DLF looks to exit IT SEZ in Chennai, seeks 700 crore refund from govt

Source :12 May 2010, 0121 hrs IST,ET BUREAU


CHENNAI: Concerned over the delay in getting clearance from the Centre for its IT SEZ in Chennai, India’s largest listed developer DLF has decided to pull out of the project, communicating the same to Tamil Nadu government.

Tamil Nadu’s deputy chief minister MK Stalin informed the state assembly on Tuesday that DLF is keen to exit the proposed IT-SEZ project, which was to come on 26.24 acres at Taramani in Chennai. It has offered to return the land and also asked the state government to return the Rs 700 crore that it had paid earlier for the site. The government is yet to take a call on DLF’s request.

"At Taramani in Chennai, an IT related SEZ was proposed on an extent of 26.64 acres and DLF was selected through the transparent open tender procedure. Though this firm had already remitted Rs 700 crore to the Government towards the cost of the land, they have been requesting return of this money as approval by the Central Government for the SEZ is getting delayed," Mr Stalin told the house.

It is learnt by ET apart from problems on securing clearance front from the Centre, there also seem to be differences between DLF and government agency, Tidco (Tamil Nadu Industrial Development Corporation) over the terms and conditions of the agreement for the SEZ.

"As per the agreement, at least 2.5 million square feet of IT/ITes space needs to be developed in the SEZ . But DLF is not keen to develop this in an SEZ because existing units cannot be shifted to a new SEZ," Tidco chairman and managing director Sunil Paliwal said.

DLF, on the other hand did not wish to comment on the subject. When contacted, DLF Southern Homes MD KK Raman said, "We have no comments. We have several options." But he didn’t elaborate on what these options are. Official sources said neither any decision has been yet on re-tendering the project nor about returning the amount paid by DLF. "Negotiations are still on," a senior official said.

DLF’s project may have hit a wall but the SEZ project on 25.27 acres by another national player, Tata Realty and Infrastructure at Taramani was on track and is scheduled to be completed in a couple of years.
Stalin said "This project (Tata Realty) involves building a state-of-the-art SEZ for IT with an integrated international convention centre with about 40 lakh Sq. ft. of I.T. and I.T.E.S./commercial space, an Integrated International Convention Centre to seat 1,500 delegates and 275 Service Apartments and suites at an estimated cost of 2,410 crore of rupees. Construction works are in progress now,".

He was replying to an adjournment motion moved by the opposition alleging irregularities in the MoU signed by the Government with Tata for the IT-SEZ project. He told the house Tata was not chosen arbitrarily without following any procedure. It was chosen by Tidco through the transparent tender procedure. It was during the previous AIADMK regime, 123 acres of lands were given to the firms of its choice arbitrarily without any tender.

That way, through Government orders, 80 acres of land was given to Wipro, 50 acres to Satyam Computers, 50 acres to HCL, 20 acres to Cognizant, 25 acres to Mega Soft, 25 acres to Bench mark Soft, 50 acres to Advance software. Again, without floating any tender, AIADMK Government had signed an MoU with Lee Kim Tah Holdings, Singapore to develop a township at Siruseri IT park for allotting 104 acres of land at a price of Rs 15 lakhs per acre.