Denchi Land Compensation Scam – II

New documents and evidences show that inspite of the government’s clarifications, the Denchi land compensation was an illegal act by the cabinet with a strong conflict of interest. The government went against the official recommendations of PAVA which was already aware of Denchi being declared a Thromde, didn’t follow the rules applied in Denchi in another new urban town Duksum in Trashiyangtse where rural rates were paid, and also misinterpreted and violated the PAVA rules and the Land Act 2007

 

PAVA report on Denchi contradicts the cabinet’s clarification

The government earlier in a clarification sent to all newspapers except for this paper defended the Denchi Land Compensation scam essentially saying that the Parliament on 2nd June 2010 had declared Denchi as a Thromde and so the Thromde rates were applied.

The Property Valuation and Assessment Agency (PAVA) first fixed the official PAVA rate for Denchi at Nu 3,952.42 per decimal as a class B rural land under PAVA rules in May 2009 after rejecting the Pemagatshel Dzongkhag’s optimistic Nu 5646.32 per decimal as a Class A  rural land.

This was even though PAVA already knew that land was being acquired to establish the new Pemagatshel Dzongkhag Thromde.

In 2nd June 2012 the Parliament officially declared Denchi as a Dzongkhag Thromde.

 

PAVA Knew Denchi was a Thromde

The cabinet then forwarded the issue of Denchi people wanting higher rates to PAVA instructing them to review the existing rates as it was felt to be far too low. When the PAVA committee received this request on 26th November 2010 they were already aware about the Parliament declaring Denchi as a Thromde and were also made aware about it while being asked to review the case.

“We were aware and also made aware that Denchi had been declared a Dzongkhag Thromde while looking at the case for the second time on 27th November 2008 in the chambers of the MoWHS secretary,” said the PAVA member on the condition of anonymity fearing government action.

 

PAVA’s bold warning to cabinet

The PAVA team also went out of its way in its report to inform the cabinet that any raise above the Nu 3,952.42 per decimal for Class B rural land would not be in keeping with the Land Act 2007.

The report says, “It may be appraised that as per Section 154 of the Land Act of Bhutan 2007 the PAVA shall revise compensation only after every three years.”  This is also the only sentence of report marked in bold.

“We had put this particular sentence in bold as we hoped that this would make the authorities change their mind on the issue of giving higher then legally approved rates for Denchi,” said the PAVA member.

 

Denchi is Class B rural land

As per the official two page report (a copy of which is with the paper)  submitted by this PAVA task force on 28th November the governments logic of paying Thromde rates is not mentioned and instead PAVA again insists on placing Denchi as the original rural B category. The report, however recommends that if the government feels the rate for Denchi Class B is too low then the original formula and rules of pricing land prices under PAVA can be changed to give Nu 5519.74 per decimal instead of Nu 3,952.42 per decimal for Class B rural land.

“As per the existing rules we cannot fix the rates at Nu 5519.74 but we had to follow the directives of the cabinet to increase the rates. We were under pressure from the cabinet,” said the PAVA member.

“We were asked to increase the rates will against our will. This is because though the PAVA committee was already aware and made aware of the Parliament declaring Denchi as a Class ‘B’ Thromde the revision of paying Thromde rates would not be in line with the Land Act 2007 and PAVA rules,” said a PAVA member.

 

Denchi had no urban infrastructure

“We, however, in our report could not recommend Denchi to be paid as a Thromde B as it would not be in keeping with the PAVA rules and land Act 2007. Rural rates were still applied by us because even though we knew Denchi was declared a Thromde, on the ground it was still a rural land with no urban infrastructure. In PAVA we have to pay for acquiring the current land type and not the future speculative price of land. Without actual urban infrastructure on the ground how can a rate be paid for at an urban rate,” said the PAVA task force member.

“There is also evidential fact on the ground which clearly shows that area to be acquired is a rural area land with no proper roads, urban facilities and is quite a distance from any urban settlement,” he added.

 

Denchi cannot be compared to Nanglam

When the cabinet had put the case to PAVA to review the rates for Denchi it had also mentioned that even Nanglam rates need to be reviewed as people in Denchi compared their rates to the Nganglam which was Nu 9,801 per decimal for commercial purpose and Nu 9770.51 for residential purpose.

PAVA’s report says, “For the issue Nanglam does not arise as the planning has been based on land pooling method which the public of Denchi did not agree.”

The PAVA member said, “What we meant is that though both were declared towns in Nanglam the urban rate could be paid as there was land pooling and some urban development which was not the case in Denchi.”

 

Hejo inequity brought up

The same task force report also brought up the land acquisition in Hejo for Diplomatic enclave where the cabinet had refused to pay anything above the PAVA rate.

The report says, “The task force members informed the meeting (in MoWHS) that a similar instruction to revise rate of Diplomatic Enclave was also received earlier. On submission of the enhanced rate of Diplomatic Enclave the cabinet decided that the rate be maintained at status quo (same) to avoid social, financial, and legal obligations.

“This was an attempt also to remind that cabinet that earlier in a similar case it had said no,” said the PAVA member.

 

Legal Views on Denchi

A prominent legal expert also on the condition of anonymity said, “The Rate should not be Thromde B rate because land is being acquired for a Thromde B and not from a Thromde B. For it to qualify for the full rate of Thromde B it has to have the existing municipal facility and investment to deserve such a rate. Municipal rates cannot be paid for a fallow land but once the land has all the facilities then it can charge the necessary rates.”

The expert said that if the government was buying land in established Thromdes like Thimphu, Paro, Gelephu, etc then the rates would apply.

“While it is true that the Parliament in the fifth session declared Denchi as a Dzongkhag Thromde the parliament has not declared what rates are to be paid. That has to be left to the Land Act 2007 and the PAVA which is the appropriate authority to decide the rates,” said the expert.

Section 151 of the Land Act says, “There shall be a Property Assessment and Valuation Agency established under the Ministry of Finance to valuate and fix the value of land and any other collateral property that may be acquired. The valuation of the Land and the property shall consider the total land registered area, registered land category, its current use, location in relation to accessibility to vehicular road, immovable property, local market value, and other elements such as scenic beauty, cultural and historical factors, where applicable.”

The legal expert said that the Prime Minister may have mentioned about the historical importance of his Aunt’s land but the appropriate authority would be PAVA.

Denchi while getting Thromde rates is also enjoying the fruits of being in rural area with compensation being provided for the fruit trees like orange and mangoes.

 

 

Denchi compensation rules not applied in Duksum Urban Township

In area called Khitsang in Khamdang Gewog under Trashiyangtse Dzongkhag, 55.735 acres of land are being acquired to relocate and develop the current Duksum Urban Township which is just 0.5 km away.

If one goes by the cabinet’s decision, precedent and logic to give Nu 9,000 per decimal for Denchi in 2010, the 67 private landowners of Khitsang whose land was acquired in mid 2011 for the urban town are entitled to Nu 9,801 per decimal for commercial areas and Nu 9,770.51 in residential areas as per the PAVA’s own urban rates for Duksum.

However, the government unlike in the case of Denchi has decided to go strictly by the PAVA’s original estimate for Rural Class ‘C’ land and pay 2,900 per decimal for Kamzhing land and 3,300 per decimal for Chuzing land being acquired for the Duksum township.

The 67 private land owners of Khitsang many of whom are ordinary farmers and thought the price was too low were told by the Gewog and Dzongkhag administration that the government’s PAVA rates are fixed and final.

The local Khamdang Gewog Gup Ugyen Wangdi said, “People came forward for higher rates but since the rate was fixed by the government we have to abide by it.”

The Dzongkhag land officer Jigme Tenzin also said that the government had fixed the rates as being final and the people were also informed accordingly though some of them felt the rates were too low.

A local landowner on the condition of anonymity said, “We thought that since our land is being taken to develop a new town we would get higher rates but we were told we will be given only rural rates.”

Under the same PAVA rules and rates that were applied on Denchi the rule shows Duksum as a throm land under Trashiyangtse Dzongkhag. The PAVA rule says, “Urban land compensation rates for specific Throms listed below,” and lists Duksum as being eligible for Nu 9,343.62 for commercial area and Nu 9,147.60 for residential areas.

Coincidentally Duksum like Denchi was also relocated from its original location as the new location was found to be better and safer. The old Duksum town was in danger of rockslides and river flood and its relocation was also discussed in Parliament.

Also, like in Denchi people losing land will also be given urban plots. However, the only difference is that in Denchi residents will get urban rates while Duksum residents will get rural rates.

Apart from being the only second major town in Trashiyangtse, Duksum will soon see the arrival of the 600 MW Kholongchu project that is expected to boost the local economy and population.

Duksum was identified as a satellite town in the Bhutan National Urbanization Strategy of 2008.

A legal expert said, “First of all the Denchi compensation should have been at rural rates and not thromde rates but once that has been done it should be applied uniformly. It is legally strange that in the case of Duksum which is a throm under PAVA only rural rates are being given.”

A land owner at Khitsang, Kunzang Dechen said, “The amount to be paid for plots to be retained by land owners is more than what we get by surrendering our land at PAVA rates. There are people who cannot afford paying that much. They can give us commercial rates. It is like land is being looted from us- we are losing land as well as paying more to retain some.”

 

Strict PAVA rates for Hejo and Green Zone in Thimphu

While landowners in Denchi can enjoy rates which are 200% above the official PAVA rates 101 affected landowners in Hejo, Thimphu whose 31.7 acres are being acquired as part of the Diplomatic Enclave have been told by the cabinet that no rates higher than PAVA rates will be given.

The PAVA committee which had been asked to revise and review the Denchi rates again on 27th November 2010 had pointed out the Hejo case to the cabinet in its report reminding the same cabinet that it had taken a decision not to raise PAVA rates for Hejo.

The PAVA rate for Hejo is Nu 98,611.13 for a decimal of land while the market rate is five times as much.

The Hejo resident over the years have lost 75% of their ancestral land to the golf course, National Assembly, Wood Craft Center, Supreme Court and the proposed diplomatic enclave.

Three years have passed in appeals to the Ministry of Works and Human Settlement and the Prime Minister.

Since 1994, the government put these areas under the municipal boundary. “We have been paying tax at the town rate and still we did not get any amnesty as a town,” said one land owner.

In 4 April 2009, Thimphu Thromde (the erstwhile Thimphu City Corporation) made an announcement asking people to claim a compensation of Nu 150 per sft for the green zone when it came up. Once PAVA came into effect in April 2009 this was increased to 180 per square feet as per PAVA rates. For the Green Zone 42.61 acres of land is being acquired from 99 landowners. Here too the cabinet and government did not budge beyond the PAVA rates. For the Supreme Court construction, 1.75 acres was acquired from 28 landowners.

“What we are left is only 25% of the land. We are not saying that we will not give the land but for a fair compensation that is commensurate enough to buy a same plot of land in the municipal boundary or a land substitute or allow us to construct houses,” she said.

She also added that the irony about the land acquired by the Government above the Lanjophakha highway was that initially it had been acquired for development purposes but it was sold to private individuals.

“Some people have withdrawn with no options to sustain and compelled to take the compensation,” she said adding that those who accepted the compensation are those who inherited the land and gave up with no options and the others who bought the land at a much cheaper rate than the compensation rate.

She asked, “If PAVA rates for Denchi could be revised by the cabinet, why not in our case?”