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A representation has been received from Executive Director (Works & Disposal) HUDCO, regarding the implementation of Andrewsganj Project, New Delhi. Detailed contents of representation may please be seen at page 90/c onwards. He has raised the following issues
a) He has stated that allotment letters for 42.6 acres land (residential pocket and community centre pocket) were issued on 1/11/1990 and 19/3/1996 & Perpetual Lease Deed between the President of India through MoUAE (Lessor) and HUDCO(Lessee) for 17.6 acres of land on 4/7/1997. During execution of the project various issues were referred to MoUD by HUDCO for its decisions (including grant of mortgage permission to M/s Leela hotels & approval on sublease terms of sub-leases) in line with Perpetual Lease Deed conditions by the decisions were either delayed or still awaited. This has resulted in various disputes with the allottees for which expenses are to be incurred on defending is also being incurred on maintaining the properties at 17.6 acres community centre pocked and 18 acres zonal green.
b) He has also referred the opinion of Ld. A. G. Shri G.E. Vahanvati’s opinion dated 19/8/2009 which is read as under:-
“it is not open top the Ministry of Urban Development to contend that they had nothing to do with the development of Hotel site or that HUDCO was not its agent. The protracted dispute between the two ministries is leading to mounting interest which is being added to the amount of the decree. This is a matter which therefore, has to be resolved on a mutually acceptable basis and the MoUD should accepts its liabilities as the land owner”
c) HUDCO is implementing Andrewsganj project as an agent of MoUD and all the expenses incurred on the project are to be borne out of the “ No lien Andrewsganj Project Account” of Government, which is maintained by the HUDCO and funds in this account are not available. HUDCO has been requesting M/o UD for making available the funds so as to meet the liabilities arising out of Andrewsganj Project. MoUD is requesting to reimburse the amount of Rs.41.20 crores spent by HUDCO on Andrewsganj Project from HUDCO’s account alongwith the interest 10.75% from the date of incurring the expenditure by HUDCO besides 1.5% administrative charges, as decided by the Board of Directors of HUDCO.
d) He has also referred the letter dated 18/8/2010 of CPWD in connection with arbitrator for construction works carried out by CPWD for 319 transit flats at Andrewsganj, New Delhi. In its letter CPWD has demanded Rs.3,29,59,917/-. HUDCO is requested to pay the above mentioned award by MoUD because
this works has been done by HUDCO on behalf of MOUD.
e) Vide letter dated 18/11/2010 Dy. Chief(Projects), HUDCO has forwarded the latest statement of Accounts as on 15/11/2010 regarding the expenditure incurred out of
J-13011/3/91-LD
HUDCO’s Account on Andrewsganj Project, as there are no funds in the “No lien AGP Account” of Government. In the above mentioned letter, she has requested to reimburse the amount of Rs. 42.35 crores spent by HUDCO on Andrewsganj Project alongwith the interest @ 10.75% from the date of incurring the expenditure by HUDCO BESIDES 1.5% administrative charges, as decided by the board of Directors of HUDCO.
In this connection it is stated that HUDCO is lessee by virtue of the Perpetual Lease deed executed on 4/7/97 for 99 years. The relationship of M/o UD and HUDCO are governed by the lease terms and conditions and not any agent ship terms and conditions. HUDCO has all the rights as lessee and not as an agent. This has already been clarified to HUDCO. Further it is mentioned that HUDCO falls within the administrative control of Ministry of HUPA. As per presidential notification no. CD-160/2004 dated 27/5/2004 entry no. 6 at page 17, M/o HUPA has been allocated all matters pertaining to HUDCO other than those relating to Urban infrastructure. Even though urban infrastructure operations of HUDCO fall in the domain of MoUD as contended in the letter, the subject matter at hand pertains to entrustment of a specific project,(and not of urban infrastructure in general) allotment of land to HUDCO, execution of perpetual lease deed and thereby creating relationship of Lessor and Lessee. The Lessee in this case is HUDCO which is under the administrative control of Ministry of HUPA and this has also been stated in the letter dated 20/2/2009 of Hon’ble UDM.
In this context opinion of S.G. of India may be perused; he has opined on August 9, 2002:-
“In any view of the matter, I do not see how the Government could be made liable at all for any of sums awarded by the Arbitrator. HUDCO was undoubtedly entrusted with the responsibility of developing the property in Andrews Ganj on behalf of the Government of India. However, what has been awarded is damages for breach of contract. HUDCO cannot seek to burden the Government of India with damages caused by its wrongful acts. It has to be borne in mind that the award is on the basis of that HUDCO has been guilty of committing gross breach of contract and invited this liability on to itself. That being so, the Government of India cannot be burdened with a liability arising out of the lapses of HUDCO”
In view of the position explained above, HUDCO as lessee by virtue execution of lease deed on 4/7/1997 so that all expenses/financial implication incurred by HUDCO; so that HUDCO is liable to bear the financial burden. It is also mentioned so that there is no question arise to pay Rs. 42.35 crores spent by HUDCO and interest thereon.
Submitted for orders please.
Sl.no.26( R) at page99/c
Communication has been received from Executive Director (Projects) regarding utilization of 9 nos vacant guest houses blocks at HUDCO Place, Andrewsganj, New Delhi. Detailed of the representation has been seen at page 99/c onwards. He has requested to consider the proposal of licensing/ leasing
the 9 guest houses blocks.
In support to the proposal he has referred the Court orders passed in Nov/Dec 2003 granting permission to utilize the 9 nos tendering or re-allotting it either by/for itself or on short terms license to other government bodies or institutions or third party with clear stipulations that the same is terminable on a short notice and shall subject to the orders of Hon’ble Court or the trial court as the case may be, till disposal of the appeal or the final disposal of the pending suits being heard in the courts.
Further he has forwarded the copy of minutes of Board of Directors dated 28/9/2010, wherein Board has resolved to forward the proposal as contained in the agenda note to MOUD for its approval and for finalizing the terms and conditions and licensing fees, since HUDCO is acting as agent of MoUD for this project, in line with the existing lease deed dated 4/7/1997 executed between HUDCO & MoUD. A condition of maximum 11 months leasing/licensing period to be renewed upto 5 years, extendable to 10 years, subject to decision of court on the pending suits is to be recommended in the proposal.
In this connection it is mentioned that the issues explained above has already examined earlier in the Ministry and it has been decided that these guest house blocks could be utilized by the Directorate of Estates for use as government office as there is a huge unsatisfied demand such accommodation, but HUDCO board decided that any action for handing over the 9 guest houses blocks could be taken only after the recommendations of the Review Committee are considered by the Government and decision taken by it for the entire Andrewsganj project as a whole. Further it is also mentioned that HUDCO is a lessee and Perpetual Lease/Supplemental Lease Deeds have been executed between HUDCO and Union of India. All actions of HUDCO were to be governed by the terms and conditions of the Lease Deed/Supplementary lease deed and it is not correct to state that HUDCO is an agent of the Ministry.
In view of the facts mentioned above, draft letter is placed below for approval/signature.
Sl.1(R)
A representation has been received from Shri Ramesh Kumar Safaya, Executive Director (Works & Disposal) HUDCO, regarding the implementation of Andrewsganj Project, New Delhi. He has raised the following issues
(a) That HUDCO is implementing Andrewsganj project as an agent of MoUD and all the expenses incurred on the project are to be borne out of the “ No lien Andrewsganj Project Account” of Government, which is maintained by the HUDCO and funds in this account are not available. HUDCO has been requesting M/o UD for making available the funds so as to meet the liabilities arising out of Andrewsganj
Project. In its. 459th meeting the HUDCO Board which was held on 24th August 2009 vide item no. 459.4, Board has decided to recover the amount from MoUD alongwith interest @ 10.75% in addition to administrative charges @ 1.5% being charged on expenditure incurred on Andrewsganj Project. He has enclosed the statement of expenditure incurred on Andrews Ganj Project as on 8/9/09 and as per this statement Rs.40.04 Cr which is required to be reimbursed to HUDCO by MoUD alongwith interest.
(b) He has requested to hand over the 18 Acres land allotted for maintaining Zonal Green Pocket to MoUD. Since it is not possible for HUDCO to maintain the 18 acres as ‘green’ because of paucity of funds due to the fact that the present annual expenditure including security is around Rs. 35 lakhs. Therefore HUDCO is not in a position to continue maintenance of 18 acres Zonal Green. He has further mentioned that Vivekananda Park, in close vicinity of HUDCO Place was also developed through the surplus generated from the Andrewsganj project which is being presently maintained by CPWD. In view of nature and use of 18 acres zonal green, it has been decided by the Board of Directors of HUDCO that MoUD may be requested to take over the said area from HUDCO and hand it over to any other agency for maintenance within one month time period from issue of this letter as HUDCO would not be in a position to maintain it due to non availability of funds.
In this connection it is stated that HUDCO is lessee by virtue of the Perpetual Lease deed executed on 4/7/97 for 99 years. The relationship of M/o UD and HUDCO are governed by the lease terms and conditions and not any agent ship terms and conditions. HUDCO has all the rights as lessee and not as an agent. This has already been clarified to HUDCO. Further it is mentioned that HUDCO falls within the administrative control of Ministry of HUPA. As per presidential notification no. CD-160/2004 dated 27/5/2004 entry no. 6 at page 17, M/o HUPA has been allocated all matters pertaining to HUDCO other than those relating to Urban infrastructure. Even though urban infrastructure operations of HUDCO fall in the domain of MoUD as contended in the letter, the subject matter at hand pertains to entrustment of a specific project,(and not of urban infrastructure in general) allotment of land to HUDCO, execution of perpetual lease deed and thereby creating relationship of Lessor and Lessee. The Lessee in this case is HUDCO which is under the
L-II/1(974)/09 Andrewsganj Project, HUDCO
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administrative control of Ministry of HUPA and this has also been stated in the letter dated 20/2/2009 of Hon’ble UDM.
As per clause of allotment letter dated 19/3/96, 18 acres of land is entrusted to HUDCO without payment of any fee for care and maintenance as Zonal Green. HUDCO will develop this area and maintain it till further directions from the Govt. The cost of development and maintenance of the Zonal Green may be charged by HUDCO to the accounts of the community centre project. According to meeting held under the chairmanship of Cabinet Secretary, the matter was referred to the Ministry of Law regarding issue of whether HUDCO is agent of MoUD or not which is still pending with them.
In view of the facts explained above it is for order we may process the case for handing/taking over of 18 acres of land.
L-II 8(3)/08Plot-25 August Karanti Bhawan
Bhikaji Cama Place
Dy. No. 118/R.P.Cell dated 11/3/2010
F.R is a letter from Shri N. K. Negi Chief Project Housing and Urban Development Corporation Ltd. HUDCO Bhawan Lodhi Road and requested to approved the Draft Sub Lease Deed Plot No-25 August Karanti Bhawan as submitted by HUDCO in 2004.
2. The issue a Supplemental Lease Deed to the Lease Deed between L&DO and HUDCO of Plot No-25 August Karanti Bhawan and
3. To consider application submitted by HUDCO on 12.8.2005 or conversion or plot no-25 august Kranti Bhawan from Lease Hold to Free Hold. In this connection it is submitted that the matter regarding approval a draft Sub Lease has already been discussed and it was decided that since the Govt. of India is not a party nor a signatory and as such Sub Lease Deed/Agreement should wetted by its legal Department
4. Regarding 2nd issue execution of supplemental Lease Deed the matter is still under consideration M/Law & Justice.
5. Regarding 3rd issue Conversion of Leasehold rights, it is submitted that the matter require the approval of Cabinet. The action in this regard is to be taken by M/HUPA.
If approved draft is placed below for approval/signature.
Dy.No.422/R.P.Cell dt.26/8/09
Asstt. Legal Adviser has returned our letter dated 10/8/09
It has been ascertained for the office of Ld. AG that matter is still pending with Ld. AG and it has been informed that same will be cleared very soon.
May Kindly see for information please.
It has been found from records that HUDCO is lessee by virtue of the Perpetual Lease deed for 99 years
A representation received from Shri T. Prabakaran, Director (Finance), HUDCO requesting fort meeting to resolve the disputes relating implementation of Andrewsganj Project at New Delhi. Detailed contents of letter may please be seen at page /c onwards.
He has further informed that HUDCO has constructed 1176 number of flats/transit flats at 25 acres land at HUDCO place, one underpass on Khel Gaon Road & other Govt. directed works and given free of cost to Ministry. HUDCO has also developed 17.6 acres community centre pocket comprising of shopping arcade, two levels of car parking in basement, 12 blocks of guest houses, cultural centre site and hotel site to generate resources for construction of houses and also developed 18 acres land as zonal green and is still maintaining as per allotment terms.
He has request to finalization of recommendations of the committee for transferring freehold right of 17.6 acres of community centre is still awaited. In this connection it is mentioned that HUPA is administrative Ministry in charge of HUDCO and the further action is to be taken by HUPA separately.
He has also referred the recent development in the case of M/s Leela Hotels Ltd. and in order to contain the rising interest liability on account of the same, an amount of Rs. 50.54 crores is being deposited in the court without prejudice to its rights and contention in the appeal already filed. HUDCO’s Board has also resolved the amount deposited in the Court shall be claimed from Ministry with interest. He has requested to make available the funds in “No Lien AGP Account” as fund in the same are not available and HUDCO has not earned out of this project.
In this connection it is stated that The case of M/s Leela Hotels Ltd., relating to Arbitration has arisen out of the agreement to sub-lease entered into by HUDCO with M/s Leela Hotels Ltd. It has been found from records that HUDCO is lessee by virtue of the Perpetual Lease deed for 99 years executed on 4/7/1997 regarding 17.6 acres of land for community centre. The ground rent payable in advance @ Rs.1/- per acres. The Perpetual Lease Deed does not have any clause for agreement to sub-lease. The clause III(2) states about sub-lease of built-up space after allotment. In the instant case an agreement to sub-lease has been executed by HUDCO with Leela Hotels, though it did not have approval of MOUD/L&DO.
Regarding the issue of mortgage permission, the opinion of Ld. ASC was obtained and forwarded to HUDCO. It includes
“Legally, the allotment and consequently the agreement to sub-lease or the sub-lease itself, if entered, would be invalid. Since the bank or the financial institution which will advance the money to M/s Leela Hotels Limited would look to the hotel site for recovering its advance, they may initiate litigation which could put HUDCO into difficulty in complying with the decree obtained by M.S. Shoes limited. It is essential, therefore, that the bank or financial institution which is agreeable to advance moneys to M/s Leela Hotels Limited is apprised of the litigation should be required to give an undertaking that in the event of M/s M.S Shoes Ltd. succeeding in the suit, the mortgage would cease to be valid and they would have to claim, change or lien in respect of the hotel site. It is only in the event that M/s Leela Hotel Ltd. and their intending creditors/mortgagees are willing for such a condition that the government/HAUDCO could permit the mortgage of the site”.
In this regard the stand of MOUD is crystally clear that MOUD is not responsible to pay Rs. 50.54 crorres because sub-lease agreement in between HUDCO and M/s Leela Hotels Ltd. and
He has enclosed the agenda for meeting and requested to indicate the convenient date and time.
Submitted please.
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Sl.no 31 (R) to 39(R)
This is regarding meeting to be held by Cabinet Secretary on 25/6/2009 at 5 P.M. in the committee room of Cabinet Secretariat, Rashtrapati Bhavan, regarding resolution of disputes related to Andrewsganj Project between L&ADO and HUDCO- award decided by Hon’ble Supreme Court and Hon‘ble Execution Court( High Court of Delhi in favour M/s Leela Hotels Ltd.). As per notice dated 17/6/2009 received from Cabinet Secretariat, a background note is to be circulated by M/o HUPA separately. The background note is awaited by the time this note is prepared.
2. In this regard the letter from Kumari Shelja the then Hon’ble MOS HUPA addressed to Hon’ble UDM dated 24.3.09 was received in L&DO on 30.3.09. Subsequently another letter was received from Dr. P.K. Mohanty J.S, NURM (HUPA) on 2.4.09. After that a letter from Director, Finance HUDCO dated 17.4.09 addressed to Secretary (UD) was received on 22.4.09. All these communications pertain to the issues involved in HUDCO project Andrews Ganj relating to financial implications of arbitration award and Court Orders against HUDCO in the case of M/s Leela Hotels Ltd. The issues raised in these communications have already been raised by HUDCO/HUPA and their reply has been sent by Secretary (UD) to Secretary (HUPA) through a D.O. letter no.J-13026/10/99-LD dated 18/5/09. The stand of M/o UD has also been conveyed by Hon’ble UDM to MOS, HUPA vide d.o. letter no. J-13026/10/99-LLD/523 dated 20/2/2009.
3. Now a fresh communication has been received from Secretary HUPA [ S.No. 38(R)] addressed to Cabinet Secretary requesting to his intervention to find a meeting ground between two Ministries. Before a copy of this letter was received, his letter dated 5.6.09 addressed to Secretary (UD) is also received. On the said letter Secretary’s remarks are as under;
”we may convene a meeting now, early as this goes on”.
4. In the letter addressed to Cabinet Secretary, Secretary (HUPA )has raised the following two points:-
A. HUDCO in the Andrews Ganj project was agent of the M/o UD(L&DO) which was the Principal and Lessee
of the site. HUDCO as agent has asked M/o UD to make payment for the amount in dispute or freehold assignment of the site to them to develop to recoup the outgo.
Stand of UD: On this issue the stand of M/o UD, as already conveyed to M/o HUPA is that HUDCO is a lessee and Perpetual Lease/Supplemental Lease Deeds have been executed between HUDCO and Union of India. All actions of HUDCO were to be governed by the terms and conditions of the Lease Deed/Supplementary lease deed and it is not correct to state that HUDCO is an agent of the Ministry.
B. Second issue is that the M/o HUPA feels that as the land in question belongs to M/o UD and Urban infrastructure
operation of HUDCO stands assigned to the M/o UD, it is for the Ministry of Urban Development to indicate the
possible solution. That M/HUPA cannot approach on an issue outside its business allocation. If HUDCO loses the last appeal (as is likely to be the case), with the matter ticking away Rs.4.9 lakhs per day, a resolution becomes urgent.
Stand of UD: The stand of M/oUD on this issue was conveyed vide D.O. letter of Hon’ble UDM dated 20/2/2009 to MOS, HUPA as under:-
“The request for transfer of freehold rights for 17.6 acres of commercial land to HUDCO is a substantial
deviation from the earlier allotment/lease conditions. Normally, when commercial exploitation of Govt. land is to be done on a freehold basis, it is advisable and desirable that specific approval to that effect is obtained
from the Union Cabinet. Since the problem essentially pertains to HUDCO and there are compelling circumstances necessitating an early resolution of the issue, the Ministry of HUPA, the administrative Ministry in charge of HUDCO, may take further action”.
Further regarding moving of cabinet note it may be stated here that HUDCO falls within the administrative control of Ministry of HUPA. As per presidential notification no. CD-160/2004 dated 27/5/2004 entry no. 6 at page 17, M/o HUPA has been allocated all matters pertaining to HUDCO other than those relating to Urban infrastructure. Even though urban
infrastructure operations of HUDCO fall in the domain of MoUD as contended in the letter, the subject matter at hand pertains to entrustment of a specific project,(and not of urban infrastructure in general) allotment of land to HUDCO, execution of perpetual lease deed and thereby creating relationship of Lessor and Lessee. The Lessee in this case is HUDCO which is under the administrative control of Ministry of HUPA and this has also been stated in the letter dated 20/2/2009 of Hon’ble UDM. Therefore, the difficulties being faced by HUDCO on account of Arbitration Award arising out of certain contractual obligations between HUDCO and some other parties created by decisions of actions of HUDCO should be taken up by the Ministry of HUPA.
5. It has been found that the letter addressed to Cabinet Secretary by Secretary (HUPA) does not incorporate the basic issues leading to financial burden on HUDCO and its failure in complying with the terms and conditions of Agreement to Sub- lease between HUDCO& M/s Leela Hotels Ltd on 4/7/1997.
6. It is also not a correct statement that HUDCO in the Andrews Ganj Project was the agent of M/o UD. While it has already been clarified to the M/O HUPA that HUDCO is a lessee as per the perpetual Lease Deed executed on 4/7/1997 between HUDCO and L&DO. Thus the relationship of M/o UD and HUDCO are governed by the lease terms and conditions and not any agent ship terms and conditions. HUDCO has all the rights as lessee and not as an agent. This has already been clarified to HUDCO.
7. In the letter dt. 24.3.09 from Hon’ble MOS HUPA to Hon’ble UDM, it has been contended that it is due to denial of Mortgage Permission by M/o UD and there by default by M/S Leela Hotels Ltd. in paying the 3rd installment that HUDCO had to ultimately cancel the allotment of land to M/s Leela Hotel Ltd forfeiting 50% of the paid amount i. e Rs.76 crores. The point has already been examined and incorporated in letter dated 20/3/2009 of Hon’ble UDM to MOS(HUPA )and DO Letter dated 18/5/2009 Secretary (UD) to Secretary HUPA wherein it has been stated that on 24/6/1999, the then Secretary(UD) wrote to ensure that all action taken by HUDCO in this regard must fully protect the interest of Government and they must be in strict compliance with relevant clauses in the agreement of sub-lease entered between HUDCO and M/s Leela Hotels Ltd., in particular to the clause relating to Arbitration etc.
contd../-
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FPP:
8. The file is submitted in view of the meeting to be held by Cabinet Secretary on 25.06.2009 at 5.00 p.m.
(Surendra Singh)Dy.L&DO(III)/23/06.2009
L&DO
Reference from pre-page:-
Summon has been received from the Court of Shri Ajay Goel, Senior Civil Judge tot appear on 11/5/2009 to prove the documents as listed duly attested by Shri Surinder Singh, CPIO & Dy. Land & Development Officer. The undersigned alongwith the Dy. Land & Development Officer and Govt. Counsel attended the Court on 11/5/09. The statement of Dy.L&DO has also been recorded. The next date of hearing is fixed for 23/5/09 for admission and denial.
Submitted for information please.
Sl.no.34(R) page 481/c
Reference JS (DL)’s comments at p 68/n. We have received a copy of D.O no.I-14012/1/2009-H dated April2, 2009 written by Dr. P.K. Mohanty, JS(NURM) to Director(Finance) officiating CMD, HUDCO regarding preparing agenda for proposed meeting between two Ministries on the following issues:-
i) The extent of liability on account of M/s Leela Venture.
ii) The repercussion on other cases viz. M.S Shoes and others and the extent of likely liability out of them; and
iii) If the solution is the transfer of lessor’s rights on the land in question to the lessee (HUDCO) alongwith the liabilities, but only of lease hold and not freehold rights, would HUDCO be able to use the land sufficiently to discharge the liabilities arising out of this contract with Ministry of Urban Development?
2. The clarification regarding issues mentioned in JS (DL) notes and D.O. of JS (NURM) are as under:-
(i) HUDCO had strictly compiled with the mandate as spelt out by MOUD in the Lease deed.
The case of M/s Leela Hotels Ltd., relating to Arbitration has arisen out of the agreement to sub-lease entered into by HUDCO with M/s Leela Hotels Ltd. It has been found from records that HUDCO is lessee by virtue of the Perpetual Lease deed for 99 years executed on 4/7/1997 regarding 17.6 acres of land for community centre. The ground rent payable in advance @ Rs.1/- per acres. The Perpetual Lease Deed does not have any clause for agreement to sub-lease. The clause III(2) states about sub-lease of built-up space after allotment. In the instant case an agreement to sub-lease has been executed by HUDCO with Leela Hotels, though it did not have approval of MOUD/L&DO. Regarding mortgaging the Hotel site by M/s Leela Hotels, the opinion of Ltd. ASG Shri C.S. Vaidyanathan was communicated to HUDCO. It includes, “Legally, the allotment and consequently the agreement to sub-lease or the sub-lease itself, if entered, would be invalid, “M/s M.S. Shoes Ltd. succeeds in the suit and in the interregnum, HUDCO permits M/s Leela Hotels Ltd., to mortgage the Hotel site.” Para 6 at page 66/n may be perused. It also suggests that bank or financial institution agreeable to advance money to M/s Leela Hotel Ltd. be apprised of litigation, should be required to give an undertaking that in the event of M/s M.S. Shoes Ltd succeeding in the suit, the mortgage would cease to be valid and they would have no claim, change or lien in respect of Hotel site. It is only in the event that M/s Leela Hotel Ltd. and their entire
creditors/mortgagee are willing for such conditions that Govt/HUDCO could permit to mortgage the site.
The opinion was forwarded to CMD, HUDCO under signature of the then Secretary (UD) on 20/5/1999. But Board of HUDCO decided not to grant permission for mortgage of hotel site as the matter was under llitigation with M/s M.S. Shoes Ltd. Thus the issues with M/s Leela Hotels Ltd. and HUDCO leading to arbitration/Apex Court have arisen due to the decision of HUDCO at its own not to grant permission for mortgage. It is also worth mentioning that Secretary(UD) on 24/6/1999 cautioned the HUDCO to ensure that all actions taken by the HUDCO in this regard must fully protect the interest of Government and they must be in strict compliance with relevant clauses in the agreement to sub-lease entered with HUDCO and Leela Hotels Ltd. Thus it is evident that HUDCO has defied the instructions of Secretary (UD) in this case.
(ii) It is due to denial of mortgage permission by MOUD that HUDCO cancelled the allotment of land to M/s Leela Hotels Ltd.
It is wrong to say that MoUD denied permission of mortgage to M/s Leela Hotels Ltd. The stand of MOUD is crystally clear from the above referred letter of Secretary (UD) to HUDUCO. HUDCO was cautioned by MOUD though the MOUD was not a party to the agreement to sub-lease.
(iii). The arbitration award against HUDCO was also primarily due to denial of mortgage permission.
As per Ld. SG’s opinion, the conclusions of Ld. Arbitrator are inter-alia as under:-
a) The refusal by HUDCO to permit Leela Hotels to
mortgage or charge the hotel site is a contractual breach, a breach of a fundamental term of the agreement of the sub-lease.
b) HUDCO is guilty of misrepresentation in relation to the submission of the revised outlay plan, although this conclusion, as per this award, is inconsequential.
c) Leela Hotels was justified in treating HUDCO’s breaches as constituting a repudiation of the contract and, therefore, it stood relieved of the obligation of paying further installments.
From the above it may be noticed that it is not only denial of permission to mortgage the hotel site but also misrepresentation by HUDCO in relation to the submission of revised outlay plan and treating Leela Hotels stand as justified for treating HUDCO’s breaches as a repudiation
of the contract and therefore it stand relieved of the obligation of paying further installment.
It is also noticed that though allotment to Leela Hotels was cancelled on 30/6/1999, the amount deposited by M/s Leela Hotels as Ist installment and IInd installment and ground rent was not refunded to them alongwith cancellation of allotment. The Arbitrator has awarded damages with reference to amount paid as Ist and IInd installment, property tax for the period of amount payment with HUDCO until payment to MCD, an interest for period amount remaining with HUDCO.
(iv) The denial of permission by MoUD cannot be construed as HUDCO’s fault.
It is wrong on part of HUDCO and misleading to state that MOUD has denied permission to mortgage. HUDCO did not act as per advice of Ld. ASG and Secretary (UD).
(v). Powers to take decisions in the matter was with MoUD and not with HUDCO as per the lease conditions.
It is wrong to say that the decision making authority was with MoUD as agreement to sub-lease was between HUDCO and Leela Hotel Ltd. Also that Secretary (UD) has conveyed clearance to HUDCO in this matter, by way of forwarding opinion of Ld. ASG.
3. From the facts of the case there is no ambiguity on the liability of HUDCO on account of Arbitration Award in favour of M/s Leela Hotels. Accordingly, a draft D.O. letter reply is placed below for approval/signature of Hon’ble UDM.
Submitted please.
Sl.no.23(R) at page 72/c
A representation received from Shri T. Prabakaran, Director (Finance), HUDCO regarding allotment of space for office requirement of the newly set up National Investigation Agency(NIA) in guest house blocks constructed by HUDCO in Andrews Ganj. Detailed contents of the letter may please be seen at page 72/c onwards.
He has further informed that recently the request made by MOHA for allotment of space for office requirement to National Investigation Agency, the matter was placed before the 452nd meeting of Board of Directors vide item no. 452.23 held on 16/3/2009 wherein
“it has been decided that in view of the pending decision of Government on conversion of freehold rights of 17.6 acres of community centre pocket, the said guest houses cannot be handed over to MOUD for allotting the same by them to the Government bodies. However, in case MOUD communicates the licensing terms and licensing fees to be charges by licensing the vacant guest houses blocks, HUDCO can allot these guest houses to prospective licensees (PSU/government bodies etc.) on the licensing terms and fees approved by MoUD. And the revenue thus received could be deposited in “No lien Andrewsganj Project Accounts”.
He has requested to expeditiously convey the approved licensing fees & licensing terms for licensing the vacant guest houses blocks. And also finalization of recommendations of the committee for transferring freehold rights of 17.6 acres of community centre is still awaited.
In this connection it is mentioned that the issue regarding finalizing of licensing terms and licensing fees has examined earlier in the Ministry and it has been decided that these guest houses blocks could be utilized by the Directorate of Estates for use as Government office as there is a huge unsatisfied demand such accommodation. This decision was communicated to the HUDCO on 6/12/2005(copy placed at page 51/c).
Issue with regard to the transfer of freehold rights of 17.6 acres is concerned. In this regard it is mentioned that a D.O. letter dated 20/2/2009 has already been issued in which it is mentioned that HUPA is administrative Ministry in charge of HUDCO, the further action is to be taken by HUPA separately.
Submitted for further orders please.
65/n
Ref. on pre-page
1. Dy. No. R.P.Cell/192 dated 27/3/092. Dy. No.R.P.Cell/4/VIP dated30/3/093. Dy. noR.P.Cell/5/VIP dated 30/3/09
Advance copies of D.O. letter has been received from Minister of state for HUPA addressed to UDM regarding prompt consideration of the issues regarding the recent Supreme Court judgment in case of allotment of hotel site to M/s Leela Hotels Ltd. at Andrewsganj Project by HUDCO. She has mentioned that it is due to denial of mortgage permission from MOUD and thereby default by ultimately cancel the allotment of land to M/s Leela Hotels Ltd. forfeiting 50% of the paid amount i.e. Rs. 76 crore. This money was utilized by HUDCO for the construction of houses and other works of MOUD. 1176 houses have been given to MOUD free of cost since then. The cost of these 161 crores. HUDCO has not earned or kept any money whatsoever from this development and as such cannot be burdened to bear the current liability of Rs. 119 crores as claimed by M/s Leela Hotels Ltd. on account of recent Supreme Court decision in the case filed by M/s Leela Hotels ltd. The arbitration award against HUDCO was also primarily due to denial of mortgage permission by MOUD which cannot be construed as HUDCO’s fault as powers to take decisions in the matter was with MoUD and not with HUDCO as per lease conditions.
2. She has further stated to please reconsider the stand of MoUD as HUDCO is not liable to pay this amount as it neither owns the land nor has earned any money out of this project. It is suggested that the available land may be utilized in a manner in which funds could be generated for MoUD in the Project Account and current as well as future liabilities are taken care of.
3. In this connection it is stated that HUDCO is functioned as lessee as per the perpetual lease/Supplemental Lease deed executed between HUDCO and Union of India. All the actions of HUDCO are governed the terms and conditions of the lease deed/Supplementary lease deed.
4. Briefly stated that the Government allotted an area of 42.6 acres at Andrewsganj to HUDCO on 19/3/1996 with the stipulation that 17.6 acres of land will b e developed as a Community centre and HUDCO will build general pool
houses in the remaining 25 acres. Government was to use land as a resources and build general pool residential houses out of the surplus earned from the development of 17.6 acres land as a community centre. The lease deed was also executed with the HUDCO on 4/7/1997 whereby 17.6 acres of land was leased to HUDCO for 99 years. The lease contemplated that the lessee would be required to sub-lease the land and space created to others and laid down a number of conditions for sub-lessees. One of the conditions III(6) was that the sub-lessee may with the previous consent in writing of the lessor, sell, transfer, mortgage or charge their respective interest in sites/built-up spaces as may be approved by the lessor in his absolute discretion.
5. As part of its development of the Community Centre, HUDCO has originally allotted a part of land for hotel to M/s M.S. Shoes which went into litigation. After getting the injunctions, HUDCO was in a position to reallot the land and after inviting tenders allotted it to M/s Leela Hotels Ltd., HUDCO also entered into an agreement to sub-lease.
6. Regarding permission of Ministry of Urban Development for mortgaging the hotel site by M/s Leela Hotels Ltd., and as requested by HUDCO, the delay in forwarding the decision was due to the delay in furnishing the requisite information to the Ministry by HUDCO. The matter was referred to Additional Solicitor General of India, Shri C.S. Vaidyanathan. As per his opinion dated 4/11/1998:-
“The question is if M/s M.S. Shoes Limited were to succeed in the suit and if in the interregnum, HUDCO permits M/s Leela Hotels Ltd. to mortgage the Hotel site, What would be the consequences? Legally, the allotment and consequently the agreement to sub-lease or the sub-lease itself, if entered, would be invalid. Since the bank or the financial institution which will advance the money to M/s Leela Hotels Limited would look to the hotel site for recovering its advance, they may initiate litigation which could put HUDCO into difficulty in complying with the decree obtained by M.S. Shoes limited. It is essential, therefore, that the bank or financial institution which is agreeable to advance moneys to M/s Leela Hotels Limited is apprised of the litigation should be required to give an undertaking that in the event of M/s M.S Shoes Ltd. succeeding in the suit, the mortgage would cease to be valid and they would have to claim, change or lien in respect of the hotel site. It is only in the event that M/s Leela Hotel Ltd. and their intending creditors/mortgagees are willing for such a condition that the government/HAUDCO could permit the mortgage of the site”.
7. This opinion was forwarded to the Chief Managing Director, HUDCO under signature of the then Secretary (UD) on
J-13026/10/99-LD linked file no.J-13026/8/97-LD
67/n
contd. From pre-page:-
20/5/1999 vide D.O. letter no. J-13026/8/97-LD thus which is clear that HUDCO could take action as per opinion of Ld. Additional Solicitor General dated 4/11/1998 by incorporating the conditions mention therein. The D.O. was received by the PS to CMD on 21/5/1999. But the board of HUDCO decided not to grant permission for mortgage of hotel site as the matter was under litigation with M/s MSSEL and pending in the Court of Law.
8. Further on 24th June, 1999, the then Secretary (UD) vide D.O. no. J-13026/8/97-LD quotient the HUDCO to ensure that all actions taken by HUDCO in this regard must fully protect the interest of Government and they must be in stricted compliance with relevant clauses in the agreement of sub-lease entered between HUDCO and M/s Leela Hotels Ltd. in particular to the clause relating to Arbitration etc. This DO was also received by PA, CMD, HUDCO.
9. The position explained above, it is evident that it was not Ministry of Urban Development/Government of India that refused to grant permission to mortgage but only HAUDCO that took the decision not to grant permission for mortgage at its own. If approved, we may convey the same to Hon’ble Minister of State, HUPA as per draft d.o. placed below for approval/signature please of Hon’ble UDM.
AS per clause 18(a) and (b) the intended sub-lessee shall not have the right to sell, transfer, assign or otherwise part with the possession of the whole or any part of the said demised premises without the written prior approval of the lessor/corporation except the license to use and occupy the demised premises solely for the purposes of constructing and executing a hotel building. Notwithstanding anything contained in sub-clauses referred above, the intended sub-lease may to enable him to raise funds for construction of the hotel building and the required equipment and machinery with the previous consent in writing of the lessor/corporation and subject to first charge of the lessor/corporation to the extent of its outstanding dues payable hereunder mortgage or charge the said premises to such person and on such terms and conditions as the lessor/corporation may specify in its absolute discretion.
M/s Leela Hotels applied for permission for mortgage to HUDCO and to Government. HUDCO refused permission to mortgager and Leela hotel thereafter went for arbitration.
The Arbitrator has held that either HUDCO or the Government could give the permission to mortgage and since HUDCO refused to give permission. So that HUDCO entitled to pay damages to leela Hotels. The arbitrator has awarded damages to the extent of the amount paid by Leela Hotels with interest @ 20%. The Court has also awarded 15% interest on the payable amount of the award from the date of the award.
The arbitration was between M/s Leela Hotels and HUDCO. Govt. as a lessor was not made a party. Nor does it seem that Government’s approval was taken to appoint the arbitrator
In this regard it is stated that we had taken the opinion of the Ld. Solicitor General and on the basis of that we have communicated to HUDCO vide out letter dated 11/9/2002(F/C) and again on 1/10/2002 that in so far as the award itself is concerned HUDCO may take a decision on it after considering the legal advices to it.
It is stated that on these issues SG of India has opined as under:-
“In any view of the matter, I do not see how the Government could be made liable at all for any of the sums awarded by the Arbitror. HUDCO was undoubtedly entrusted with the responsibility of developing the property in Andrews Ganj on behalf of the Government of India. However, what have been awarded are damages for breach of a contract. HUDCO can not seek to burden the
J-13026/10/99-LD67/n
Government of India with damages caused by its wrongful acts. It has to be borne in mind that the award is on the basis of that HUDCO has been guilty of committing gross breach of contract and invited this liability on to itself. That being so, the Government of India cannot be burdened with a liability arising out of the lapses of HUDCO.”
In view of the facts above, we may the same to the Ministry of HUPA as per draft DO is placed below for approval please.
J-13014/1/2009-R.P.CellAnsal API
Dy. No. 3/VIP/R.P.Cell dated 24/3/2009
Dy. MD & CEO has represented himself through his letter dated 24/3/2009. He has stated that in terms of allotment letter, draft sub-lease deed, duly approved by the Govt. Of India was to be sent to us for our perusal and execution in our favuor. He has further stated that the several representations have been made to HUDCO pointing out that the variations/departures between the Agreement to Sub-lease and draft sub-lease and requested to delete the clause of variance with the agreement to sub-lease. Detailed contents of the letter may be seen at page 1/c onwards.
Briefly stated that as per notes of the then Dy.L&DO on 31/7/95,
“HUDCO propose to execute an agreement to Sub-lease .and request that a nominee of the lessor to join on behalf the President of India for execution of Sub-Lease deed. …….he has written that agreement for lease appears to be in order. Since this is a legal document and the legal officer is required to vet the same. The then VLO in his notes dated 1/8/95 stated that the Agreement to sub-lease legally vetted. The copy of the sub-lease deed executed by the then VLO on behalf of President of India with HUDCO & APIL at page 114-131may kindly be seen
”
On going through the file, it is understood that file was neither referred to Law Ministry Internal Finance Division (IFD) of Ministry for vetting of draft sub-lease deed. This was done at the level of Legal Officer of this office.
Submitted for information please.
Pt file J-13026/01/99-LDM/s Leela Hotel Pvt. Ltd.
DY. NO. R.P.Cell/66 dated 30/01/2009
In response to this office letter dated 13/1/09, Executive Director (Law), HUDCO has requested to provide the noting of the Ministry and/or the brief which the Ministry might have sent in/or about July-August, 02 to the then SGI for seeking his opinion dated 9/8/2002. Further he has stated that the said notings/brief would held facilitate us to appreciate and understand in right prospective the issue/s involved and/or the stand of MOUD in the matter of litigation with M/s Leela Hotels Ltd., relating to Hotel site at HUDCO Place for taking further action so as to protect the interest of HUDCO.
In this connection, it is mentioned that the main file has already submitted on 21/1/09 on issue of reimbursing ground rent, to examine the matter with in the provisions of lease deed/allotment letter etc.
Submitted for information please.
As per the notes of JS(DL) regarding issue of reimbursing ground rent, to examine the matter with in the provisions of lease deed/allotment letter etc.
As per clause (xi) of allotment letter dated 19/3/1996, the ground rent will be payable from the date of the possession of the site was handed over.
Clause III(2) tells that the lessee shall pay unto the lessor the yearly rent thereby reserved on the day and in the manner hereinbefore appointed without any deductions until any portion of built spaces are allotted. Thereafter the sub-lessees/space buyers shall pay to the lessee the yearly rent of two and half per cent of the premium paid towards the proportionate share of the land as per the provisions of the sub-lease without any deductions, who in turn shall pay the yearly rent collected to the lessor in two equal installments payable on 15th January and 15th July every year.
Clause III(4) tells that the space buyers shall from time to time and at all times pay and discharge all rates, taxes, charges and assessments of every description which are now or may at any time hereafter during the continuation of the sub-lease be assessed, charged or imposed upon the premises hereby demised or any party thereof or on any building to erected thereupon or on the sub-lease in respect thereof.
Dy. No.2466/DYIII dated 4/12/2008
The Assistant Chief (W&D), HUDCO has forwarded the request of M/s Focus Energy Ltd., for permission of the creation of charge in favour of Oriental Bank of Commer5ce and also for grant of time extension, for the purpose of construction of Cultural Centre at the site allotted to them at HUDCO Place, Andrews Ganj.
She has further stated that M/s Focus Energy vide its letter dated 23/9/08 and 14/11/2008 regarding to grant permission for creation of mortgage as well as extension of time for construction of Cultural Centre as the construction alleged to be delayed on account of permission for mortgage. As on date, HUDCO is acting as an agent of Govt. for Andrewsganj Project as per the Perpetual Lease Deed dated 4/7/1997, which is still in operation and Govt. has yet to take a decision on review of leasing arrangement of Andrewsganj Project for transferring freehold rights in favour HUDCO as recommended by Committee.
In this connection it is submitted that no objection for grant of extension of time to M/s Focus Energy Ltd. For carrying out
construction at Cultural Centre site has already been issued on 16/6/08.
Further it is mentioned that the issue regarding creation of mortgage is concerned, as per the Allotment letter dated 31/10/1994, Clause (iv) & (v), it tells that date of handing over possession of the site on license bases for construction of the Cultural Centre building and Licensee have not any right to sell, transfer, assign or otherwise parting with the possession without the prior permission of lessor/HUDCO. In this connection Ministry of Law has also opined in their note dated 9/9/03 (p-29/30/N) that a licensee does not any interest in the licensed property. It has right to use and enjoyment and occupy for particular permitted purposes.
The brief facts of the matter are that HUDCO (Lessee) was allotted 42.6 acres of land at Andrews Ganj on 1.11.90 by the Govt. (Lessor). The letter dt. 1.11.90 was modified and in suppression of this letter, allotment letter dt.15.6.93 was issued conveying the allotment of 42.6 acres of land to HUDCO at Andrews Ganj (Flag 'B'). 17.6 acres of land, out of the 42.6 acres, was for construction of Community Centre (CC) and the remaining 25 acres of land was for residential purposes. The lease deed was also executed between the Government of India and HUDCO in respect of this land on 4.7.97 (Flag 'C'). The HUDCO had allotted land measuring about
1500 sq. mtrs. to M/s. FEL on dt.31.10.94 for construction of Cultural Centre at Andrews Ganj (P.91-95/C).
There are following issues are involved for consideration:-
A. Approval of draft Agreement to Sub-lease by this Ministry/Office already entered into between M/s. Focus Energy Ltd. (earlier known as M/s. Phoenix Overseas Ltd. (Sub-lessee) and HUDCO (Lessee). In this matter, the Ministry of Law Opined that sub-lease deed between two companies that are independent of Government of India and as should have their own legal advice. It may be conveyed to HUDCO.
B. Grant of NOC to HUDCO to enable them to grant permission
for creating charge to M/s. FEL in respect of land allotted to them for construction of Cultural Centre at Andrews Ganj, New Delhi. In this regard, Ministry of Law has opined in their note dated 9/9/03 (29-30/N) that a licensee does not acquire any interest in the licensed property. It has mere right to use and enjoyment and occupy for particular permitted purpose. It may also be conveyed to HUDCO.
C. The third issue is regarding permission for execution of time for carrying out construction of Cultural Centre at cultural site at Andrews Ganj. In this connection, it is stated that the plot of land measuring 1500 sq. mts in Andrews Ganj Project was allotted based on auction by HUDCO to M/S Focus Energy Overseas Ltd. for a cultural center on 31/10/94. M/S Focus Energy Overseas Ltd. for has made payment for the land as well as the interest thereon to HUDCO.
The Perpetual lease Deed executed on 4/7/1997 between President of India and HUDCO, possession was handed over on 3/10/2006. It may be considered that as per policy of L&DO, issued vide office order No. 7/98(f/a) dated 15/7/98 file No.
J-13026/2002/03
60/N
24(10)-CDN regarding delays in construction on plots allotted by L&DO reads as under:
"….in respect of institutional plots, the Land & Development Officer shall grant extension for construction on case-to-case basis upto 5 years and thereafter the extension shall be granted only with the approval of the Ministry. However, the maximum period for which such extension shall be allowed is 10 years in all, and in case no construction takes place within this period, the allotment shall be cancelled and plot would be put to alternative use."
Though the issue is to be finally decided by the HUDCO being Lessee, we may convey no objection to the request of M/S Focus Energy or that it is f or HUDCO to decide.
Proposal as per paras A, B & C are submitted for seeking approval of L&DO and draft is also put up for approval.
In referred file, the following issues involved for consideration:-
1. Approval of draft Agreement to Sub -lease by this Ministry already enter5ed into between M/s Focus Energy Ltd. in this regard, Ministry of Law has opined in their note dated 9/9/03(29-30/N) that a licensee does not acquire any interest in the licensed property. It has mere right to use and enjoyment and occupy for particular permitted purpose.
2. The second issue is regarding to grant of NOC to HUDCO to enable them to grant permission for creating charge to M/s FEL in respect of construction of Cultural Centre at Andrews Ganj, New Delhi. In this matter, the Ministry of Law had opined that sub-lease deed between two companies which are independent of Government of India and as should have their own legal advice.
3. The third issue is regarding for giving extension of time for carrying out construction of Cultural Centre at Andrews Ganj. The plot of land measuring 1500 sq. mts in Andrews Ganj Project was c allotted by HUDCO to M/s Focus Energy Overseas Ltd. for a cultural center on 31/10/94. M/s Focus Energy Overseas Ltd has made full payment for the land as well as the interest thereon to HUDCO. Moreover, the Perpetual lease Deed was executed on 4/7/1997 between President of India and HUDCO. Possession was handed over on 3/10/2006. The office order 7/98 dated 15/7/98 regarding delay in construction on plots allotted by the Land & Development Office referred as under :-
"…. in respect of institutional plots, the Land & Development Officer shall grant extension for construction on case-to-case basis up to 5 years and thereafter the extension shall be granted only with the approval of the Ministry. However, the maximum period for which such extension shall be allowed is 10 years in all, and in case no construction takes place within this period, the allotment shall be cancelled and plot would be put to alternative use."
The present case is fit under the above-mentioned office order. If approve we may send the file to L&DO for approval.
Reference from pre-page:-
This is regarding proposal for approval of draft Sub-lease Deed and signing of Supplemental Lease deed in respect of plot no. 25 Bhikaji Cama Place known as August Kranti Bhawan.
Briefly stated land comprising of Block no. 14, 25 & 26 at Bhikaji Cama Place was allotted to HUDCO with effect from 8/11/1990 vide allotment letter dated 16/4/1992(page 22/c). HUDCO paid cost of land plus development charges to DDA. Ground rent at the nominal rate of Rs.1/- per month was payable for initial period of 5 years. Thereafter, ground rent @ 2.5% of the then prevailing market value in respect of block no. 14 & 25 was payable by HUDCO. A Perpetual lease deed in respect of block no.
25 has been entered into by L&DO with HUDCO on 22/7/2004 (page 8/c vol-5).
The present case relates to execution of sub-lease deed between HUDCO and CIC at block no. 25. With respect to sub-lease deed in the bipartite format, it is stated the lease of plot no. 25 has been executed on the lines of lease deed which provide for that the lessee shall get tripartite agreement executed in the prescribed format but of late in many cases the department of legal affairs has been taking a view that the lease deed should be bipartite only. HUDCO was submitted the copies of the draft of sub-lease deed and Supplemental Lease Deed. HUDCO had also pointed out in their letter dated 8/5/07 that draft Sub-lease in respect of plot no.25, August Kranti BHawan is on the same format as approved by this office in respect of plot no. 14. The extracts where the draft sub-lease deed was approved by the Ministry of Law in respect of plot no. 14 may kindly be seen at flag 'D'.
File may please be sent to Ministry of Law for their approval.
Dy.No. R.P. Cell/173 dated 20/3/08
The above said FR is a representation received from Office of the Resident Commissioner of Karnataka. He has requested for registration of sub-lease agreement in respect of A-5 Guest House Block, (Karnataka Bhavan) HUDCO Place, and Andrews Ganj. Detailed contents of the letter may please be seen at page 49/c onwards.
Resident Commissioner on behalf of the Karnataka Govt. requested to settle the issue of date of liability of ground rent and finalization of the Sub-Lease Agreement. He has annexed number of documents to support to his claim. In this connection, it is stated that we have already submitted the draft Cabinet note for approval regarding conversion from leasehold to freehold of 17.6 acres of area of Community Centre.
Submitted please.
Allotment of guest houses to NTRO by HUDCO
DY No. R.P. Cell/86 dated 7/2/2008
The above said FR is a DO letter written by Shri S. Prabhu, I.A.A.S, Controller of Administration, Office of National Security Advisor (Prime Minister's office) addressed to Shri S.K. Choudhary, Ex. Director (W&C), HUDCO and copy forwarded to the Land & Development Officer, Ministry of Urban Development. In his letter he has referred to his earlier D.O. letter dated 2/11/2007 and 6-7/12/2007 regarding allotment of 9 blocks of hostel cum Office accommodation in HUDCO place to NTRO. He has further stated that NTRO is in urgent need of office accommodation.
Notes from page 1/ante onwards may be perused. HUDCO has constructed 12 blocks of Guest Houses at the Community Centre. Out of these 12 blocks, HUDCO had allotted three blocks to CPSUs/States Government Institutions. The remaining nine blocks are vacant as the allotment of these blocks to M/s M.S. Shoes Ltd., had to be cancelled for non-payment of requisite amount by the firm and subsequently the matter in sub-judice in the Delhi High Court, the next date of hearing is 20/2/2008.
In this connection, it is stated that it was decided with the approval of Secretary (UD) that instead of renting out these guest house block to individual organizations, these blocks would be utilized by the Directorate of Estates for use by various commissions/offices keeping in view the great paucity of space for General Pool Office Accommodation (GPOA). It was also decided that HUDCO should be asked to hand over possession of the vacant
guesthouses to the CPWD for maintenance while the Directorate of Estates would utilize them for the purpose of Office accommodation. However, until date HUDCO has not hand over the possession of the vacant guest houses to CPWD for maintenance stating that their Board has decided the matter of handing over possession of the nine vacant Guest Houses Blocks can be decided only after the recommendations are finalized by the Committee (as constituted by MOUD to examine the various issued related to Andrewsganj project terms and conditions of allotment and decision taken by the Govt. for the project as a whole.)
In view of the position explained above it is for order whether we may reject the allotment application of NTRO, or keep pending till final outcome of the Court case or transfer of possession from HUDCO to CPWD/Directorate of Estates.
Allotment to NTRO
Reference note on pre-page:-
The recommendation of Review Committee has been examined in the linked filed from page35/ante (F/A) onwards. The Review Committee has suggested the following three options:-
OPTION I Payment of value of land and conversion charges in respect of Community Centre by HUDCO to L&DO at the rate of notified land rates of 1998 + 100% thereof. Under this option, the amount payable by HUDCO to L&DO comes to Rs.180.39 crores after adjusting the cost incurred by HUDCO in respect of construction of GPRA and other Government directed work, (Cost land per sq. meter = RS. 53.36/-, area of community centre in sq. meter = 71224.74 Expenditure on GPRA = Rs. 168.99crores)
Option-II Payment of value of land in respect of hotel site and 9 Guest House Blocks at the rate of notified land rates of 1998 + 100% thereof while rest of the land in Community Centre valued at notified land rates of 1990( 23rd July, 1990). Under this option the amount payable by HUDCO to L&DO come to Rs. 82.61 crores after adjusting the cost incurred by HUDCO in respect of construction of GPRA and other Government directed works, (cost per sq. meter @ 1990 rates= Rs.19260/-, area of hotel site + 9 guest house block = 42550 sq. meter, rest of the community centre = 28674.74 sq. meter)
Option -III Payment of value of land in respect of hotel site at the rate of notified land rates of 1998 + 100% thereof while rest of the land in Community Centre valued at notified land rates of 1990. Under this option the amount payable by HUDCO to L&DO comes to Rs. 22.76 crores after adjusting the cost incurred by HUDCO in respect of construction of GPRA and other Government directed works( area of hotel site = 25000 sq. meter, cost of hotel site area = 133.40 crores; area of rest of community centre = 46224.74 sq. meter, cost of rest of community centre = Rs. 89.03 crores, total cost of community centre land = Rs. 222.43 crores. Expenditure on GPRA = 211.07, freehold conversion charges @ 6% of the land cost =Rs.11.40 crores. Balance const Rs. 11.36 crores
2. A meeting was held under Chairmanship of Secretary (UD) on 13/7/2006 to discuss the report of Review Committee and it had been decided that option III along with concomittent conditions (enumerated in pare 7 of the report) may be adopted as it was acceptable to all concerned inducing HUDCO. Option III provides for land value calculated at L&DO's notified rates i.e. Rs. 22.76 crores. The details of calculations may be seen at table at p 104/c of linked file (F/B). The decision therefore is for transfer of land to the HUDCO on freehold basis subject to the conditions enumerated in para 7 of the report.
3. The file was then sent to Internal Finance Division. On their advice the file was sent to Ministry of Finance, Department of Expenditure. The comments of Department of Expenditure may be seen at page 40-41/ante (F/C) of the linked filed. They have opined that appropriate view on the issue may be taken by Ministry of Urban Development on the merit of the case, after seeking legal opinion, looking into the fact that there are several legal/arbitration proceedings pending in the matter. JS (DL) asked to examine whether we, in the ministry, will be able to settle the matter now. This matter has been discussed with officer of HUDCO on 13/9/07 (page 45/ante of linked file) in the chamber of L&DO. The officers of HUDCO were of the view that various problem of sub-letting etc being faced by them in respect of properties of Andrews Ganj project, may be easily resolved if the proposal for conversion of 17.6 acres of land of community centre at Andrews Ganj were to be approved by the Ministry.
4. `The observations of Review Committee 8regarding General Pool Residential Accommodation are reproduced as under:-
"The Committee also notes of the fact that the primary objective of the project was to construct General Pool Residential Accommodation (GPRA) by using "land as resource" and without drawing funds from the Government exchequer namely, the Consolidated Fund of India. To this end, HUDCO has informed that the following GPRA units have been constructed and handed over to Directorate of Estates:-
Type - VI 60 UnitsType- V 200 Units
Type -IV (Special) 314 units Type -IV 24 Units
_________ _____ Total __598_Units
In addition, 319 units of transit accommodation are under construction and are likely to be handed over by June 2006 to the Directorate of Estates. The construction is being done by CPWD with the funds being released by HUDCO for this purpose. Further, 259 servant quarters were also constructed and handed over to Directorate o f Estates along with Type VI and Type V units. In all 1176 units of accommodation including the servant quarters, have been considered by virtue of this project."
GNERAL POOL OFFICE ACCOMMODATION5. So far as the issue regarding General Pool Office Accommodation is concerned there is no observation/recommendations given by the Review Committee. The issue of General Pool Office Accommodation has been considered on separate file as linked below. HUDCO informed that 9 guest house blocks (A1, A3, A4, B1 TO B6) were constructed by them as a part of Andrews Ganj Project and were lying vacant unutilized informed in 2005. HUDCO indicated therein that Government had permitted licensing of the same to Government institution/PSUs or for the use of HUDCO on temporary basis and that, the license should be terminated on a notice of 3 months. It was examined in Ministry of Urban Development and was decided that Directorate of Estates could utilize these guest houses for use as Government Office (G.P.O.A) as there is huge unsatisfied demand for such accommodation. Accordingly, on 6/1/2/2005 the HUDCO was requested to handover the possession of these guesthouses to CPWD for their maintenance and that Dte. of Estates shall allot the same for their use as office accommodation to various Government department/offices (F/C). In response to these directions HUDCO informed on 24/1/2006 that the matter was placed before the Board of Directors of HUDCO on 21/12/2005 wherein the Board had resolved that the matter of handing over of possession of 9 vacant guest house blocks can be decided only after the recommdations are finalized by Review Committee and decision taken by Government for the project as whole (F/D). Again on 20/1/2006 (F/E) the HUDCO was requested to handover the possession of the guest houses to Ex. Engineer, CPWD immediately on the Committee of Ministry of Urban Development had decided that the guest houses blocks be taken from the HUDCO and further allotment may be made. Also that the issues relating to Andrews Ganj Project including terms and conditions of allotment may be implemented later as per decision of the Committee. On 22/3/2006 the HUDCO re-iterated their earlier stand stating that the project needs to be seen in its entirety and an exclusive decisions on the guest houses alone may not be prudent at that stage.
6.. The recommendations of the Review Committee have been examined as explained herein before and Secretary (UD) has decided to accept option No.3, the allotment of guest houses at present may be done by HUDCO or HUDCO may be directed to wait till final decision is taken by this Ministry after decision on Cabinet note. A draft Cabinet note is already under preparation and will be submitted next week. The recommendations of Review Committee have been processed on the relevant file. Submitted for orders regarding request of the N.TR.O.
ALLOTMENT TO CIC
The request has been received from Shri V. Roy, Chief (Works & Disposal) on 26/3/2007 regarding g allotment of space to M/s Central Information Commission in August Kranti Bhavan, Plot No.25, Bhikaji Cama Place, New Delhi- approval of Rent Agreement format.
The recommendation of Review Committee has been examined (F/A) onwards. The Review Committee has suggested the following three options:-
1. OPTION 1 Payment of value of land and conversion charges in respect of Community Centre by HUDCO to L&DO at the rate of notified land rates of 1998 + 100% thereof. Under this option, the amount payable by HUDCO to L&DO comes to Rs.180.39 crores after adjusting the cost incurred by HUDCO in respect of construction of GPRA and other Government directed work.
2. Option-II Payment of value of land in respect of hotel site and 9 Guest House Blocks at the rate of notified land rates of 1998 + 100% thereof while rest of the land in Community Centre valued at notified land rates of 1990. Under this option the amount payable by HUDCO to L&DO come to Rs. 82.61 crores after adjusting the cost incurred by DUCO in respect of construction of GPRA and other Government directed works.
3. Option -III Payment of value of land in respect of hotel site at the rate of notified land rates of 1998 + 100% thereof while rest of the land in Community Centre valued at notified land rates of 1990. Under this option the amount payable by HUDCO to L&DO comes to Rs. 22.76 crores after adjusting the cost incurred by HUDCO in respect of construction of GPRA and other Government directed works
A meeting was held under Chairmanship of Secretary (UD) on 13/7/2006 to discuss the report of Review Committee and it had been decided that option III along with concomitment conditions (enumerated in pare 7 of the report) may be adopted as it was
acceptable to all concerned inducing HUDCO. Option III provides for land value calculated at L&DO's notified rates i.e. Rs. 22.76 crores. The details of calculations may be seen at table (F/B). The decision therefore is for transfer of land to the HUDCO on freehold basis subject to the conditions enumerated in para 7 of the report. The file was then sent to Internal Finance Division. On their advised, the file was sent to Ministry of Finance, Department of Expenditure. The comments of Department of Expenditure may be seen at page 40-41/ante (F/C) of the linked filed. They have opined that appropriate view on the issue may be taken by Ministry of Urban Development on the merit of the case, after seeking legal opinion, looking into fact that there are several legal/arbitration proceedings pending in the matter. JS(DL) asked to examine whether we, in the ministry, will be able to settle the matter now. This matter has been discussed with officer of HUDCO on 13/9/07 (page 45/ante of linked file) in the chamber of L&DO. The meeting officer of HUDCO were of view that various problem of sub-letting etc being faced by them in respect of properties of Andrews Ganj project and be easily resolved if the proposal for conversion of 17.6 acres of land at Andrews Ganj were to be approved by the Ministry. The observations of Review Committee regarding General Pool Residential Accommodation are reproduced as under:-
"The Committee also notes of the fact that the primary objective of the project was to construct General Pool Residential Accommodation (GPRA) NY USISNG "la d as resource" and without drawing funds from the Government exchequer namely, the Consolidated Fund of India. To this end, HUDCO has informed that the following GPRA units have been constructed and handed over to Directorate of Estates:-
Type - VI 60 UnitsType- V 200 Units
Type -IV (Special) 314 units Type -IV 24 Units
_________ Total __598_Units
In addition, 319 units of transit accommodation are under construction and are likely to be handed over by June 2006 to the Directorate of Estates. The construction is being done by CPWD with the funds being released by HUDCO for this purpose. Further, 259 servant quarters were also constructed and handed over to Directorate o f Estates along with Type VI and Type V units. In all 1176 units of accommodation including the servant quarters, have been considered by virtue of this project."
2. The issue regarding General Pool Office Accommodation is concerned there is no observation/recommendations given by the Review Committee. The issue of General Pool Office Accommodation has been considered on separate file as linked below. HUDCO informed that 9 guest house blocks (A1, A3, A4, B1 TO B6) were constructed by them as a part of Andrews Ganj Project and were lying vacant unutilized informed in 2005. HUDCO indicated therein that Government had permitted licensing of the same to Government institution/PSUs or for the use of HUDCO on temporary basis and that, the license should be terminated on a notice of 3 months. It was examined in Ministry of Urban Development and was decided that Directorate of Estates could utilize these guest houses for use as Government Office (G.P.O.A) as
there is a use of unsatisfied demand for such accommodation. Accordingly, on 6/1/2/2005 the HUDCO was requested to handover the possession of these guesthouses to CPWD for their maintance and that Dte. of Estates shall allot the same for their use as office accommodation to various Government department/offices (F/D). In response to these directions HUDCO informed on 24/1/2006 that the matter was placed before the Board of Directors of HUDCO on 21/12/2005 wherein the Board had resolved that the matter of handing over of possession of 9 vacant guest house blocks can be decided only after the recommdations are finalized by Review Committee and decision taken by Government for the project as whole (F/E). On 20/1/2006 (F/F) the HUDCO was requested to handover the possession of the guest houses to Ex. Engineer, CPWD immediately on the Committee of Ministry of Urban Development had decided that the guest houses blocks taken from the HUDCO and further allotment may be made. Also that the issues relating to Andrews Ganj Project including terms and conditions of allotment may be implemented later as per decision of the Committee. On 22/3/2006 the HUDCO re-iterated their earlier stand stating that the project needs to be seen in its anterity andan exclusive decisions on the guest houses alone may not be prudent at that stage.
3. The recommendations of Review Committee have been examined as explained herein before and Secretary (UD) has decided to accept option No.3, the allotment of guest houses at present may done by HUDCO or HUDCO may be directed to wait till final decision is taken by this Ministry after decision on Cabinet note. A draft Cabinet note is already under preparation and will be submitted next week.
Allotment of guest houses to NTRO by HUDCO
DY No. R.P. Cell/86 dated 7/2/2008
The above said FR is a DO letter written by Shri S. Prabhu, I.A.A.S, Controller of Administration, Office of National Security
Advisor (Prime Minister's office) addressed to Shri S.K. Choudhary, Ex. Director (W&C), HUDCO and copy forwarded to the Land & Development Officer, Ministry of Urban Development. In his letter he has referred to his earlier D.O. letter dated 2/11/2007 and 6-7/12/2007 regarding allotment of 9 blocks of hostel cum Office accommodation in HUDCO place to NTRO. He has further stated that NTRO is in urgent need of office accommodation.
Notes from page 1/ante onwards may be perused. HUDCO has constructed 12 blocks of Guest Houses at the Community Centre. Out of these 12 blocks, HUDCO had allotted three blocks to CPSUs/States Government Institutions. The remaining nine blocks are vacant as the allotment of these blocks to M/s M.S. Shoes Ltd., had to be cancelled for non-payment of requisite amount by the firm and subsequently the matter in sub-judice in the Delhi High Court, the next date of hearing is 20/2/2008.
In this connection, it is stated that it was decided with the approval of Secretary (UD) that instead of renting out these guest house block to individual organizations, these blocks would be utilized by the Directorate of Estates for use by various commissions/offices keeping in view the great paucity of space for General Pool Office Accommodation (GPOA). It was also decided that HUDCO should be asked to hand over possession of the vacant guesthouses to the CPWD for maintenance while the Directorate of Estates would utilize them for the purpose of Office accommodation. However, until date HUDCO has not hand over the possession of the vacant guest houses to CPWD for maintenance stating that their Board has decided the matter of handing over possession of the nine vacant Guest Houses Blocks can be decided only after the recommendations are finalized by the Committee (as constituted by MOUD to examine the various issued related to Andrewsganj project terms and conditions of allotment and decision taken by the Govt. for the project as a whole.)
In view of the position explained above it is for order whether we may reject the allotment application of NTRO, or keep pending till final outcome of the Court case or transfer of possession from HUDCO to CPWD/Directorate of Estates.
J-13026/04/08-L&DO-16-
Dy.No.R.P.Cell/165 dated 17/3/08 - FRe said FR is a letter received from Shri K.L. Dhingra, CMO, HUDCO regarding the review of HUDCO Project at Andrews Ganj, New Delhi. He informed that the Secretary had been attended the meeting at Chandigarh on 14/3/2008, which he had also been directed to attend.
Further he has stated that issues involved having financial implications for HUDCO project at Andrews Ganj and he has also interested to attend the same. He has requested to postpone the meeting.
Keeping in view, file is re-submitted for fixing of date and time for meeting to review the HUDCO project at Andrrews GAnj, New Delhi.
