15 years after CAG rap, Karnataka government collects only Rs 19k rent for Chinnaswamy stadium

Hundreds of crores of revenue foregone as PWD fails to hike rent.

Bengaluru: Nearly 15 years after the Comptroller and Auditor General (CAG) rapped the state government for leasing Chinnaswamy stadium at a low price and losing hundreds of crores in rent, officials say the Karnataka State Cricket Association (KSCA) was yet to respond positively to their demand for higher rent.

The stadium spread over 16 acre and 32 gunta -- is part of three parcels of public land measuring 17 acre 11 gunta -- leased to KSCA for 99 years starting from July 1969. Rs 19,000 was fixed as the annual rent at the time of the lease. Since then, the Public Works Department (PWD) has failed to increase the rental amount.

Official sources said that attempts have been made earlier to increase the rent. In 1994, officials put the annual rent at Rs 3.63 lakh for the three parcels of land measuring more than 17 acres. But the government continued to be satisfied with low rent.

In 2005, the Comptroller and Auditor General (CAG) pulled up the PWD for failing to do its job in collecting the rent as per the prevailing market value. "No grounds had been made out for subsidising the rent and the terms of lease did not provide for any enhancement of rent," the report said.

The CAG estimated that as of April 2005, the government has foregone Rs 202.78 crore revenue. The government replied to the CAG in September 2015 that the revision of rent was in process. However, it was not until 2011 that the PWD came up with a revised rent.

In a letter dated April 15, 2011, the Executive Engineer wrote to his superior about the KSCA hosting matches meant for entertainment rather than sports. He noted that the KSCA was leased land with the intention of building a stadium and promoting cricket and not to be used for other purposes.

"Recently, the Indian Premier League/T20 matches were played in the stadium. These matches are meant for entertainment purpose only. It is well known that cricketers are bought like commodities by the team owners. Cheer girls are brought from foreign countries.. Despite huge revenue, the KSCA is neither paying rent as per its earnings, nor making contributions towards government programmes for education, generating emlopyment, housing for poor or other welfare programmes," he said.

Noting that the CAG has already rapped the department, he suggested imposing daily rent of Rs 12.40 lakh for the days when T20 matches are hosted in the stadium. Further he recommended an inquiry into the provisions adopted by KSCA to rent the stadium for IPL matches.

In September 2012, the assistant executive engineer of PWD submitted the revised calculation of rent for the KSCA. Based on the guidance value at the time, he calculated the annual rent amount at Rs 78.70 crore.

To a question, a senior engineer at the PWD said no progress has been made since then. "We have sent notices to the KSCA but have not received a positive response. A final notice will be issued within a week," an official said.

C Manjappa, who took over as PWD Chief Engineer (Communication and Buildings), said he will look into the issue. "I will look into the file and take a decision on the matter," he said.

DH sent detailed queries to KSCA CEO Shubendhu Ghosh but did not receive a response at the time of publishing this.

Activist T Narasimhamurthy said it was the government's responsibility to follow the CAG's advice and land belonging to the public generates resources for the common good. "No government can ignore the fact that the land is a natural resource belonging to the public, who should get its benefit ultimately," he said.

Advocate Sudha Katwa filed a bunch of applications before the KSCA, seeking information about the earnings. "It (KSCA) has been declared as a public authority in 2012 by the Karnataka Information Commission," she said, which brings the association under the Right to Information Act.