The Hindu Business Line : Dunlop union writes to BIFR on disposal of non-core assets

Chennai, Aug. 7 The Dunlop Factory Employees Union, at Dunlop India’s Ambattur factory, has written to the Board for Industrial and Financial Reconstruction (BIFR) to ensure that the “non-core assets/properties belonging to the company in Ambattur are never disposed.”

Dunlop owns over 58.52 acres at Athipattu village in Ambattur, apart from the factory premises of about 30 acres. The workers see this prime property as the last asset available with the company to support their own livelihood.

In a representation to the BIFR in July, the union said that the Dunlop management has not restarted the factory or kept to its agreement of full-fledged productivity. The management also owes the workers statutory dues. The company should be allowed out of the purview of BIFR only if these conditions are met.

Previous managements

The DFEU representatives told Business Line that under the earlier management of the Chhabrias of the Jumbo Group, Dunlop India Ltd sold over 60 acres adjacent to the factory in 2004 to a Chennai-based developer for Rs 24.34 crore. At that time, the sale through the BIFR was seen as a necessary move to restart production at the factory.

Subsequently, the Kolkata-based Ruias acquired Dunlop in 2005, but the factory is yet to restart production even three years after the land sale. The company is now left with over 58 acres in Athipattu, which the union fears would be lost if appropriate action is not taken immediately.

Land in Ambattur area is at premium with an acre in Athipattu costing about Rs 2.5 crore. With Ambattur industrial estate a scene of major development with about six million sq. ft of IT and office space coming up, land in the estate costs about Rs 10 crore an acre. In the vicinity of Dunlop factory, land costs about Rs 5 crore an acre.

Land Encroached

According to the DFEU, over the last few years when the factory had suspended production, the Athipattu land had been encroached upon by private individuals who have sold a portion of the land as housing plots. They have urged the management to take action to protect the property.

The DFEU has also informed the management that over 15 acres has been encroached and sold as house sites by private parties at Athipattu. The union has also filed a police complaint and forwarded copies to the District Collector and State Government authorities.

Government land

According to the DFEU, the State Government could intervene in this issue. In 1959, the Government had acquired over 52.28 acres from private parties on behalf of Dunlop and also assigned 6.24 acres of its own land to the company. It also gave exemption under the Land Ceiling Act.

The exemption granted under the Tamil Nadu Urban Land (Ceiling and Regulation) Act, 1978, is on the condition that if the company plans to sell land it would have to hand over the exempted excess land to the Government and sell only the portion it can hold legally.

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