BDA pledges plots to borrow Rs 573 cr to return initial deposits

With allottees yet to pay for sites, authority borrows from banks

Cash-strapped Bengaluru Development Authority (BDA) has pledged more than 425 plots as collateral to borrow Rs 573 crore from various banks.

The BDA collected Rs 717 crore through initial deposits with the applications for sites in Kempegowda Layout Phase 1. However, it has used the money for other purposes. When it had to return the initial deposit to 26,370 applicants who did not get plots, the BDA sought loan.

According to information obtained by social worker Saidatta under RTI, the BDA borrowed Rs 250 crore from Canara Bank branch near central office, Rs 73.73 crore from SBM's MG Road branch, Rs 48 crore from Corporation Bank.

Apart from this, the authority has got Rs 200 crore of the Rs 400 crore loan sanctioned for layout development from the Housing and Urban Development Corporation (Hudco).

For the loan from Canara Bank, it pledged 174 sites, including 150 corner sites, in Visveswaraya Layout. Similarly, it has pledged over 100 sites to Corporation Bank and 150 sites to SBM.

Responding to queries, BDA Commissioner Rajkumar Khatri said, “It is true that the authority took loans from banks to return the initial deposits. But I do not have details regarding the collateral at present.”

The commissioner said the BDA was to get Rs 1,408 crore from those who got sites in Kempegowda Layout.

“The BDA borrowed money believing that it would collect the money in time. However, the allottees sought more time. The BDA management board gave in-principle approval to provide two more months to the allottees. So, there will be further delay in getting the money for sites,”he said.

He noted that those who got a 50X80 site have to pay over Rs 1 crore, including tax. “The Centre is monitoring high-value business transactions post demonetisation. So, many people are not coming forward to pay such huge amounts.

“Some have even submitted applications requesting us to take back the site and return their initial deposit. The BDA will land in a crisis if we do not get the money from allottees at the right time,” he said.