Noida Land Scam, a throwback - Part V

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Noida Land Scam, a throwback - Part V

Tuesday, 03 May 2022 | R B Sinha

Noida Land Scam, a throwback - Part V

The Authority’s decision to change the status of private companies to Institutional category was injudicious, selective and without basis

The C&AG has stated that multiple allotments to applicants on a single date were given and front companies were used for allotment of plots through different applications. There is evidence of dereliction of duty by the members of the PAC whereby fraudulent actions have been permitted by the officials of NOIDA.

A national newspaper has also reported based on RTI documents that 3C Universal Developers Pvt Ltd’s promoters, directors and shareholders, and their companies took eight plots.  Dharampal Satyapal Sons Pvt Ltd, makers of Rajnigandha pan masala, and its promoters and directors together got six plots.

Businessman Late Gurdeep Singh Chadha, better known as Ponty Chadha, bagged a plot along with Rajinder Singh Chadha and Javed Ahmed as promoter-cum-director of Brilliant Builders Pvt Ltd. His wife Jatinder Kaur was allotted another plot as promoter-cum-director of Jagat Guru Real Estate Developers Pvt Ltd. Ajay Rastogi, an official in Ponty Chadha’s liquor business, too got a plot.

Among the other beneficiaries of the scheme, prominent lawyers Shanti Bhushan and his son Jayant Bhushan, former ASG Vikas Singh, HCL CEO Vineet Nayar, etc., were also included.

Thus, the land of farmers acquired at lower rate, invoking the urgency clause for industrial development, was allotted on discretionary basis to affluent and influential individuals/companies for their personal/leisure use at a highly

subsidised rate.

Noida Authority allotted 134 plots ranging from 1000-5000 sqm each, covering an area of 2,41,072 sqm at the rate of `7800 per sqm for the corporate offices of the Private Companies/Firms in 2008-09 treating them as Institutions rather than Commercial profit-making firms. As these companies run on commercial basis and earn profits, they should pay for the plot of land at commercial rate. The Authority used to charge commercial rate from them earlier. However, the Authority changed the status of these commercial companies to Institutional in October 2008 thereby giving undue benefit of `6600 per sqm to these private companies. Therefore, the decision by the Authority to change the status of private companies to Institutional category was injudicious, selective and without basis. Thus, the land of farmers acquired at lower rate, invoking the urgency clause for industrial development was allotted at a highly subsidised rate on discretionary basis, thereby affording undue benefits of

`161.75 crore to 134 Private companies. Undue favour in allotment of industrial plot to CBS International Projects Ltd.

Noida Authority allotted an industrial plot (No. 01/90) measuring 1,02,949 sqm on 03 September 2007 CBS International Projects Ltd at a premium of `52.77 crore for establishment of IT Park. The allottee claimed to be a consortium of three companies (Burchill VDM, Carnoustie Management and RS Resource Management Consulting). However, on verification, it was found that the CBS was actually owned by Carnoustie Management and RS Resource Management Consulting only on the date of the application (06 August 2007). The name of Burchill VDM, an overseas company was added to present a rosy picture of its financial health in order to qualify for allotment of the plot. These wrong facts were not verified and were accepted by NOIDA without any documentary evidence. This has resulted in allotment to an ineligible applicant of a plot worth `52.77 crore. Further, the Authority failed to restrict sale of commercial and residential portion for non-captive use in the Plot as ‘Bhutani Group’, the promoter advertised the projects ‘Alphathum’ and NOIDA World One in Sector 90 wherein residential studio apartments and commercial spaces were being sold to non-IT/ITES units, which has resulted in undue benefit to the allottee to the extent of `745.56 crore.

The C&AG has therefore raised a serious question of probity, integrity and the governance failure at every level in the functioning of Noida Authority. The Authority appeared to have abdicated its responsibility to protect its own as well as public interests. Senior officials had acted in clear breach of public trust and in complete disregard to the interest of Authority and the home buyers. There was little monitoring of the projects and negligible compliance of the terms and conditions which has put the interests of stakeholders in peril. In spite of the clear evidence of breaches, the Authority failed to act against builders /allottees and take action against its own officials for their dereliction of duty and collusive role in permitting/abetting the continuing infractions. As Noida is a subset of NCR and also an important part of UP which contributes to about 10 percent of GDP of India, it is necessary that Yogi 2.0 as well as GOI take immediate action to stem the rot and hold the culprits accountable.

The Government should immediately order for an investigation by a SIT including a senior official of C&AG, IT and MCA or CBI and punish all such officials who have colluded with the developers/builders in the illegal/irregular transactions over the years, as pointed out by the C&AG of India.

All allotments of plots where full premium/cost have not been paid, should forthwith be cancelled and the possession of the plots of land be taken back. Indemnity bonds of each allottee should be encashed.

All allottees who have illegally sold/transferred the plots/sub-plots to third parties in violations of the terms and conditions of the schemes should be prosecuted and proceeded against.

The name of the New Okhla Industrial Development Authority is a misnomer. It should be changed to the Noida Development Authority.

All allotments of plots whether for GH or commercial or Institutional purposes to private companies/firms should be done on competitive bidding basis in future.

RERA should take immediate action to protect the interests of home-buyers of each residential projects being developed in 4 Sports City projects encompassing 826 acres of land in Sectors 78,79, 150 and 152.

RERA should also take a considered view on registration of such residential project where there are specified conditions on the use of land.

Discretionary Allotments of multiple Farm-houses at throwaway prices to affluent and influential persons/companies should be cancelled forthwith. In future, all such allotments should be done transparently at market rate after following objective criterion.

The Board of the Authority should be mandated to monitor the progress of projects every quarter and to take corrective/ remedial actions in time so that the prime objectives of the schemes are achieved.(Concluded)  

(The writer is a retired DG of the C&AG of India and a member of RERA, Bihar between April 2018-December, 2021. The views expressed are personal.)

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