Lok Sabha Question No. 603 (UNSTARRED), answered on 2023-07-24
Subject: Shipping Corporation of India
Ministry: FINANCE
Asked by: Vinayak Bhaurao Raut, Arvind Ganpat Sawant

GOVERNMENT OF INDIA MINISTRY OF FINANCE DEPARTMENT OF INVESTMENT AND PUBLIC ASSET MANAGEMENT (DIPAM) LOK SABHA UNSTARRED QUESTION No. 603 TO BE ANSWERED ON MONDAY, JULY 24, 2023/ SRAVANA 2, 1945 (Saka)

## Shipping Corporation of India

603:

SHRI VINAYAK RAUT

SHRI ARVIND GANPAT SAWANT

Will the Minister of FINANCE be please to state:

- (a) whether the Government is planning to bring disinvestment scheme in Shipping Corporation of India;
- (b) if so, the details thereof along with the amount involved therein as per present plan;
- (c) the value of non-core assets of the Shipping Corporation of India for the last eight years till date;
- (d) whether the land has been acquired by the Shipping Corporation of India in various States and if so, the area of land, State-wise;
- (e) whether the Government has set up a new organization to monetise the land and assets of the Shipping Corporation of India; and
- (f) if so, the details thereof and if not, the reasons therefor?

## ANSWER

## THE MINISTER OF STATE IN THE MINISTRY OF FINANCE (DR. BHAGWAT KISHANRAO KARAD)

(a)&(b): CCEA in its meeting held on 20.11.2019 accorded 'in-principle' approval for strategic disinvestment of Government of India shareholding of 63.75% in Shipping Corporation of India Limited (SCIL) along with transfer of management control. Preliminary Information Memorandum (PIM)/Expression of Interest (EoI) was floated on 22.12.2020. Multiple EOIs were received by the due date for submission (01-03-

2021). The eligible bidders were shortlisted and due diligence process is underway in the second stage of the transaction. As part of the transaction design, the non-core assets of Shipping Corporation of India were to be demerged to Shipping Corporation of India Land and Asset holding company (SCILAL). On 23 February, 2023, Ministry of Corporate Affairs issued the demerger order under the relevant provisions of the Companies Act. The strategic disinvestment process is based on an open, transparent, competitive bidding process where the QIBs participate and the sale price is discovered. (c) The value of non-core assets (land & buildings) of the SCI for the last 8 years till date as per the accounts is given at Annexure-I .   The   freehold   land   has   been measured at fair value in transaction year (FY 2016-17) w.e.f. 01 April 2015 & that fair   value   is   used   as   the   deemed   cost.   Other   assets   (including   leasehold   land, buildings, flats) are at their existing book value in the transition year, after accounting for   appropriate   depreciation.  Further,  these   are   demerged/transferred   to   SCILAL which will   continue   as   a   Government   company   and   is   not   a   part   of   strategic disinvestment of government shareholding of SCI. (d) The details of land of Shipping Corporation of India in various States are given at Annexure-II (these   land   parcels   have   now   demerged/transferred   to   another Government company called SCILAL). (e)&(f):   The   process   of   strategic   disinvestment   of   Shipping   Corporation   of   India involves   disinvesting   government   shareholding   of   SCI   along   with   management control of the company to a strategic buyer. The non-core assets of the SCI have been hived off in accordance with demerger order dated 23.02.2023 issued by Ministry   of   Corporate  Affairs   (MoCA)   for   its   demerger/transfer   to   the   demerged company, Shipping Corporation of India Land and Assets Limited (SCILAL), which will   continue   as   a   Government   company.  These   non-core   assets   would   not   be transferred to the Strategic Buyer of SCI.

*****

## Book Value of Non-Core Assets for last 8 financial years of SCI

## Annexure-I

(INR in lakhs)

|         |                | Land             | Land           | Buildings        | Buildings      | Flats             | Flats          | MTI Assets       | MTI Assets     | Total Non-Core Assets   | Total Non-Core Assets   |
|---------|----------------|------------------|----------------|------------------|----------------|-------------------|----------------|------------------|----------------|-------------------------|-------------------------|
| Sr.no . | Financial Year | Gross Book Value | Net Book Value | Gross Book Value | Net Book Value | Gross Book Valu e | Net Book Value | Gross Book Value | Net Book Value | Gross Book Value        | Net Book Value          |
| 1       | FY 2015-16     | 2,37,630         | 2,37,630       | 1,107            | 1,083          | 140               | 135            | 54               | 43             | 2,38,931                | 2,38,891                |
| 2       | FY 2016-17     | 2,37,630         | 2,37,630       | 1,107            | 1,055          | 140               | 130            | 321              | 273            | 2,39,198                | 2,39,088                |
| 3       | FY 2017-18     | 2,37,630         | 2,37,630       | 1,107            | 1,027          | 140               | 125            | 522              | 391            | 2,39,399                | 2,39,173                |
| 4       | FY 2018-19     | 2,37,630         | 2,37,630       | 1,107            | 999            | 140               | 120            | 530              | 396            | 2,39,407                | 2,39,145                |
| 5       | FY 2019-20     | 2,37,630         | 2,37,630       | 1,141            | 1,004          | 140               | 115            | 560              | 421            | 2,39,471                | 2,39,170                |
| 6       | FY 2020-21     | 2,37,630         | 2,37,630       | 1,279            | 1,111          | 140               | 110            | 560              | 390            | 2,39,609                | 2,39,241                |
| 7       | FY 2021-22     | -                | -              | -                | -              | -                 | -              | -                | -              | -                       | -                       |
| 8       | FY 2022-23     | -                | -              | -                | -              | -                 | -              | -                | -              | -                       | -                       |

Note1.   Non-core   Assets   as   defined   in   the   demerger   scheme   between   SCI   and   SCILAL   has   been considered as non-core assets. 2. There were no Non-Core assets in FY 2021-22 and FY 2022-23, since the fixed assets were transferred to SCILAL on 01.04.2021 as per scheme. 3. Values rounded off to nearest lakhs. 4. Values as per audited books of accounts. 5.   The freehold land has been measured at fair value in transaction year (FY 2016-17) w.e.f. 01 buildings,   flats)   are   at   their   existing   book   value   in   the   transition   year,   after   accounting   for

- April 2015 & that fair value is used as the deemed cost. Other assets (including leasehold land, appropriate depreciation.

## Annexure-II

## Details of Land of Shipping Corporation of India in various States

(Under demerger scheme to be demerged/transferred to SCILAL)

|   S. No | State       | Details of Assets                                                   | Property Rights                                                                                      | Area of Property                                                                 |
|---------|-------------|---------------------------------------------------------------------|------------------------------------------------------------------------------------------------------|----------------------------------------------------------------------------------|
|       1 | Maharashtra | Land for corporate office (Shipping House) at Nariman Point, Mumbai | Leasehold Property. For a period of 99 years from 27.07.1963 received from Government of Maharashtra | 2995.85 Sq meters                                                                |
|       2 | Maharashtra | Land with Building at Malad, Mumbai                                 | Freehold Property. Purchased from Seth Babulal Ratanji Jangla Charitable Trust                       | 1287.63 Sq meters                                                                |
|       3 | Maharashtra | Powai Mumbai for establishment of Training Institute                | Freehold property. Received as grant from Govt of Maharashtra.                                       | 1,43,158 Sq meters and 35, 713 Sq meters 22nd December 1978 and 27th August 1982 |
|       4 | West Bengal | Strand Road, Kolkata                                                | Freehold property Purchased from Shashi Properties & Industries Limited.                             | 1104.15 Sq Meter (i.e., 16 Cottas, 8 Chittacks and 5 Square feet)                |