Allotment of land to LKH cancelled following CAG rap

Yet another controversial land deal signed by the erstwhile Y S Rajasekhara Reddy government is going to be annulled by the present Congress government in Andhra Pradesh.

Chief Minister N Kiran Kumar Reddy today directed the Andhra Pradesh Industrial Infrastructure Corporation to take action for cancellation of allotment of 8,844 acres of land in a Special Economic Zone to Lepakshi Knowledge Hub Private Limited (LKH) in Anantapur district bordering Karnataka.

A press release from the Chief Minister's office said the allotment would be cancelled on account of "violation of terms" of the Memorandum of Agreement by LKH.

The Comptroller and Auditor General, in its latest report on land allotments in the state, had castigated the government for "irregularly executing" the sale deed in favour of Lepakshi Knowledge Hub, even before the creation of infrastructure by the developer.

LKH did not establish any industry or create any employment, but mortgaged 4,397 acres of the allotted land for obtaining loans of Rs 790 crore from banks, CAG noted.

The government's decision to cancel the allotment to LKH may also put the public sector Bharat Dynamics Limited's proposed project in jeopardy. Hyderabad-based BDL has sought to set up a complex for manufacturing missile systems on a 600-acre site at land given to LKH in Anantapur, while another complex was to come up on a 500-acre site at Ibrahimpatnam near Hyderabad.

"We have received instructions from CMO for cancellation of land allotment to LKH. We have to examine whether the BDL project too will be affected. In such case, we may allot alternative land to BDL," a senior official of APIIC said.

LKH singed a Memorandum of Agreement with AP government in December 2008 for establishment of "world-class Global Knowledge Hub" by providing integrated infrastructure support to university/clusters, Science & Technology Parks, medical parks, aviation/aerospace parks, agro food parks, IT/BT parks, theme parks, logistic parks, Global Eco Theme village, business financial district, energy projects, commercial, retail, residential and other support infrastructure.

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