ISLAMABAD: In a major legal development, the Islamabad High Court has upheld the Capital Development Authority decision to cancel the lease of the high profile One Constitution Avenue project, dealing a decisive blow to the developer after years of financial default and legal battles.

The verdict was announced by Chief Justice Sardar Mohammad Sarfraz Dogar on appeals filed by M s BNP Private Limited and residents of the building. The court had reserved its decision earlier this year in the long running dispute over the controversial Grand Hyatt project located in the Red Zone.

At the heart of the case lies a project that was originally approved as a five star hotel but was later converted into residential apartments and commercial units. The CDA argued that this deviation, coupled with massive unpaid dues, constituted a clear violation of lease terms and public interest obligations.

According to official records, the developer paid only a fraction of the total liability, leaving billions outstanding over more than two decades. The authority maintained that full payment was a precondition for ownership rights, and failure to meet this requirement justified termination of the lease.

The court also took into account previous legal rulings and admissions made by the developer, including its inability to continue payments due to economic constraints. Investigations by state agencies and ongoing accountability proceedings further strengthened the CDA position.

With the ruling, the land and structure now stand vested with the CDA, raising fresh uncertainty for investors and residents linked to the project. The decision is being seen as a watershed moment for urban governance, reinforcing regulatory authority and sending a strong signal on compliance in high value real estate developments.