CAG report can't be sole basis for PIL: Gujarat HC

Dismisses public interest litigation against Modi's ambitious GIFT City project

Holding that the report of the Comptroller and Auditor General (CAG) of India cannot be the sole basis of a public interest litigation (PIL), the Gujarat High Court on Friday dismissed a PIL seeking CBI probe on alleged irregularities in allotment of land to Gujarat chief minister Narendra Modi's ambitious Gujarat International Finance Tech (GIFT) City project.

The Rs  9,700 crore project is being developed Gujarat Urban Development Company Limited (GUDCL) and Infrastructure Leasing & Financial Services Limited (IL&FS)  through a 50:50 joint venture company, Gujarat International Finance Tec-City Company Limited (GIFTCL). It is planned as a financial Central Business District (CBD) between Ahmedabad and Gandhinagar as a greenfield development. Till date Rs  450 crore has already been invested in the project.

Delivering the judgement, division bench of Chief Justice Bhaskar Bhattacharya and Justice J B Pardiwala observed that a CAG report is always subject to scrutiny by the public accounts committee of the state assembly after government gives its view on the observations made in the report. "CAG is a constitutional body and a key figure in the parliamentary system. However, CAG is not empowered to question the merits of government policies," the court observed while dismissing the PIL.

Court further held that there was not merit in the allegations made in the PIL, nor in the contentions raised by senior counsel Yatin Oza appearing for the petitioner. It also dismissed the allegations by the petitioners that the state government had given undue favoures to IL&FS by making it JV partner in the project. It was further observed by the court that government had not sacrificed larger public interest nor its intentions seemed malafied in developing the project on public private partnership model. It was of the opinion that the state government acted in a transparent manner with regard to the GIFT city project.

The PIL was filed early this year by a plastic trader from Ahmedabad, Mohammed Suleman Pathan, citing CAG report pointing out large-scale discrepancies in land valuation in the Gift city project, through his lawyer.

PIL claimed that CAG found the land at present valued at Rs  2,700 crore was allotted by the state government for nominal price of Rs  1, and it was further allotted to private companies negating the views of finance, revenue and other departments.

The PIL mentioned that the state government allotted 26,77,814 square metre land worth Rs  500 crore in 2007-08 to the GIFT Company Ltd in Gandhinagar. After that, the government allotted 10,11,744 square metre land to GIFT SEZ Ltd and 16,66,070 square metre land to GIFTCL for a nominal price with the condition that during the first phase of the project, the surplus amount received by the developers shall be divided between the Gujarat government and the two companies in 50:50 ratio.