Unhappy Acres

Cracks Under A Scanner

Round and round: The many unanswered questions around the Vadra land deal in Shikohpur, Haryana

Vadra buys 3.5 acres in Shikohpur in March 2008 for Rs 15.38 crore. Seller: Onkareshwar Properties.
What “licence” did Skylight Hospitality, Vadra's company, get when it bought the land?
Letter of Intent/licence received from Haryana government by Skylight during March 2008
What was this “licence” he was given later, in whose name, at what terms?
DLF says it agreed to buy the plot, with its licensing status, and took possession in 2008-09
How could this land be "conveyanced" to DLF in 2008-09 if the existing laws didn't allow it?
In September 2012, Skylight officially resold this plot to DLF Universal for Rs 58 crore
Doesn't this run foul of the East Punjab Consolidation Act 1948 that you can’t transfer or sell unconsolidated land?
In August 2011, land consolidation was restarted in Shikohpur after a 15-year break
Is the 3.5-acre deal valid, given that this land still cannot be sold etc while consolidation is under way?
The land is in a prime location near the highway, and close to an SEZ that did not take-off
Were the development plans of Sector 77 and 83 (Shikohpur) altered repeatedly? And to what impact on the 3.5 acres?

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A towering crescendo of outrage had brought a hasty look-in. Then came reports that four district collectors in Haryana—of Gurgaon, Faridabad, Palwal and Mewat—had given a clean chit to the land deals struck with DLF since 2005 by Robert Vadra, the son-in-law of Congress chief Sonia Gandhi. But it appears these officials, who report to a committee of three headed by a senior state bureaucrat, gave a clean chit to only the value of the deals.

In fact, officials privy to the details told Outlook that they feel a series of permissions, mutations and changes in development plans need to be closely examined before Vadra’s dealings are cleared. In particular, they point to the permissions Vadra’s company Skylight Hospitality ostensibly got for the 3.5-acre plot of land it acquired in Shikohpur, ten kilometres from Gurgaon.

Documents seen by Outlook reveal that, till recently, the land did not have the required permission to be sold, leased or used for any other purpose (than for which it was sold to the buyer). In short, Vadra’s company could not by law sell the land (as it claims to have done in 2008) to DLF. Even the paperwork concerning the location of the plot deserves further probe, they feel.

As has been reported, the Shikohpur land’s sudden escalation in value came to light after India Against Corruption, an NGO run by Arvind Kejriwal, released documents to the public. Surrounded by upcoming residential townships and opposite an entertainment park, Skylight bought the plot for Rs 15 crore in March 2008. Skylight claims it resold it to DLF for Rs 58 crore—the deal was ostensibly struck within 65 days of acquiring the land. Another agreement was signed in September 2012 by both parties.

As per one set of official records of the state government for 2008, 2009 and 2010, the permission the Shikohpur plot had was a ‘CLU’, which makes farmland fit for commercial use. This ‘licence’, officials say, could not have been transferred. Nor could a plot with CLU have been sold, sub-let, sub-divided, broken into plots, or developed in any way other than the CLU was originally meant for.

In Skylight’s case, the permission is understood to have been for developing residential properties, though it is not yet known whose name exactly it was taken in. Subsequently, Skylight may indeed have decided to tie up with a builder such as DLF to develop homes—but would the company be permitted an outright sale, along with the licence? That’s something officials say can’t be done.

That may explain why the land was not transferred to DLF, even though it paid Rs 50 crore to Skylight. Concerns have been raised by auditors about the 3.5 acres not being passed on to DLF, to the detriment of the real estate giant and its shareholders. It also casts a shadow on DLF’s claim that it “agreed to buy the said plot, given its licensing status”.

Records confirm that Skylight got the CLU permission post haste—within 65 days after Vadra purchased the land from Onkareshwar Properties. In all, Vadra’s firm seems to do little more than operate as a middleman in the entire transaction, as the plot moved from farmer to builder. Even today it lies unused, save for a small, shabby building.

Officials say the plot, which boasts an excellent location on the highway to Jaipur, could have been transferred only by following due legal procedure.

To change land use, a new buyer must either seek permission from the DC—this has not been taken by Skylight. Alternately, he may purchase and re-register land, paying a fresh stamp duty.

Similarly, the second agreement in September 2012, according to a letter ordering a probe into the transaction, was in contravention of the East Punjab Holdings (Consolidation and Prevention of Holdings) Act, 1948. The letter was sent by IAS officer Ashok Khemka, then inspector-general of registration, Haryana, who also ordered a probe into the ‘real value’ of the property. Three days after the ‘mutation’ was cancelled by Khemka, he was transferred out. “There are times when permission is given to sell land in an unconsolidated area, but only for urgent cases, such as the marriage of a daughter of a resident, who may want to raise money by selling the land, but it is never given for commercial purposes,” says a state official.

The location of the plot—in an unconsolidated area—is worthy of examination. “Think of an unconsolidated area like an old ten-paisa coin with irregular sides. Its owners are scattered across the zone, each claiming different-sized portions, but no individual plots are demarcated,” says another official. Could Vadra’s connections have proved useful in ensuring he landed a plum highway location? Or, did Onkareshwar Properties’ Satyanand Yajee, a man said to be close to Haryana CM B.S. Hooda, already own land along the highway?

Officials do say that the two sectors—77 and 83—being carved out of Shikohpur saw repeated and persistent changes and alterations in their development plans, including the alignment of roads and highways. Once, between 2006 and 2008, it even boasted of a planned SEZ.

According to central government rules at the time, an SEZ project could not be split into two—it had to be ‘contiguous’. So, officials were put to the task of re-routing an under-construction road that would otherwise have split the proposed SEZ. Later, it turned out that if the road was built according to the original plan, it would have taken over most of the plot now owned by Skylight. The SEZ project also did not see light of day and has now given way to a housing development.

In conclusion, the particular permission Skylight’s plot seems to have allows the owner to develop it for the initial purpose it grants within two years. “If he does not implement the project he can get an extension, but only after demonstrating hardship in fulfilling the original plan,” says the second official. As for the clean chit regarding the land’s value, it’s well known that government valuation of land is typically much lower than what owners actually bargain for.

It is for the Haryana government to examine if Vadra’s reasons to sell the land to DLF lie in ‘hardship’, and if all the other deals he has struck across the state benefited from speedy grants of licences and permits.