KTDFC gave terminal to bogus company

Kozhikode: Kerala Transport Development Finance Corporation (KTDFC) which is in possession of the Rs 65 crore worth bus terminal of KSRTC here selected a bidder who has no financial credibility and not even a proper address, says a report of the finance department.

An earlier inquiry by Kozhikode district collector into the address revealed that there was only a mobile repairing shop functioning at the address of MAK Associates at Mukkam.  

It has also been suggested that KTDFC may go for a fresh tender following the transparent e-tendering procedure, it says.

The KTDFC had conducted several rounds of bids to lease out the building complex with a 2,18,716.23 sq ft of commercial space located at the heart of the city.

The bid was won by MAK Associates which was ready to remit an amount of Rs 50 crore as a nonrefundable deposit for thirty years and also was willing to pay an amount of Rs 50 lakh as monthly rent. To execute the deal, KTDFC also approached the state government to exempt the proposed lease from the provisions of Kerala Building (Lease and Rent Control) Act -1965 which involves a lot of risks, it was pointed out.

When the process of handing over got delayed, the group approached the HC which ordered the KTDFC to execute the lease. But the finance department in the note (dated 3/3/2016) to KTDFC chairman said that the entire deal including the legal procedures followed is suspicious. “There are serious irregularities in the way the case was conducted,” according to the note. The tenders were not following the procurement procedures.  KTDFC has not followed the e-tendering, and even the standard eligibility has not been fixed for the bidder on a par with the relevant manual and guidelines.

On the bidder, the note said the group is ‘dubious as per the IT returns, and the partnership was registered seemingly for the specific purpose of this tender just before the bid’.  

The letter further said that the doubts were corroborated in the inquiry conducted by the district collector, Kozhikode which also exposed that some of the partners are not even IT assessees. KTDFC not even took a legal opinion on the verdict and instead, engaged in exploring steps to hand over the building to the company.

The finance department also suggested the KTDFC to inquire into the antecedents, credibility and financial standing of the bidder be referred to the IT department and the district collector to ascertain the genuineness, source of funds and their financial capacity and asset base.

Meanwhile, KTDFC managing director Usha Devi Balakrishnan told DC that the entire process is transparent. “We have done everything as per court order and if we fail to hand over the building the group would approach Supreme Court which would cause further delay in the process”, she added. On the failure of KTDFC in inquiring about the antecedents of the bidder Ms Devi said that such an inquiry is not at all essential.