The Oil Sector Officers Association on Tuesday welcomed the Supreme Court decision, restraining the government from privatising oil refiners Hindustan Petroleum Corporation Ltd and Bharat Petroleum Corporation Ltd without Parliamentary approval.
"We welcome the court decision and hope the government will not proceed with privatisation of the two companies," Ashok Singh, convenor, OSOA, told PTI in New Delhi.
OSOA had filed a petition challenging the government decision to sell its 34.01 per cent stake in HPCL to a strategic partner and 35 per cent stake in BPCL through public offerings in domestic and overseas markets.
The apex court had agreed with OSOA contention that the government should have approached Parliament for enacting a suitable law for privatisation of the two companies, which were acquired through a Parliamentary legislation in 1974.
OSOA's counsel, senior advocate Fali S Nariman, said the petitioner was not against the decision to privatise the public sector undertakings. "What it was opposing was the manner of privatisation of the oil PSUs, which were in the strategic sector," he added.
Meanwhile, the officials associated with the divestment process said the apex court ruling will be "fatal" to the government's divestment programme. Besides halting the process in its strides, it may also affect the stock valuation of public sector companies in general and the two oil firms in particular.
Singh said the due diligence process for HPCL will now have to be stopped.
Notwithstanding the pendency of petition challenging the decision to privatise the two oil refiners, the government had gone ahead with the due diligence of HPCL.
Suitors for the government's 34.01 per cent stake in HPCL began due diligence on August 28. Reliance Industries Ltd was the first firm to initiate the process and after it scrutinised the books and installations, British oil and gas major BP Plc visited the data room for the due diligence.
"At the same time, we as employees will stride to improve the performance of the company and further enhance the quality of service and productivity," Singh added.
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