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UT Admn considers all three Parsvnath proposals ‘unviable’

It seems the Chandigarh Administration has a catch-22 situation on its hands. With real-estate giant Parsvnath listing three options to decide the fate of the multi-crore Prideasia project,the officials are in a tizzy to choose the best option.

Written by Varinder Bhatia | Chandigarh |
March 27, 2009 1:12:30 am

It seems the Chandigarh Administration has a catch-22 situation on its hands. With real-estate giant Parsvnath listing three options to decide the fate of the multi-crore Prideasia project,the officials are in a tizzy to choose the best option. Although instructions on the issue are awaited from UT Administrator General S F Rodrigues (retd),sources say the top brass consider all the three conditions “unacceptable”.

Failing to get ‘encumbrance-free’ land even after two years of the allotment of project,the developer Parsvnath had asked the Chandigarh Administration to either terminate ties; or restructure the contract agreement or take the project forward on a pro rata basis.

As such the Administration is waiting for the developer to deposit a pending sum — Rs 304 crore — of the bid amount of Rs 821 crore. Parsvnath was given the land to establish 1,431 dwelling units and a commercial complex at Rajiv Gandhi Chandigarh Technology Park. The Chandigarh Housing Board (CHB),a partner in the joint venture,was to use the bid amount for constructing 25,000 flats for the rehabilitated colony residents.

“It would be a major problem if Parsvnath does not deposit the pending amount. The CHB has frozen the escrow account apprehending that the developer might withdraw the total deposit of Rs 517 crore. In case ties are snapped,the CHB would have to refund the deposit,which would put the rehabilitation project in jeopardy. It is a tricky situation,but we are working it out,” said a senior official of the Chandigarh Administration. Earlier,Parsvnath had asked the UT Administration to terminate the contract of another mega project — Filmcity — complaining that it was not provided encumbrance-free land after more than a year. At present,the Central Vigilance Commission is probing both the projects,Filmcity and Prideasia.

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Heading to court?
According to legal experts,it is a fit ground for the developer to move court against the UT if the Administration has failed to respond to repeated reminders.
* Filmcity project: The developer had already offered to opt out,asking the UT Administration to refund the deposit of Rs 47 crore with interest. However,the Administration has not yet responded to the representation citing that the matter is pending with the CVC.
* Prideasia project: The developer has given three options to the Administration,wherein its first choice is ‘termination of contract’. The Administration is yet to respond.

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