CBK 'perplexed' by turn out of events
19th November 2008
Mr. Lasantha Wickramathunga
Editor in Chief
The Sunday Leader
24, Katukurunduwatte Road,
Dear Mr. Editor,
Sumal: Laughing all the way to the bank
I have read with interest the article arried
in The Sunday Leader of 16th November, under
the heading "Sumal laughing all the way to
While congratulating your newspaper on its
attempts to undertake investigative
journalism with impartiality, I wish to add
some facts with regard to this matter which
may not have come to your notice.
The said article speaks of the environmental
damage caused by the filling of the land
leased to APGC Ltd. for a BOI project,
specifying the damage caused to the fauna
and flora living in the area.
In addition to this, a serious consequence
of filling the said land could be the
flooding of residential areas in Colombo, as
they would be denied the areas reserved for
water retention during the monsoon rains.
In fact, soon after my government came in to
power in August 1994, I informed the Cabinet
of Ministers that the indiscriminate
allocation and sale of retention land during
the previous government, had caused much
damage to the environment and that our
government should not permit construction on
any of the remaining retention land.
When the BOI received an application for an
investment to create a golf course on part
of this retention area, I gave instructions
- in my capacity as the minister then in
charge of the BOI, that the application
should be studied in detail by all relevant
authorities, including the Central
Environment Authority and allowed only if
the retention capacity of the said land was
not harmed in any way. Hence the relevant
authorities agreed to the project on the
basis that no buildings would be constructed
on the land and that it would only be
grassed for a golf course. As such, it would
retain its retention capacity
It transpires that the original shareholders
decided to sell their company - Asia-Pacific
Golf Courses Ltd. in a legally acceptable
transaction, to a different group of
shareholders led by the said Mr. Sumal
Perera (after the change of government in
2001). As Head of State I did not have any
involvement with the private transactions of
companies. Although I may have had a few
friends or acquaintances who happened to be
shareholders or directors of private
companies, as a matter of strict principle,
I never interfered nor even kept myself
informed of the transactions of such
companies. Hence, I was totally unaware that
the above said sale of the company had
occurred, for some time.
Yet when this came to my notice, I presented
a Cabinet Paper to the Government of Mr.
Ranil Wickremesinghe, requesting an inquiry
and a report on the status quo of the APGC
Ltd.(see Cabinet Paper dated 03rd July
2002). Finally a report was made to Cabinet
after several reminders from me, stating
that the project was progressing well and
nothing irregular had happened.
Despite the above report, I was informed
that land filling was taking place on the
said land, but information requested by me
from relevant ministries were not given to
me. This was at a time when a sharply
conflictual relationship was maintained with
me - the President - by the UNP government.
At the first opportunity I had of directing
the affairs of government, after the PA was
returned to power in April 2004, I ordered a
full inquiry into the matter. I presented a
second Cabinet Paper, proposing the complete
termination of the project as it had
violated some of the major conditions of the
BOI agreement i.e. the environmental ones
(Cabinet Paper dated 28th July 2004).
Approval was obtained and the ministers in
charge of the BOI and the UDA were
instructed to take action and take back
possession of the land.
I held several discussions with the minister
in charge of the UDA to ensure
implementation of the Cabinet decision.
After some months the relevant minister
informed me that his ministry consulted the
AG, whose written opinion was that there
could be serious implications to reacquiring
the land. Nevertheless, I instructed the
minister to consult senior lawyers and find
a solution to this.
I could not ensure the implementation of the
Cabinet decision, as I had to leave office,
one year before the due date, in consequence
to a surprise Supreme Court judgment.
All the above actions were undertaken by me,
in keeping with my government's New Vision
For A Better Sri Lanka, which included the
protection of the environment, as one of its
Up to this date I have met Mr. Sumal Perera
only at a wedding reception and once before
at an official event of the Bank of Ceylon.
During my tenure of office as Minister of
Finance and Planning the BOI has awarded
land (as was the usual practice from its
inception under the Jayewardene presidency),
to over a thousand BOI projects.
I took great pains to ensure that land
allocation for BOI projects, as well as for
others, be carried out as transparently as
A high level Presidential Task Force was set
up within a month of my assuming the
presidency to recommend regulations, systems
and procedures in order to regularise and
render transparent all allocation of state
land by ministries and government agencies.
A landmark presidential circular was sent in
1995 to all ministries and government
institutions based on the recommendations of
the above Task Force. Allocation /
alienation of all state land was carried out
in accordance with conditions set out in
Similarly land allocated to all BOI projects
- including to the Asia-Pacific Golf Courses
Ltd. were in adherence to the said
The two Cabinet Memos mentioned above,
together with dozens of relevant BOI, UDA
and CEA documentation were presented to the
Supreme Court together with my Affidavit and
I am greatly perplexed as I remain totally
unaware of the consideration that has been
accorded to these documented facts placed by
me before the Supreme Court.
Chandrika Bandaranaike Kumaratunga
Chronology of events
1984 - Decision by then Minister of Lands
Gamini Dissanayake to acquire a large tract
of land in Kalapaluwawa, Rajagiriya under
the Land Acquisition Act for the public
purpose of urban development and for
increasing the Parliamentary Administrative
Complex and for providing water retention as
a low lying area.
October 14, 1988 - Declaration by Gazette
notification to notify owners of land,
following which compensation of Rs.312 per
perch paid and Vesting Certificate issued
granting land to the Urban Development
April 7, 1997 - Managing Director of Asia
Pacific Golf Course Ltd. (APGC) Shantha
Wijesinghe submits proposal to Board of
Investment to establish 18 hole golf course
on 150 perches of aforesaid land. (This land
according to the SC judgment was recommended
to Asia Pacific by the UDA in response to
the APGC's original inquiry letter.
June 5, 1997 - BOI grants approval for
project with effect from May 14, 1997
February 9, 1998 - Former President
Chandrika Kumaratunga in her capacity as
Minister of Finance and Planning submits
Cabinet Memorandum titled release of land on
concessionary terms - Asia Pacific Golf
Courses Ltd, strongly recommending the
project and its promoters and participants.
March 4, 1998 - Cabinet approval granted
without query, clarification or amendment.
March 4, 1998 - UDA board approval allowing
sale of constructed villas and apartments by
the UDA to willing buyers.
April 27, 1998 - Director General, BOI sends
letter to UDA to enter into a lease
agreement with APGC as per Cabinet
February 19, 2000 - Cabinet Memo by Indika
Gunawardena then Minister of Urban
Development to allocate another 7.8 hectares
(approx. 190 perches) to the Kaduwela
Pradeshiya Sabha (KPC) for developing a
March 23, 2000 - Cabinet approval granted
and land filled with public funds by the KPC.
May 3, 2000 - Letter allowing License
Indenture to APGC free of charge of 41 acres
of low lying land in addition to the 140
acres already leased.
May 30, 2000 - Board of management of UDA
approves this move.
September 4, 2000 - Indenture of Lease
758/760 between UDA And APGC for 140 perches
of land for a term of 99 years at a per
annum rental amount of Rs. 300 million.
September 4, 2000 - Indenture 759/767
licensing to APGC 41 acres of land
contiguous to already leased land free of
Undated UDA Board Paper - To license to APGC
free of charge a further 44 acres in front
of leased land. To amend license for earlier
41 acres to survive for 99 years and to
narrow rights of the UDA to revoke. To
reallocate to APGC Ltd. free of charge the
7.8 hectares of land given to KPC and for
which the KPC had already spent a large
amount of public funds to fill. To allow
APGC to build 100 luxury holiday villas on
stilts on the marsh areas. To remove
restrictions prohibiting sale of the
acquired land to third parties and permit
APGC to sell the aforementioned holiday
villas on a free hold basis.
January 18, 2001 - Mangala Samaraweera,
Minister of Urban Development sought
approval for the above changes.
January 31, 2001 - Cabinet approval granted.
June 21, 2001 - BOI and APGC enter into
August 9, 2001 - Deed of Rectification 821
to effect Cabinet approved changes.
August 9, 2001 - Agreement 822 license to
release further 44 acres as per Cabinet
September 18, 2001 - Cabinet approves sale
price of land to be sold to APGC to be
determined as a pro rata share of the CV's
January 22, 2002 - Sumal Perera's Access
Holdings Pvt. Ltd. became beneficial owner
of 50 percent of APGC shares.
June 19, 2002 - Ravi Karunanayake, then
Minister of Trade submits Cabinet Memorandum
to cancel allocation of land to APGC.
Seven days later - Withdrawn without reason.
November 28, 2002 - Minister of Urban
Development issues approval (SC Judgment
states the UDA was never intended by law to
be a land sales agent or empowered to
acquiesce indirectly or actively in land
January 8, 2003 - UDA Board Paper (altering
March 4, 1998 UDA approval) allowing for
sale of land directly to APGC and to do so
though no villas had yet been built.
March 3, 2003 - Agreement to sell Deed No.
473 executed effecting transfer of said land
for approximately Rs. 62 million. (As per
Deed no 473 the joint vendors UDA and APGC
owned by Sumal were given a time period up
until February 2008 for release and transfer
of the said luxury villa blocks..)
For instance even as recently as 2007
transfers were still being made. And that
under this government underscoring the all
governments had willingly carried the baby.
June 17, 2003 - Access Holdings acquires 100
% ownership in APGC.
December 24, 2003 - Sri Lanka Land
Reclamation and Development Corporation (SLLRDC)
grants approval of revised master plan to
construct villas and use marsh land
designated for flood retention and
demarcated as wetlands.
March 7, 2007 - A Deed of Release No 6 was
executed for Lot 12 of the 205 blocks of
land signed by the UDA
March 7, 2007 - Deed of transfer to a public
buyer signed by joint vendors the UDA and
APGC pertaining to Lot 12
October 8, 2008 - Supreme Court holds entire
deal illegal and orders entire transaction
null and void and orders total land extent
to revert back to UDA.
November 10, 2008 - Urban Development
Authority submits to the Supreme Court the
Deed of Revocation of ownership of 224 acres
of land to the state.