Concerns relating to a possible legal action by the state government in Maharashtra against the Lavasa project, have resulted in a fall of 3 per cent in the shares of construction major HCC in the early morning trade.

The Maharashtra government might be ready to file a case against the company on the insistence of the Environment Ministry. The case, which is likely to be filed in a district court, will most likely to be analyzed by the MoEF before it comes out with its final order.

The Maharashtra government will file the case in the district court of Pune and initiate action against Lavasa for environmental violations. The Bombay High Court had asked the MoEF to give either its rejection or its approval within three weeks.

The shares of the company were trading at Rs 28.10, down Rs 1.10, or 3.77%. It was trading with volumes of 127,264 shares. The shares had closed down 0.17% or Rs 0.05 at Rs 29.20 in the previous trading session.

The new case follows months of legal proceedings involving the government agencies and the company behind the ambitious project, which has run into controversy.