The Hon. (Dr.) Susil Ranasinghe - Deputy Minister of Land and Irrigation

¶ 01 Hon. Speaker, I will summarize the lengthy answer.

¶ 02 Hon. Member, you refer to leasing 1,000 acres at Dehiattakandiya in Mahaweli “C” Zone to Informatics Agrotech (Pvt.) Ltd., and the subsequent lease revision. In 1991, the Mahaweli Authority leased 1,000 acres for 30 years: initially 640 acres, with the balance 360 acres in stages, for teak and cashew cultivation. Upon expiry of the 30-year term, normally, under the State Lands Ordinance, a renewal requires a fresh valuation and rent set accordingly.

¶ 03 However, at second lease, instead of a fresh valuation-based rent, a revision was applied per the Commissioner General of Lands Circulars 2017/1 and dated 2017.07.04: adding 20% to the last year’s rent of the first term to set the initial rent of the second term. Cabinet approved, via a Cabinet Memorandum dated 08.09.2021, granting a further 30-year lease from 01.01.2021, per the Cabinet decision of 27.09.2021.

¶ 04 Your question is whether such concession can be given, the basis, and whether it can be revised. The State Lands Ordinance does not provide for this method; it has been done via circulars. We are examining whether, within the legal framework, this can be revisited, including suspension or amendment of the circulars.

¶ 05 I table the detailed answer.

¶ 06 Answer tabled.

¶ 07 (a) (i) Yes. The 1,000 acres were leased in 1991 for 30 years to Informatics Agrotech (Pvt.) Ltd. Upon expiry, Cabinet, by decision of 27.09.2021 on Cabinet Paper No. 21/1701/317/043 (submitted 08.09.2021 by Irrigation), approved re-leasing from 01.01.2021 for a further 30 years. (Annex 01 tabled.)

¶ 08 (ii) Cabinet also approved, in line with Lands Circular 2017/01, computing the initial rent of the second term as the last year’s rent of the first term plus 20%.

¶ 09 (b) (i) It is possible. (ii) Under the State Lands Ordinance, on expiry, a fresh rent should be set based on a new valuation. However, per Lands Circular 2017/01 (and a parallel Mahaweli Authority circular 2017/01), for renewals after a 30-year term to the same lessee, the initial rent of the second term may be computed as last-year rent plus 20%. (iii) Since the State Lands Ordinance sets out rent principles, amending or rescinding Lands Circulars 2017/01 and 2017.07.04, and the Mahaweli Authority circulars 2016/2 of 01.11.2016 and 2017/1 of 05.05.2017 on “granting rent concessions in disposal of state lands in Mahaweli areas,” would allow revision.

¶ 10 (c) Not applicable.