Tender rules bar certain entities facing investigations that could impair project performance.
Hotelier Mushtaq Ahmad Chaya, who was summoned by the Enforcement Directorate in June in connection with its investigation into alleged irregularities in Gulmarg land transactions, is associated with Pahalgam Green Hotels, one of the three members of the consortium that emerged as the successful bidder for three Srinagar Development Authority (SDA) land parcels at Sangarmall, with a winning bid of Rs 421.75 crore. Chaya’s association with land-related controversies in Jammu and Kashmir predates the Sangarmall auction by at least five years. His name appeared in two separate sets of land records made public by the J&K administration in 2020, with one concerning two Srinagar properties regularised under the erstwhile Roshni Act and the other concerning an alleged physical encroachment of state land in Jammu, outside the Roshni scheme. The Sangarmall transaction is significant because the SDA’s tender contains eligibility provisions concerning bidders and consortium members who are the subject of pending criminal investigations by agencies including the Enforcement Directorate.
The Sangarmall Composite Mixed-Use PPP Development was floated through RFP No. 05 of 2026-2027, issued on 3 August 2026 by the Srinagar Development Authority, covering three government land parcels at Sangarmall with an aggregate area of approximately 45.70 kanal (1 Kanal is equal to 505.8 square metres), comprising a 32-kanal hotel and mall site, a 6.50-kanal mu l tip lex sit eanda 7.20-kanal high-street and service-apartment site. The project is structured as a 99-year Build-Own Operate-Transfer ar – rangement, under which the land remains in the ownership of the SDA throughout, while the selected bidder receives leasehold rights to develop the properties during the concession period, after which the sites and structures revert to the authority. The aggregate reserve price was fixed at Rs 125 crore, with the RFP providing for a single composite bid covering all three sites, followed by a Forward Auction through the J&K government’s eprocurement portal. Parmesh Construction Company Ltd emerged as the successful bidder at Rs 421.75 crore, with the consortium comprising Parmesh Construction Company Ltd, Pahalgam Green Hotels and Bhutani Infra Ltd.
Chaya’s connection to Pahalgam Green Hotels is longstanding, with corporate records showing that he has been a director of Green Hotels (Pehalgam) Private Limited since 8 February 1988. The company is associated with the Pahalgam Green Hotels entity that formed part of the successful consortium. The tender requires the bidder to identify its consortium members and contains a Negative List provision covering the bidder and each consortium member, with one of the exclusions applying to an entity that is the subject of a pending criminal investigation by the CBI, Enforcement Directorate, Serious Fraud Investigation Office or an equivalent body where the matter could materially impair the bidder’s ability to perform the project documents. The provision does not mean that every person summoned by the ED is automatically disqualified, as it contains an additional requirement concerning whether the investigation could materially impair the bidder’s ability to perform the project, while the tender also requires the SDA to verify the bidder and each consortium member against the applicable eligibility and Negative List provisions through prescribed declarations and supporting documents. It is against this eligibility framework that Chaya’s earlier land history becomes relevant.
In November 2020, following the Jammu and Kashmir High Court’s judgment declaring the Roshni Act unconstitutional and void ab initio, the J&K administration published lists identifying beneficiaries under the legislation. The Roshni controversy centred on the Jammu and Kashmir State Land (Vesting of Ownership to the Occupants) Act, 2001, under which ownership of state land was transferred to occupants against payment, with the scheme originally intended to generate revenue for power projects. Allegations later emerged that government land had been transferred at undervalued rates and that rules governing eligibility and valuation had been manipulated to benefit influential individuals. In October 2020, the Jammu and Kashmir High Court declared the legislation unconstitutional and void ab initio and directed a CBI investigation into alleged irregularities in its implementation, while also directing the administration to make public details of beneficiaries, land valuations and amounts paid. Chaya’s name appeared in those records in relation to two Srinagar properties. The first was 5 kanals and 8 marlas (1 marla is equal to 25.29 square meters) on Maulana Azad Road, where the administration’s records put the assessed value at approximately Rs 4.30 crore, while Chaya was reported to have paid approximately Rs 97.20 lakh, with a reported difference of around Rs 3.35 crore between the assessed value and amount paid.
The second was 4 kanals and 16 marlas at Gogji Bagh, where the reported assessed value was approximately Rs 1.93 crore and Chaya was reported to have paid Rs 66.52 lakh, with a reported difference of approximately Rs 1.27 crore. The two properties covered a combined 10 kanals and 4 marlas, while the reported payments totalled approximately Rs 1.64 crore against assessed values of about Rs 6.23 crore. Chaya’s appearance in the beneficiary list establishes that he was identified as a beneficiary of the Roshni process in relation to the two properties, but it does not by itself establish that he committed a criminal offence or was found guilty of wrongdoing. A separate land allegation involving Chaya emerged at approximately the same time, when the Jammu divisional administration in November 2020 published a list of “Encroached State land”, covering land that was physically encroached but not shown as such in revenue records, separately from Roshni land. Chaya was included in that list in relation to 1.5 kanal of state land in Sunjwan, Jammu, with the administrative listing describing the land as physically encroached but not reflected as such in the revenue record. The allegation was separate from the Roshni Act transactions and concerned alleged physical occupation of state land outside the Roshni scheme.
In June, the Enforcement Directorate summoned Chaya along with eight other prominent Gulmarg hoteliers in connection with its investigation into alleged irregularities in Gulmarg land transactions, with the summons issued under Sections 50(2) and 50(3) of the Prevention of Money Laundering Act. The agency reportedly sought bank- account details, information on movable and immovable assets, revenue records, lease deeds, income-tax returns for five years and documents relating to applications filed under the erstwhile Roshni Act. The reported underlying investigation traces back to FIR No. 08/2009 of the then Vigilance Organisation Kashmir, now the Anti-Corruption Bureau, with reports linking that case to alleged irregularities in the vesting of government land in Gulmarg under the Roshni Act, while the reported charge sheets concerned approximately 35 kanals and 6 marlas of land. The ED is examining whether alleged illegal land transactions generated financial gains that could constitute proceeds of crime under the PMLA. The available material establishes that Chaya was summoned by the ED, but does not establish that the agency has charged him with money laundering or made a finding that he generated proceeds of crime. Reports said Chaya did not personally appear on the scheduled date but provided the documents the agency sought, while the ED investigation does not concern the Sangarmall transaction itself.
Questions sent to Mushtaq Ahmad Chaya seeking his response did not elicit a response by the time the story went to press. What makes the Sangarmall development significant is the timing and the tender’s eligibility framework, with the tender issued in August only weeks after Chaya had been summoned by the ED in the Gulmarg land investigation. The tender required the consortium to identify its members and submit a Joint Bidding Agreement, Statement of Legal Capacity, Anti-Collusion Affidavit and other prescribed documents, while the SDA was required to verify the bidder and each consortium member against the applicable eligibility and Negative List provisions before allowing the bidder to proceed through the technical qualification process. The issue is not whether an ED summons automatically barred Chaya from participating in the auction, as nothing in the tender provides for automatic disqualification merely because an individual associated with a consortium member has been summoned by the ED. The question is whether Pahalgam Green Hotels was formally a consortium member of the successful bid, whether the ED investigation involving Chaya had any bearing on the company’s eligibility under the Negative List provision, and what verification the SDA carried out before declaring the consortium technically qualified.
