The unit had remained closed since January 13, 1997 following Madras High Court directive to release the treated effluent into land for irrigation instead of letting it out into Bhavani river.

SIV, it is understood, has been permitted to operate the controversial pulp plant up to a capacity of 90 tonnes per day (tpd). The trial run of the unit commenced last weekend and it is expected to stabilise latest by next Tuesday. SIV's pulp plant has a total capacity of 145 tpd. The company has been meeting it's pulp requirements from Andhra Pradesh and imports from South Africa.

The viscose major is also planning to commence operations of SIV - Magcobar Lignins Ltd, a subsidiary of SIV, which is dependent on black liquor supply from SIV. The subsidiary had been reporting a low turnover from 1997-'98 following closure of the pulp plant. Sourcesclaimed the management gave the official `go ahead' for the unit on Thursday.

The Supreme Court had, while disposing off the special leave petition in the company's favour on March 30, '98, allowed it to run the rayon and viscose plants. The pulp plant was directed to be operated only after obtaining TNPCB permission. SIV's rayon and staple fibre plants have been functioning since the apex court's order, though the latter is yet to achieve full capacity of 92 tpd.

SIV, after much resistance from a section of the farmers in Sirumugai, laid pipelines to carry the treated effluent to around 500 acres of agricultural land bought by it. The state law and order machinery had stepped in to help the company lay the pipelines. Recently the Supreme Court refused to stay the pipe laying activity of SIV which was sought by local villagers.

Meanwhile, the Coimbatore-based second largest viscose staple fibre (VSF) producer in the country posted a net loss of Rs 104.06 crore (Rs 88.60 crore net loss) on a turnover ofRs 241. 26 crore (Rs 154.65 crore) for 1998-'99. The environment-related issues hit the company's bottomline hard since 1996-'97 financial year -- the year it reported a net loss of Rs 31.64 crore against the net profit of Rs 63.80 crore in the fiscal before. The company's turnover had touched a peak of Rs 421.34 crore in 1995-'96.

SIV's cup of woes started from February '95 when TNPCB issued a show cause notice to it. Environmentalists, under the Bhavani River Joint Protection Council banner, accused the company of polluting Bhavani river. Later during May '95 the Board issued closure notice, aginst which it obtained a stay, and then started SIV's protracted legal battle which cost it dear.

SIV was ordered to close it's pulp, rayon and VSF plants located in Sirumugai, near here, by the Madras High Court following it's failure to lay pipelines before the court-fixed deadline of January 16, 1997. The three units of SIV were discharging around 41,000 kilo litres of treated effluent back into Bhavani. Apartfrom an erosion in bottomline, the company had to face the wrath of it's employees which led to a lock-out from October 27-December 12, 1997. The legal wrangle also saw the exit of SIV's high profile Managing Director G S Keshavamurthy from the company.