Land designated for construction Ooty medical college pledged to bank

Prior to this, a PIL was moved with the Madras high court praying to halt the construction work of the college alleging environmental violations.

Medical Dialogue team had earlier reported that a PIL was recently moved by advocate V Ramesh with the high court, alleging that the construction of the medical college would lead to adverse environmental impact and environmental violation. The plea sought a direction to the state to utilize the land and buildings leased and owned by Hindustan Photo Films for establishing the government medical college hospital.

However, the court had ordered that the construction work can not be stalled and directed the state government to confirm whether the existing buildings of Hindustan Photo films manufacturing company limited could be used as hostel buildings and other purposes instead of the construction of new buildings.

Also Read: Madras HC refuses to stay construction of Ooty medical college over alleged environmental violations

Now, another hurdle cropped up in the way of establishment of a new medical college as Canara Bank claimed that the land of the defunct company, earmarked for Ooty med college was 'pledged' to the bank. Hence, issues like whether public sector undertakings of Central government can be used as a mortgage for loans or if banks can accept such leased land for extending loans of as much as rupees 1,800 crores have raised questions on the construction work of Ooty Medical College.

Times of India reports that while following the further hearing of the same case, now another question was raised before a bench of justices including Justice M Sathnarayan and Justice R Hemlatha on Monday as the counsel for the Canara Bank alleged that "the land was offered as security in 1985. The government is also aware of it. Rupees 18700 crores of public money have been involved in the issue."

After hearing the submission of the bank, the court came down heavily on the bank for being irresponsible in accepting the land as security without checking it properly.

The court has also instructed the Registrar of National Company Law Tribunal to file its response on the issue. As far as the response of the Additional Solicitor General of India Sankaranarayanan is concerned, he informed the bench, "The insolvency proceedings regarding HPF of assets are pending before the National Company Law Tribunal. Till the proceedings are over the land cannot be used for any other purpose."

HPF has clarified that the 300-acre land allotted for the hospital belongs to the company and it cannot be used for any other purpose. However, the court has not made any judgment on the case yet.