Moreover, Daewoo's application to re-validate the existing import licence was also turned down some time back as the government was trying to push more and more companies into the MoU route. The company had applied for this licence while entering the country.

"Daewoo's application has been turned down as we are not keen to allow companies to go in for any further licences without entering into MoU's with the government as per the revised policy," DGFT NL Lakhanpal told The Financial Express.

It is learnt that the DGFT has already communicated this to top company officials in a meeting last week.

Daewoo, however, denied any such move by DGFT. "There is no rejection of any fresh application of import licence as far as we are concerned," a Daewoo spokesman said in a written communication. He said "the company's import licence was not re-validated as we hadapplied after the stipulated time of 90 days".

The details of the fresh licence are not known but sources said "it was for importing a few thousand CKD/SKD kits".

The impact of the rejection of these licences on the company could not be ascertained. Official sources pointed out that possibly Daewoo would sign the MoU with the government as soon as possible so as to prevent any delay in its manufacturing plans.

Earlier, the directorate had asked the Central Board of Excise and Customs to stop all import consignments of CKD/SKD kits for cars till the manufacturers sign MoU's with the government.

Sources said that the directorate had information that automobile manufacturers were importing completely-knocked down/semi-knocked down kits in the guise of components through their import licence.

Daewoo Motors India posted a net loss of Rs 4.8 crore on a turnover of Rs 116.71 crore for the quarter ended June in the current fiscal. The net income from operations was Rs 86.58 crore during thequarter.

According to the unaudited financial results, the company had a gross loss of Rs 89 lakh. The provision for depreciation was Rs 3.91 crore and the total expenditure was Rs 90.57 crore.

The company had registered a net loss of Rs 41.78 crore on gross income of Rs 383.50 crore for the year ended March 1998. The gross loss stood at Rs 23.89 crore, while depreciation was Rs 17.89 crore. The total expenditure worked out to Rs 63.87 crore.