Over Rs 600 cr at stake; developers,UT at loggerheadshttps://indianexpress.com/article/cities/chandigarh/over-rs-600-cr-at-stake-developers-ut-at-loggerheads/

Over Rs 600 cr at stake; developers,UT at loggerheads

With all three controversial mega projects — Amusement-cum-Theme Park,Filmcity and Prideasia — going to arbitration,real estate giants and the Chandigarh Administration have locked horns.

Arbitration * Fate of 3 mega projects — Filmcity,Prideasia,Theme Park — hangs in balance

With all three controversial mega projects — Amusement-cum-Theme Park,Filmcity and Prideasia — going to arbitration,real estate giants and the Chandigarh Administration have locked horns over their hundreds of crores of rupees at stake. While the Chandigarh Administration has forfeited around Rs 600 crore deposited by Parsvnath Developers Limited and Unitech,both developers are now contesting their claims,in an attempt to get their money released.

“Arbitration is a clause,which is one of the most vital components of any contract signed by the government and private developers. In case of any such dispute,arbitration is invoked to settle the ongoing dispute,” said a senior officer of the Chandigarh Administration.

Speaking to Chandigarh Newsline,senior advocate A R Takkar,who is representing Chandigarh Administration in the arbitration case of Filmcity,said: “Cross-examination of a few witnesses is pending,which is likely to get completed on the next date of hearing on April 9. The case is moving at a fast pace and once the cross-examination is complete,it will be followed by arguments after which the final verdict of the arbitration tribunal will come.”

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The three mega projects,conceptualised and allotted during the regime of former UT administrator General S F Rodrigues (Retd),got mired in controversies in the late 2009,resulting in various high-level probes and detection of gross irregularities. The Central Bureau of Investigation (CBI) has already registered a criminal case against three former top UT bureaucrats in case of Theme Park,while a probe is already on into Prideasia and Filmcity projects. In case of Filmcity,Parsvnath has filed a claim of over Rs 50 crore,contesting which the Chandigarh Administration has said the developer should have completed the project within the stipulated period of two years.

In case of Prideasia too,the same developer’s over Rs 550 crore is at stake,which the Chandigarh Housing Board (CHB) has forfeited. The money deposited in the escrow account,jointly maintained by the CHB and Parsvnath,was sealed by the board. Out of this money,the CHB has already transferred Rs 210 crore to the Consolidated Fund of India,as instructed in the special audit conducted by a team of officials from the Ministry of Home Affairs.

The Amusement-cum-Theme Park is the recent addition in the list of mega projects going for arbitration. The Punjab and Haryana High Court has recently sought names of the three arbitrators from Unitech and Chandigarh Administration. Unitech has challenged the Administration’s decision to terminate the project. In this case,too,the Administration has forfeited an amount of around Rs 5.4 crore,deposited by Unitech as first installment towards the project. Subsequently,after terminating the project,the Administration also encashed the bank guarantee of Rs 11 crore given by the developer.

While the Administration allegedly could never provide the developer an encumbrance-free land,Unitech did not deposit the second installment and the project got caught up in one controversy after the other,resulting in its termination last year.

“The arbitration tribunals will decide the fate of these three projects. Though the CBI has registered a criminal case against three top bureaucrats involved in the Theme Park project,the developer still has the right to adopt the arbitration channel as a civil remedy,” said a senior official of the Chandigarh Administration.