The Haryana government has finally decided to take back 1383.68 acre of land from M/s Reliance Haryana SEZ Limited (RHSL) after Reliance failed to develop the envisaged Special Economic Zone on the said land.
The decision was taken by the Haryana Cabinet that met under the chairmanship of Chief Minister Bhupinder Singh Hooda on Friday. The state government has also decided that it will pay Reliance a sum of Rs 343 crore. However, the company has raised a demand of Rs 1172 crore to be paid to it in lieu of the said land. The land shall be vested with Haryana State Industrial and Infrastructure Development Corporation Limited (HSIIDC).
Since Reliance failed to develop the SEZ on the said land even after a period of around seven years, the state government on Friday took the decision. HSIIDC and M/s Reliance Ventures Limited, a 100 per cent owned subsidiary of Reliance Industries Limited had entered into a Joint Venture Agreement (JVA) on June 19, 2006 for setting up of a SEZ over an area of 25000 acre in Gurgaon and Jhajjar districts.
HSIIDC had transferred an area of about 1383.68 acre of land at Village Garhi Harsaru to the special purpose vehicle floated by HSIIDC and RVL for implementing the project – Reliance Haryana SEZ Limited, for a consideration price of about Rs 399.85 crore.
“The project configuration was subsequently changed to SEZ in Gurgaon district over 12500 acre and a Model Economic Township over 12500 acre in Jhajjar district. Reliance was able to purchase and aggregate about 7100 acres land in Jhajjar district and another about 1200 acre in Gurgaon district, which however was not contiguous. RHSL also paid annuity to the landowners whose land was acquired/ procured in Gurgaon and Jhajjar amounting to Rs 50.71 crore upto March 31, 2013 that included Rs 17.61 crore on HSIIDC land in Gurgaon and balance amount of about Rs 33.10 crore in Jhajjar where they had procured land from the landowners through direct negotiations,” said Yudhvir Malik, Principal Secretary, Industries, Haryana.
“During a review of the progress on the project, it emerged that the SEZ Project at Gurgaon was not economically unviable due to the mid-term corrections in the SEZ Policy viz. imposition of the Minimum Alternate Tax (MAT), withdrawal of the Tax holiday, slowdown in the global economy, prohibitively high prices of land and other problems associated with aggregation of land through private negotiations. Sensing the difficulties posed in this behalf, the Chief Minister requested M/s Reliance to return the HSIIDC land. As such, M/s RHSL offered to return the HSIIDC land and abandon the SEZ project in Gurgaon vide their letter sent to the government in January 2012. M/s RHSL had requested for refund of the amount paid by them to the HSIIDC and re-imbursement of expenditure incurred on the site, apart from interest on the said amount aggregating to Rs 1172 crore”, Malik added.
“Haryana Cabinet today approved the return of the land to HSIIDC, in lieu of payment of an amount of Rs 343.51 crore to M/s RHSL as against Rs 399.85 crore paid by RHSL at the time of transfer of land and the demand of Rs 1172 crore by M/s RHSL. Claims on account of administrative charges forming price of the subject, refund of the Stamp Duty, re-imbursement of development expenditure and interest amount have not been accepted. The refund amount has been worked out strictly as per the terms of the Joint Venture Agreement date June 19, 2006 signed between the HSIIDC and M/s RVL”, haryana Chief Minister Bhupinder Singh Hooda said while addressing the mediapersons after the Cabinet meeting.
“The same land shall be used for developing a Global city under the Delhi Mumbai Industrial Corridor (DMIC) Project. It will have an international standard Exhibition and Convention Centre as part of its eco system. The Global City is planned to be designed by integrating smart community concepts ranging from water supply, power to integration of IT services in managing various public utilities of the area. It is envisaged to be an integrated model township in Gurgaon, Haryana comprising of the exhibition and convention centre, high value innovation and knowledge industries, central business district and township facilities etc”, Hooda said.