The Sunday Leader

Scandal Behind Gymkhana Club Deal

by Nirmala Kannangara

The Chairman and the Treasurer of the country’s oldest club, the Gymkhana Club in Colombo, have come under severe criticism for their alleged involvement in a scandalous contract, with a property developer without obtaining the proper approvals.

Gymkhana Club Chairman Shammi Silva and its Treasurer Kapila Ranasinghe are accused of signing an agreement with a property developer to construct a building in the Gymkhana Club premises, leaving its club members and the land owner-Land Commissioner General in total darkness. Therefore, a group of club members is to file legal action against the duo for violating the club constitution, seeking to remove them from the positions they are presently holding in the club.

“According to the constitution, the members’ approval should be obtained before commencing any project of the club. The approval should be obtained at an Annual General Meeting (AGM) or at a Special General Meeting (SGM). Instead of doing so, Chairman Shammi Silva had got the approval from the members at an Executive Committee meeting and had signed the agreement in September,” reliable inside sources said.

The sources who wished to remain anonymous said that an urgent executive committee meeting was called for by the club Chairman on August 30 and that the discussions were held to obtain an opinion from club lawyers on the controversial agreement.

“The draft copies of the agreement were given to all the Executive Committee (Ex-co) members for their review and comments. This draft had been submitted by the club lawyers and later got the approval from the Ex-co members, which is against the constitution. When there are around 450 ordinary members and 200 life members, who are eligible to vote, how could the club Chairman get the approval only from Ex-co members which is less than 25,” the sources added.

According to the sources, this is not the first time Chairman Shammi Silva, who is also the Treasurer of Sri Lanka Cricket (SLC), is accused of breaking the rules of the lease agreement the club and the Land Commissioner’s Department that first signed on January 1, 1892. The sources further accused the Chairman for giving new memberships to his friends without following the enrolment procedure thereby going against the constitution.

It is learnt that Secretary Gymkhana Club Prashantha Wimalasena has got an injunction order in July 2015 to prevent the AGM from being held on July 29, 2015 since Silva was planning to contest for the Chairmanship for the seventh time with the help of the new members who are his friends.

“Over 250 honourary memberships had been given to unsuitable people bypassing the enrolment procedure. The honourary memberships have to be given to the erudite in society for the club to receive their special services. Instead, the Chairman has given this prestigious membership to those who engage in ethanol trade and illicit businesses,” the sources claimed.

Silva was also planning to get the members approval to go ahead with the proposed construction of a commercial/apartment complex in the club premises but could not do so as he was debarred from holding an AGM to get the members approval. Hence an SGM was called for in March 2016 to get the necessary approval. However, Silva’s dream to convey the SGM too was squashed by three club members, Nishantha Dias, Dushyantha Abeygunawardena, and Chtistie Marathasan by getting an injunction order (Case No: DSP/0031/2016) from the District Court Colombo preventing Silva from holding the SGM as well.

“On February 25 this year, Assistant Secretary Kithsiri de Silva sent a notice to all club members other than the junior/ playing/temporarily/honourary members who are not eligible to vote at any general meeting to be present at an SGM on Monday, March 14, at 6 pm at the club premises. However, the proposed SGM could not be held on March 14 because of the injunction order taken by Dias, Abeygunawardena, and Marathasan, which led Shammi Silva to hold an Ex co meeting, to get the approval for his planed commercial and apartment complex construction,” the sources added.

According to the sources, the agreement signed by the Gymkhana Club and the property developer says that a 24,000 sq. ft. building with a ground floor and two upper floors and a rooftop lounge is to be constructed for an office area to carry out the administrative service and an indoor cricket complex including two indoor cricket pitches and a dormitory to accommodate 20 players and two umpires, but the club members say that it is yet another tactic of Silva to get the necessary approvals.

“According to the contract, the Lessor (Gymkhana Club) has given the property developer to manage the property for 25 years from the date of implementation, which means up to year 2041 from this year. It is questionable as to how Silva can sign such an agreement when the lease period of the club premises expires in year 2021. A letter dated April 2, 2003 by the then Land Commissioner S. J. Pathirana to Chairman Gymkhana Club states that the land depicted in plan number 9959, lot number 6840, which is six acres, two roods and 10 perches in extent has been given on a 30-year lease from January 1, 1991.The first lease agreement for 99 years was signed on January 1, 1892. Despite this, Shammi Silva, without consulting the Land Commissioner’s Department, has signed an agreement with the developer for a 25-year period.,” the sources alleged.

It is learnt that the first lease agreement signed in 1892 states that the lessee (Gymkhana Club) will not use or suffer the said premise or any part thereof to be used for any other purpose, trade, business or profession or otherwise than as a cricket ground without the previous license in writing. “If this club has agreed to such an undertaking, how can this premises be used for commercial purposes,” sources alleged. The sources further said that the Land Commissioner’s Department and the Divisional Secretariat Thimbirigasyaya, Colombo 5 had been kept in the dark about the proposed construction although it is a must that approvals should be first obtained from the two government institutions before any agreement is signed for any construction to be carried out in the club premises.

“We do not own the land where the club operates but the Land Commissioner’s Department. It had been given to this club not for any commercial work but for recreation purposes. That is why we are charged a minimal annual fee which is half a per cent of the land valuation calculated in 1991. When we contacted the Land Commissioner (Legal) of the Land Commissioner’s Department to find out if the Gymkhana Club had informed the land owner about their plan, we were told that they have not received any request as such. It was the same with the Divisional Secretariat Colombo 5 as well. It has now come to light that the Club Chairman not only has violated the Club Constitution but also has failed to get the approval from the Land Commissioner’s Department and the Divisional Secretariat for the project he had already signed with the property developer,” the sources claimed.

The sources further said that Shammi Silva was involved in yet another construction in the club premises when he was holding the post of Deputy Chairman when Iqbal Hussain was the Chairman.

“In the guise of constructing a gymnasium, the first construction was carried out in early 2000. Although the approvals were obtained by submitting documents that the club was constructing a gymnasium and a sports complex with sports oriented facilities for its members, once the construct was finished, the space was given for commercial purposes without the approval of the club committee. A night club, a pub, saloon, bank and many other private ventures are now housed in this building. Although the agreement signed in September this year too says that the building will be used for club administrative work and the sports complex to accommodate 20 sportsmen and two umpires, neither the players nor umpires will be given accommodation. It will be a mere apartment complex for private residential purposes. This is the gimmick Shammi Silva is carrying out to get the necessary approvals,” the sources added.

According to the sources, a square foot of the first building by the Independence Avenue had been rented out between Rs.15 and 18. But the present market rate of a square foot is Rs. 185- 200. Although the financial statements show a low rental, it is alleged that the exact rentals are much higher and the difference goes to somebody’s pocket.

It is now learnt that an advance amounting to Rs.15 million had been obtained by the Gymkhana Club from the Developer on August 12 and had deposited the money to the club account – Sampath Bank Gregory’s Road branch. “The developer had issued two cheques – for Rs. 5 million by cheque number 152303 and Rs. 10 million by cheque number 335126 and deposited into the club bank account at Sampath Bank, Gregory’s Road Branch. The money collected is totally wrongful as the entire exercise of this commercial project violates lease agreement signed with the Land Commissioner’s Department. Also do not forget the land prices in the area ranging from Rs.10m – Rs15m a perch. Seventy six perches had been allocated for this construction and the value of the land is more than Rs.76 million but the lease drawn is for Rs.25 million. This is nothing but an exercise of misusing and misappropriation of state assets provided for development of sports and recreational activities,” sources said.

The sources further said that a telecommunication tower has been erected in the club premises and the Divisional Secretary Thimbirigasyaya has strongly warned the Chairman not to construct any building in the premises without getting the necessary approvals.

“In a letter dated February 25, 2016 the Divisional Secretary has reprimanded the Chairman. In this letter the Divisional Secretary had warned and ordered the Chairman, not to make any construction within the premises, without the proper permission. But Silva signed the agreement without the approvals from the Land Commissioner’separtment and the Divisional Secretary,” the sources added.

Meanwhile, Commissioner, Inland Revenue Investigation Branch Sujatha P. Ranasinghe had given permission to R. J. K. R. D. Ranathunge, Assistant Commissioner Investigation Unit, to carry out an investigation along with 12 other officials into the accounts of Gymkhana Club since it had failed to pay taxes amounting to millions of rupees over the years.

“Recently, all these officials from the Inland Revenue Department raided Gymkhana Club and took away its financial documents in six gunny bags for their investigation. This is a black mark to this once much respected club, which was started by the British only for them. It was only after the independence when the British left the country, the locals were allowed to take membership,” the sources claimed.

It is also learnt that Silva has got a private surveyor to survey the club land and got it sub divided for the commercial building project inside the premises without the approval of the land owner- the Land Commissioner.

When contacted Land Commissioner (Legal) R. B. Seneviratne to find out whether Gymkhana Club informed him about the survey carried out by a private party, Seneviratne said that his department was not informed. “This is a State land and the survey has to be carried out by the Survey General’s Department, not by any private individual.

Only the Survey’s Department can sub divide this land. Since we were not aware of it earlier, we have to inquire this from the club and initiate an investigation into the allegations leveled against them. If they have done so, we have to take stern action against the club,” Seneviratne said. Meanwhile, Divisional Secretary Thimbirigaasyaya Amal Edirisooriya said that Gymkhana Club has not taken any approvals for another construction. “If they have signed an agreement for a construction without our approvals, we along with the Land Commission can cancel the lease agreement. In such an event, they have to hand over the property back to the Land Commission because they have violated the rules and regulations,” Edirisooriya added.

It is also learnt that a group of club members had lodged a complaint with Minister Patali Champika Ranawaka recently to look into the matter. Since the land in question is not owned by the Urban Development Authority it had been referred to the Commissioner General Lands to take action against the club for signing an un lawful agreement with a property developer. Since Commissioner General Lands was overseas, all attempts taken to contact the acting Commissioner General to get a comment failed as she was not available in office.

Chairman Refutes Allegations

Refuting allegations, Club Chairman Shammi Silva said that it was during the tenure of President Shiran Anthony and Secretary Prashantha Wimalsena such a decision was taken to construct the building in question. He added that it is now being implemented.

“These are all baseless allegations. It was Prashantha Wimalasena, who gave you the story, got the membership approval for this project at an SGM when Shiran Anthony was the club President. They have misled you as this is not an apartment complex but a sports complex. At a location as such, there is no way we can get an apartment complex built as we don’t have a bigger land area to go for such a large construction. Why won’t you call the Urban Development Authority and see if we are going to construct an apartment complex within the premises,” Silva asked.

When asked whether it was Wimalasena and Anthony that signed the agreement with the Developer, Silva said that he is not ready to reveal any such details of his club to this newspaper. “This is a private club. Why should I give inside details to you? Since this matter is in courts I will not talk to you further,” Silva said and disconnected the line abruptly.

2 Comments for “Scandal Behind Gymkhana Club Deal”

  1. kudson

    crooked rats should be kicked out

  2. carl fernando

    I was one of the first Sri Lankan members to join this club on invitation to play Rugby way back in 1965 and did so till 1969, what a great club it was then and the office bearers were gentlemen. Now when one hears these stories I can only hang my head in sorrow at what has been done to such a wonderful club in the last years.

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