- Villagers allege undervaluation, statutory bypass in land transfer for industrial use
- JSW Steel says acquisition is legitimate and part of long-term expansion strategy
- Government notes industrial investment importance; no regulatory probe yet confirmed
NE BUSINESS BUREAU
BHUBANESHWAR, JAN 221
Allegations of land misuse and regulatory lapses have surfaced in Odisha’s Dhenkanal district, with villagers from Khadagprasad and Khurunti approaching the Securities and Exchange Board of India (SEBI) seeking intervention in land transfers involving JSW Steel Ltd, Saffron Resources Pvt Ltd and the now-insolvent Lanco Group.
Villagers Raise Serious Concerns
According to a representation submitted by Narendra Kumar Sahoo, Vice President of the Anchalika Silpanchala Khyatigrasta Prajasangha, about 900–1,000 acres of fertile land originally belonging to farmers was allegedly diverted through structured deals that bypass land return laws.
Villagers maintain: “What was projected as industrial development has resulted in dispossession, distress and denial of lawful rights for more than fifteen years… This case is not merely about farmers’ land. It is a test of India’s regulatory institutions, investor protection framework and the rule of law.”
They argue the land was acquired by the Odisha Industrial Infrastructure Development Corporation (IDCO) between 2008–10 for a Lanco Group power project, which was never completed. After Lanco’s liquidation, they contend that the land was transferred at undervalued rates to Saffron Resources, and later to JSW Steel, without sufficient transparency, independent valuation, or consultation with original landowners.
The villagers claim massive economic losses to local communities and the public exchequer, including unpaid dues to contractors and potential stamp duty and tax revenue losses.
What Is Verifiable: JSW Steel’s Land Acquisition
JSW Steel publicly disclosed that it acquired 100% equity stake in Saffron Resources Pvt Ltd, a company holding approximately 887 acres of land in Dhenkanal district—part of its long-term strategy to secure strategic land assets for future expansion.
A regulatory filing indicates:
- Saffron Resources currently has no business operations, and its land holdings may be used by JSW Steel for future projects.
- The transaction was structured as a cash acquisition and, according to the filing, does not constitute a related party transaction under SEBI norms.
JSW Steel has not publicly acknowledged any ongoing regulatory probes related to the land deal.
Government and Industry Perspective
Industrial development in Odisha has been a priority for state authorities, with recent approvals for major projects including a 6 MTPA steel plant by Saffron Resources (a JSW Group subsidiary) estimated at ₹35,000 crore.
State government officials have generally defended industrial expansion, citing job creation and economic growth, although specific responses to the villagers’ SEBI plea were not publicly available at the time of reporting.
Context: Lanco Project and Legal Framework
The land in question was originally acquired by IDCO for a Lanco Group thermal power project that did not materialise due to the company’s insolvency. Under the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, unused land must revert to original owners after five years. Villagers allege this statutory requirement was ignored; however, no independent legal or regulatory ruling has been reported on this specific point.
Calls for SEBI, Government and Judicial Review
Villagers have appealed not only to SEBI, but also to the Prime Minister’s Office, Finance Ministry, Minister of Corporate Affairs, NSE and BSE leadership, and state authorities, seeking:
- SEBI review of disclosures and investor filings related to the land transaction
- Reversal of the transfer or fair, benchmarked compensation to original owners
- Coordination between income tax, IDCO and SEBI for a full statutory audit
Balanced Takeaway
While community grievances reflect deep socio-economic distress and long-standing land-use concerns, there is no publicly available confirmation that SEBI or any regulator has yet initiated a probe into alleged investor deception or statutory breaches in this case.
JSW Steel’s land acquisition through Saffron Resources is documented in regulatory filings, but the valuation, usage plans and compliance with land return laws remain contested by community representatives. Authorities and the company have not issued statements addressing the specific allegations at the time of publication.
This evolving matter sits at the intersection of industrial policy, land rights, investor confidence and regulatory oversight, and may prompt official clarification and legal scrutiny in the coming weeks.
