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BMC divided over plot deal for special hospital

Updated on: 08 October,2020 06:05 AM IST  |  Mumbai
Sanjeev Shivadekar |

Even at an early stage, proposal for 21-acre plot in Mulund is raising questions about ownership, tax breaks, price and procedure

BMC divided over plot deal for special hospital

The open ground quarantine facility with 1,008 beds that BMC had set up at Bandra Kurla Complex. File pic/Shadab Khan

The BMC's plan to set up a hospital for infectious diseases on a 21-acre plot in Mulund is likely to come under the scanner for two reasons — firstly, for buying land from private players despite having its own land bank and secondly for drafting land acquisition procedures such that the seller of the plot doesn't have to pay capital gains tax on the funds got from the deal. BMC has refuted the allegations.

With COVID-19 highlighting the city's inadequate health facilities, the BMC shortlisted two plots to set up a 5,000-bed infectious diseases hospital to handle such situations in the future. And the plot in Mulund was finalised.

What about reserved land?

However, the selection has not gone down well with many in the Shiv Sena-ruled municipal corporation. A group of senior officials feel the BMC should have used plots reserved for hospitals under the development plan (DP) or explore setting up infrastructure on land available with the corporation or on vacant space in an existing big civic hospital. Civic officials are also upset by the way the deal has been designed.

Mumbai Mayor Kishori Pednekar vists 500-bed quarantine facility NSCI Dome, Worli. With COVID-19 highlighting the city
Mumbai Mayor Kishori Pednekar vists 500-bed quarantine facility NSCI Dome, Worli. With COVID-19 highlighting the city's inadequate health facilities. The BMC shortlisted two plots to set up a 5,000-bed infectious diseases hospital to handle such situations in the future

A mid-rank civic official on condition of anonymity said, "The plot in consideration is owned by private people, and since it is in the process of being acquired under the Land Acquisition Act, the purchasing cost would be much higher than ready reckoner (RR) rates. It would cost the civic body hundreds of crores. Instead of wasting tax payers' money by benefitting an individual land owner, the BMC can save money by considering alternate options."

Land may cost Rs 1,500 cr

The estimated cost for procurement of the Mulund plot is said to be over R1,500 crore, and is believed to be owned by people close to a high-profile minister in the Uddhav Thackeray-led Maharashtra Vikas Aghadi government.

The civic body plans to go ahead with the plan, even though it has taken a hit during the pandemic. The BMC's expenditure has risen by around R600 crore because of COVID-19 relief measures and has even slashed R2,500 crore from the funds allocated for important infra projects like Coastal Road and Gargai dam. In fact, so grim is the fiscal situation that the BMC has told all its departments to slash expenditure by at least 20 per cent.

BMC refutes allegations

A BMC civic official, in the know of the process, said that the corporation did ask the development plan (DP) to give options from the plots reserved for hospitals for the 5,000-bed medical infrastructure. "But, DP officials said no plot met the required criteria. Hence, the BMC started looking for the other option — buying a plot. Accordingly, the expression of interest (EOI) was invited [in July]," a mid-rank BMC official told mid-day.

P Velrasu, additional municipal commissioner (projects), said the proposed hospital will not only cater to Mumbai, but all of Mumbai Metropolitan Region. Asked about questions raised on the entire process, the IAS officer said modalities are being worked out, and refused to reveal any further information.

BMC won't decide process

Meanwhile, another junior-rank BMC official who is aware of the process, said since the title of the land is Class-2 (the government owns the land, according to records) the modalities of the entire deal will be based on instructions and procedures recommended by the state revenue department.

"As per prima facie information, the title of the land is in the name of the state government. Now the state revenue department will examine the records and revert, and accordingly, a decision will be taken on proceeding with the process and the deal. BMC will not decide the process," the official added.

When asked about drafting the tender in a manner that the seller doesn't have to pay capital gains from the deal, the official said, "Some portion of the land has reservation, while others are freehold. Since the plot has reservation, the acquisition has to be done under the Monopolies and Restrictive Trade Practices (MRTP) Act.

But, not the entire land will be taken under the Acquisition Act. Only a reserved portion will be acquired under the Act, while the remaining portion will be bought through negotiations."

The mid-rank civic official said, "So far, only the EOI has been invited and nothing has been finalised. The deal is in a very nascent stage. Going ahead, several things might change as the proposal shapes up."

No. of beds the proposed hospital will have

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