13,000 poor families in B'luru to lose homes over unpaid dues

Bengaluru: Nearly 13,000 poor people in Bengaluru may soon lose homes allotted to them under two government schemes as the Rajiv Gandhi Housing Corporation Limited (RGHCL) has decided to cancel allotments over non-payment of stipulated fees, officials said.

The decision was taken at a recent board meeting, and the corporation is expected to start sending cancellation letters next week.

Over the past decade, around 23,000 beneficiaries were allotted houses under the Pradhan Mantri Awas Yojana (Urban) and the CM’s Multi-Storeyed Bengaluru Housing Scheme. However, about 13,000 allottees have paid only the initial deposit of Rs 50,000, against the total of nearly Rs 8 lakh.

The houses — currently vacant— were allotted over different years, including in 2018 and 2023.

The RGHCL issued multiple notices to allottees seeking payment of the balance amount. “We have issued three notices and even temporary cancellation letters. They have still not paid the pending amount,” an official told DH.

Officials said timely payments were crucial to completing projects. Cancelling allotments and selecting new beneficiaries would help ensure better utilisation of the houses, they added. “Hundreds of people are waiting for allotments. If selected beneficiaries are not paying, it is only fair to cancel their allotment and give it to those waiting instead of keeping houses vacant,” another official said.

Allottees will not receive a full refund. Citing “inconvenience and delay” caused by defaulters, the corporation plans to deduct 25% from the initial deposit.

While officials argue that the move to cancel the allotments will benefit other applicants, activists say it will only put the poor under more pressure.

“The government provides a subsidy of Rs 3.5 lakh per house while the allottee has to pay the rest. Many may not have paid due to financial distress. Some may have even taken loans to pay the initial deposit,” said Issac Amrutha Raj, state president of the Slum Janara Sanghatane-Karnataka.

He also argued that the RGHCL would have earned interest on the initial deposits and said deducting 25% was “unfair”.

An allottee who has not been unable to pay the balance amount said his family’s financial condition had made things difficult for him.

“I took a loan to pay the initial deposit. I worked as an auto driver and hoped to take another loan to pay the remaining amount. But my situation changed. My mother fell ill and my responsibilities increased. Now, it is nearly impossible for me to pay lakhs. I am already in debt,” he said.

RGHCL officials said the government had facilitated bank loans for beneficiaries and even offered to subsidise interest up to 3%. However, they said the response was still poor, so the decision to cancel the allotment was taken.

While the construction quality and basic amenities in these housing projects are generally decent, many allottees have raised concerns about the locations. These projects are located far from public transport points and connectivity is a problem. The surrounding areas are also underdeveloped, forcing people to travel far to access markets, schools or hospitals.

Over the past decade, 23,000 houses were allotted under the Pradhan Mantri Awas Yojana (Urban) and CM’s Multi-Storeyed Bengaluru Housing Scheme.

The houses are located in remote areas: Agrahara Palya, Bilijaji and Bethanagere (all in Yelahanka assembly segment), Anekal and Bidarahalli (Mahadevapura).

The projects offer decent construction quality and amenities but  are not well-connected to transit hubs or accessible to markets.  

Each house costs about 8 lakh. The govt gives a subsidy of Rs 50,000 while allottees pay the rest.
About 13,000 allottees have paid only the initial deposit of Rs 50,000.