The CPI-M led LDF government in Kerala today decided to handover the custodial right of the Kovalam Halycon palace and adjoining 4.21 acres of land to the RP Group of companies.
A decision in this regard was taken at a cabinet meeting chaired by Chief Minister Pinarayi Vijayan here.
The decision was taken based on the Kerala high court order and legal advice on the matter, an official release said.
CPI-M veteran and Chairman of State Administrative Reforms Committee Chairman V S Achuthanandan termed the government decision as "unfortunate."
Achuthanandan was at the forefront of an agitation to retain the Kovalam palace under government ownership itself.
"Though the palace was handed over with ownership right resting with the government, there is possibility that ownership would reach the private party in the future," the former chief minister said.
The government should have filed a civil case against handing over of the palace to a private venture. The advocate general also had given such an advice, he said. "I had pointed out this earlier itself," Achuthanandan said, adding "It is still my stand."
The government should examine whether it can file a civil case to retain the palace under its ownership itself, Achuthanandan said.
The resort was a part of the Ashoka Hotel run by ITDC. Following its disinvestment in 2002, the private GalfFar group took and later sold it to Leela ventures Ltd and it was purchased by the RP Group.
However, the state government enacted the Kovalam Palace (Takeover by Resumption) Act 2005 to take over the palace considering the appeal of the Travancore Royal family to retain the palace and adjoining land as heritage site.
The palace was built by a member of the erstwhile Royal family of Travancore in the 1930s.
But it was challenged and the Kerala high court struck down the act and the Supreme Court also dismissed a special leave petition challenging the court order filed by the state government.
"The RP Group has filed a contempt petition against not handing over the assets and it was under this circumstance, the government decided to handover the palace and land to the group," the release said.
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