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Prideasia controversy ends, Parsvnath surrenders 123 acres to Housing Board

The land in IT Park was given to Parsvnath in 2005 for Rs 821 crore, but the project failed to take off.

Chandigarh | Updated: February 5, 2015 3:56:06 am

By: Vivek Gupta

The controversial high-end residential project ‘Prideasia’ was finally buried when Delhi-based private developer Parsvnath Pvt Ltd surrendered 123 acres of prime land to the Chandigarh Housing Board in return for Rs 567.25 crore on Wednesday.

The land in IT Park was given to Parsvnath in 2005 for Rs 821 crore, but the project failed to take off, following which both parties went for arbitration the award of which was recently delivered by Justice (retd) R V Raveendran.

In a high-level meeting, both parties agreed to accept the arbitration award and legally revoked the lease-hold agreements and entitlement and privilege benefits which were agreed between CHB and Parsvnath Developers Ltd back in November 2005.

Parsvnath chairman Pardeep Jain told Newsline that the project was finally over. “We are left with a few belongings on the land, which will be removed very soon, and permission of which has been granted by the administration,” he said.

He said that the company had a bad experience in the city, “We regret that it could not develop the project due to unavoidable circumstances.”

“We would, nevertheless, again like to associate with the Chandigarh Administration, if given a chance,” he added.

CHB’s officiating chairman V P Singh said that the private developer cleared all formalities, including the bank mortgage. “We have also taken an undertaking that the company is no longer involved in any third party contract on the land,” he said

He said the board was happy to take back the possession of the land. “We will soon take a call on how this land can be developed. Since the land belongs to administration, they can take it back after duly reimbursing the board,” he said

In the arbitration award, both parties were directed to refund Rs 130 crore of the investors money, 70 per cent by Parsvnath and 30 per cent by the Chandigarh Administration.

Pardeep Jain said they had paid a major portion of their share to the investors. “Those who are left will be reimbursed soon,” he added.

Singh said that the board would clear its part of the investors liability soon. “We have also returned the private developers bank guarantee to the tune of Rs 80 crore,” he said.

Today’s decision was a win-win situation for both parties. For Parsvnath, their investment was trapped for the last several years. On the other hand, the administration got back the land the market price of which has increased manifold.

TIMELINE

* In November 2005, CHB signed a contract with Parsvnath to allow the builder to construct a high-end residential project on 123 acres of government land in IT Park

* In early 2006, CHB transferred the land to the private developer for Rs 821 crore, out of which Rs 516.25 crore was received in 4 instalments

* The project, which was to be completed in three years, went in limbo due to the mistrust between both parties over government approvals

* In 2009, both parties went for arbitration and the Punjab and Haryana High Court appointed a three-judge
arbitration tribunal

* On January 30, 2013, the Supreme Court dissolved the three-judge tribunal as it was bleeding both parties by charging a hefty fee. It appointed its former judge R V Raveendran as the sole arbitrator

* On January 9, the arbitrator delivered the award

* On February 4, both parties accepted the award

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