The Cabinet Committee on Economic Affairs, chaired by Prime Minister Narendra Modi, has given its approval for conversion of interest of Rs.39.53 crore accrued on the loan of Rs.21.82 crore provided to Artificial Limbs Manufacturing Corporation of India (ALIMCO), Kanpur.
The loan was provided during the years 1977-78 to 2001-02 and penal interest of Rs. 12.61 crore on this amount as on March 31this year is a total of Rs.52.14 crore (Rs.39.53 crore + 12.61 crore) will be equity. Penal Interest after March 31, 2015 has been waived.
The increase in capital base support will strengthen the financial position of the corporation. It will ensure availability of increased working capital required for enhanced targeted business and also enable the corporation to seek loans from Financial Institutions or Banks on favorable terms.
This will also enable the Ministry of Social Justice and Empowerment to release grants to the Corporation for modernization.
ALIMCO has an authorized share capital of Rs.3 crore and paid up capital of Rs. 1.965 crore as on March 31, 2014. The Government of India had given interest bearing loans amounting to Rs. 21.82 crore to the Company from 1977-78 to 2001-02, for meeting its working capital requirements.
However, interest was not paid and continued to be shown as accrued and due in the books of the Corporation. An interest of Rs 39.53 crore is accrued and due on these loans in addition to a penal interest of Rs. 12.61 crore on this amount as on March 31, 2015. Subsequently, ALIMCO has fully repaid the loan amount to the Government of India by 2003-04.
ALIMCO was set up in 1972 by the Government of India under Section 25 (Not for Profit Motive) of the Companies Act, 1956. It is a fully owned Government of India undertaking working under Ministry of Social Justice and Empowerment.
The Corporation has been working for the past 40 years and has manufactured and distributed various types of cost effective quality assistive devices to approximately 42 lakh Persons with Disabilities (PwDs) so far. It is currently on an average serving around two lakh PwDs every year.