Maharashtra Launches Inquiry into Alleged ₹1,000 Crore BMC Housing Project Scam

The Maharashtra government has launched a comprehensive inquiry into a significant ₹1,000 crore scam involving a housing project for project-affected persons (PAPs) in Malad (E). The inquiry was initiated after Junior Urban Development Minister Madhuri Misal admitted in the assembly that there were irregularities in the agreement between the Brihanmumbai Municipal Corporation (BMC) and the developer.

Congress MLA Aslam Shaikh, who raised the issue in the assembly, alleged that the land classification was illegally changed and ready reckoner rates were hiked, increasing the cost of each PAP unit and raising the project cost by ₹618 crore. He further stated that the project would not be ready for 10 to 20 years.

Shaikh and BJP MLA Yogesh Sagar demanded that the inquiry be conducted by a retired High Court judge rather than an ACS rank officer, citing the gravity of the allegations. Shaikh said, 'The plot was originally reserved for police staff quarters but was used for PAP housing, and the letter of acceptance was amended after April 2025. The ready reckoner rates were changed from ₹84,460 per square meter to ₹1,33,670 per square meter by illegally shifting land classification.'

This change was made without any fresh physical inspection or independent evaluation, raising suspicion of collusion. Due to this, the cost per PAP unit increased from ₹32.2 lakh to ₹50.9 lakh. Other PAPs from the Slum Relocation Authority (SRA) are available for just ₹15 lakh, resulting in an additional cost of ₹618 crore.

Misal stated that the developer is responsible for constructing 13,347 flats for PAPs. Forty percent of the plot's area is reserved for police housing, while the remaining 60% is proposed for the construction of PAP flats. She mentioned that the developer has been given a credit note of ₹470 crore for the first phase. Additionally, a conveyance deed was signed on June 27, 2025, to transfer the land to the BMC. After including the BMC's name on the property card, a second credit note of ₹470 crore was issued, along with 100% Transferable Development Rights (TDR) of 97,102 square meters.

Shaikh also pointed out that the private plot lay in a no-development zone but was first reclassified for a police housing society and then converted for the PAPs project in favor of a builder. He alleged that the BMC paid the developer despite the lack of green clearance. He added, 'BMC has spent ₹200 crore to construct the road to access the plot. Under the PAP scheme, this construction is supposed to be done by the builder at their cost.'

The allegations of irregularities and potential collusion have raised serious concerns about the transparency and accountability of the project. The government's decision to launch an inquiry is a step towards ensuring that the interests of the PAPs and the public are protected.