Lawmakers on Friday asked the government to stop public land from being leased out to private firms after National Trading Limited (NTL) defied the parliamentary Public Accounts Committee’s order to cancel a rental deal for its property on Ram Shah Path and went ahead with it.

Speaking at the PAC meeting, lawmakers criticized the growing trend of leasing out state-owned land for commercial purposes lured by high rentals.

NTL has leased out 25 ropanis of land at Ram Shah Path to Infinity, a private company, for 33 years. The firm plans to erect a 17-storey business complex on the plot. 

In 2010, concerned by the security risks that the proposed high-rise could pose to Singha Durbar, the country’s administrative centre, PAC had told NTL to scrap the rental pact with Infinity.

Disregarding the House panel’s order, the NTL management led by the then general manager Satya Narayan Mehta leased out the land to two other private companies named Khaptad Supplier and Yogambar.

Khaptad has taken out a lease on 10 ropanis for 10 years while Yogambar has leased a plot of land for five years to operate a party palace. Yogambar has also leased another plot for three years to run a vehicle trial centre.

Lawmakers said the government should end the wrong practice of leasing out public land to private firms. “The government should study the cases and penalise the guilty,” said Member of Parliament Bikas Lamsal.

The Supplies Ministry has recently taken over the NTL management after firing Mehta on suspicion of misappropriating the corporation’s assets. The ministry has also annulled the performance bond of Infinity and asked it to vacate the land.

Supplies Secretary Prem Kumar Rai said the ministry had stepped up action to liquidate the loss-making corporation. According to him, the ministry is also scrutinizing deals under which NTL-owned land in Birgunj and Nepalgunj has been leased out to private companies.

NTL has debts totalling Rs920 million. The public enterprise, set up to sell daily essentials and household goods, has been racking up losses due to low revenues and high overheads.

Its annual revenue comes to Rs50 million while its administrative costs amount to Rs100 million, according to the ministry.

NTL started going into a tailspin in 2008 after the Maoist-led government shut down the duty-free shop it was operating at Tribhuvan International Airport, one of its few profitable ventures.

According to the ministry, it has offered a voluntary retirement scheme to the 384 NTL employees, but 21 of them have rejected it. Supplies Secretary Rai said the government was working to pay off the corporation’s employees.

Meanwhile, The Finance Ministry said it had started maintaining records of the properties owned by all public enterprises. “The ministry aims to check the misappropriation of public land through this step,” said Finance Joint Secretary Ganesh Pandey.

• Lawmakers on Friday expressed concern at the misappropriation of land by the Ex-Servicemen’s Association at Pulchok, Lalitpur.
• The government owns 7 out of the 17 ropanis of land being used by the Ex-Servicemen’s Association.
• A controversy arose after the association moved to lease out the land to a non-governmental organisation (NGO) which is planning construct a business mall on it.
• Lawmaker Yogendra Chaudhary said the government should stop the NGO from constructing a business complex on the public land.