The Yamuna Expressway Industrial Development Authority (YEIDA) allocated 2,428 industrial plots spanning 24.6 million square metres between 2013 and 2021, but lease deeds, or registries, happened for just 453 plots, the Comptroller and Auditor General of India (CAG) has found. An astonishing 81% of allottees did not get possession.
Even for those where registries went through, there was no industrial unit on these land parcels that became operational at least till Apr 2022, the auditor said in its report. Land allotted in other categories was also similarly affected. CAG found a total 30,675 plots were allotted in the YEIDA region between 2008-09 and 2020-21 under industrial institutional, mixed-land use, commercial and residential categories (including the 2,428 residential plots). Of these, 1,666 plots (5%) were cancelled or surrendered. Lease deeds were not executed for 23,832 plots (82%).
The audit report, the first such assessment of YEIDA by the central auditor, says allocations were made through interviews instead of objective parameters. This compromised transparency, while the lack of financial and technical eligibility assessments for larger plots compounded the problem, according to the auditor.
YEIDA's tardiness in lease deed execution and inability to make land available to investors despite allotting them led to major delays, with some projects pushed back by 12 years. Operational shortcomings resulted in lease rent losses amounting to Rs 122 crore, according to CAG. Interviews were relied on for initial allotments of industrial plots over 2,000 sqm, which saw discretionary power lying with plot allotment committee, the auditor said.
Irregularities in location charge policies also eroded YEIDA's revenues, it said, adding that plots at preferential locations, such as those near wide roads or green belts, were not consistently subjected to location charges. The ultimate objective of industrial development was defeated as none of the allotted industrial plots saw project completion as of April 2022.
Despite allocating 24.6 million sqm (taken together, this would be 10 times the size of the largest mall in NCR), the failure to ensure land readiness and enforce compliance mechanisms rendered the efforts ineffective, observed CAG. As of April 2022, the total due amount against industrial plot allottees stood at Rs 318 crore.
This represents 61% of the 2,382 industrial plot allottees who were issued plots during the period. YEIDA provided several explanations and justifications for the shortcomings highlighted in the CAG audit regarding allocation and management of industrial plots. YEIDA attributed delays in issuing checklists and executing lease deeds to incomplete infrastructure development and land encumbrances. It cited farmers' agitations for compensation and pending legal issues as main obstacles in handing over possession of plots.
YEIDA claimed that penalties were not rigorously enforced because many projects faced genuine delays due to external factors, such as delays in regulatory approvals and land encumbrances. It said extension of up to two years was granted to allottees for completing development and construction and defended its decision to deviate from standard pricing practices and not levy location charges uniformly, citing the need to attract investors during periods of economic uncertainty. However, it assured future schemes would not repeat this.
The authority also said instead of cancelling leases of defaulters, it chose to issue repeated notices and grant time extensions to avoid litigation. CAG, however, rejected YEIDA's explanation, stating it had failed to deliver land to investors and that delays in infrastructure development were a consequence of poor planning. The auditor recommended overhauling YEIDA's policies to address these flaws. Key suggestions included instituting transparent eligibility criteria, prescribing penalties for delays, and ensuring land readiness before allocation. Present scenario YEIDA has executed 3,040 industrial plots so far, of which 1,400 have been registered.
Around 1,000 of these registries were executed in the last year 18 months. The industrial plots span key sectors such as 24, 28, 29, 32, and 33. In Sector 29's Apparel Park, 149 plots have been allotted, with 75 lease deeds signed so far. In Sector 33's Toy Park, 139 allotments have been made and 74 registries have been completed. In the Medical Devices Park in Sector 28, 73 allotments have been made under three schemes launched over the past 18 months, with 15 companies completing their lease deeds.
