COURTESY HINDUSTAN TIMES FEB 9

Flipkart land allotment hits a hurdle
Hitender Rao

hrao@hindustantimes.com

CHANDIGARH : The allotment of 140 acre to e-commerce company, Flipkart, in Gurugram’s Manesar by the Haryana State Industrial and Infrastructure Development Corporation (HSIIDC) seems to have hit a hurdle.

Flipkart was allotted a warehousing site in October last year at the warehousing and transport hub in Patli Hazipur, Manesar, close to the industrial hub of IMT, Manesar, for setting up its largest fulfilling centre in Asia, having covered an area of 3 million square feet.

The land was allotted at Rs 3.09 crore per acre at bare shell cost. This meant that the HSIIDC would not provide external or internal infrastructure for the site and creating it would be the responsibility of the allottee.

The allotment was approved by the executive empowered committee under the chairmanship of the then principal secretary to CM, Rajesh Khullar.

Allotment on hold after Dushyant’s intervention

While Flipkart had deposited about Rs 22 crore as earnest money, the allotment process was put on hold after deputy CM Dushyant Chautala, who holds charge of industries and commerce portfolio, sought clarifications on the allotment price of Rs 3.09 crore per acre.

Subsequently, the Haryana Enterprise Promotion Board (HEPB) asked the corporation to put a few more warehousing sites for e-auction to explore the market. “The minister was of view that pricing for this land was low and the HSIIDC needs to dive deeper,’’ said an official. Dushyant wasn’t available for comment.

Zero response to newly-floated sites create dilemma

While last month the HSIIDC had put up four warehousing sites of comparatively smaller sizes for auction, officials said that there was zero response.

The last date of registration and deposit of earnest money by the bidders was February 3. “If these sites had fetched a higher price, then the allotment price for Flipkart would also have been revised. But not a single bid was registered,’’ said an official.

All four sites were advertised for auction at approximately the same reserve price as Flipkart’s. The sites though were way smaller – 7.47 acre, 8.44 acre, 16.68 acre and 25.29 acre - as compared to the site allotted to Flipkart.

Officials said that for the past one year, the corporation has advertised the warehousing sites four times without any success.

“The first time the allotment price was about Rs 6 crore per acre. This included providing internal and external infrastructure by the HSIIDC. The second time the price was reduced to about Rs 4 crore per acre, but this was without any commitment to provide internal infrastructure. The third time it was decided to further reduce the price to about Rs 3.09 crore at bare shell cost. This meant that internal and external infrastructure will not be provided. And the latest floatation where no one responded was also on similar lines,’’ said an official.

Officials said now the HEPB, headed by the CM, will have to decide on further action.

Officials said that they had held multiple rounds of meetings with companies who would be interested in buying the warehousing sites, but they cited pricing as a major restraint. That’s why, they said, it was decided to sell these sites as bare shell