To earn a few extra chips, UT Admn loses several hundreds of crores
By VARINDER BHATIA, Times of India Posted online: Wednesday, May 14, 2008

Chandigarh, May 13 The policies adopted by the UT Administration in
the allotment of prime commercial sites in the city may have helped it
earn a few crores in the last three years, but have resulted in a loss
of hundreds of crores from the state exchequer.
Documents obtained under the Right to Information Act clearly say the
administration has been doling out land at the prime sites and
changing rules to suit the private players from time to time.

No specific policy has been implemented to govern the rules of
allotment for upcoming commercial places in the city including
multiplexes, office spaces and shopping malls .

For instance, in the DLF Infocity allotments, a leading private sector
developer, who was allotted a prime commercial site in 2003 for
setting up an IT hub in the city, has quietly been taken out of the
fold of the rules governing the IT park Special Economic Zone. Though
still in the IT park area, the site now stands alone as a commercial
complex, with none of the SEZ rules being applicable to it.

The allotment was made on 12.5 acres of land on a payment of Rs 5.10
crore, to be paid over a period of 7 years with the interest rate of 9
pc per annum.

When contacted, the official spokesperson of UT Administration said,
"Bids were invited. Three companies submitted their bids including
DLF, Larsen and Toubro and a Singapore-based company Ascendas, out of
which DLF's bid was the highest. It's right that DLF has been taken
out of the IT Park SEZ, but it is still using 80 per cent of the area
for IT companies such as Infosys, IBM etc."

Brigadier G S Kahlon (retd), President, Chandigarh Sanjha Morcha,
said, "the administration allotted DLF a prime land for peanuts. The
land would be more than Rs 30 crore per acre at the time when it was
allotted to DLF. One can easily imagine and calculate the difference."

Besides allotments, the conversion policies of UT Administration are
also equally 'full of flaws". The flawed and erratic policies of the
UT Administration in using its power in an arbitrary manner, was even
pointed out by the office of the Accountant General, Punjab, last
year, which raised serious objections to the UT Administrator allowing
conversion of industrial sites for commercial use.

In his report, the senior Deputy Accountant General pointed out, "The
conversion of industrial site for commercial use by the Chandigarh
Administration, without obtaining the prior approval of the Central
Government and entrusting the government money to an autonomous body
were irregular and violated the canons of financial propriety."

The report even pointed out that submission by the then UT Finance
Secretary, in September 2006 that powers exercisable by the Central
Government under Sections 3, 7 and 22 of the Capital of Punjab
(Development and Regulation) Act, 1952 were vested with the UT

The Finance Secretary stated that the UT Administrator was fully
competent to frame any scheme or rules under the Section of the Act.

The Accountant General's office rejected the reply, saying that it was
"not tenable as the powers and functions of the Central Government
exercisable and dischargeable under laws other than Central Acts were
only delegated to the Administrator, as per notification dated October
30, 1968 of Ministry of Home Affairs.

Different sets of rules for different people
While prime commercial sites have been given to major private players
at throw-away prices, others have got it on high rental. When the
rates of commercial property on lease-hold basis were reported to be
Rs. 80,000 per square yard. The old resident industrialists were asked
to pay Rs. 20,000 per square yard for conversion of his own land for
commercial use.