Under consideration,Jet plea to delay payment for BKC plot until September
Jet Airways could get yet get another extension for a payment towards a Bandra Kurla Complex plot it bid for two years ago.
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Jet Airways could get yet get another extension for a payment towards a Bandra Kurla Complex (BKC) plot it bid for two years ago.
Having already extended the deadline twice,the Mumbai Metropolitan Region Development Authority (MMRDA) is in the process of approving a proposal to give it time until September to pay the Rs 826 crore due. We have put a proposal to the MMRDA and are awaiting their response, said a Jet spokesperson. The last extension lapsed seven months ago.
As per rules,a winning bidder for a BKC plot has to pay up half the amount within a month of receiving the allotment letter and the rest over the next two months. If the bidder fails,the MMRDA can retain the earnest money deposit (EMD) and call off the deal.
Jet Airways has asked the MMRDA for an extension until September which is under consideration, said additional metropolitan commissioner SVR Srinivas. If the request is approved,the airline would have to make the payment with 14 per cent annual interest,he said.
Jet bid for the 5,951-sq-m commercial plot in March 2008 with plans to build its global headquarters there. Starlight Systems,winning bidder for two residential plots at the same auction,had also asked for an extension; unlike Jet,it has so far paid up half the amount,
MMRDA sources say Jet,after seeking a couple of extensions,wrote for permission to exit the deal. The airline wanted their EMD of Rs 10 crore returned which we refused, a source said.
For a long time,the MMRDA kept on hold its plans to call off the deal. With the matter being referred to the state government,the MMRDA has now been asked to consider the request for another extension.
With plans for its global headquarters delayed,the private carrier has extended the lease for its current head office at SM Centre on Andheri-Kurla Road. The lease was to expire in January this year.
According to a Jet official,the company,which was earlier hoping to exit the BKC deal,has been looking out for larger office space to accommodate under one roof its head office as well as its back-office,cabin crew training centre and a few other departments scattered across Mumbai. However,the company has now secured an extension on its lease for the head office at Andheri.
Meanwhile,in a move that will help generate extra revenue,Jet has asked for additional built-up rights on another BKC plot,bought in 2006. With not enough funds to develop the plot on its own,the airline has been negotiating with developers for a joint venture on the two-acre plot.
At the time of the lease deed,the FSI (floor space index) granted on the plot was 2.4. As per revised regulations,the airlines has now asked for rights to construct an additional 40,000 sq metres of built up area,taking the total FSI to 6.3.
UNPAID DUES
The plot: 5,951 sq m at BKC,bid for by Jet in 2008
The rule: Pay half in a month,rest over next 2 months
Status: Rs 826 crore due,nothing paid. Two extensions given,third sought,till September
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