24 business houses owe MSRDC Rs 277 crore

It has come to light that big business houses and advertising agencies for several years now owe the state government-run Maharashtra State Road Development Corporation (MSRDC) nearly Rs 277 crore for use of advertising space along 33 flyovers in the city and metropolitan region, and along the Mumbai-Pune Expressway.

Documents accessed by The Asian Age reveal that many agencies have illegally continued to use advertising space for free even after expiry of contract period for using the said space. MSRDC generates revenue by renting out space over flyovers and on electric poles for advertising. Currently, MSRDC has entered into contracts with advertising agencies for renting out designated advertising space along 33 flyovers, three toll plazas, and three subways. However, documents accessed by this newspaper reveal names of 24 firms, including advertising agencies and business houses that have defaulted on rent payments till and as on April 30, 2016. These include the likes of Adlabs Films Limited, Kamat Hotels, India Outdoor Advertising, Unity Infraprojects Limited and Ashoka Highway Ads.

MSRDC’s commercial department, in an internal communication between the former and MSRDC’s accounts department, has given seven remarks as to the reasons behind terming these contractors as defaulters.

One particular communication says: “M/s Kamat Hotel as requested earlier, the commercial department is once again requesting to provide documents in respect of closure of this account as interest is accumulating.” MSRDC’s commercial department charges defaulters nearly 18 per cent interest on rent.

When contacted, Shrikant Bhangare from MSRDC’s commercial department, said, “There are certain issues with collecting rent and we have been sending regular reminders to the defaulters.” However, activists have slammed MSRDC bureaucrats of being ignorant about loss of revenue of the already cash-strapped MSRDC which is exploring every possible avenue to generate finance for funding the Rs 30,000 crore Mumbai-Nagpur Expressway. “If the agency is not paying rent, their hoardings should be removed but there is no action taken by MSRDC. Instead, it is just sending them reminders to pay their dues and charging interest rather than taking action,” said activist Sanjay Shirodkar.

Meanwhile, an internal communication by MSRDC officials to MSRDC bureaucrats also revealed that in case of numerous defaulters, the comments on earlier remarks of contractors defaulting on rents were awaited by MSRDC bureaucrats.