The Parliamentary standing committee on urban development has slammed the government for awarding the contract to build flats at the Commonwealth Games Village to real estate player Emaar MGF.
The buyers of the 445 flats sold by Emaar MGF at the CWG complex here are yet to get possession, even 18 months after the Games are over. They paid about Rs 1,500 crore in all for these flats.
Observing that Emaar MGF was not financially strong, the committee, headed by Janata Dal (United) leader Sharad Yadav, said the contract to the developer was a “big mistake”. It did not buy the urban development ministry’s argument that the developer could not complete the project on time (March 31, 2010) because of the recession of 2009, among other reasons.
It was only after the Delhi Development Authority (DDA) came to rescue it financially, Emaar MGF could restart work after a gap of about four months. DDA purchased 333 flats for Rs 766.89 crore as part of a bailout package. With that, DDA’s quota of flats went up to 720, from the initial grant of one-third of the total 1,168, or 389, flats.
In the action taken report of the ministry, it noted the suspension of work for four months was reflected in the project developer completing the construction by Septe-mber 2010, just before the Games began on October 3, 2010, that too with some defects remaining in the residential complex.
The committee pointed at a “deep-rooted involvement of officials in awarding the contract to Emaar MGF”. Referring to the Shunglu committee report on the CWG, it recommended “stringent deterrent action be taken against the officials, firms and other bodies indicted for lapses”.
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Emaar MGF refused to comment on the matter.
Besides the Rs 1,500 crore paid for the 445-odd flats sold by Emaar MGF, an estimated Rs 2,500 crore is locked in the village in connection with the DDA quota of 720 flats, whose auction is stuck due to the absence of a completion certificate. The market value of these flats has been estimated to be Rs 2,500 crore.
The Delhi high court is monitoring the process of handing over of the flats to the buyers, stuck over floor area ratio issues.
Emaar MGF is a joint venture between Dubai-based Emaar group and Indian realty company MGF Development. Emaar MGF was one of the 15 bidders for the CWG project.