Here's how Mumbai-based activist Kamlakar Shenoy dug out ₹40,000 crore MHADA scam

Kamlakar Shenoy, 65, was duped in a property deal by a builder; this prompted him to dig into a scam of at least Rs 40,000 crore. Free Press Journal spoke to him recently. Here are excerpts from the interview.

S BalakrishnanUpdated: Monday, January 02, 2023, 11:30 AM IST
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Kamlakar Shenoy | YouTube

Kamlakar Shenoy, 65, an activist and the owner of a small vegetarian hotel near Sandhurst Road railway station, was duped in a property deal by a builder. This prompted him to dig into a scam of at least Rs 40,000 crore; a scam which no political party wants to talk about since it will expose their own ilk.

Under Rule 33 (7) of the Development Control, builders were given additional floor space index (FSI) by the state government as an incentive to develop old and dilapidated buildings mostly in the island city on the condition that they rehabilitate the old tenants in the newly reconstructed buildings and give a certain ratio of flats to MHADA. The remaining flats could be sold in the open market.

Shenoy discovered that most of the builders did not surrender the flats concerned to MHADA and instead sold them in the open market. This deprived MHADA of flats worth at least Rs 40,00 crore.

How did you unearth the 33 (7) scam?

My personal fight with a developer ledme to this scam. Since the developer did not surrender the surplus area of redeveloped properties, I started following the matter. I came across many such developers around the year 2010.

Was it easy getting information from MHADA officials?

They were non-cooperative as they feared exposure (of their own role) in the scam.

On what basis do you claim it is a Rs 40,000 crore scam?

MHADA has given in writing that 1.37 lakh sq, metres of surplus area is to be recovered i.e. around 15 lacs sq. ft. If you add 100% by way of balcony and super built up area,it will be 30 lakh sq.ft. Then the market value was Rs 40,000 crore. Now it could be around Rs 1 lakh crore.

How many builders are involved in this scam? FIRs have been registered against how many of them?

As per the list given by MHADA there are around 172 developers but we need to verify if there are more. It was only after my follow up in the year 2011 an FIR was registered just for name sake against 29 developers without making any efforts to recover the surplus area looted. However, there are still scores of developers roaming scot-free without any FIR being registered against them and without the recovery of any surplus area from them even after several years.

Could builders have perpetrated this big scam without political patronage?

Several bureaucrats and engineers of MHADA, Repair Board etc are directly involved. However, without political patronage no bureaucrat could have carried out this scam. It is because of political patronage the government did not grant sanction to criminally prosecute top officials of MHADA and Repair Board. So, I had to move the Bombay High Court.

You received a favourable order from the Bombay High Court. But, why do you think the state government appealed against this order?

Instead of registering FIRs against all the developers and senior MHADA officials concerned, the state government chose to file a Special Leave Petition in the Supreme Court.

The Uddhav Thackeray government tried to regularize the matter by asking the builders concerned to compensate the government (for the flats they have sold illegally in the open market) at ready reckoner rates. Why are you objecting to this?

The ready reckoner rate does not reflect the actual market rate. Why should the government favour builders who have cheated it? Interestingly, the CEO of MHADA had no locus standi to file the SLP since the Bombay High Court order did not name any official, instead it left it to the investigating agency to register FIRs against those who violated the laws. The fact is that politicians have received a huge chunk of the loot. Such a large scheme scam cannot be committed without the support of politicians.

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