Zaki's MVR 544 million compensation claim for Kuredhifushi fails

Civil Court has ruled that the government should not compensate for not handing over the island of Kuredhifushi for tourism development as agreed, in return for establishing water and sewerage services in Omadhoo and Kinbidhoo islands in Thaa atoll.

The case was filed against the tourism ministry by former MPL chairman Mohammad Zaki. He requested the court:

In the court, Zaki pointed out that the proposal to develop a 100-bed resort in Kuredhifushi was made in return for providing sewerage facilities to two islands under CSR. He said the government agreed to this, sent a letter and signed an agreement to lease the island, but the island was not handed over.

In response, the state said it had agreed to give the island but could not do so as Zaki had not yet paid the due 20% of the lease acquisition cost for the island. 

Initially, the development of a resort in Kuredhifushi was agreed to be done through a CSR agreement, but the government of President Abdulla Yameen Abdul Gayoom changed the CSR portion to acquisition fee.

After converting it to acquisition fee, the government tried to go ahead with the lease of islands by creating a JV owned by the government with 5% stake in the state as part of its policy of leasing out islands without bidding.

Timeline of the Kuredhifushi case:

While three governments have dealt with in this case, the incumbent government said the Attorney General's Office has recommended that there is no legal provision that makes it mandatory for the government to lease out the islands without paying the 20 percent of the acquisition cost. 

Judge Fayyaz Shatir in his ruling on Wednesday said that the initial agreement was that the JV company would build and lease out the island once the work required under CSR was initiated.

The judge pointed out that while it was clear that Zaki's responsibilities arose with the signing of the agreement, it was not clear that it had been fulfilled: