Garuda Mall JV: deal made on Rs200 paper

Garuda Mall JV: deal made on Rs200 paper
New Indian Express

BANGALORE: the Garuda Mall joint venture of Bangalore Mahanagara Palike (BMP) and Maverick Holdings seems to have too many skeletons in its closet to be ignored.

The JV that began as a multilevel car parking complex and improvement of BMP workshop has become purely a commercial complex - thanks to various alterations to the original JV agreement. One gaping hole the government has left is regarding stamp duty to be paid on deed of agreement for a project worth Rs 90 crore.

Oddly, pending a decision by the government, the agreement is executed on a stamp paper worth Rs200 and it is not registered.

Under normal circumstances the stamp duty works out to be Rs 4.5 crore at the rate of 5 per cent of the project cost. Clause 24 of the JV agreement signed on June 19, 2002 says, “The party of the first part (BMP) shall apply and pursue with the government for total exemption of stamp duty and registration charges for the purpose of this agreement.....If no exemption is accorded by the government, the party of the second part (Maverick Holdings) shall bear and pay the stamp duty and registration charges.”

However, the MD of Maverick Uday Garudachar told this website's newspaper that the developer was willing to pay any duty as decided by the government. “The BMP should be pursuing that matter and once a decision is reached, we will comply,” he said.

But the very document is not registered risking entire gamut of JV terms. BMP commissioner K Jairaj said that the document was an agreement based on good faith. He said that he would track the status of exemption of stamp duty to the project. “The decision on whether the stamp duty should be exempted would be taken soon,” he added.

Uday who was behind the huge project taken up on private-public participation feels that the project should not be dragged through mud as Garuda is being seen as a model for future JVs.

“The project was taken up with a consent from the government and BMP. Even using up additional space was under government instructions. The government wrote to BMP to concur with the decision. Now it is being projected as a breach of contract,” Uday said. He also welcomed the audit of the project by any third party.