Vending zone project ‘scam’: F&CC keeps proposal pending again

Harshraj Singh

Tribune News Service

Ludhiana, March 20

Despite directions and repeated reminders issued by the Department of Local Government for over the past two years, the Municipal Corporation (MC), Ludhiana, has failed to take action against anomalies in the Smart Vending Zone project.

After finding a number of anomalies, the then Chief Vigilance Officer, Department of Local Government, had issued directions to the civic body to cancel the project agreement with a private firm in June 2018 but the MC took no action. On Friday, the MC’s Finance and Contract Committee (F&CC) again kept the proposal for cancellation of agreement pending.

Under the project, the Municipal Corporation had allowed the firm to construct over 200 structures, including around 190 shops and 32 commercial halls, on a piece of land (central road portion under Southern Bypass ROB) at BRS Nagar without getting a ‘no objection certificate’ from the Irrigation Department, which is the actual owner of the land.

Notably, the foundation work for the construction of buildings was started without any approved building plan and required permission in 2018. The Irrigation Department had then also submitted a complaint to the police against the construction work.

Many questions were raised over conditions of the agreement between the firm and the MC for a period of 20 years.

As per the agreement, the private firm was empowered to collect up to Rs 10,000 per month per shop from each tenant and even if the firm wanted to collect more, they could collect with due permission of the MC Commissioner.

But, the MC had supposed to collect no licence fee during the first year after the construction of shops. It had to receive Rs 500 as licence fee per shop per month for second year and Rs 1,000 per shop per month during the third year with 10 per cent increase in successive years. After 20 years, the agreement could also be extended for 10 more years. The Irrigation Department, which owns the land, was offered only 15 per cent of the income to be incurred by the corporation from the smart vending zone.

After obtaining information under the RTI, a city resident, Kuldeep Singh Khaira, had sent a complaint to the Department of Local Government, raising questions as to why the MC wanted to benefit the private firm to generate 90 per cent revenue from the market for a long period.

“Instead of establishing the smart vending zone for street venders/hawkers in compliance with the Supreme Court guidelines, as projected before the Irrigation Department, the MC was going to construct a full-fledged market,” he had stated in the complaint.

When an inquiry was conducted, the then Chief Vigilance Officer of the Department of Local Government had found anomalies in the project. In June 2018, the MC was directed to follow due process of cancellation of ‘current contract/agreement’ and take other necessary steps as per the directions of the department.

The civic body was also directed to take inputs from all stakeholders, including PWD, NHAI, Irrigation Department, Traffic Police and the public, regarding the project.

The Department of Local Government had also directed the MC to send names of officials responsible for anomalies and asked to file action-taken report by July 3, 2018, but nothing was done as per sources.

Notably, the proposal to follow due process for the cancellation of agreement and other recommendations given by the Local Government Department was put up before the F&CC in November 2018 but it was kept pending at that time. In January 2021, the Chief Vigilance Officer of the department directed the MC to send the current status report regarding the proposal.

Mayor Balkar Singh Sandhu said the proposal was kept pending during the F&CC meeting yesterday. Sandhu said the project was not approved during his tenure. The project file belongs to the period before he became the city Mayor.

The private firm had presented a proposal to set up the smart vending zone before the MC in 2016 but unauthorised construction work at the site was started in around January 2018.

After the Irrigation Department filed a complaint with the police, the construction work was stopped.