• Fate of 1,100 site allotments worth Rs. 2,000 crore sealed
• Even Khatas are annulled
• Site owners face uncertainty

Mysuru: The Karnataka Government yesterday ordered the cancellation of the allotment of 1,100 housing sites worth Rs. 2,000 crore granted under the 50:50 alternative land compensation scheme in Mysuru by the erstwhile Mysore Urban Development Authority (MUDA), now rebranded as Mysuru Development Authority (MDA), despite a March 14, 2023 order barring such allotments.

The Urban Development Department order also said the Government would consider approaching Civil Courts to cancel sale deeds for replacement sites that have already been registered, while directing the authorities to stop issuing sale deeds and khatas for  such properties.

The order came after the Justice P.N. Desai Commission, constituted by former Chief Minister Siddaramaiah, whose family was also linked as a beneficiary of the 50:50 MUDA scheme, recommended last year the cancellation of all illegal allotments made under  the scheme.

“All 50:50 alternative site allocation orders made in violation of the Government directive dated March 14, 2023, should be cancelled immediately,” Urban Development Minister Dr. Yathindra Siddaramaiah said.

Cancellation grounds

A detailed explanation has also been provided on the grounds for cancelling the allotments. The Government clarified that the action was based on the recommendations of the Justice Desai Inquiry Commission and the report of a high-level technical committee that suggested urgent corrective measures.

In a written order, the Urban Development Department’s Principal Secretary stated that the approvals for alternative sites distributed in violation of Government directives stand cancelled.

Clear instructions have also been issued to Mysuru Deputy Commissioner G. Lakshmikanth Reddy, who is the Chairman of the Mysuru Development Authority, on the steps to be taken in this regard.

Illegal resolutions

The Government order said MUDA passed resolutions approving alternative site allotments at several meetings held on May 10, 2019, May 20, 2019, Sept. 14, 2020, Nov. 6, 2020, Aug. 27, 2021 and June 22, 2022.

The Government observed that similar decisions were repeatedly taken not only at these meetings but also at subsequent meetings.

Under Rule 16 of the Karnataka Urban Development Authority (Site Allotment) Rules, 1981, there is a provision for granting alternative sites. However, MUDA and its Commissioners were found to have violated the rule in numerous cases by approving alternative allotments in contravention of the law.

Realtors reap profits, buyers left helpless

While real estate operators became millionaires by selling sites under the 50:50 scheme, those who purchased them now find themselves in distress. The Government has cancelled the approvals of all such allotments made in violation of its directives, delivering a severe shock to buyers.

Thousands of people, lured by the promise of prime sites at lower prices, invested crores of rupees to acquire these sites. The real estate syndicates pocketed vast sums, but the buyers are now left with neither money nor the property.

Many had even completed Khata registrations for their purchases. However, the Government has now annulled those records as well, leaving buyers to suffer losses running into crores.

Plight of homeowners on illegal sites

Those who purchased illegally allotted sites and went on to build houses there now face an unimaginable ordeal. Many invested crores of rupees to buy the plots and then spent additional crores constructing homes.

But the Government has cancelled the approvals for these properties, and the Khata registrations too will be annulled. As a result, homeowners are staring at a grim reality. They are left without their houses and without the money they invested, with no solution in sight.

The 50:50 alternative site scheme

An alternative site scheme was drafted on November 20, 2020, by MUDA members, including the Chairman and Commissioner, for distributing sites to those who lost their land on a 50:50 ratio basis; 50 percent of housing sites in a developed area in exchange for 50 percent of the revenue land acquired by the Authority.

The Karnataka Urban Development Department warned MUDA against implementing the scheme on May 4, 2021, and on March 14, 2023, but the Authority did not stop it.

According to the Department, as many as 1,328 alternative sites were given as compensation under the 50:50 scheme since its introduction in 2020. It has been alleged that people who did not lose land were also given high-value alternative sites under the scheme after realtors and politicians began abusing it.

Govt. acts after sustained reportage in Star of Mysore

For months since June 25, 2024, Star of Mysore and its sister publication Mysuru Mithra have been publishing detailed reports on the large-scale corruption and irregularities in MUDA. Readers, too, have consistently supported these efforts to bring the irregularities to light.

As a direct outcome of this sustained coverage, the State Government has now cancelled thousands of site allotments worth thousands of crores of rupees that were allegedly sanctioned in violation of the rules. Isn’t this, in fact, a victory earned by your trusted newspapers?

‘I was the first to stall 50:50 sites’

Former MUDA Chairman K. Marigowda has welcomed the State Government’s decision to cancel and withhold site allotments made under the controversial 50:50 ratio scheme, claiming that he was the first Chairman to stall the unauthorised allotments during his tenure.

Speaking to Star of Mysore this morning, Marigowda said the decision was in line with his earlier efforts to stop site allotments under the 50:50 ratio scheme.

“After taking charge as Chairman, I had issued circulars instructing the then MUDA Commissioner to stop site allotments under 50:50 ratio without MUDA Board’s approval. I had to step down after my warnings were ignored,” he said.

Marigowda fully backed the Government’s orders and the Judicial Commission’s findings to halt and cancel the 50:50 site allotments. He said stopping the scheme had safeguarded MUDA’s assets and saved more than Rs. 2,000 crore.

Rejecting allegations that he had acquired unauthorised sites, Marigowda challenged the Government to confiscate any site found to have been allotted to him illegally under the scheme.

On his 40-year political association with former Chief Minister Siddaramaiah, Marigowda maintained that the former CM had never instructed him or anyone else to carry out illegal site allotments.

Government issues 5 strict directives

While cancelling illegally approved site allotments, the State Government has issued five stringent instructions to Mysuru DC G. Lakshmikanth Reddy, who also serves as Chairman of the Mysuru Development Authority. The directives outline the legal steps to be taken:

• Cancel all allotment orders for alternative sites distributed in violation of Government Order No. Urban Development Department 71 Mysuru Urban Development Authority 2023(E), dated March 14, 2023.
• For alternative sites already registered at the Sub-Registrar’s office, initiate civil suits in Courts to annul the sale deeds.
• Where sale deeds have not yet been executed, the Authority must refrain from issuing them until fresh Government guidelines are framed.
• Direct the Mysuru City Corporation or the jurisdictional City Municipal Council/Panchayat to prevent Khata registration for such sites.
• If Khata has already been created, instruct the respective local bodies to cancel them under the provisions of the Karnataka Municipal Corporations Act, 1976, the Karnataka Municipalities Act, 1961, and the Karnataka Panchayat Raj Act, 1993.

Strict compliance required

The Government has issued a stern warning to the Mysuru Development Authority, insisting that its directives be followed without deviation. Failure to comply will invite appropriate legal action under the rules. The order states that the instructions come into immediate effect and must be implemented rigorously. The Authority has also been directed to submit a compliance report to the Government without delay. Any lapse, the Government cautioned, will result in strict action as per law.

Action to extend beyond 2023, clarifies Dr. Yathindra

Urban Development Minister Dr. Yathindra Siddaramaiah said the Government has ordered the cancellation of nearly 1,100 site allotments made under MUDA’s 50:50 scheme in violation of the rules, with an estimated value of around Rs. 2,000 crore. He explained that, in the first phase, allotments made after March 14, 2023 have already been annulled. In the second phase, allotments made before March 14, 2023 are being scrutinised for irregularities.

Dr. Yathindra made it clear that if illegalities are detected in those earlier allotments as well, action will be taken.