Caught in JCT land row, Punjab Small Industries and Export Corporation cancels pact with bidder, liquidator

Chandigarh, August 9

Days after the auction of 31 acres of prime land of liquidated JCT Electronics in Mohali for Rs 90.56 crore to a private realtor triggered a controversy, Punjab Small Industries and Export Corporation (PSIEC) has cancelled its tripartite agreement with the bidder and the official liquidator of the said property.

Setback for Arora

The move is being seen as a setback for Industries Minister Sunder Shyam Arora, who had been justifying the auction despite facing flak from leaders within the party. The Opposition has been demanding his resignation over the issue.

PSIEC had been asked to initiate the process to cancel the lease deed with the bidder and resume the plot, confirmed a senior government functionary. However, the government has not spelled out the action being initiated against the erring PSIEC officials.

The PSIEC’s role has come under scanner for not staking Rs 161-crore claim as the unearned profit to be paid on the sale of property. It instead agreed to claim Rs 45.28 crore as 50 per cent of the sale value.

The decision was taken in a meeting of the PSIEC Board of Directors, without referring the matter to the Finance Department or the Advocate General (AG) for the second opinion. The Finance Department, in its communication to the Managing Director, PSIEC, has made known its objection to the decision.

Acting on of the advice of the Finance Department, which had sought legal opinion from the AG on the issue, the PSIEC has been asked to annul the tripartite agreement, cancel the lease deed and resume the property. The AG in his report submitted in June stated the state government had incurred a loss of nearly Rs 125 crore in the deal due to a casual approach by officials.

Officials said the land was auctioned for Rs 90.58 crore to GRG Developers and Promoters. “Against a current market price of Rs 21,500 per sq yd quoted by the corporation in its claim, plots were being offered by the bidder at Rs 30,000 per sq yd. This means the land cost comes to over Rs 350 crore, whereas it has been auctioned for Rs 90.58 crore,” they pointed out. — TNS