NOIDA: Loot of public land

CBS International Projects Limited (CBS) was allotted 1.02 lakh sqm in 2007 at a premium of Rs 52.77 crore for establishing IT Park on the recommendation of PAC.

The allottee, CBS, was a consortium of three companies (Burchill VDM, Carnoustie Management and RS Resource Management Consulting). CAG found that CBS gave false information of ownership and other details but such wrong facts were accepted by Plot Allotment Committee of NOIDA without proper scrutiny and examination of documents. For example, Burchill VDM was not even a shareholder in CBS but it was shown to be one to bolster the financial health of CBS.

The project registered in RERA on the plot has shown ‘Bhutani Group’ as the promoter of the project, which has registered four commercial projects with an area of 38,152 sqm, whereas CBS has registered only 11,823 sqm area in five phases (four commercial and one residential project). The projects were advertised as ‘Alphathum’ and NOIDA World One, respectively wherein residential studio apartments and commercial spaces were being sold to non-IT/ITES units whereas they were to be given to IT/ITES units for their captive use.

The allotment had the condition that out of total FAR, 75 per cent would be permitted for IT/ITES, and 25 per cent would be permitted for institutional facilities (5 per cent) besides residential and commercial (10 per cent each) use.

The company widely publicised/advertised the project for sale of commercial and residential portion for non-captive use but NOIDA did not take any step to issue a public notice that the project was meant only for IT/ITES units. Thus, inaction on the part of NOIDA for stopping unauthorised sale of commercial and residential portion resulted in undue benefit to the allottee worth Rs 745.56 crore.

When allottees did not pay full premium/cost of the allotted land, they were not pursued for the recovery of the unpaid amounts. Again, many allottees illegally sold the allotted plots and subplots to third parties in violation of the terms and condition of allotment. Such widespread deviations could happen due to collusion between insiders and outsiders.

To prevent encroachment on its industrial development areas, NOIDA needed a dedicated enforcement wing but made no provision for one. As a result, NOIDA lost control over more than 45 lakh sqm land worth Rs 16,386 crore due to encroachment.

NOIDA also undertook huge expenses in violation of rules. Two such cases are:

NOIDA disregarded statutory provisions to spend/ commit Rs 5,735.57 crore on organisations (Gautam Buddha University, Delhi Metro Rail Corporation, Noida Metro Rail Corporation etc.) that had nothing to do with its mandated work of developing industrial estates.

They also provided loans of Rs 5,587.24 crore which was beyond the mandate of UPIAD Act.

(This was first published in National Herald on Sunday)