The Telecom Commission has decided to give a Rs 2 crore loan to a Tata company for appointing a consultant who will advise in finalising the terms of hiving off surplus land owned by Tata Communications Ltd (formerly VSNL).
The loan will be given to Hemisphere Properties India Ltd (HPIL), the company into which the 773 acres of surplus land will be transferred to.
The Telecom Commission, at its meeting on August 10, also decided to hold 51.12 per cent in HPIL. The company will appoint a consultant having expertise in handling company law, land revenue and tax matters. “The consulting firm should do due diligence regarding title, change of land use and all other preparatory steps needed for finalisation of the scheme of arrangement to enable hiving off of surplus land from VSNL to HIPL,” said an internal DoT note.
The decision is a step towards resolving the 5-year-old issue. In 2009, the Tatas had written a letter to the DoT seeking permission to raise funds. This was rejected by the Department. The biggest block between the two sides is the dispute over 773 acres of surplus land. In 2002, VSNL's majority stake was acquired by the Tata Group. But the 773 acres spread over five locations in Delhi, Kolkata, Chennai and Pune, was not part of the deal.
The DoT had proposed to hive off the surplus land held by VSNL into a separate company to unlock the value by selling it. However, the process hit rough weather with Tatas raising a number of issues, including clarity on who will bear the cost of creating the new company.