The CAG report reveals how select members from the Services and the civilian administration, politicians and individuals connected with them, benefitted from the illegal construction of the 31-storey building in the heart of Mumbai

Moneylife Digital Team

The Comptroller and Auditor General of India (CAG) has said that the Adarsh Co-operative Housing Society (Adarsh CHS) episode poses serious questions of probity, integrity and ethics in public life and among public servants, which need to be addressed by the polity and it also displays failure at all levels of governance.

In a report, submitted in Parliament today, the CAG said, "The entire process of allocation of land to the (Adarsh) society, obtaining no objection from the Army, obtaining modification to the Mumbai Metropolitan Region Development Authority (MMRDA) development plan, getting a no-objection certificate (NOC) for residential development in coastal regulation zone (CRZ), obtaining NOC from Brihanmumbai Electric Supply & Transport Undertaking (BEST) for transfer of developmental rights of the adjoining land, getting additional floor space index (FSI), raising the height of the building, was riddled with instances of decisions being taken by those who exploited their official capacity for personal benefit."

"The episode of Adarsh CHS reveals how a group of select officials, placed in key posts, could subvert rules and regulations in order to grab prime government land-a public property-for personal benefit. They resorted to falsification of records, suppression of facts, ruse of welfare of servicemen and their widows and children, flouting of acts and rules," the CAG noted.

It said that the case is particularly alarming as individuals across the governance system at many levels have participated in this deceit and benefitted from it. The public has trusted these public servants to safeguard its interests, but there is enough evidence that they betrayed the fiduciary trust and acted against all norms of public interest and probity, the report added.

In February 2000, Ramchandra Sonelal Thakur, a serving sub-divisional officer (SDO) in the Defence Estates Office (DEO), Mumbai, in his capacity as chief promoter of Adarsh CHS, wrote a letter to the chief minister of Maharashtra for allotment of 38,542 square metres of land in Block VI of Backbay Reclamation Scheme (BBR) at Colaba, for the construction of a residential building, for the welfare of serving and retired personnel of defence services.

 "The letter of the chief promoter (RS Thakur) would clearly indicate the knowledge that the land was in the possession of the Army. However, the title of the land was never transferred to the Ministry of Defence. As subsequent events would prove, this fact of possession of land by the Army without holding the title of the land was exploited in full, to misappropriate the land for private benefit," the CAG observed.

From the very beginning, the welfare of the servicemen and ex-servicemen in one form or the other was used as a ruse to grab this piece of public land. In various correspondences from the Society, defence authorities and the Government of Maharashtra at different points of time, the prime reason for allotment of the land has been described as welfare of service personnel and ex-servicemen.

'Girls' hostel for wards of army officers posted in far flung areas', 'Welfare of Kargil war heroes', 'Welfare of widows of servicemen', 'Welfare of soldiers who have served their motherland' were used as grounds on almost all occasions for seeking relaxations in favour of the Society at different points of time.

The report by CAG said, "It would be only reasonable to conclude that though references to 'widows' and 'Kargil Heroes' was being repeatedly made, such could never have been the intention, as these individuals would not have the financial capability to meet the cost of apartments in this structure."

The chronology of the events shows the alacrity with which the varied requests of the Adarsh CHS were attended to. It illustrates how permissions were sought, and granted, on grounds, which do not now stand to public scrutiny. It also indicates how vague clearances, susceptible to multiple interpretations, were provided to facilitate the rather dubious intentions of the members and promoters of the Society.

The complicity, as is evident, is from the organs of the Maharashtra Government, the Armed Forces, the central government and local bodies, each of which is otherwise prone to be intransigent when approached by a common citizen, the report said.

According to CAG observations, all service officers except one, who held charge as General Officer Commanding Maharashtra, Gujarat and Goa Area, between February 1998 and July 2010, became beneficiaries as per the lists of members of the Adarsh CHS as made available by Collector of Mumbai city.

By 2002, Admiral Madhvendra Singh, former Chief of Naval Staff, and Lt Gen GS Sihota, had become members of the Adarsh CHS, apart from many other officers from the Army and the Navy. Eventually, General NC Vij and General Deepak Kapoor, former chiefs of army staff, also became members of the Adarsh CHS.

"Notable among the service officers who became members of the Society at a later date were two former Chiefs of Army Staff, General NC Vij and General Deepak Kapoor. Both of them were allowed to be members of the Society as 'one-time special case' keeping in view their noteworthy service in the Indian Army and their social status," the CAG said.

The list of the members as intimated by Adarsh CHS to the Mumbai City Collector, on 10 April 2000, indicated that the Society largely comprised members belonging to the defence services and civilian organisations related to defence. Out of the 40 members, 30 were serving and retired service officers, eight belonged to Defence Estates Office, one officer belonged to the Military Engineer Services (MES) and one was a widow of a retired MES employee. However, the final list of 102 members as of 2010 included 37 defence officers, including civilians, 15 retired government servants, eight Members of Parliament or state legislatures and 42 individuals, who were mostly relatives of government officers and politicians.

At almost every stage, the Maharashtra government extended significant concessions in favour of the Adarsh CHS. Many officers-both civilian and services-who were dealing with the case and were instrumental in taking those decisions, eventually became members of the Society. In some cases, relations of these officers became the members.

The Urban Development Department (UDD), in April 2002 approved modifications to the MMRDA development plan, deleting a 60.97 metres wide road leading to the south Colaba harbour link and reducing the width of Captain Prakash Pethe Marg from 60.97 metres, to a mere 18.40 metres, and the inclusion of the deleted area in the residential zone, parade ground, helipad, garden and BEST Depot.

However, the CAG said, "During the audit, it was noticed that on past occasions, the Government of Maharashtra had decided against allotment of the land for genuine welfare of ex-servicemen on the ground that the land was earmarked for widening of the very same road."

On 17 March 2003, Mr Thakur wrote a letter for allotment of additional FSI of adjoining plot of 2669.68 sq metres used by BEST as approach road to its depot on payment of reasonable charges. "Interestingly, in his letter, the chief promoter termed the use of the land by BEST as 'unauthorized' and also stated that BEST cannot use the FSI of this land for expansion of depot due to CRZ restrictions," the report noted.

Initially, BEST was reluctant to transfer the FSI to Adarsh CHS. However, Ramanand Tiwari, principal secretary of the UDD gave a proposal to BEST, which the public undertaking could not fulfil and subsequently agreed to transfer the FSI to Adarsh CHS.

"It would be clear from the meetings that the proposal of the Principal Secretary to ask BEST to pay for the land, amounted to a threat which possibly compelled BEST to succumb to agree with the proposal of the Society. Asking a public utility to pay the market price of the land essentially to compel them to agree to transfer the FSI in favour of the private society was blatant violation of all norms of public interest. While BEST was asked to pay the cost of land at the market rate, the Society paid only Rs6.14 crore," the CAG report noted.

Read the complete CAG report on the Adarsh Co-operative Housing Society case