SWIL's appeal to the London Queen's Court for a revision of the arbitration award has been turned down and the Calcutta-based company is now faced with a foreign exchange liability for "non-fulfilment of the contract".

The RS Agarwal-promoted company, a secondary copper producer, is engaged in importing large quantities of primary copper for churning out value-added copper products.

The LME, in its ex-parte arbitration award, held the Indian company liable for non-fulfilment of a contract to purchase 200 MT of copper cathodes from Simportex.

SWIL will, in case of the execution of the aforesaid award, have to shell out forex liability aggregating $52,142 and 51,440 pound sterling.

The company had challenged the arbitration award at the London Queens Court, but the court after hearing the case hasconfirmed the arbitration award.

The company has stated this in its prospectus filed with the Securities & Exchange Board of India (Sebi) for its public-cum-rights issue.

SWIL has, however, said that the liability arising out of the arbitration dispute will not have much of an adverse impact, and the company will challenge the verdict in higher courts.

SWIL is close to having in place its own copper smelter, being set up at a revised cost of Rs 595 crore. The cost estimates shot up from the initial Rs 464 crore following major cost and time overruns. The company has attributed the cost overrun to its subsequent plans for a captive power project next to the smelter project.

The captive power project, envisaging a capital outlay of Rs 45.61 crore, will lead to uninterrupted power supply, which is crucial for copper production, sources said.To part-fund its expansion plans, the company is coming out with a public-cum-rights issue. The rights issue, aggregating Rs 62.41 crore, will involve issue of fullyconvertible debentures, face value of Rs 100 each, at a ratio of 3:13. The public offering aggregating Rs 53 crore, on the other hand, will involve issue of fully-convertible debentures at a face value of Rs 100 each.