Health dept staff co-op mired in Rs 200-cr land scam

A housing co-op formed by the employees of the health department is mired in a Rs 200-crore land scam.

The Health and Family Welfare Department Employees’ House Building Co-operative Society Limited collected the money from more than 1,000 people by promising to allot them sites near Devanahalli, on the northern outskirts of Bengaluru, but failed to deliver the sites even five years after the original deadline, according to a complaint filed by 37 site buyers.

The complaint has prompted the Additional Registrar of Cooperative Societies to investigate the co-op’s business dealings.

Site buyers said they had made the initial payment in 2012 in the hope that the sites would be registered in their names within 36 months.

Such housing co-ops typically allow site buyers to make payments in instalments and accept bookings from the general public, too, in addition to the staff of the department concerned.

“As of date, more than 1,000 applicants have paid the instalments. Some have paid in full while others have balance payments. The approximate amount involved is in the range of Rs 200 crore,” the complaint stated.

One of those who booked a site was Gavisiddeshwar Kataraki who started paying the instalment in 2012 and paid Rs 10 lakh for a 30X50 site over the next two years.

“I lived a hand-to-mouth life and borrowed from friends to pay the instalments. They (the co-op) were supposed to allot me the site by 2015. But more than six years later, I still don’t know what I will get from this, if at all,” said Kataraki, who works in a private company.

Sanjeev, another site buyer, said he was yet to see any evidence that some work had actually started on the ground.

The co-op, he continued, had conducted a meeting in the residential layout in February 2021 and promised to deliver the sites by December. “But nothing has happened. We are worried,” he said.

A senior official in the office of the Registrar of Cooperative Societies in Karnataka said an inquiry was already underway against the co-op under Section 64 of the Karnataka Cooperative Societies Act on the basis of a previous complaint.

And a second inquiry would begin shortly based on the latest complaint.

“The previous complaint made serious allegations. We are looking into payments made without the board’s approval, land agreements and money transfers through RTGS. We will also see if any action was taken internally to fix the problems. The latest complaint will be added to the ongoing investigation,” the official said.

Shankar Naik, the current president of the co-op who took charge about a year ago, claimed that the co-op had done nothing wrong.

“There have been delays in land conversion. The builder has sought additional payment but applicants want to see some progress (on the ground) before paying more,” he said.