The Public Procurement Regulatory Authority (PPRA) has called for a comprehensive report and comments from Pakistan Housing Authority (PHA) regarding violation of Public Procurement Rules (PPR)-2004. Following a complaint received from Transparency International Pakistan (TIP), the information has been called by PPRA under section 5(2)(i) of the PPRA Ordinance 2002.
On October 5, TIP Chairman Syed Adil Gilani sent a letter to the Managing Director of PHA, Muhammad Abbas, relating to the allegations of violation of PPRA Rules in the process of making a Joint Venture with Maymar for PHA-Maymar Tower, Karachi. It was also pointed out that PHA has to abide by the building byelaws of Karachi Building Control Authority (KBCA).
TIP had sought modalities as to how PHA secured assurances that PHA-Maymar Tower shall not default on any of the KBCA byelaws. Since no response was received from PHA, another letter was written by TIP on October 15, highlighting that PHA-Maymar Towers was reportedly violating KBCA byelaws 5.1.9 & 10.
According to these byelaws, PHA-Maymar Towers shall confirm the allotment of a unit within 15 days of booking and shall sign agreement with 15 days of the issuance of allotment order. The allocation of the plot shall be confirmed by the developer through an allotment letter to the allottee as specified in Form DNP-2 annexure 14, within 15 days of booking.
The allotment letter shall specify the plot number, sector or block, general facilities, total price of the plot and details of other charges. If the allotment letter is not given within 15 days then the developer shall pay mark-up to the allottees at the prevailing bank rate.
Within 15 days of the issuance of allotment letter and before calling for other instalments in respect of the plot, the developer shall, in pursuance of clause 5(4) of the Ordinance, execute an agreement with the allottees as specified in Form DNP-4 in case of the failure of the developer he shall pay the mark-up to the allottee at the prevailing bank rate in addition.
The TIP letter said that PHA-Maymar project has reportedly received thousands of applications, with unkown advance payments with the application, but has not allotted a single unit yet. The applicants were supposed to get the allotment letters within 15 days of booking, which has not been done.
According to the byelaw 5.1.9, it is mandatory on PHA-Maymar Towers to pay bank interest to all such applicants who have submitted their applications. It is not confirmed from the advertisement of DHA that this mark-up will be paid by them.
The TIP letter said: "By the alleged violation of the KBCA building byelaws, PHA-Maymar project is making undue profits out of booking funds, and depriving the citizens of Pakistan their legal rights. The sample agreement form was sent for information which confirms that PHA-Maymar Towers JV are responsible for various commitments to be given to the allottees and, in case of default, heavy penalties are to be borne by them which means Government of Pakistan also." PHA has again been requested to respond on the factual position to its letters urgently.
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