Probe panel declares Hayatabad shops lease illegal, recommends cancellation

Published September 8, 2020
In the 19-page report of inquiry into the conversion of three years lease into 33 years’ by the civic agency, the Provincial Inspection Team has censured the relevant PDA officials for violating rules and regulations in leasing out shops and called for departmental action against them, including suspension. — PDA Facebook/File
In the 19-page report of inquiry into the conversion of three years lease into 33 years’ by the civic agency, the Provincial Inspection Team has censured the relevant PDA officials for violating rules and regulations in leasing out shops and called for departmental action against them, including suspension. — PDA Facebook/File

PESHAWAR: A government inquiry panel has declared the Peshawar Development Authority’s 2009 decision to extend the lease of 150 shops in Hayatabad area from three to 33 years ‘patently illegal and void ab initio’ and recommended its rescission.

In the 19-page report of inquiry into the conversion of three years lease into 33 years’ by the civic agency, the Provincial Inspection Team (PIT) has censured the relevant PDA officials for violating rules and regulations in leasing out shops and called for departmental action against them, including suspension.

Dawn has a copy of the report, which, according to officials, has been submitted to the chief secretary’s office.

When contacted, the PDA didn’t offer comments on the report.

The matter was referred to the PIT by the National Accountability Bureau in 2017.

Calls for departmental action against PDA officials

The PDA had initially leased out 150 shops in Hayatabad through open auction between 1991 and 1996.

The successful bidders were then given the possession of shops after executing lease agreement with the civic agency.

The initial lease of three years was extendable for three years subject to 25 per cent increase in rent.

The report pointed out that though the leasses had regularly paid rent to the civic agency at increase rate of 25 per cent after every three years, most of the leases were not extended regularly in line with the terms and conditions of lease agreement.

Interestingly, in most cases, neither the leasses had applied for extension nor the PDA had approved any extension.

In 2009, on the recommendation of committee which was formed in line policy of now defunct Provincial Urban Development Board (PUDB), director general PDA approved conversion of three years lease into 33 from initial date, on additional payment of Rs 100,000 by each leasse.

The report noted that the PDA had neither developed own lease policy nor adopted the provincial government’s while leasing out shops.

“There was no other policy of lease except approved minutes of 32nd minutes of the board-in-council,” a PDA official told the inquiry committee.

The PDA also contended before the panel that its DG was empowered to execute all types of leases and extension.

However, it noted that the agency failed to point out any rule, regulation or law to substantiate the contention.

The PIT report said the whole process of leasing out shops and the so-called lease extension was not covered in the law.

“The relevant officers had failed to discharge their duties in accordance with applicable laws/rules and were found guilty of misuse and abuse of authority which is cognizable offence under the National Accountability Bureau Ordinance and also constitutes a serious misconduct,” it said.

The committee noted that the lease was not covered under the law and therefore, it was illegal, unlawful and not tenable in the eye of law.

“It is a classic example of lackadaisical, casual, callous, passive, inefficient and indifferent attitude towards official business and safeguarding the interests of the organization and saving it from recurring financial losses,” it noted censuring the civic agency.

The probe body said it was criminal negligence on part of those at the helm of affairs, which led to non-compliance with the legal formalities as leasses were paying 25 per cent enhanced rent after three years despite the fact neither they had applied for extension nor the agency had granted them any.

It added that the agency’s ‘board-in-council’ was also well aware of legal vacuum and noted in its meeting minutes that shops had been leased out for more than a year and practice had been adopted by the PDA/PUDB on its own.

However, no body dared stop it despite that.

The committee said the forum was requested to approve the leasing out of commercial and other local area authorities under the PUDB from one to 33 years to be decided by the PUDB in each case on its merit and financial viability on case to case basis.

It, however, said the PDA didn’t place the case of Hayatabad shops before the board-in-council until Dec 2008. “No action whatsoever was taken from 1999 to 2008 by the PDA,” it said.

The committee also noted that the then PDA DG’s action of extending the lease period up to 33 years was a clear-cut case of the misuse of authority and he was answerable for the illegalities.

It also said to frame a proper lease policy and sort out low rent issue for local area authorities including PDA, a high-level committee with an additional chief secretary as the convener and having the local government secretary and PDA DG should be constituted for the assessment/evaluation of premium and rent of all civic agency property, including 150 shops.

The inquiry panel said its recommendations should be presented to the government within a month.

Published in Dawn, September 8th, 2020

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