The MUDA’s operandi of site allotment scam

In the last 16 months, alleged irregularities in the Mysuru Urban Development Authority (MUDA) were flagged at least twice. In March and  November 2023, K V Rajendra, the former Mysuru DC and chairman of MUDA, had alerted the state government about procedural lapses in the allotment of sites in other developed areas on a 50-50 sharing basis to compensate land owners. 

However, the state government failed to take any action against top officials said to be responsible for these procedural lapses until recently. Even though the state government transferred G T Dinesh Kumar, the MUDA Commissioner, in February 2024, eventually this decision was revoked. 

In fact, based on DC’s letters, the Department of Urban Development (UDD) Secretary on March 14, 2023, directed the MUDA to stop distribution of sites to land owners in alternative areas developed under a 50-50 sharing basis until they come up with guidelines. 

These sites were distributed in cases where MUDA had failed to compensate people during land acquisition, and layouts were developed before the land was fully acquired. In such cases, 50% sites developed in land acquired were kept by MUDA, and a few sites were given to land owners in alternative highly developed areas (instead of giving 50% sites developed on acquired land) to compensate. 

In a letter, the Secretary stated that the allotment was in violation of the Karnataka Urban Development rules 1991, Rule 16(1). 

Despite these steps, MUDA continued to distribute sites on a 50:50 basis and DC received complaints about that. In a letter dated October 27, 2023,  Secretary, Urban Development, had stated that, the decision taken in MUDA meeting on November 20, 2020 under KUD Act Rule 13(2a) (to distribute sites in alternative developed areas on 50:50 basis, in such non compensated cases ) had been cancelled as there is no government approval to the decision. Hence by November 2023, the registration of such properties had been stopped.  

Retd official blows whistle

Simultaneously, a retired official had filed a complaint in 2023, alleging that the development authority had distributed sites on a 50:50 basis in alternative developed areas to non-compensated land owners illegally and had caused loss of more than Rs 1,000 crore to MUDA and the government. 

He had alleged that several top MUDA officials, former and current, and other government officials were involved and had made ‘benami’ properties for themselves.

Based on the letter from the secretary (UDD), related to this complaint by the retired official, the DC had issued notice on November 9, 2023, to the MUDA commissioner and had sought a report from him within seven days. 

The DC had asked MUDA to furnish the details of a letter to the government requesting permission to form rules under Karnataka Urban Development Act Section 13(2a), (as per decision taken in MUDA meeting on November 20, 2020) to acquire the remaining parcels of the land (where layouts are developed) and to distribute sites to land owners on a 50-50 basis in alternative developed areas in cases where compensation is not given.

He pointed out that while these rules could only be implemented after the government’s approval, MUDA had not submitted the documents for consideration in this regard. 

BDA model

The MUDA commissioner clarified in a notice that the development authority had taken the decision to operate based on the guidelines adopted in such cases by the Bengaluru Development Authority. However, he had not submitted documents to support the adoption of BDA guidelines. There was also no explanation why MUDA continued to distribute sites even after the state government’s direction to halt allotment in March 2023. 

The DC also stated in his report to the state government that 13 other complaints had been registered regarding lapses in MUDA and notices were issued to the MUDA commissioner, but he had not responded to many.