Subhash Ghai directed to surrender 20 acres of government land

The Bombay High Court on Thursday indicted former Chief Minister Vilasrao Deshmukh for irregularities in a joint venture for the allotment of 20 acres land to film director Subhash Ghai's film training institute Whistling Woods. The court stated that the agreement signed between Mr. Ghai's company Mukta Arts and the Maharashtra Film, Stage and Cultural Development Corporation (MFSCDC) is “illegal, arbitrary and without authority of law”.

“Mukta Arts has been directed by the court to immediately surrender 14.5 acres of the 20 acres land to the State government. The rest of the 5.5 acres land, on which the institute has been constructed, can be retained by them till May 2014, for which they will have to pay rent at the market rate. The condition of delay has been put only to prevent any loss to the students, who have already enrolled for courses at the institute,” Bhushan Mahadik, advocate for the petitioner, told The Hindu.

“The court has also directed Mukta Arts to pay rent on the entire property from the year 2000 onwards at the prevailing market value and to also pay interest on the rent at six per cent simple interest,” Mr. Mahadik said.

The court stated that Mr. Deshmukh, as the then Chief Minister, misused his official position and illegally signed on the agreement papers, giving undue favour to Mr. Ghai's institute. It said that all norms of transparency had been bypassed in the case.

Rajendra Sontakke and four other agriculturists from Latur and Osmanabad districts had filed a public interest litigation in the court in 2009 alleging that Mr. Deshmukh had “grossly abused his power” for allotting the land to Mr. Ghai.

“We had filed the petition stating that the land which was actually owned by the Maharashtra government, was given to Mukta Arts without the government's permission. There were no competitive bids for the same. Even the board of the MFSCDC had not given an approval for the MoU [Memorandum of Understanding],” Mr. Mahadik said.

“Still, very significantly and for no ostensible and bona fide reason, the ex-Chief Minister as the Chief Minister signed the agreement below the signatures of the parties to the agreement, underneath a handwritten endorsement made by him saying ‘signed before me',” he said.

The petition stated that the value of the land was wrongly calculated as Rs.325 per square metre by the MFSCDC, whereas the prevailing rate notified by the Mumbai municipal corporation in that year was Rs.3,900 per sq. m.

It stated that even the Comptroller and Auditor General had raised queries about it but it was told that the agreement will be renegotiated. “However, the existing agreement has not been rescinded till date. Action has not been taken against the officials responsible for the undervaluation,” the petition stated.

“The court has directed the State government to appoint an expert committee to look into the valuation of the construction on the land. That consideration price will either be adjusted in the rent or will be payable by the government,” Mr. Mahadik said.

The petitioners had also sought interrogation by the Central Bureau of Investigation in the matter on the grounds that the deal may have been struck to promote Mr. Deshmukh's son Ritesh Deshmukh in the films. It is however learnt that the court dismissed this plea.

“The court has stayed the order for six weeks so that they can appeal in the Supreme Court. But they will not be able to take any new admissions in the period for any course which runs beyond May 2014,” Mr. Mahadik said.