government has decided not to renew the Memorandum of Understanding (MoU) signed with Deepak Steel and Power Ltd after the promoter of the company was found to be involved in illegal mining activity.

"The MoU signed with Deepak Steel and Power has already lapsed. We are not going to renew it," said Rajnikant Singh, state minister for steel and mines.

"We have also cancelled the trading licence of the company and asked the miners not to sell iron ore to the firm," he added.

The owner of the company Deepak Gupta, who was operating Uliburu iron ore mines in Joda mining circle under the power of attorney received from original lease holder B K Mohanty, is accused of raising ore from an adjacent plot categorised as reserve forest area and is said to have made money worth Rs 1,800 crore by exporting the mineral.

The state forest department has already filed a case in this regard. The state revenue minister has ordered a special inquiry into the case today.

"I have ordered my principle secretary to ask the district collector to file a report within 72 hours by visiting the spot. We will definitely take necessary action against all those people who were involved in this crime," said Surjya Patro, the state revenue minister.

In 2005, Deepak Steel & Power Ltd had proposed to set up a 0.25 million tonne per annum (mtpa) steel plant at Topodih (Barbil) entailing an investment of Rs 195.31 crore.

In 2010, the company was asked to expedite work on its project and furnish a report to the state government on the state of land acquisition and actual investments grounded as soon as possible. It was warned that if it failed to submit the details then its MoU may be cancelled.

Miner B K Mohanty, who had authorised Gupta to operate the iron ore lease, has been issued notice by the Joda deputy director of mines (DDM) for illegal mining and selling of minerals worth Rs 1,776 crore. However, the government sources said, the total amount of business transacted by the mining company, based on total transport records obtained from Paradip port, could top Rs 1,800 crore.

Meanwhile, the Shah Commission has asked for clarification on the illegal activities in Mohanti's lease-hold area.