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Odisha Demands ₹1,255 Crore from Vedanta's ESL Steel Over Mine Production Shortfall

The Odisha government has demanded over ₹1,255 crore from Vedanta Limited's subsidiary, ESL Steel, citing an alleged failure to meet minimum production and dispatch targets from leased mines. The demand notices were issued by the Deputy Director of Mines for the Koira Circle regarding the BICO and Feegrade mines. ESL Steel contends the demands are not sustainable and intends to pursue legal remedies to challenge and potentially quash them. The disclosure was made to stock exchanges in compliance with SEBI listing regulations.

Key Points: Odisha Govt Demands ₹1,255 Cr from Vedanta's ESL Steel

  • ₹1,255 crore demand notice
  • Alleged mine production shortfall
  • Vedanta subsidiary ESL Steel involved
  • Legal challenge planned by company
2 min read

Odisha Govt asks Vedanta arm ESL Steel to pay up Rs 1,255.38 crore

Odisha government issues demand notice to Vedanta's ESL Steel for alleged shortfall in mine production targets. Company to challenge legally.

"ESL...believes that the same are not sustainable on merits. - Vedanta Regulatory Filing"

Mumbai, Jan 18

The Odisha government has raised a demand of Rs 1,255.38 crore from Vedanta Limited's subsidiary, ESL Steel Limited, over an alleged shortfall in fulfilling its minimum production target from the mines leased to it in the state, according to the company's disclosure to the stock exchanges.

In a regulatory filing on Saturday, Vedanta disclosed that ESL Steel received two demand notices on January 17, 2026, from the office of the Deputy Director of Mines, Koira Circle. The notices, dated January 16, 2026, relate to an alleged shortfall in fulfilling the Minimum Production and Dispatch Targets (MDPA Targets) for the fourth year of operation of two mining leases-BICO and Feegrade Mine.

As per the Demand Notices, an aggregate amount of Rs 12,55,37,61,591 has been demanded towards the alleged shortfall in production and dispatch for the relevant period.

The filing says that "ESL is in the process of evaluating the Demand Notices and related computation and believes that the same are not sustainable on merits. ESL proposes to pursue appropriate legal remedies and seek a stay over the Demand Notices and appropriate reliefs, including quashing of the impugned demands."

The production and dispatch targets from the two mining leases have been fixed in accordance with an agreement signed with the mining department of the Odisha government. The demand notice has been issued as the company has not allegedly met the requirement under Sub-Rule 1 of Rule 12 (A) of the Minerals (Other than Atomic and Hydrocarbon Energy Minerals) concession Rules, 2016 for the fourth year of operation of the two mining leases (BICO & Feegrade Mine) under the Mine Development & Production Agreement dated November 15, 2021.

The disclosure has been made by the Company to the Bombay Stock Exchange and National Stock Exchange in compliance with the provisions of Regulation 30 read with Schedule III of SEBI Listing Regulations.

- IANS

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Reader Comments

S
Sarah B
Interesting to see this from an investor perspective. Vedanta's disclosure is standard procedure, but a demand of over ₹1255 crore is significant. The stock might see some pressure on Monday. The key will be whether they can get a stay.
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Priyanka N
As someone from the region, I just hope the money, if recovered, is actually used for development here. Too often, these penalties vanish into the system. The mines have an environmental cost too, which is never fully accounted for. 🌳
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Aman W
The legal battle will go on for years. That's the standard playbook. By the time a court decides, the amount will be negotiated down or stuck in appeals. The system needs faster resolution for such clear contract violations.
K
Karthik V
Respectfully, the government should also look inward. Were there any delays in clearances or logistical issues from their side that contributed to the shortfall? A fair assessment needs to consider all factors, not just blame the company.
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Michael C
The amount is staggering—over twelve hundred crores! This highlights the scale of these mining operations. The MDPA targets are there for a reason, to ensure optimal resource utilization for the state's benefit.

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