KUDA urges govt to amend immovable property lease rules

KUDA urges govt to amend immovable property lease rules
Highlights

The GHMC Act, 1955 is coming in the way of Kakatiya Urban Development Authority (KUDA) in leasing out a commercial coamplex it constructed in Hanamkonda. As per section 148 of the GHMC Act, which apply mutatis mutandis to all corporations and urban development authorities constituted under Telangana Municipal Corporations Act, 1994, KUDA can sanction lease of any immovable property for any term,

Hanamkonda: The GHMC Act, 1955 is coming in the way of Kakatiya Urban Development Authority (KUDA) in leasing out a commercial coamplex it constructed in Hanamkonda. As per section 148 of the GHMC Act, which apply mutatis mutandis to all corporations and urban development authorities constituted under Telangana Municipal Corporations Act, 1994, KUDA can sanction lease of any immovable property for any term, not exceeding three years.

As a result, the property situated in a prime location near Hanamkonda RTC bus stand is lying idle for more than a year as the bidders are not showing interest to take it on lease as KUDA is offering it on lease for a period of just three years.

A recent notification issued by KUDA seeking expression of interest (EoI) from bidders for leasing out the commercial complex evoked poor response as only four bidders shown interest as on May 21. It forced the development authority to go for another round of notification.

It may be noted that the KUDA has constructed the commercial complex in the land owned by the sports department spending Rs 4 crore with an agreement to share the income at 50:50 ratio. The frame of the G+3 structure has been completed a year ago with 60,000 square feet plinth area and with 15,000 square feet in each floor.

It is said that the bidders are asking the lease for a minimum of 10 to 25 years so that it can be financially viable to them. And the KUDA is not in a position to honour their request. The outcome is, it is losing an estimated income of Rs 50 to Rs 60 lakh per year, which is can earn if the property is leased out.

When contacted, KUDA Chairman Marri Yadava Reddy informed The Hans India that since they received only four EoIs, the last date to submit expression of interest was extended to May 31. Letters have been written to the Commissioner, municipal administration and urban development (MAUD) many times seeking to relax the norms allowing KUDA to lease the property for 25 years, he said.

“However, the former and present commissioners of MAUD told us that we cannot lease out the property for more than three years as per the existing rules,” the Chairman said. The State government has to amend the rules so that the urban development authority can lease the property for at least for ten years period. It will help us to get good response from the bidders and ensures good income, he felt.

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