India’s 2nd Largest Steel Manufacturer Gets Relief as Orissa High Court Quashes Rs 4,313 Crore Demand Notices

The Indian equity markets were trading on a flat to negative note on Tuesday, with the Nifty 50 index down by 23.05 points or 0.10 per cent at 24,069.65 during the session. Amid this, shares of Tata Steel gained 1.57 per cent to Rs 216.62 after the company informed the exchanges that the Hon’ble High Court of Orissa at Cuttack has quashed two demand notices aggregating Rs 4,313.62 crore issued in relation to its Sukinda Chromite Block in Odisha.

Orissa High Court Quashes Two Demand Notices Issued to Tata Steel

Tata Steel Limited stated that the first demand letter dated July 3, 2025, issued by the Office of Deputy Director of Mines, Jajpur, had raised a demand of Rs 1,902.72 crore in connection with revised assessment of shortfall in dispatch of minerals from the Sukinda Chromite Block for the fourth year period from July 23, 2023 to July 22, 2024 under the Mine Development and Production Agreement.

Subsequently, a second demand letter dated October 3, 2025, sought Rs 2,410.89 crore towards alleged shortfall in dispatch of chrome ore for the fifth year period from July 23, 2024 to July 22, 2025. Both notices had also invoked appropriation of performance security under Rule 12A of the Minerals Concession Rules, 2016.

Court Rules Penal Provisions Cannot Be Applied Retrospectively

The company had challenged both demand letters before the Hon’ble High Court of Orissa through separate writ petitions. Interim protection from coercive action was granted by the Court during August 2025 and November 2025, and the matters were subsequently reserved for judgment on February 2, 2026.

Tata Steel informed that the judgment was pronounced on April 20, 2026 and received by the company on April 27, 2026. The Court held that while Rule 12A(1) remains valid, the penal provisions introduced through sub-rules (1A), (1B) and (1C) with effect from July 1, 2021 would apply prospectively and cannot be enforced retrospectively. The Court further held that in case of inconsistency between the approved Mining Plan and the Mine Development and Production Agreement, the Mining Plan shall prevail.

Demand Notices Aggregating Rs 4,313.62 Crore Stand Quashed

Based on the conclusions and directions passed by the Hon’ble High Court, Tata Steel Limited said that Demand Letter 1 and Demand Letter 2 issued by the Office of Deputy Director of Mines, Jajpur stand quashed to the extent they are contrary to the conclusions and directions of the Court, providing significant legal relief to the company in the long-pending mining dispatch dispute.

About Tata Steel Limited

Tata Steel Limited, incorporated in 1907, is one of the world’s leading integrated steel producers with geographically diversified operations across India, the Netherlands, the United Kingdom and Thailand, along with raw material assets in India and Canada. The group has a consolidated crude steel capacity of 35 MTPA, including 26.6 MTPA in India.

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Disclaimer: This article is for informational purposes only and not investment advice.