SC restores lease of One Constitution Avenue

Top court sets aside IHC decision upholding cancellation of the lease

ISLAMABAD: Some prominent residents of the federal capital, including Prime Minister Imran Khan, would have taken a sigh of relief on Wednesday after the top court set aside a verdict of the high court regarding the cancellation of the lease deed of a multi-storey tower being built on One Constitution Avenue.

The court, though, directed the owner of the tower to pay Rs17.5 billion to the government against its lease in instalments over eight years.

In a short order issued on Wednesday, a three-member bench of the Supreme Court (SC), comprising Chief Justice of Pakistan Mian Saqib Nisar, Justice Ijazul Ahsan and Justice Faisal Arab.

The court set aside verdicts of the Islamabad High Court (IHC) which had upheld a decision by the Capital Development Authority (CDA) to cancel the lease of the land. CDA's counsel Muneer Paracha urged the court that the federal cabinet will review the matter fully.

CJP Nisar, though, noted that two towers of the structure have now been built and people have bought apartments in it. He asked why did the CDA not raise any objections for the 13 years when the tower was being built. And then, the lease was cancelled on the directions of a minister.

The civic agency was asked to clarify what did it want to do with the tower now. Paracha told the court that CDA was ready to implement whatever the court orders, but it will be extremely difficult to demolish the tower now. He added that the site where the tower has been constructed would be auctioned again. The CJP remarked that the CDA stands to gain around Rs15 billion, the real problem will be faced by those who had invested in the project.

Regarding the federal cabinet's decision on whether to grant time to the tower's owner to pay the government, the CJP remarked that the court was not dependent on the cabinet and in the absence of a decision, could decide the matter on merit. Justice Ijazul Ahsan observed that the CDA neither gave any recommendation or any plan to the federal cabinet.

The CDA's lawyer objected to the observations of Justice Ahsan but it was overruled by the chief justice. Barrister Syed Ali Zafar, who is representing the owners of the tower BNP (Pvt) Ltd, told the court that the construction of the tower is expected to be completed by 2028. In a bid to sway the court, the CDA's lawyer pointed out that the structure lies within the boundaries of a protected park.

At this, the CJP asked that the buildings of the supreme court building and Pakistan Secretariat also fall within the boundaries of the park, so should they also be demolished? Who will protect the rights of those who bought apartments in the building? The CJP further chastised the CDA for its inability to form regulations on its own and pointed out that it had to direct former federal minister for Capital Administration and Development Division (CADD) Tariq Fazal Chaudhry for them. When the CDA lawyer mentioned the alleged irregularities of the civic body's employees, Justice Ahsan remarked that why did the CDA not raise this issue in the past 13 years. Justice Arab asserted that CDA had defended the case when the auction of the plot had been challenged.

The 13.5 acres of land had been leased to the BNP group after it had successfully bid for it during an auction on March 9, 2005, for Rs4.88 billion. The CDA's Board, though, handed over possession of the plot the same year after receiving just Rs800 million. So far, BNP has paid CDA Rs1.02 billion while the remaining Rs3.85 billion is recoverable in instalments until 2026. In July 2016, the CDA had cancelled the lease of the land citing a host of violations.

The decision was challenged and a single bench of the Islamabad High Court (IHC), headed by Justice Athar Minallah, had on March 3, 2017, upheld the CDA's action of terminating the lease contract and sealed the building, declaring the construction of luxury apartments on land meant for a hotel as illegal. An appeal against the single bench's decision was dismissed by a larger bench of the court and the matter was then raised before the SC late last year.