FIs now move against JK group firm

JK Udaipur has a total outstanding to the tune of Rs 70 crore to ICICI Bank and Rs 52 crore to other banks and financial institutions such as Unit Trust of India(UTI), Life Insurance Corporation (LIC), Central Bank of India, State Bank of India (SBI), IDBI amongst others. “We will seize the assets after 60 days under the new law,” said an ICICI Bank official.

JKULL had taken loans from ICICI Bank for its cement plant situated at Udaipur in Rajasthan. Subsequently due to the downturn in the cement industry and inefficient management, the company started facing financial constraints.

The company was declared NPA with ICICI Bank in Nov 1999 and it is NPA with most of the other institutions and banks also.

The term lenders to the company had restructured the facilities in January 2001, which was approved by the High Court of Rajasthan, with the specific condition that the cement businesses of the JK Group would be consolidated in JK Corp Limited.

However, the company started defaulting to lenders again and has not made any payments since December 2001 and the manufacturing facilities have been lying closed since March 2002.

Now in order to save JK Corp (the other profit-making cement business of the JK Group (East), the promoters have decided to renege on their commitment of merging JKUUL with JKCL and thereby leaving the lenders of JKUUL in lurch. JKUUL was taken over by the JK group (East) from Bajaj Hindustan in the year 1990.