Scam-tainted TDR in shambles, govt turns blind eye

BBMP road widening on Madiwala tank bund road in Bengaluru. DH Photo/Janardhan B K

When Transferable Development Rights (TDR) scheme was first introduced in 2006, it was seen as a god-send for Bengalureans who were facing hardship due to mounting traffic.

The scheme was meant to ensure smooth and cost-free acquisition of private properties, enabling the Bruhat Bengaluru Mahanagara Palike (BBMP) to take up long-pending infrastructure projects, especially those related to traffic. And, accordingly, an ambitious plan to widen number of narrow, high-traffic-density roads and build flyovers and elevated roads was drawn up.

Under the TDR scheme, Development Rights Certificates (DRCs) are issued to the land losers (whose properties are acquired) in lieu of monetary compensation. DRC is a virtual property, which is two times the value of land acquired. DRC holders can either use it for themselves to increase the built-up area on their properties or sell to those who are in need of it.

Thirteen years down the line, the scheme is in shambles. While majority of the projects planned to be implemented under TDR scheme remain on paper, corrupt officials and builders literally plundered the government, misusing the scheme. Ironically, dealing with the illegality committed by the official-builder nexus has now become a bigger problem than the woes of motorists who are getting stranded on overcrowded Bengaluru roads.

The recent raids on real estate companies by the Anti-Corruption Bureau (ACB) exposed the official-builder nexus; the BBMP — which was the DRC-issuing authority under the old version of TDR – had granted DRCs illegally to favour builders. The certificates were, in many cases, issued only on paper without actual acquisition of land. Builders conveniently bought low-value DRCs from the city outskirts and used them in high-value areas of the Central Business Districts, making handsome profit. Development Rights were issued even for the government lands by creating fictitious documents.

The blame for it squarely goes to the government: though TDR rules were fraught with flaws, the government chose to turn a blind eye right from the beginning. It did precious little to plug loopholes in the rules and punish the guilty despite media reporting several cases of irregularities. This was quite understandable as many politicians across all parties have high stakes in the lucrative real estate business in Bengaluru.

In fact, the government created a roadblock for the effective implementation of the TDR scheme by increasing Floor Area Ratio (FAR) in the Master Plan of Bengaluru in 2007 — it introduced maximum FAR of3.24 (permissible built-up area allowed on a plot). Result: demand for DRCs slumped.

While corrupt builders made hay with illegal DRCs, there were no takers for the genuine ones. The scheme naturally became unpopular and met with stiff opposition from public to give away their properties in exchange of DRC.

The illegality in implementing the scheme was so rampant that BBMP today does not have a consolidated data on DRCs issued by it. According to an estimate, about 15 lakh sq m of DRCs were issued between 2006 and 2014. And, interestingly, neither BBMP nor Bengaluru Development Authority (which is DRC-issuing authority under the revised TDR scheme) has any clue as to how much of the existing DRCs are actually legal. It is said about 6 lakh sq m of the Development Rights have already been utilised in the real estate market. 

By the time the state government woke up from slumber and realised the problem, the damage was already done. Though the then government stripped BBMP of the power to issue DRCs in 2015 and amended theTDR rules, it did not order a much-needed probe into what appears to be the biggest real estate scam, in order to clean up the mess. Instead, it declared that all old DRCs are valid.

Only some cosmetic and bureaucratic changes such as entrusting BDA with the responsibility of issuing DRCs were made to the rules in 2017 when the revised TDR scheme unveiled. The revised rules are said to be loosely framed and lacks clarify. Moreover, there was no effort to gain the confidence of the people as far as the revised scheme was concerned. In fact, the government chose to ignore an expert committee recommendation to bring down the FAR level in order boost the demand for TDR. The panel had also suggested establishing an independent body that could enable people sell and buy DRCs in the market. But nothing was done in this regard.

Rejecting proposals

Now, it is over two years since the revised scheme came into effect. DRCs have been issued only in four cases so far! BDA has been rejecting proposals being sent by BBMP for acquiring lands under TDR due to discrepancies in documents.

For instance, BBMP had proposed to acquire private properties for widening Ballari road, Jayamahal road and Sarjapur road last year. But the process has been stalled due to lack of clarity in property documents and the TDR rules.

The BDA’s efforts to seek clarification on the ambiguous sections of the rules from the Urban Development Department have been in vain. For instance, it is clueless whether to issue DRCs for ‘B’ khata properties (properties developed either without approval or land use conversion) and agriculture lands.

The process of re-validating old TDRs has also come to a standstill. Section B of the Karnataka Town and Country Planning Act states that BDA has to check the veracity of old DRCs before re-validating them. This, in order words, means a thorough scrutiny has to be done. But BDA has been unable to re-validate any of the DRCs issued under the old TDR scheme by BBMP because of non-availability of proper documents. Old DRC files being sent by BBMP are said to be incomplete and lack crucial documents to trace the original owners of properties.

Many of the BBMP officials who had granted DRCs in the past were either transferred or retired from service. The officials concerned now are, therefore, washing their hands off the issue, leaving the DRC holders in limbo. The situation, it appears, is back to square one: infrastructure projects are stalled due to non-availability of lands and motorists continue to suffer. 

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