Thursday, June 20, 2024
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Too much leniency shown to lessee: Panel

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By Our Reporter

SHILLONG: An Assembly Committee which examined the reasons for the undue delay in the completion of Crowborough Hotel project has said that too much leniency is shown to the lessee, Lessly Shylla, who is executing the project.

The report of the Assembly Committee on Public Undertakings, which was placed in the Assembly on Tuesday, said as per agreement signed between the lessee and Meghalaya Tourism Development Corporation (MTDC) on May 28, 2008, it was decided that the lessee would complete the construction of the building within 2009.

However, three years have passed and there is no sign of completion of the work.

The Committee, while expressing concern over the inordinate delay in completion of the project, said that it not only depicted the lapse on the part of the Government but also became an eye sore to the public at large. The report after analyzing the previous findings of the CAG in this regard said that no penalty clause was included in the lease agreement binding the lessee to complete the building as per schedule except Clause 3(a) of Article 9 of the lease agreement which stated that MTDC was entitled to call in, to retain and appropriate the security deposit and even this has not been enforced by the MTDC on the lessee.

As per MTDC, the building has become the property of the lessee for a period of 33 years and it is his lookout whether to complete the building or not within a span of 33 years as long as he pays the lease amount as agreed upon. According to the report, instead of taking action, extension of time was given to lessee on many occasions, as a result “the lessee appears to have taken advantage of the inaction on the part of the MTDC and kept on asking for extension of time and the much awaited project appears to be still far from completion”.

The work for the construction of 3 star Crowborough Hotel project started in March,1987 and two contractors were engaged for the construction. However, the services of the two contractors were terminated by the Government. Since both the contractors approached the court for settlement, the matter went into arbitration and finally out of court settlement was reached in 2000 with the first contractor and in 2004 with the second contractor.

After the out of court settlement, it was decided in the MTDC board meeting in December, 2004 to appoint ITDC as consultant for the completion of the hotel.

However, the ITDC indicated that it would not be able to render ample guidance in the matter.

Later, an empowered committee was constituted by the Government in January 2005 and the Committee recommended that the unfinished construction works should be completed.

The Government accordingly accepted the recommendation and awarded the work to Shylla as he was the highest bidder who quoted Rs. 98.9997 crore to be paid in 33 years.

A letter of intent was accordingly issued to Shylla in June 2007 and the lease agreement was signed on May 28, 2008 between Shylla and MTDC.

Annoyed over the delay in completion of the project, the Assembly Committee in its recommendation said that the lessee had submitted a request for extension of time indicating that testing, commissioning and dis engaging of the hotel will be done by August, 2013.

The Committee recommended that MTDC should ensure that the lessee is abiding by the deadline to complete the project “failing which appropriate action should be taken as per terms and conditions of lease agreement”.

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