Tongaat mall owner got tax breaks

2013-12-01 14:00

The eThekwini Municipality gave the property company belonging to Tongaat death mall owner Jay Singh a rates exemption on his low-cost housing empire, part of which he illegally sold on for millions, without paying tax.

The startling claims against Singh, whose operations are now the subject of investigations by the South African Police Service, the Department of Labour and the National Home Builders Registration Council, are contained in court documents that are part of three applications against Singh-owned companies, his partners and government, by residents of the Phoenix housing projects.

The residents, represented by the Phoenix Residents and Tenants Association, want the Durban High Court to stop Singh and his partners from evicting them.

They also want the city to review the sale of the projects to Singh, who they claim illegally rented them properties which the city had originally intended for rent-to-own, and his subsequent sale of their homes to First Metro Housing Company.

On Friday, the court adjourned the applications until January 5 for the city, Singh and other parties to provide it with documents to enable it to assess whether both the sale and the rental scheme were legal.

The documents include crucial council resolutions around the creation of the rent-to-buy housing projects under its Enhanced Extended Discount Benefit Scheme to give ownership to working class families.

A separate contempt of court application against Singh’s security company, Bambelela Surveillance and Protection Services CC, was adjourned until Monday after residents brought an application against the company for violating an order preventing its officers from assaulting and harassing residents.

In their papers, residents claimed that the city had planned to allow them to purchase the houses. But they discovered that Singh’s Wood-

glaze Trading had purchased the units, developed by Singh, and was acting as their landlord.

This, they said, was illegal, as legislation only allowed him to act as a social housing agent in conjunction with council if he was running a Section 21 (not for profit) company.

None of his companies had this status and Woodglaze, they said, had already made more than R250 million from renting them the properties.

Council regulations, the residents said, stipulated that the houses had to be sold either to them or to the municipality, and could not be sold on to a third party for profit for at least eight years. This had been violated by Singh’s sale to First Metro Housing Company last

December in a deal for which SARS certificates show no VAT was charged.

City rates certificates, secured by the residents’ lawyers in terms of Promotion of Access to Information Act applications against the municipality starting in 2010, show that the former head of housing, Coughlan Pather, who was nailed by the Manase Report into city tender corruption, signed a rates exemption for the housing projects.

This allowed Singh’s companies to collect rents without paying for city services.

They also claimed in papers that Pather – who served on First Metro Housing’s board from 2003 to 2005 – had allowed Singh to build the projects without plans.

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