Defence ministry tells Mumbai collector to register property only after its approval.
The Rs 750-crore (Rs 7.5 billion) purchase of the iconic Lincoln House by Pune-based industrialist Cyrus Poonawalla has hit a hurdle.
The defence ministry, in its capacity as lessor, has informed the Mumbai district collector that it is yet to receive a formal communication from the US government on the sale of Lincoln House to the billionaire chairman of vaccine manufacturer Serum Institute.
The two-acre property at Breach Candy in south Mumbai housed the US consulate until 2011. The consulate moved from Lincoln House to the Bandra-Kurla Complex that year.
The defence ministry has asked the Mumbai district collector to issue the necessary instructions to the departments concerned on registration of the deal till further orders. Poonawalla was not available for comment.
Acting on the ministry's instruction, the collector has asked the deputy registrar of the stamps and registration department not to register the Lincoln House deal and the mutation department not to issue a certificate until further orders.
A senior official from the Mumbai district collectorate who did not want to be named told Business Standard, "The ministry said it came to know about the sale of Lincoln House to Poonawalla through the media. There has not been any formal information. The ministry directed the district collector to take necessary action."
Another official said the stamp duty payable amounted to Rs 37.5 crore (Rs 375 million).
Lincoln House, formerly known as Wankaner House, used to be a palace owned by the Maharaja of Wankaner in Gujarat.
It was leased to the US in 1957 and was subsequently renamed Lincoln House.
The official referred to the provisions in the lease agreement whereby Lincoln House could be used only as an office/diplomatic/consular establishment by the US consulate general or for the US government's use.
Besides, the premises should not be used as a "shop or factory" or for "any trade that might be a nuisance to the owners or occupiers of other premises in the vicinity".
This apart, there was another provision in the lease agreement whereby the lessor should be informed within 20 days in the event of the property was not used as a consulate by the US government.
