Orkay

The ruling says that a person or a company cannot be held liable for prosecution for a dishonoured cheque if he requests the payee not to present the same due to insufficient funds in his account before the date of presentation of the cheque.

The Maharashtra state government has served a notice to Orkay Industries to wind up its operations in lieu of failure to pay back Rs 20 crore to the Maharashtra State Financial Corporation (MSFC).

Orkay had availed of the loans in June 1995. Since then it has been defaulting.

The implementation of the notice will give a minor jolt to the synthetic fibres and intermediates industry. With supplies from Orkay not entering the market, prices of synthetic fibre, which had been depressed for quiet some time now, might see a slight adjustment on the upward side.

Also, raw material providers to Orkay like Bombay Dyeing who supply almost 10 per cent of their DMT production will be affected to that extent. As a result the company can see a reduction in its turnover by Rs 36 crore. Bombay Dyeing has been plagued during the year by a high finished goods inventory with the closure of Orkay, Bombay Dyeing will be in doldrums.

Linked to the fortunes of the Bombay Dyeing DMT plant is Rama Petrochem supplier of methanol to the company. Any reduction in Bombay Dyeings production will also have an adverse impact on Rama Petrochem. Also, prices of MEG will take a beating.