SRINAGAR: A prominent business group has clarified the “inaccuracies, misinformation and false insinuations” in various media reports and “set the record straight”. The rebuttal by the promoters of M/s Paradise Avenue came in response to news that the business group was booked by the Income Tax (I-T) Department and the Anti- Corruption Bureau (ACB) for evading taxes and adopting corrupt practices to secure a huge amount of bank loans. It was also reported that the ACB booked management, officers and officials of the J&K Bank for colluding in the firm’s financial irregularities/loan fraud worth crores of rupees.
“First and foremost it is clarified that M/s Paradise Avenue is a registered partnership firm formed in the year 2012 with five partners and Hilal Ahmad Rather, who happens to be the son of former Finance Minister of the state of Jammu & Kashmir, Abdul Rahim Rather, is only one of the five partners, but time and again the focus of all media reports concerning Paradise Avenue is only on him and invariably name of Abdul Rahim Rather is dragged into it without any reason inspite of the fact that he has nothing to do either with M/s Paradise Avenue or Simula Group, the company of Hilal Ahmad under the banner of which he has been successfully doing business for last 17 years in Jammu,” the group said. “It is being widely reported in the media houses that the loan has been fraudulently obtained from the bank even without having title of the land in possession which is completely baseless as no bank releases a single penny to any borrower without securing adequate security in place. In this instance as well as reported in the media, land was registered in the month of July 2012 and funds were released only in September 2012 after creating all securities and pledges.
Further it has been assumed that the value of land has been artificially inflated in the sale deeds which is again not true as the land has been registered at the existing circle rates of the time.” The business group further said, “The biggest lie reported is the illegal waiver of Rs 50 crores given to the firm through One Time Settlement (OTS). The accusation falls flat on its face simply on the fact that the bank itself through its letter dated 20.10.2018 , refused to accept any OTS citing that there was no such provision with the bank. How can an OTS, terminated even before implementation be considered any benefit at all?” “The whole issue of the Loan Amount of Rupees of Rs.177.60 crores has to be understood in the right perspective. The principal component of the loan primarily for construction of the project was only around Rs 128 crores, rest being interest component. The principal component has been utilised towards construction of 342 flats on the project site unlike media reports that the loan was sanctioned for only 52 flats of two towers (Eden-Zion) which are actually the ones which have been delivered to customers.
Structural work in the remaining two towers which is the bulk of the project have almost been completed. Anyone with some idea of construction costs in Prefabricated Steel Structures can vouch that more money has been spent on the project than has been drawn. It is also pertinent to mention that the bank has collected substantial revenues in customer proceeds to the tune 25-30 crores.” “The only issue which has marred the project was continuous delays in the project for reasons beyond the control of the promoters of the project and which have been regularly intimated to the bank and which have duly been taken cognizance by the bank authorities despite an adverse political dispensation in the state,” the group said. “Some of the key issues were the devastating floods in Kashmir Valley in September 2014, which brought the complete economic life in the state to a standstill and consequently no customer proceeds were received for a very long time.
In December 2014 the ruling National Conference was voted out of power and local Municipal Authorities started troubling the project and compelled to take a revised permission for a mere 2% deviation in the actual construction which could have been easily compounded.” “To add salt to the injury, in September 2015 the revenue department sealed the construction on block-A citing some court order of High Court regarding construction near water bodies turning a deaf ear to the pleas of the promoters that their permission dates prior to the High Court Order and it cannot be implemented retrospectively as if it were done, half of the legal residential constructions in the city would have to be razed down and it would lead to chaos. It was also pleaded that majority of the land was banjar kadeem and actual construction was far less than the area under banjar Kadeem. Even during spot verification, the authorities could not identify as to which area was banjar Kadeem and which pertained to water bodies. Still it wasn’t enough to satisfy the administration who apparently were under instructions to stop the construction on site by all means. All such matters were referred to the High Court which directed the state government to formulate a policy in the matter, which till date has not been addressed.”
“Despite all the above challenges and after seeking due legal opinion on the legality of the construction in Block A the promoters approached the J&K Bank to work out a feasible solution by getting some external investor on Board, so that the project can be delivered to the customers and bank can also recover its funds. The negotiations with the bank were on when this so called OTS was terminated by the bank. On one hand the project has continuously been sabotaged by the vested interests and on the other hand attempts of finding a feasible solutions by the promoters are being thwarted and being projected as illegal benefits. What a travesty of justice.”
“As far as directorship in a foreign agency is concerned and a bank account, the promoters would like to put on record that Hilal Rather has a minority interest in a company in Dubai which is a connection distribution agent of DU Telecom, which does not require any major capital investment. 51% of the company is owned by a citizen of UAE and there are total four partners and his proportionate interest in the firm is less than 20%. It takes 30000 UAE Dirhams to register a new business and around 7000 Dirhams for residency. Therefore, the total financial interest of his is not more than 14500 Dirhams, roughly Rs 2.90 lakhs in the entire venture. Further no business can exist without a bank account therefore a bank account does exist. As per his knowledge, Reserve Bank of India does not prohibit Indian citizens from investing in business abroad within the certain limit and no prior permission is required. But, if in the process rules and regulations have unintentionally been violated, it shall be duly complied with.” “As far as the rest of the issues regarding the transactions of the firm etc. are concerned, no official intimation has been provided to the promoters by the agencies of the information and evidence gathered by them. Due clarifications and explanations shall be provided whenever they are officially sought,” the business group said.