The iconic Atlas Cycles, a household name in India, has shut its last manufacturing unit in Sahibabad, outside Delhi, citing financial trouble in running the factory.

CEO NP Singh Rana has stated that the shutdown is temporary and that they will resume operations once they are able to raise around Rs 50 crore. They plan to do this by selling surplus land.

According to Economic Times, the shut down led to the laying off of 431 employees but Rana has stated that they continue to be on the company’s rolls and will be paid “lay-off” wages post marking their attendance.

“The company had been passing through a financial crisis for several years and had exhausted all its funds to keep the factory afloat. But now, there are no funds left. We are facing difficulty in arranging funds for our day-to-day operations. We are also unable to buy raw materials. In these conditions, the management is not in a position to operate the factory,” said a notice posted on the factory gates.

 

However, employees have claimed that the unit was shut without notice.

“We have not closed down the plant. In fact, there has been a lot of misinformation…The plant is very well open, we have not terminated any employee. We have only temporarily suspended the operations,” Rana said, according to ET.

“All the employees are on the rolls of the company…Laying off does not mean that people have been terminated or their employment is discontinued. Laying off is a provision in the law where people are required to come once in a day to sign their attendance…So currently they are on the rolls of the company and they will continue to get their employment. They will get the lay-off wages for their period,” he added.