Mumbai: The Mumbai Metropolitan Region Development Authority’s (MMRDA) failure to recover lease premium on schedule resulted in non-recovery of Rs 866 crore, states the Comptroller and Auditor General’s report 2017 tabled in both houses on the last day of the state legislature.
In 2008 the state urban development department announced an increase in floor space index for residential (from 1 to 3) and commercial (2 to 4) exploitation in the G Block in the Bandra-Kurla Complex. This resulted in an additional Built Up Area of 13 lakh sq metres becoming available in G Block. This was made available to existing allottees at 100 and 150% respectively of the Ready Reckoner Rate as a one-time scheme.
As per the scheme, 20% of the premium was to be paid along with demand letter before March 2009 (revised to March 2010 and further revised to March 2011) and rest in four annual instalments with 10 per cent simple interest. The delay in payment of annual instalment would attract delayed interest at 14%. There was no time limit specified for consumption of the additional BUA.
The CAG studied two cases and found that M/s Reliance Industry that was allotted an additional BUA of 67,000 sq metres for Rs 985 crore did not adhere to the time schedule for instalment payment. By March 2016, the sum had touched Rs 1,340 crore but the allottee had paid only Rs 697 crore.
MMRDA eventually issued a demand notice in September 2017 and the dues had increased to Rs 770 crore.
In the second case M/s Starlight Systems Pvt. Ltd was allotted an additional 32,000 sq metres in April 2010 for residential use and was required to pay Rs 230 crore at the time. By March 2015 the amount had escalated to Rs 433 crore but the lessee paid only Rs 366 crore after utilising part of the additional fsi.
“The MMRDA did not insist on the recovery of dues within the stipulated period as envisaged in the one-time scheme. Failure of MMRDA to ensure the recovery of the lease premium resulted in non-recovery of Rs 85 crore as of March 2017,” states the report.
MMRDA clarified that the lessee (M/s Starlight Systems Pvt. Ltd) had made full payment of lease premium with interest and delayed interest before issuance of full occupancy certificate. CAG has, however, said the reply is not tenable since the allottee was required to pay the dues for the full area within the stipulated period. The matter was referred to the state government and its reply was awaited, states the report.
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