Rourkela, Feb. 16: Adhunik Metaliks Limited of the Adhunik Group has closed down its operation from February 14. The closure has rendered nearly 1,265 of its employees jobless.

The company, which is located at Chadrihariharpur in Biramitrapur, was producing 0.45 million tonnes of sponge and pig iron. The company has also made official its decision to shutdown the unit.

Speaking to The Telegraph on the condition of anonymity, an official of the plant said: 'The company was facing huge loss due to the perpetual shortage of raw materials. The company does not have its own captive mines and purchases its requirement from the open market. Following the closure of the mines, it became very difficult to get raw materials and the loss was on the upswing.'

The official said the company would resume its operation once procurement of raw materials became easy. 'The decision to shutdown the gates of the steel plant were taken to ensure that people did not take advantage of the problem,' he said.

Chief minister Naveen Patnaik inaugurated Adhunik Metaliks in 2004. The integrated steel plant produced pig iron, sponge iron and other related products.

The lockout has been termed 'illegal and unacceptable' both by the workers' union and the state labour department.

Bishnu Mohanty, national vice-president of CITU that leads the Adhunik Metaliks Karmachari Sangh, said: 'It is completely illegal and is in violation of the law. It should be reopened immediately.'

Pranab Patra, the district labour officer, echoed similar views. He said: 'This is completely illegal and we have written to the government informing it about the lockout and are waiting for directives.'

'There was no strike and there is no valid reason for the lockout. The authorities did not even bother to send a missive to the government regarding the closure notice. On February 14, they put up a lockout notice in front of the plant gate,' Mohanty said.

The unit here was undergoing financial problems for a long time. There were delays in the payment of salaries since the last three to four months. Nearly 780 workers and 485 officers are yet to receive their salaries for the last three months.