Legal hurdle in the way of Ballari plant revival

Amid the ArcelorMittal's bid to revive its steel plant project at Ballari, a legal battle pertaining to acquisition of land of over 4,800 acres before the Supreme Court is set to haunt the largest steel maker.

A group of farmers had approached the top court in May against a decision to re-examine their plea for enhanced compensation for the land. The land owners, through their counsel Sanjay M Nuli, have claimed that ArcelorMittal did not challenge or dispute the order for enhanced compensation from Rs 1.5 lakh per acre to about Rs 30.20 lakh per acre, besides other benefits like solatium. However, Karntaka Industrial Areas Development Board (KIADB) objected to it and challenged it before the Karnataka High Court.

The top court has issued a notice to ArcelorMittal and the KIADB against the high court's order of January 8, remanding the matter back to the reference (trial) court for a fresh consideration.

In its point-wise response to the petition, the company filed an affidavit in October last week claiming that the reference court had on March 1, 2016 enhanced the compensation 20 times from Rs 1.5 lakh to Rs 30.20 lakh per acre in an “arbitrary and perverse judgement” without hearing it or the KIADB, the statutory body that acquired the land. 

It further claimed only 2659.75 acres of 4864.64 acres of land sought to be acquired by an order of May 4, 2010, was meant for the steel plant and the remaining more than 2000 acres was for other statutory purposes. The company had proposed to invest Rs 30,000 crore to set up an integrated steel plant, along with a 75-MW captive power facility in Ballari.

“Since the land was being acquired by KIADB, the company, having not filed an appeal, cannot be construed as it acquiesced to the enhancement of compensation,” it said. As its counsel supported KIADB in the high court, not filing an appeal cannot be implied that it was not aggrieved with the order for enhanced compensation, it added.

The company said the high court's order that both the ArcelorMittal and KIADB must be heard by the reference court is “absolutely correct”.

With regard to claims of the land owners that KIADB acted as an agent of ArcelorMittal, the company said, “it was wholly false, baseless and misconceived and does not merit consideration.”

It further said the company had already paid the amount for the cost of the land to the KIADB, but the execution of the lease was still pending.

In a separate response, KIADB, through its counsel Nishanth Patil, sought dismissal of the land owners' plea, contending that the petitioner “deliberately” did not disclose that the high court had subsequently directed for payment of compensation at the uniform rate of Rs 10 lakh per acre as per consent and the petitioners had withdrawn the deposits so made.

It also maintained that the agency is wholly responsible for the acquisition of land and the disbursal of compensation. It was mandatory to notify the KIADB in the proceedings for enhanced compensation, it said.