Land laws add to plantation woes

In a letter to the SEBIchairman, the convenor of the Association said “the sudden stoppage of collection will force us to abandon some of our projects in pipeline, midway and will have very adverse effect on the long term health of the companies.”

“If the rating companies apply the usual norms in such a situation, they may find it difficult to accept the ownership of the companies on such land, whereas legally and for all practical purposes, the companies do enjoy all rights on those lands,” claims the Agro-Forestry Association letter to SEBI, adding, “It will be a herculean task to establish the market value of the land which differs from plot to plot and to evaluate the real price of land where hundreds of thousands of small plots are amalgamated in a farm of say 500-1000 acres will require physical survey which may take months for a workforce of a few offices.”

“In all land deals, the registration value stated on the sale deed is always lower than the actual price paid by the purchasers as it is a common practice todetermine to demand a sizeable portion of the consideration in cash (black money),” says the association.

“In the case of teak plantation projects, the returns are shown as highly inflated and a promise made 20 years hence, really entails high degree of uncertainty,” admits the letter.

After the Golden Forest of Chandigrah, SEBI has started investigating whether the tall claims made by plantations companies about huge land holding is true. Chennai-based Anubhav Plantations claimed that it had acquired 4000 acres of land at 26 project sites and is in the process of acquiring another 6000 acre. “The company has made rapid strides in teak farming all over Tamil Nadu and development work is on in full swing at 21 sites,” said its brochure.

According to the company chairman C Nateshan, procurement of land by Anubhav Plantations Ltd will cross 10,000 acres — 4000 acres for teak plantation and the rest will be used for orchards. The Anubhav group which was targetting a turnover of Rs 500 crore isseverely affected by the SEBI ban on fresh collections as it has put pressure on Anubhav’s ambitious expansion plans.

Similarly, Enbee Plantations claims that it has acquired 3,000 acre of land in Ichhawar, Loha Pathar in Sehore and Samshabad in Madhya Pradesh and 1,500 acres of land in Pali district of Raigrah.

In Tamil Nadu also Enbee claims to have acquired 5,500 acres of land in Tirunelveli and Theni. Mehna Plantations Pvt Ltd claimed that it has an annual turnover of Rs 100 crore and acquired 3000 acres under cultivation and expansion upto 5000 acres for short term crops. It has also claimed to have ownership of 400 acres of Acquculture at Karwar, Karnataka.

Southern Horticulture & Rubber Plantation Ltd claimed that it acquired rubber estates of 245 acres and is on the verge of acquiring another 350 acres of ready rubber plantations.

“We are in the process of negotiating with the Government of Maharashtra for acquiring 1,500 hectares in areas which have been tapped by them as best suited forrubber planation,” claimed the company brochure. Similarly, Mumbai-based Shrushti group has circulated a colourful brochure claiming ownership of huge area of land in Maharashtra, but the company later said it was due to a printing mistake!