Chandigarh leasehold to freehold conversion: Ex-administrator’s stance 2015 still a roadblock - Hindustan Times

Chandigarh leasehold to freehold conversion: Ex-administrator’s stance 2015 still a roadblock

By, Chandigarh
Jul 13, 2022 02:34 AM IST

Shivraj Patil, former Chandigarh administrator, had in a 2015 file note expressed strong opposition to the conversion

Even as the UT administration makes fresh attempts at allowing conversion of commercial and industrial leasehold properties to freehold, a 2015 file note by the then UT administrator Shivraj Patil continues to be a major impediment to its efforts.

Ex-administrator’s stance 2015 still a roadblock for Chandigarh’s leasehold to freehold conversion process. (HT File)
Ex-administrator’s stance 2015 still a roadblock for Chandigarh’s leasehold to freehold conversion process. (HT File)

Patil’s file note, accessed under Right to Information Act, reveals that the then administrator not only went against the conversion permission, but also expressed strong opposition to the move.

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The administration had in-principle approved the move last year, before seeking a similar clearance from the Union government. Patil, however, had rejected the proposal in 2015.

Nearly 70% commercial and industrial plots in the city are leasehold, allowing occupation for a limited period, mostly 99 years, with government agencies holding the ownership rights.

The Chandigarh Industrial Policy promised to allow conversion of industrial plots from leasehold to freehold to promote ease of doing business in the city, an idea also favoured by the administration’s advisory council and repeatedly supported by member of Parliament Kirron Kher. Recently, the apex court-appointed committee, headed by Kher, also recommended it.

Their contention was that leasehold properties create a web of legal complications and that the allottees struggle with their sale and purchase while raising a mortgage when needed, troubles normally not associated with freehold properties where the allottee is the real owner.

Patil’s contention

Patil categorically said no to the proposal, “This matter is likely to create unnecessary complications. I am inclined to hold that the leasehold properties should not be turned into free hold properties.”

Listing one of the reasons for rejection, Patil suspected that allowing leasehold to freehold can be drummed up as another scandal.

“As the properties which are very costly, if they are given to the private persons who were lessees, without auctioning them or taking the price less than the market value, the matter can be raised as another scandal and those persons who are asking for it would not be available to say that they had insisted on the Administration doing the same,” noted Patil.

Notably, the administration had allowed the conversion of the residential properties through the Chandigarh Conversion of Residential Leasehold land tenure into freehold tenure Rules 1996. Conversion rates, though, were notified nearly a decade later.

But, in his note, the administrator objected to not only commercial and industrial plot conversion but also to residential.

“There are many plots given for industrial purposes on lease which have not been used by the lessees. If their intention is to get the plots turned into free hold plots and sell them and earn the money, that should not be allowed,” Patil wrote on industrial plot conversion.

Made it tough for future approvals

Patil’s note came only two weeks before his term ended in January 2015’amid expectations that the administration might re-initiate the process for allowing the conversion after Patils term ended.

For any such future proposal, Patil made it mandatory to take the Union government’s approval, writing, “The Government of India, the Home Ministry or any other relevant and concerned Ministry may give the directions which the Administration of union territory of Chandigarh implement for which all relevant notes and my note may be sent to the MHA and other concerned and relevant ministries.”

Notably, earlier this year, the administration has permitted conversion of all unsold leasehold properties with its agencies to freehold before their open auction. The administration approved it through executive order of administrator, and did not seek Union’s consent.

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