Rs 275 cr for builder, only Rs 1 cr for Cidco ………..Nauzer K Bharucha
Govt Lets Bhosale Make A Killing Almost For Free
Govt Lets Bhosale Make A Killing Almost For Free
Mumbai: The politically well-connected Pune-based builder Avinash Bhosale made Rs 275 crore by selling off half of the 12-acre Cidco (City Industrial Development Corporation) plot on Palm Beach Road in Navi Mumbai. And what did Cidco, which owned this prime land, get in return? According to high-level sources, the government agency received a paltry Rs 1.25 crore as change of user fee for approving Bhosales proposal to convert half the plot into a residential zone, which he promptly offloaded to another builder.
As reported by TOI in its Wednesday edition, the 47,000 sq m plot (about 12 acres) was reserved exclusively for a five-star hotel, and Bhosales company, Metropolis Hotels, had emerged as the highest bidder at Rs 282 crore when Cidco invited bids in 2008.
But early this year, the builderwho is known for his links with big politicianssubmitted a request to Cidco to allow him to convert 23,000 sq m (about six acres) of this land for residential purposes. In March, during the tenure of its then MD G S Gill, Cidco controversially permitted this change of use by levying a fee of just Rs 550 per sq m on Metropolis.
Barely a month later, in April, Bhosale sold the residential part of the plot to the Dheeraj Group,which has already started marketing apartments at over Rs 9,000 a sq ft in this prime location opposite Seawoods in Navi Mumbai. Said a prominent citizen who didnt wish to be named, The government could just as well have sold this land directly to Dheeraj at the same price and made Rs 275 crore. Instead it allowed Bhosale to make an enormous profit by merely onselling the land. Its not as if he developed the land or added value to it in any way. It was a pure and simple trading profit. The boss of Cidco, and the government, should answer for this.
Times View |
Theres no question: This great and beautiful city of ours is up for sale. Every rule in the book is being twisted and broken to line the pockets of influential builders and their political patrons. And, whats happening in Mumbai and its suburbs in the name of sale of government land is nothing but a scandal of monumental proportions. Readers must never forget that government land is not owned by any government, it belongs to the public, to you. If a government sells it for a fraction of its real value, then some neta and/or babu is colluding with a businessman to cheat you out of what is legitimately yours.
For perspectiveto convey a sense of the scale of the money that is being lost to the public exchequer through questionable dealsRs 275 crore (the money that the government has all but gifted to Bhosale) is about two-and-ahalf times the BMCs total capital expenditure on primary education in the last three years (about Rs 12.9 crore, Rs 33.5 crore and Rs 63.5 crore in 2006-07, 2007-08 and 2008-09 respectively). Whats even more depressing is that this Rs 275 crore represents no more than a drop in the ocean; tens of thousands of crores worth of questionable land deals have been allowed to go through in the last few years under the guise of development.
For perspectiveto convey a sense of the scale of the money that is being lost to the public exchequer through questionable dealsRs 275 crore (the money that the government has all but gifted to Bhosale) is about two-and-ahalf times the BMCs total capital expenditure on primary education in the last three years (about Rs 12.9 crore, Rs 33.5 crore and Rs 63.5 crore in 2006-07, 2007-08 and 2008-09 respectively). Whats even more depressing is that this Rs 275 crore represents no more than a drop in the ocean; tens of thousands of crores worth of questionable land deals have been allowed to go through in the last few years under the guise of development.
GROUND REALTY
Bhosale citing airport delay is ridiculous
We will have to see if tender conditions have been violated, said a senior state government official. Many have said that Cidco would have fetched a far higher price if it had reserved the entire 12 acres for a residential zone instead of a hotel.
However, a spokesperson for Bhosales ABIL Group said in a statement on Wednesday, When Metropolis Hotels bid for this plot, one of the key drivers in business generation was going to be a proposed international airport, work on which was to have started in 2008. It is clear that any progress will be further delayed on account of differences between the environment ministry and the civil aviation ministry…It would have been disastrous for Metropolis Hotels to have invested in a large hotel on the site plot. An internationally designed golf course was to have also come up across the site by 2009, which too has not started.
An industry observer counters ABILs excuse by saying, There has always been a question mark over the second airport. Bhosale knew the airport had not received key clearances before he bid, so there was a risk involved. For him to say later that he was forced to ask for a change in land use because of problems with the airport is ridiculous.
The spokesman said that ABILs bid was higher than what Cidco got (Rs 55,000 per sq m) for a residential-cum commercial plot sold later in December 2008 in the vicinity. However, people in the property business claimed this plot is not in the vicinity, but 10 km away in New Panvel.
The ABIL spokesperson said that once it was established that building a hotel on such a large plot would not be feasible, Metropolis Hotels approached Cidco for relief. Cidco went by the book and accorded permission for conversion. Conversion charges in full have been levied by Cidco, he added. What ABIL does not say is that the conversion charges amounted to a measly Rs 1.25 crore (as mentioned earlier in the report) in lieu of which it made a jaw-dropping Rs 275 crore by merely selling it to another company.
G S Gill, the Cidco MD under whose watch this highly questionable deal was struck, defended his decision to allow part-conversion of the land and said the corporation had the power to do so. One reason for assigning the work of new towns to the NTDAs (new town development authority) and SPAs (special planning authority) is to develop towns speedily, and to do so they are provided this flexibility. This approach is christened as the structural plan. To regulate the change of user, each NTDA/SPA forms its own set of policies from time to time. Cidco also has such a policy and the instant case was covered under the policy and only after full satisfaction was the part change of user permitted, he said.
But activist-lawyer Y P Singh said that in the case of special planning authorities such as Cidco, the land use map is prepared after consultation with the public and it assumes the force of law only after this is finally approved by the state government. If such a land use stipulation has to be altered, then the only way to change it is to follow the procedures of minor modification contained in the Maharashtra Regional and Town Planning Act by issuance of public notice,calling objections and suggestions, and then taking the approval of the state government, he added.