March 3rd, 2016
News Source: Economic Times | Image Source: newindianexpress
It’s another session in the Parliament and another season of attacks and counter-attacks. The Budget discussions have not finished yet, but the Opposition has trained its guns on BJP’s Anandiben Patel, the Chief Minister of Gujarat and successor to Narendra Modi in the state, over her daughter’s involvement in dubious land deals. The Logical Indian tries to examine the allegations and check if they really hold some water.
The Economic Times has reported twice, that business associates of Anandiben Patel’s daughter, Anar Patel, received 422 acres of land near the Gir Forest in 2010, out of which 250 acres of land was allotted at a nominal rate of Rs. 15 per sq metre. This is at a huge discount of 91.6% from the government stamp duty (jantri) rate of Rs. 180 per sq metre. The land was allotted to Wildwoods Resorts and Realties, a company now owned by Dakshesh Shah and Amol Sheth, whose companies have extensive business dealings with firms owned by Anar Patel and who also own equities in her firms.
What makes the land deal suspicious is that at the same time, another company was offered land near the Gir Forest at a rate of Rs. 671 per sq metre, far higher than the stamp duty rate of Rs. 190 per sq metre for that area. Muralidhar Gau Seva Trust, a cow protection outfit, was offered the land at outrageous price which it subsequently declined.
Facts which support the allegation:
1. The allotment was red-flagged by the local range forest officer in his 2014 report, as the land was under forest cover and was not supposed to be allotted for private use. However, in 2015, the state’s exclusion zone for land allotment near forests was reduced from 2-km radius to 1.5-km radius which took the Wildwoods plot out of the restricted zone.
2. Wildwoods was given the land under the condition that ownership won’t change and the tourism project would be completed in five years. However, within a year of the allotment, the company was sold to Dakshesh Shah and Amol Sheth, business associates of Anar Patel. Also, the resort project planned on the site hasn’t started yet, and Wildwoods has requested the government to extend the time frame for project completion.
3. The original owner of Wildwoods, Sanjay Dhanak, has claimed that Dakshesh Shah was his partner at the time of this deal and was aware of the transaction. Shah has refuted this claim. However, as per ET’s review of filings with the Registrar of Companies (RoC), soon after the land deal, a host of transactions took place between companies that received the government’s land allotment as well as other companies run by Dakshesh Shah and Amol Sheth and companies where Anar Patel has significant equity presence.
4. Anandiben Patel was the revenue minister in 2010 when the dealings took place. After becoming the Chief Minister in 2014, she retained the portfolio. Since revenue department is the nodal authority for such land allotments, her alleged involvement in the matter cannot be completely ruled out. We have earlier reported how her son may have been benefited from her position in the past.
Govt officials deny wrongdoing:
The officials of the Gujarat government have denied all the allegations of wrongdoing in the land deal. Their points are:
1. The difference between the land rate given to Wildwoods and Muralidhar Gau Seva Trust is because market rates are different from the stamp duty rates. Many factors such as proximity to roads, development level, etc are considered. According to officials, the plots of the two companies are 30-km apart, and this explains the difference in pricing.
2. The land allotment process was handled at secretary-level itself and was not taken to the Minister-level. Hence there cannot be any interference from the revenue minister’s office. According to them, the decision was taken after inputs from the deputy town planner, a committee headed by the local collector, the chief town planner and a committee comprising finance, revenue and urban development secretaries.
The Logical Indian take:
On the first look, the price delta between stamp duty rate and allotted rate does seem huge. That the discount was given for a commercial project with no social benefits and a possible threat to the ecology leads one to believe that something is surely fishy. While the Congress may have raked up the issue because of political reasons, their allegations can neither be dismissed entirely nor taken on their face value. Only a thorough probe by an independent agency should be able to bring out the truth.
At the same time, reports suggest that the Prime Minister has taken cognizance of the issue within the party. The Logical Indian hopes that the matter will be referred to an independent agency for fair investigation.