The Bhutanese Leading the way.
The total estimated value of the 19,500 sq ft land on which Trowa theatre stands according to the Chief Urban Planner of Thimphu Thromde and also one of the committee members of PAVA, Geley Norbu now stands or works out to about Nu 4.7mn.
Following a cyclic carousel of buy or sell, the Ministry of Works and Human Settlement (MoWHS) sent a letter to the National Land Commission (NLC) Secretariat to decide on the Trowa Theater case.
The letter which is currently with the commission’s urban division will be forwarded to the land commission, who will then decide on the case after studying it at one of their commission’s meetings.
However, the commission members are yet to receive the agenda on the Trowa Theater case.
According to the NLC, the case will be decided sometime in September this year or even earlier depending on the urgency MoWHS. Earlier, the MoWHS minister, Lyonpo Yeshey Zimba said they will abide by what the commission decided. “If the land commission says the land cannot be sold to the owner then the government will buy the structure and reclaim the land,” said Lyonpo.
Earlier the Prime Minister stated, had it not been his daughter’s father-in-law involved, the case could have taken another twist. The controversy had built up when the government proposed to sell the 19500 sq ft land to the owner himself who had refused to pay the rent for nearly five years after the government increased the rate from the earlier Nu 2 to Nu 42.
Lyonpo Yeshey Zimba said with the National Housing Development Corporation (NHDC) facing budget constraints, the proper solution he thought was to sell the land to the owners of Trowa Theatre and use the money to build houses.
But the Land Act 2007 prohibits the sale of government land
Thimphu is divided into 21 precinct areas, all of which falls under town planning but the Trowa Theater area does not fall under the Thimphu Structural Planning (TSP) and instead falls under the municipal area.
So now if circumstances arose and the commission decides for the land to be sold, the land worth would sum up to Nu 238 per sq ft.
The unpaid rent itself is Nu 5mn. Based on the land lease rules and regulations, which had been issued in 2009, the lease rate also depends upon the land use.
The Thimphu Thromde has different rates for different areas and the land lease rate for Changjiji falls under the rate of Nu 20 per sq ft annually for commercial land and Nu 5 sq ft for residential land.
This case dates back to 2002 when the land had been leased to Sangay Dorji for the construction of an entertainment hall with the annual lease rate at Nu 2.
Sangay Dorji midway through construction sold the project to Kinley Wangchuk.
Kinley Wangchuk became the project owner but, before he could transfer the ownership, the government had raised the rate from Nu 2 to Nu 42.
With this Kinley Wangchuk protested and issues arose, this led to several talks between the Trowa Theater owner and the MoWHS to settle the matter.
One solution was to sell the land to Kinley Wangchuk but that had been kept as an option due to government policies,.The other solution was Kinley Wangchuk’s proposal to sell the project to the government, but, this solution did not materialize since the price had been too high for the government.
With the discussion reaching nowhere a lot of time had been wasted and now this issue has been put forth to the land commission to decide on the case.
If the rent has been set, it needs to be paid. Doesn’t matter who the lessee is. Until the owner pays the back rent and is forwarded for a criminal case to the attorney general, it is like he is holding a gun to the government’s head. If this is the way he wants to play it, then the government can just cancel the lease agreement or allow it to expire and then demolish the damn theater. Whatever happens, the back rent is still due, and I hope with the typical 29% interest, as well as criminal charges being filed.
the estimate of 4.7 million for the Trowa land as appeared in this paper is highly unrealistic. it is the estimate done in midnight dream when the person is half human and half spirit.
the current market value of the trowa land which is close to 44 decimal will easily fetch around 20 million. Considering the market value in Olakha this days, it can even fetch more, but I am trying to be modest and putting the value little bit less due to the case in consideration.
the solution is simple. simply do the public auction of the land and structure. it is fair, transparent and equal opportunity to all concerned. the scenario or the end result of public auction would result in the following:
amount that can be collected for the land through auction = 18.0 million (min.)
amount to be recovered for lease for 5 years @ 42/sft = 4.09 million
Amount balance still in the coffer = 18.0 – 4.09 = 13.91 million
cost of the trowa theatre structure based on BSR = 10.0 million (considering all the high tech interiors if exist). I have not been to the theater myself).
NET BALANCE AFTER PAYING THE COST TO TROWA THEATER = 13.91 – 10.00 = 3.91 MILLION.
ISN’T THIS THE WIN – WIN SOLUTION. SO SIMPLE AND WILL NOT TAKE TIME. NO QUESTION FROM ACC AND RAA.
Agree, who came up with this ridiculous sum of 4.7 million.
if i was owner today , i would have been langusing in chamgang. This is equity and justice in Bhutan.
govt doesnt have to buy nor sell. there are rules in the country. if some one build structure in the government land without permission then put a bul dozer to work. even in other dzongkhag government do this. if the owner do not pay the due rent then owner should be locked up. if he pays then leasing period is 30 yrs then do so.
Can’t believe that rent for the trowa theater is not paid for five years. In our case house owners threatens to throw us out if the house rent is delayed by few days but here the tenant is still running business even the rent was not paid for five years. OMG
19,500 Sq.ft land in Thimphu just for 4.7 million, thats cheap. The land price are much higher in Olakha. Everyone would might aim to buy land from Government then and this might as well set precedence.
sell it to some bank. Not to personal person. That will be best.
Auction it! Start with 200 million!
I only hope the owner of the ‘Trowa theater’ did not evade tax. It is certain that he did not pay rent to the government due to whatever reasons. But he surely made lot of profits from the business, so I hope he lawfully paid the ‘Income Tax’. The media should therefore also try to find out if there is any lapses in income tax payment.
I had never bought the idea of selling the land/structure to the owner as proposed by LYZ. But I hope NLC will not consider the proposal since it is the final authority to do so. However to break the status quo and if there is really a need to sell the land, it is only right to auction the property. And people who are responsible for such lapses should be made accountable be they officials in the MoWHS or private entrepreneurs.
my simple opinion would be to auction it at a base rate of the valued cost and pay the owner the differences with the lease and penalty.
I think the PM is damn right. If the implicated is not related to him, there would have been no issue at all.
If the law says you cannot sell, you cannot do that. Government land is not the Government’s to sell – it’s public property. And no individual should try to make profits at the ‘expense’ of public property. All who had a hand in such a loss should know that they failed in discharging their duties and the trust that the public had bestowed on them.
If the owner of the theater is not relative to PM, he/she would have been kicked out by the authority concerned and no issue.,.Simple… right 🙂
I just beleive the cost calculated for the building structure only and its quite justifiable as the contruction is simpler than building wth many rcc erections and many compartments…
thus i feel it’s justifiable…as building a five storied building costs u around 7.0 million plus only…
The housing complex belongs to NHDCL and they should be correct agency to buy. They can create few employments to run the theater and make profit instead of bringing up maintenance team which will fail. The NHDCL can pay cost of the building, furnishing minus the lease outstanding fees after taking everything into consideration like depreciation, penalty for late payment etc.
Proper investigation need to be carried out and the responsible officials fixed for their failure to carry out the duty. Now, at this juncture, the ex-minister lyonpo Kunzang is throwing the ball out of his court into the court of his secretary and director during his time. surely, there must all the correspondences, records, note sheets, etc. from where investigators could find out who should be held accountable. unless, proper investigation is carried out and the responsible officials fixed, the bureaucratic system in bhutan will not improve.