The establishment of the World Trade Centre (WTC) proposed in Bhubaneswar has hit a roadblock with the state finance department raising objections for vesting arbitrary powers with the Mumbai-based M Visvesvaraya Industrial Research & Development Centre (MVIRDC).
MVIRDC has been selected as a co-promoter for developing the WTC in collaboration with Odisha Industrial Infrastructure Development Corporation (Idco). Both MVIRDC and Idco are to sign a memorandum of understanding (MoU), the draft of which is ready.
“The draft MoU, memorandum of association and the articles of association appear to be lopsided and vests arbitrary powers with the co-promoter- MVIRDC. While it is stated that in the proposed JV company, MVIRDC and Idco will have equal control on ownership and management, the chairman of MVIRDC has been proposed to be the permanent chairman of the company,” P K Biswal, additional secretary (finance) said in a note.
“Further, a decision in the board will require affirmative vote of at least one member nominated by MVIRDC. Similarly, in respect of appointment of chief executive officer (CEO), the chairman will have the power to appoint any person of his choice if the state government or Idco does not provide suitable officers. This proves that virtually MVIRDC will have full control over the proposed company,” the note added.
The finance department has suggested that both Idco and MVIRDC should have equal rights in the management of the company.
The department has also objected to the manner of appointment of MVIRDC. No expression of interest (EOI) was invited for selection of the developer. MVIRDC was selected on the ground that it has the required license for establishment of a WTC in Bhubaneswar. “There should have been a transparent selection process for choosing the co-promoter instead of pick and choose method in order to avoid legal hassles in the future. It is not known whether an other organisation has such license or not. Only an expression of interest (EOI) would have provided a clear picture,” the finance department opined. The department has also expressed reservations over leasing out space for the proposed WTC in a prime location in the city. “Idco as co-promoter is under obligation to provide 2,000 sq ft of office space initially for starting operation of the company and then to provide required land near Janata Maidan locality in the city. In no circumstances, a premium land in the city should be handed over to the company without any consideration,” it held.
