In Brief
The National Confederation of Officers Association challenged the Union Government's decision to disinvest its remaining 29.54% stake in Hindustan Zinc Limited (HZL), arguing it violated the Nationalisation Act 1976 and the Centre for Public Interest Litigation precedent. The Supreme Court held that res judicata did not bar the petition despite an earlier summary dismissal, and that the Centre for Public Interest Litigation principle applies only to companies retaining government company status (51%+ shareholding). Since HZL ceased being a government company in March 2002 when shareholding fell below 51%, the Union Government could sell its residual stake as an ordinary shareholder. However, the Court found prima facie evidence of irregularities in the 2002 disinvestment process and directed the CBI to register a regular criminal case to investigate alleged improprieties in valuation and bidding.
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