The Cabinet Committee on Economic Affairs (CCEA) has approved budgetary support, in the form of Non-Plan loan of Rs.27.06 crore for payment of salary/wages and statutory dues to the employees of HMT Limited for the period from March, 2013 to September, 2013. The CCEA has also approved Rs.50.34 crore to HMT Machine Tools Limited for payment of statutory dues (Provident Fund, Gratuity etc.) for the period from September, 2012 to March, 2013.

HMT Limited and HMT Machine Tools Limited, a subsidiary of HMT Limited, are Central Public Sector Enterprises under the administrative control of the Department of Heavy Industry.

This decision would mitigate hardships being faced by employees and would also motivate employees and help to achieve the goal of revival/restructuring of the companies.

BACKGROUND:

Hindustan Machine Tools Ltd., was established in 1953 for production of machine tools initially. It was renamed as HMT Ltd in 1978 in view of its diversified status and multi-technology products. The work force of the company as on 31.10.2013 was 1439. The company had authorised share capital of Rs. 2100 crore and paid up equity share capital of Rs. 760.35 crore and paid up preference share capital of Rs.443 crore as on 31.3.2013.

Budgetary support for employee salary and statutory dues to relieve hardship and assist company revival and restructuring efforts. Approval was granted for targeted budgetary support in the form of a Non Plan loan to HMT Limited for salary, wage and statutory dues for March-September 2013, and separate funds to HMT Machine Tools Limited for statutory obligations (including provident fund and gratuity) for September 2012-March 2013, directed at immediate discharge of employee claims and statutory liabilities while the companies pursue revival and restructuring.