The decision was taken in view of the continuous poor physical and financial performance of the company for more than 10 years combined with a low probability of its revival in the future, it said.
The measure would save public funds which could be used for other developmental work, the statement said.
"The government will provide one-time grant of Rs 417.10 crore towards severance packages and for clearing the current liabilities of the company. In addition, an outstanding loan of Rs 35 crore given to the company by the Government of India (Ministry of Railways) shall be written off. 508 employees of BSCL will benefit from Voluntary Retirement Scheme (VRS)," the release said.
The Burn Standard Company Limited was incorporated in 1976 following nationalisation and amalgamation of the Burn and Company and the Indian Standard Wagon Company Limited in 1987 under the Department of Heavy Industries (DHI).
The company was referred to the Board of Industrial and Financial Reconstruction (BIFR) in 1994 and declared sick in 1995.
The company continues to be a sick company since then.
(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)