New land scandal generates feeling of deja vu

EVEN BEFORE the reverberations of the Merchiston estate scandal have died down, another land scandal has surfaced. The deep involvement of political, bureaucratic and business interests in the deal gives rise to a feeling that we have seen it all before.


In the Merchiston deal, a Central government institution, the Indian Space Research Organisation, figured as the buyer and an estate owner, Sevi Mano Mathew, as the seller. In the new scandal, the roles are reversed. A Central Government undertaking, the HMT, is the seller and a business house with real estate interests is the buyer. In both the deals, State ministers and officials figure as accomplices.


The State government had given the Bangalore-based HMT 320 hectares of land at Kalamassery, near Kochi, to set up its unit. About 900 families were evicted at the time of acquisition of the land.


In 1995, the State government found that HMT was holding land in excess of its needs and issued an order for resuming 161 hectares. The company represented that it had expansion plans, for which it would require 40.4 hectares. Thereupon the government issued a fresh order, allowing the company to retain 40.4 hectares for its future needs. The remaining 121.4 hectares were allotted to Kerala Industrial Infrastructure Development Corporation Limited (Kinfra), a State government undertaking, to develop an industrial park.


In October 2005, HMT placed advertisements in some national dailies offering for sale 28.3 hectares out of the 40.4 hectares it was allowed to retain. The property was conveyed to Blue Star Realtors, a real estate company, in October 2006 for a consideration of Rs.910 million.



Two contradictory opinions have surfaced on the legality of the transaction. According to one school of thought, the HMT did not have full rights over the land since the government order stipulated that the allotment was conditional. The government had the right to take back the land if it was not used for company's own expansion plans, which was the purpose for which the allotment was made. According to another school of thought, since no conditions were stipulated when land was allotted to the company originally and it had enjoyed full rights on the land from the beginning, there was nothing to prevent it from disposing of the land. The Revenue department, in an official note, is reported to have upheld this view.



Official circles had expressed contradictory opinions on the status of the Merchiston estate land too. While some held that the land in question was part of an area which had been declared ecologically fragile, others said it was not.


The authorities' inability to determine the nature and status of land, without leaving room for ambiguity, is a factor that makes it possible for real estate operators to push through suspicious deals.


Industry Minister Elamaram Karim (CPI-M) and Revenue Minister KP Rajendran (CPI) played a role in facilitating the sale of HMT land to the Blue Star Realtors, who claim to have acquired it to set up an information technology park named Cyber City.


After the sale deed was registered, the local HMT union attempted to put a spoke in the wheel.
In a representation to the Revenue Minister, it said the company was transferring the sale proceeds to Bangalore instead of using it to meet the needs of the Kalamassery unit, and urged him to intervene. The minister thereupon directed the department to keep in abeyance the process of effecting changes in the revenue records on the basis of the sale deed. The Industry Minister stepped in to get the stay removed.



The public got the first indication about the suspicious nature of the deal when Chief Minister VS Achuthanandan, who was to have laid the foundation stone of Cyber City project, stayed away from the function.


Achuthanandan said later the land deal was being looked into. He said the government would take steps to ensure that unused land in the possession of public undertakings did not end up in the hands of the real estate mafia.


The land deal has become a matter of contention between the two factions in the Communist Party of India (Marxist). Last week party secretary Pinarayi Vijayan sought to turn the needle of suspicion away from his faction by pointing out that HMT is a Central undertaking and it advertised the land for sale when the United Democratic Front was in power. -- Gulf Today, Sharjah, January 28, 2008.