He has built a larger-than-life image as a dream merchant who makes multi-starer megabuck extravaganzas. But last week he saw his dreams quashed after the Bombay High Court ordered the 20-acre land in suburban Goregaon, where Ghai's film institute — Whistling Woods International (WWI) — is located, to be handed over to it.
Congress-led government is divided, with section of the government including senior ministers and bureaucrats believe the government was not at loss. As the land belongs to the government as per the joint venture between the state-run Maharashtra Film, Stage and Cultural Development Corporation Limited (MFSCDCL) with Subhash Ghai led Mukta Arts to set up Whistling Woods International.
They also argue that the decision to allot the land was taken by the then chief minister Vilasrao Deshmukh after the former minister for cultural affairs and the chairman of MFSCDCL, Ramkrishna More, and the department secretary gave their consent. Neither the government nor the state undertaking are contemplating challenging the high court order but they have left it to Ghai who has already announced to approach the apex court.
Ghai, the promoter of WWI, is currently busy in seeking legal advice for moving to the Supreme Court. In his reaction, Ghai said, “We are at no fault and have done nothing wrong. We had a legal joint venture in 2002 with Film City to use the land for building a world-class film and media institute, which was challenged by a PIL in court after 10 years. We hope to get full justice from the Supreme Court."
| WHAT AILS WHISTLING WOODS |
| * October 2000: Maharashtra Film, Stage and Cultural Development Corporation Limited enters into JV with Ghai's Mukta Arts, a listed company, for a film school, Whistling Woods. The JV given a 20-acre piece of land in Goregaon, Film City, for Rs 3 crore based on prevailing circle rate |
| * 2009: PIL filed by a five people described as farmers in court papers challenging the land allocation, saying land was given at throwaway price |
| * 9th February, 2012: Bombay High Court orders Mukta Arts to return the land to state government |
| What stakeholders say: |
| * Ghai says because it is a JV it is not a purchase of land but merely allotted to Mukta Arts; he also says he has spent Rs 75 crore in developing the film school, and is losing money on it |
“We are going to the Supreme Court and are in process to file the needed documents,” said Ravi Gupta, CEO, Mukta Arts.
According to industry sources, if Supreme Court retains the high court judegement, Ghai will shift his institute to another state that lends him support, like Gujarat, Haryana, Punjab, Uttar Pradesh, West Bengal or even Kerala.
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The government had allocated 20-acre land for his ambitious film institute, Whistling Woods International. The court has asked to immediately vacate 14.5-acre area, which shall be resumed by the state government. The remaining 5.5 acre, where the institute is constructed, shall be taken over by the government on July 31, 2014, when all the ongoing courses at the film institute shall be completed.
Ghai had initially invested Rs 20 crore. The investment has now risen to approximately Rs 75 crore and running the school has resulted in losses ranging from Rs 5-7 crore annually.
The bench has also directed Ghai to pay rent of Rs 5.3 crore annually, since the year 2000 when the director entered into a joint venture with the government to start a film institute.
A senior bureaucrat, who did not want to be identified, told Business Standard, "The high court order is based on affidavit filed by the state government. However, the decision to allot the land by working out a JV mechanism with a purpose that Ghai uses land for the purpose of establishment of a film training institute and does not use the allotted land to raise money from the banks. The decision was taken by the former cultural minister, who was also the education minister, to give land for the JV for education purpose and such land can be given even at 10 per cent rate. The cost of the land as mentioned in the high court order was never Rs 60 crore. The land rate was considered based on the circle rate as it is situated in the no development zone."
Chief Minister Prithviraj Chavan said the government and the state undertaking had held talks with Ghai and WWI has agreed to give away the land that has not been developed so far.