IHC restrains CDA from dispossessing residents of One Consitution Avenue

ISLAMABAD: The Islamabad High Court (IHC) on Monday restrained the Capital Development Authority (CDA) from dispossessing the residents of One Constitution Avenue and issued a stay order on intra-court appeals filed against the dismissal of their writ petitions.

A division bench comprising Justice Muhammad Azam Khan and Justice Raja Inaam Ameen Minhas heard the appeals filed by the residents of One Constitution Avenue. During the proceedings, the court directed the CDA not to take any coercive action against the occupants till the next hearing.

The residents’ counsel, Sardar Taimur Aslam, said, “We want the CDA board to hear us and give us an opportunity to prove our innocence.”

Justice Khan inquired about the process of sub-leasing and whether it was documented with an institution or done informally.

Senior lawyer Ali Raza, another counsel representing the residents, contended that the CDA had leased out the land and subleases were executed while the original lease was intact.

He argued that the CDA had received a partial payment, which was sufficient to cover the space where the residential towers were built.

Appearing on behalf of the CDA, counsel Kashif Ali Malik told the court that the authority was the custodian of the land and the SC’s 2019 order, in which it directed the builder to pay Rs17bn, was public.

“Why did people invest in risky properties?” he asked.

Justice Minhas observed that the CDA had issued letters to the builder and was aware of the residents’ occupancy.

Justice Khan asked whether the CDA had issued a completion certificate for the project. Malik replied that no completion certificate had been issued to date and that residents possessed no document issued by the CDA.

Justice Minhaas noted that in the National Police Foundation case, the entire housing scheme was declared illegal, yet the residents were not dispossessed. The court adjourned the hearing while issuing the stay order.

The dispute relates to a 2005 lease agreement between the CDA and BNP for the development of a five-star hotel project, which was later converted into the luxury residential and commercial complex known as One Constitution Avenue, located in a prime area of Islamabad.

The lease had initially been terminated in 2016 but was restored by the Supreme Court in 2019, subject to stringent financial conditions, including payment of Rs17.5 billion in instalments backed by bank guarantees.

Last month, the IHC upheld the CDA’s decision to cancel the building’s lease due to the company behind the project defaulting on the payments.

Subsequently, the Bank of Punjab (BoP) and several flat owners separately filed intra-court appeals before IHC, challenging the single bench verdict, which had also ruled that third-party buyers would “sink or sail” with the original lessee.

Prime Minister Shehbaz Sharif also constituted a high-level committee to review the issue and halted authorities from taking any action.

On Saturday, intriguing new facts surfaced in the court record ahead of the hearing, including a 2012 interim arbitration award issued by incumbent Defence Minister Khawaja Muhammad Asif and a former chamber president to resolve disputes between the two main partners.

The arbitration award, dated September 13, 2012, was issued by Khawaja Asif and Mian Hamid Javed, former president of the Faisalabad Chamber of Commerce and Industries. The agreement was meant to settle differences between Abdul Hafeez Sheikh of M BNP and Nadeem Zia Pirzada of M/s Paragon regarding the five-star hotel project.

A stunning list of buyers also emerged in the record, revealing that 240 flats in the disputed project were allotted to who’s who of Pakistan’s power elite.

According to documents placed before the court, the buyers include a former acting president of Pakistan (who served two non-consecutive terms), a former Senate chairman, a former prime minister, two former chief justices of Pakistan, a former chief justice of the Lahore High Court, and a former defence minister, among other notable ex-public office holders.