IHC seeks CDA response on appeals of One Constitution Avenue apartment sub-lessees
ISLAMABAD: The Islamabad High Court (IHC) on Monday issued notices to the Capital Development Authority (CDA) on intra-court appeals filed by 20 apartment sub-lessees of the multi-billion-rupee One Constitution Avenue project, seeking protection of their possession rights after the cancellation of the project’s lease.
The court sought the CDA’s response by tomorrow (Wednesday).
A division bench comprising Justice Muhammad Azam Khan and Justice Raja Inaam Ameen Minhas sought a response from the CDA while hearing appeals filed by apartment owners, including former Pakistan Cricket Board chairman Ehsan Mani and former air chief Mujahid Anwar Khan.
During the hearing, counsel for the appellants argued that paragraph 30 of the recent single-bench judgment adversely affected the rights of apartment owners even though their possession and occupation of the apartments had been recognised.
The court was informed that residential towers B and C were constructed in accordance with the approved layout plan, and that, after the lease was cancelled in 2023, the CDA had appointed its Director of Estates as the project’s administrator.
Counsel stated that a management committee comprising residents was also formed under the supervision of the CDA to run the day-to-day affairs of the residential towers and that the appellants had been residing there legally under the arrangement approved by the authority.
The petitioners requested the court to declare their sub-lease rights lawful and enforceable, restrain the CDA from interfering in their peaceful possession and declare paragraph 30 of the single bench verdict null and void.
During the proceedings, Justice Azam Khan observed that notices were being issued to the CDA and directed the authority to appear before the court on Wednesday.
“You also come prepared,” the judge told the counsel.
Advocate Ali Raza, representing the apartment owners, urged the court to grant interim protection to the residents. He informed the bench that a committee constituted by the prime minister was also examining the matter.
“The apartment owners have paid the money. Around 200 people living there have paid for these apartments and have rights,” the counsel argued, adding that there was apprehension that the residents could again face eviction attempts after Eid if no protective order was passed.
At one point, Justice Raja Inaam remarked, “You want to spend Eid there,” to which the counsel responded that the residents merely wanted protection of their homes and investments.
Earlier this month, IHC Chief Justice Sardar Muhammad Sarfraz Dogar issued a detailed judgment upholding the CDA’s cancellation of the lease of One Constitution Avenue, ruling that apartment buyers did not acquire independent ownership rights in the absence of a valid lease held by the developer.
The judgment dismissed petitions filed by M/s BNP (Pvt) Limited — the developer of the project — along with investors and other stakeholders challenging the termination of the lease by the CDA.
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.
However, the IHC held that BNP failed to comply with the financial obligations imposed under the apex court’s framework, including timely payment of instalments and furnishing acceptable bank guarantees.
The court ruled that the CDA had acted in accordance with the law and the Supreme Court’s directions while terminating the lease after giving sufficient notices and opportunity to cure the default.
Rejecting the claims of apartment buyers against the CDA, the single bench observed that any rights of the purchasers were contingent upon the validity of the developer’s lease and that they could seek legal remedies against the builder for recovery of their investment.
On May 1, the IHC upheld the CDA’s decision cancelling the lease of iconic skyscraper One Constitution Avenue owing to the multi-billion rupee default.
That same day, residents of One Constitution Avenue had begun vacating their apartments on a voluntary basis amid a large police presence. Residents were seen shifting their belongings on mini trucks as the building was under the control of the local administration and police. Police personnel were also seen roaming inside the building’s towers.
