Premier Auto served notice over land deal

Sanjay Jog

Mumbai, Oct 3: The Maharashtra government has served notices under the provisions of Maharashtra Land Revenue Code 1966 on Premier Automobiles for alleged “unauthorised” sale of land recently to Kohinoor Group and another piece of land to Fiat India in 1996.
The company has been asked to produce the relevant documents and agreements during a hearing slated for October 15 before the Mumbai suburban district collector CS Sangitrao.

These notices have been issued by Mr Sangitrao on the basis of recent media reports in this regard. The state revenue minister Ashok Chavan and Mr Sangitrao have confirmed this action while talking to The Financial Express.

The government after taking a serious note of the deal struck between the Premier Automobiles and Kohinoor Group for sale of around 32 acres of land at a cost of Rs 51 crore.

“This type of unauthorised sale can only be regularised by paying 50 per cent of the total deal. The company will have to pay Rs 25.50 crore,” the notice said.

According to the notice, the state government had provided 87 acres to Premier Automobiles in 1947 for “factory building and outhouse under rule 43 of the then Bombay Land Revenue Rules 1921.”

“The land has not been purchased nor it has been auctioned. Thus the company cannot transfer land or make profit without fulfilling the required formalities under the stipulated rules and laws,” Mr Sangitrao said.

Mr Sangitrao said that such a deal would lead to “unjust enrichment” which was not permissible. “We have asked the company to provide necessary documents and agreements in this regard on October 15. On the basis of which further action will be initiated,” the collector added.

“Failure of payment of half the amount of deal will lead to sealing of factory premises and auction of the property so as to recover the necessary charges as per section 17 and 183,” the notice said.

As far as the sale of land to Fiat India involving an amount of Rs 250 crore, the collector has asked to provide necessary documents and pay Rs 125 crore if the deal turned out to be an unauthorised one. The deal has taken place during the previous Shiv Sena-BJP alliance government.

However, the Premier Automobiles made it clear that it has only finalised a proposal to assign the development rights of only the residential portion of its total property at Kurla in north east Mumbai with Kohinoor Group with interests in hotels, education and realty. “Premier Automobile's industrial land admeasuring 11 acres does not form part of this proposal and continues to remain with the company,” it added.

According to the company, it would realise Rs 52 crore and not Rs 51 crore on completion of the development of 7,20,000 sq ft of floor space index on the residential plot of 23 acres.