2013/11/20 durban .Mr Jay Sighn the developer of the mall that collapsed in Tongaat . PICTURE : SIYANDA MAYEZA

Pietermaritzburg - Hundreds of low-income flats preserved by the State must be returned to Pietermaritzburg property developer Jay Singh, a court ruled on Friday.

The Pietermaritzburg High Court freed 1244 Phoenix, Durban, properties from a preservation order obtained by the National Prosecuting Authority on April 4 this year.

In addition, rentals of about R3 million a month should no longer be paid to a curator, but to Woodglaze Trading, headed by the controversial property developer.

The properties, flats in four different sites, were preserved after the National Director of Prosecutions alleged in April that they were proceeds of unlawful activities.

Woodglaze was accused of fraudulently obtaining R236m from the Social Housing Regulatory Authority by setting up a social housing company, Moko Rental Housing Project, to obtain funds to buy the flats from itself.

The latest order was made by acting Judge Peter Olsen after a day of complicated legal argument involving much research of previous cases.

The judge said the land had been purchased by Woodglaze from the eThekwini municipality, on which it built the flats.

The court could not, as a matter of logic, render the flats as the proceeds of unlawful activities.

Olsen said the papers filed by the State were incoherent. He stressed his finding was only whether or not the preservation order should be extended.

“The question of any administrative irregularities is not before me. The question if there was any fraud, corruption, or unlawful conduct in the course of the various transactions is also not before me,” he said.

An attorney who would not give his name said preservation orders should only be granted on authenticated facts, and not suspicions.

Udesh Vather, for Singh, said his clients were pleased with the judgment.

A commission of inquiry is currently probing the deaths of two people following the collapse of a mall in Tongaat Ä being built by another of Singh's companies Ä in November last year. Twenty-nine people were injured when part of the mall collapsed.

The mall, which was being developed by Rectangle Property Investments, was due for completion in March. The Sunday Times reported that Singh was a director of Rectangle Property Investments until February.