Mumbai | February 25, 2016 : Tata Steel is likely to be disqualified in the e-auction conducted by the Odisha government for allotment of iron ore mining lease under the new MMDR Act, as the company is found to be ineligible under one criteria relating to lease area held previously in the state, reports a business daily.

The Odisha government may not be able to issue the letter of intent (LOI) without prior approval from the Centre in case the bidder holds or may hold one or more mining leases covering a total area of more than 10 sq km in respect of any mineral or prescribed group of associated minerals in Odisha.

At present, Tata Steel has six iron ore/manganese (an associated mineral) leases in Odisha with combined lease area of 10 sq km.

"This will automatically disqualify Tata Steel in the auction process," a top official of Odisha Steel & Mines Department has been quoted as saying.

Tata Steel does have an option in the clause whereby it can seek permission of the Centre to relax the norm in deserving cases, reports the daily.

But, the Odisha government was unlikely to recommend Tata Steel's case to the Centre for relaxation of the eligibility norm, as it might prompt other bidders to go into litigation, it adds.

(Source: http://www.indiainfoline.com/)