Maharashtra Airport Development Company cancels plot deal as Phoenix defaults on dues.

NAGPUR: Phoenix Infra, the realty firm which once rode high on the Mihan-SEZ wave, has now defaulted in paying its dues to Maharashtra Airport Development Company (MADC) - the state government agency which is developing the project. On account of this, the MADC has forfeited the earnest money deposit (EMD) and issued a letter of cancellation to the firm last month. Though it is learnt that Phoenix had bid Rs20 crore for the land, the MADC official, who confirmed the development, could not recall the exact amount.

The company had bid for a 4 acre patch of land to build a residential project in Mihan complex. However, even after over 4 to 5 months of bagging the deal through a tender process, Phoenix could not pay the amount it had bid. Phoenix had emerged as one of the key realty players selling plots of land off Wardha Road claiming huge appreciation in value once the Mihan-project came up. Its agents had a typical strategy of targeting morning walkers to vend the plots. It had also faced an income tax raid in 2012.

Phoenix already has one 4-acre plot in Mihan which it had got through a tender around a couple of years ago. Interestingly, the MADC could not get timely payment even in the first deal and had to send repeated reminders before the dues were finally recovered. It had plans to build a residential complex in the first plot too.

Despite the hiccups it faced meeting the liability in the first tender, it once again bid for another plot of land in Mihan. A MADC source said as there is no system of a pre-bid screening, Phoenix could take part in the auction again.

Though the company has finally paid the dues for the first plot, the investors in the project have been left complaining. It had bid for the land, around two years ago, but so far only excavation work has been done.

"With no signs of the building coming up, anxious investors are finally making enquiries. None of the key persons in Phoenix including the managing director Jiten Nashine is available, either at the office or over telephone," said an investor on the condition of anonymity.

When TOI tried to call Nashine on his phone, it was switched off. Nashine shot into limelight due to his overnight success through Phoenix.

MADC sources said because of delayed payment it was only three months ago that the company had got the final possession of the first plot. It has 39 months to finish the project after possession.

TOI had earlier reported how Phoenix started marketing the property even before it had received the land's possession.

Ahmad Dewani, one of the directors in Phoenix, admitted that it was not in a position to clear its liability for the second plot due to tough market conditions and had sought time till April. "As far as the first plot is concerned, it took time for securing approvals such as a fire NoC and height clearance from Airports Authority of India (AAI). The work is expected to begin soon," he said.

Source : timesofindia.indiatimes.com