Hyderabad: The vigilance and enforcement has recommended criminal action for allegations of cheating and conspiracy against senior IAS official S.N. Mohanty and industrialists Mahabir Prasad Agarwal and Pawan Kumar Agarwal of the city-based Ambience Properties Private Limited over a land deal.
The department has submitted its report to the government and sought a probe by the CID, or the CBI, into the alleged irregularities regarding development of prime land of 19.5 acres, worth hundreds of crores in Gachibowli of the AP Housing Board under public private partnership mode.
The value of project is estimated at Rs 900 crore; it involves developing residential and commercial complexes. Buyers have constructed star hotels and another hotel is proposed to be built with a sky bar. The developers have spent Rs 171 crore of the Rs 284 crore they received on sale of cold shells (unfinished structures).
Sources in the government said that the key allegation in the report was that invalid documents were used by the developer to secure the deal.
The report stated that M/s CPG Consultants, which was unqualified, was made member of the consortium and the consortium sold non-existing cold shells (unfinished projects). The department also found fault with the rating agency Crisil for not scrutinising the documents.
When contacted, chief secretary P.K. Mohanty told this correspondent: “The general administration secretary Sivashankar has received the vigilance report regarding APHB irregularities. He has taken action regarding the report. It was sent to the vigilance commission for advice in order to take further action.”
The then APHB vice-chairman, S.N. Mohanty, now director-general of disposals and supplies, was not available for comment. The vigilance and enforcement director-general R.P. Thakur confirmed submitting a report to the government regarding the then APHB VC and others.
S.N. Mohanty was APHB vice-chairman and housing commissioner from 2003 to 2007, when the deal was processed, right from issuing the EoI to permission to the sale of the unfinished property. In February 2004, APHB issued an Expression of Interest to the land, each acre then worth around Rs 10 crore.
The site is located adjacent the 200-feet road from Gachibowli to Kothaguda junction. The APHB had sold a 222-sq yd plot at Rs 32.25 lakh in the vicinity; each acre at the project would be RS 7.04 crore. APHB wrote to the GHMC that each acre would cost Rs 25 crore.
Crisil shortlisted seven developers who had responded, and of them Ambience Properties and Embassy Unity filed bid documents. Crisil scrutinised the documents, and Ambience Properties, with CPG Consultants, was selected. Universal Realtors Private Limited was the special purpose vehicle formed by the Ambience Properties Limited consortium to develop the project.
The vigilance department now says that the deal was based on invalid documents, the CPG Consultants are ineligible, that Crisil officials cleared the papers and that Mohanty cleared the deal.
It said the MoU and Letter of Acceptance filed by CPG Consultants PET Singapore and Bengaluru were “not legally valid”. It said that in September 2004, senior architect R. Gopalkrishnan though “not authorised” had signed as a representative of CPG Consultants; he had also filed fake documents.
S.R. Ramanujam, head of urban infrastructure of Crisil infrastructure advisory panel, allegedly cleared these documents. “It resulted in the selection of an unqualified and ineligible company as technical consortium member,” the report said.
It alleged that "Mahabir Prasad Agarwall and Pawan Kumar Agarwall of Ambience signed the MoU on behalf of CPG Consultants illegally and filed false documents for evaluation of technical capability in order to grab valuable public property."
Apart from criminal action, the report recommended termination of agreement after receiving the explanation of the developer and confiscation of advances of Rs 89.19 crore available with the developer. It also sought withdrawing the consulting service Crisil from all the government projects for "intentional wrong evaluation of documents of ineligible developer."
It recommended preventing change of status of 9.3 acres undeveloped land, "which may likely fetch an additional revenue of Rs 357.30 crore". It observed that there was a loss of Rs 141 crore due to non-fixing of upset price and non-assessment of market value before filing the commercial offer.
