Tata Steel faces Rs 1,902 crore demand notice from Odisha Government over Sukinda mine dispatch shortfall

Tata Steel faces Rs 1,902 crore demand notice from Odisha Government over Sukinda mine dispatch shortfall

Tata Steel has said it will challenge the demand legally, calling the claim baseless.

Tata Steel has received a demand notice of Rs 1,902.72 crore from the Office of the Deputy Director of Mines, Jajpur, Odisha, over an alleged shortfall in the dispatch of minerals from its Sukinda Chromite Block.

The demand, issued on July 3 under Rule 12A of the Minerals (Other than Atomic and Hydrocarbon Energy Minerals) Concession Rules, 2016, pertains to the fourth year of the Mine Development and Production Agreement (MDPA) — covering the period from July 23, 2023, to July 22, 2024. The mining authority has also initiated steps to appropriate Tata Steel’s performance security to recover the alleged dues.

According to Tata Steel’s regulatory filing, the revised demand is based on the recalculated average sale prices of minerals, as notified by the Indian Bureau of Mines.

“The revision in assessment is based on declaration of average sale price notified by the Indian Bureau of Mines,” the company said, clarifying that the shortfall is based on the state’s revised price methodology rather than any actual discrepancy in dispatch volumes.

Tata Steel has strongly refuted the demand, stating that the claim lacks merit or proper justification. “The management believes that the state’s demands lack justification and substantive basis,” the company noted, adding that it intends to contest the notice through appropriate legal forums.

Sukinda, located in Odisha’s Jajpur district, hosts one of India’s largest chromite reserves and is critical to Tata Steel’s raw material operations.