Surat Textile Market Faces Potential Lease Cancellation Over Unpaid Dues

Even after receiving 13 notices from the Surat Municipal Corporation (SMC), the STM management has still not paid the outstanding lease amount of ₹81 crore

By TBT Web Desk On Jun 24, 2024

Surat Textile Market Faces Potential Lease Cancellation Over Unpaid Dues — Surat Textile Market located at Ring Road in Surat

Surat : The Surat Textile Market (STM), which has been a prominent hub for textiles in Surat for many years, is facing the possibility of losing its lease because of substantial unpaid dues. Even after receiving 13 notices from the Surat Municipal Corporation (SMC), the STM management has still not paid the outstanding lease amount of ₹81 crore.

The lease agreement for STM expired in 2018, and the SMC decided to renew it for a 100-year term at a total cost of ₹127 crore. Unfortunately, the market has failed to meet its financial obligations under this renewed agreement.

According to official sources, if STM does not settle the remaining dues, the SMC has the option to terminate the lease agreement. The textile traders operating within STM are facing a dire situation, with many of them experiencing financial difficulties or choosing to disregard the SMC’s ultimatum.

According to the lease agreement, market traders are given a lease for 100 years once they have paid ₹15 lakh over a period of ten years. This amounts to ₹1.50 lakh per year or ₹12,050 per month. Traders are only required to pay ₹1,250 per month for the lease over the course of 100 years. In spite of these apparently advantageous conditions, the market management has failed to fulfill their payment obligations.

The SMC has been consistently sending notices to the STM management, however, there has been a lack of significant action taken to recover the ₹81 crore that is owed. Some critics claim that the SMC’s approach has been ineffective, comparing it to a “notice-notice game” instead of taking decisive actions to ensure payment.

“The money is not exchanged through the market system, and the SMC appears content with solely sending notices.” An official source stated that if the dues are not paid on time, the lease will be cancelled. Nevertheless, the ongoing failure of the market management to make payments raises significant concerns regarding the implementation of the SMC’s policies.