A Lahore accountability court on Monday extended by 15 days the physical remand of former Lahore Development Authority (LDA) director general Ahad Cheema and Bismillah Engineering Services proprietor/partner Shahid Shafiq in connection with the Ashiyana Iqbal Housing Scheme case.

Cheema and Shafiq were arrested by the National Accountability Bureau (NAB) last month after discrepancies and alleged corruption worth billions were detected in a deal between the Punjab Land Development Company (PLDC) and Bismillah Engineering Services.

According to NAB, the former LDA chief allegedly misused his authority and with criminal intent prepared, processed, recommended and got approved a fraudulent and illegal request by awarding contract of the Rs14 billion Ashiyana-i-Iqbal Housing Society project.

Shafiq is accused of presenting fake documents, obtaining constructive possession of Ashiyana-i-Iqbal project without financial close, and willfully failing to complete the project, causing a loss of around Rs1bn to the government.

In today's hearing, Cheema and Shafiq were both present in court when their remand was extended.

During the hearing, the prosecution lawyer further alleged that Cheema had awarded the contract for the Ashiyana scheme to Bismillah Engineering Services in return for 32 kanals of land.

According to the prosecution, the land was transferred to various members of Cheema's family, including his cousin and his sister.

"Eight kanals were transferred to Cheema's name, eight others were given to his sister Saeeda Manzoor; eight were given to his brother Ahmed Saeed Cheema; and eight were given to his cousin Asad Cheema," prosecution lawyer Waris Janjua told the court.

NAB had decided to initiate a probe after receiving a number of complaints regarding an ‘illegal deal’ involving 3,000 kanals of government land between the PLDC and the aforementioned companies.

In addition to the PLDC, the LDA and Bismillah Engineering Company, NAB has also been probing other the contracting parties — Anhui Construction Engineering Group owned by Paragon Exchange director Ali Sajjad, and Sparco Group.

The PLDC had reportedly signed an agreement with Bismillah Engineering and Sparco for the construction of 6,700 apartments on 1,000 kanals. In lieu of this construction, some 2,000 kanals were to be given to these two companies, which were to be given land corresponding to their construction work. The land was given to these companies without them having done any construction work at all.

According to the Land Disposal Act, land measuring beyond five marlas can not be sold without auction. “But in his case, gross violation has been committed as both companies were supposed to deposit 20 per cent of the total value which they did not,” a source said, adding that the Colonies Department of the Punjab government had also specifically maintained that if this land was not utilised for the said scheme, (Ashiana-i-Iqbal) it would be surrendered back to the department as government land could not be used for any other purpose.

He said only 200 apartments had been built so far while the affected persons had paid four-years' worth of installments.