“Reconsider proposal”

"It is unfortunate that a decision, which has far reaching implications on the members of our community, has been taken, to say the least arbitrarily, without granting us an opportunity of personally explaining the financial, the factual and the legal position and without waiting for us to forward to you the balance of the documents as requested by you.

"It is requested that the present proposal be considered with an open mind and not in the backdrop of the sordid saga of rejection by the Charity Commissioner of BPP’s (Bombay Parsi Punchayet) proposal of outright sale of the Hospital to Rajesh Builders (Bombay) and/or Indira Investments Private Limited, for the consideration and upon the terms and conditions as contained in the respective purchaser’s letters dated February 16, 1987 and February 24, 1987.”

The letter dated October 17, 2011 signed by Maneck Engineer, honorary secretary of The Parsi Lying-In Hospital (PLIH) on behalf of the institute’s Managing Committee was addressed to the trustees of the BPP.

Ten days earlier on October 7, 2011 BPP chief executive officer Mehli Colah in a letter addressed to the chairman of the Hospital’s Managing Committee Minoo Shroff, had stated: "The proposal of the members of the Managing Committee to lease the land and structure of the Parsi Lying-In Hospital belonging to the trustees of the Bombay Parsi Punchayet to Krimson Health Ventures Private Limited for 33 years, at a minimum lease rent of Rs 1 crore per annum, payable after a rent free period of 42 months and thereafter when revenue reaches Rs 75 crores @ 5 percent thereof was discussed by the Board of trustees of the BPP and the Hospital, and I have been asked to inform you that the said proposal is unanimously not acceptable to the trustees as being not in the interest of the Parsi community.

"You are hereby requested to forthwith cancel/revoke the executed agreement for the proposed lease and refund the money taken by you as a deposit. A property worth well over Rs 100 crores being alienated without any public advertisement and without calling for highest bid is highly suspect. Besides when the wife of the leading proponent of your proposal, Mr Yezdi Bhagwagar, one of your Managing Committee members and the wife of the purchaser, Dr Prakash Khubchandani are partners in various ventures then suspicions are further heightened.

"The trustees of the Bombay Parsi Punchayet who are the only trustees of the Parsi Lying-In Hospital are against alienation of any valuable asset of the community and instead are desirous and propose to develop the said property themselves for medical use for the larger benefit of members of the Parsi Irani Zoroastrian community with the cooperation of the Managing Committee members.”

Sentiments expressed in the BPP letter came as a surprise to the PLIH Committee as in a letter dated September 29, 2011 the BPP had reportedly stated "on receipt of the documents we shall inform you of the date and time (of a meeting) after taking the Board’s sanction.”

Engineer’s letter noted, "We also cannot comprehend the sudden change in your approach… You are aware that we have provided you with all the documents and information as requested by you from time to time… the land is reserved for Hospital use and the structure is included in the heritage list. It is therefore not permissible to build more than 24 meters i.e. seven floors. One cannot compare the value of the Hospital with a full fledged commercial property.”

Engineer pointed out the PLIH committee "were advised by our advocates, M/s Mulla, Mulla, Cragie, Blunt and Caroe that we do not require your permission for entering into the transaction as set out in the said agreement… however, for good order, the said agreement… provides its effective date to be inter alia the receipt of authorization/ratification from the honorable trustees of BPP...

"Your allegation in regard to the alienation being without any public advertisement and without calling for highest bid seems to be out of place as the present transaction is not of an outright sale but one of setting up and operating a specialty Hospital. It is significant that in the identical case of the proposed development of extra FSI (floor space index) of Parsee General Hospital, where the property seems to belong to your Trust, private closed door negotiations are being conducted by the Managing Committee of the said hospital and no such public advertisement as stated in your letter has been published. It is further significant that the same group to which Krimson belongs, has been shortlisted by the said Parsee General Hospital…

"A proposal to invite Breach Candy Hospital was also considered, but our Dr R. P. Soonawalla (who is closely connected with Breach Candy Hospital) said that the Breach Candy Hospital was considering acquisition of property for housing the nursing staff and not for setting up another hospital. Housing the nursing staff in the Parsi Lying-In Hospital was considered neither prudent nor in the interest of our community.”

As regards the allegations of conflict of interest, Engineer pointed out the transaction "has been absolutely transparent.” BPP trustee Muncherji Cama is a member of the PLIH Committee and is party to the Hospital’s agreement with Krimson. Shroff is a former chairman of the BPP.

Engineer urged the BPP Board to not let "the differences between your Mr Dinshaw Mehta and our Mr Yezdi Bhagwagar come in the way of its implementation. The proposal, as envisaged in the said Agreement, is too vital to our community and to the future of our Hospital and cannot be vitiated by the alleged relationship between two housewives.”

Mehta has had a long time feud with Bhagwagar which has its genesis in the development of the Shahnazeen ownership building at Khareghat Colony by architect Noshir Talati. Mehta alleges that the promoters owe the BPP monies that are not forthcoming. Bhagwagar is one of the residents of Shahnazeen as is BPP trustee Khojeste Mistree.

The BPP trustees are also sore with the PLIH Committee because they reportedly refused to accept Mehta or Mistree on their Committee and instead nominated former BPP trustee Noshir Dadrawala who was at loggerheads with both Mehta and Mistree as well as Cama who at that time was perceived as being part of the opposition.

Listing the benefits to the community from the deal, Engineer noted, "leading surgeons and many others would be sitting in the Parsi Lying-In Hospital itself and are obliged to treat 10 percent of in-patients and 10 percent of the outpatients (OPD) from the members of our community, free of cost. Considering an average stay of four to eight days, one could estimate the number of free surgeries at approximately 500 to 900 per year. Hip replacements, knee replacements, spinal surgeries, etc, are the burning requirements of our ageing community. The other chronic ailments of arthritis, osteoporosis, etc can be effectively dealt with within the 10 percent OPD quota. Needless to add the foregoing facilities would be housed in a state-of-the-art Hospital, the monetary and the non-monetary benefits of which cannot be expressed in writing.

"You are also aware that the Hospital land is a leasehold land, the lessor being the State Government and in spite of the fact that the lease has expired way back in 1992, no serious attempt has been made to renew the said lease. You will appreciate that Krimson will be required to: pay to us five percent of the gross revenue which at Rs 75 crores, works out to Rs 3.75 crores per annum; pay to the Collector 50 percent of the above as unearned income working out to Rs 1.875 crores annually; pay to the Collector lease rent estimated at one percent of Ready Reckoner value i.e. Rs 3 crores per annum; pay service tax on lease rent payable to us; pay to the Municipal Corporation the property tax; assist in renewal of the lease; pay re-development fee to the Collector at 10 percent of the Ready Reckoner value i.e. Rs 3 crores; pay to the Corporation/Government FSI premium of Rs 8 crores; bear the construction cost of the Hospital and the equipment estimated at Rs 100 crores; transfer the asset after the lease period…

"It is our earnest desire that the said Agreement be implemented so as to restore our decayed institution to its pristine glory and also to metamorphose this old and crumbling structure into a vibrant hospital. We once again request you, in the interest and for the benefit, of our community, to at least allow us the opportunity of personally presenting to you our proposal.”

Disclosure: One of the tenants of the PLIH is the mother of the person who runs Parsiana.