BENGALURU: Indian federal investigators say a long-running scheme involving illegal land allotments in southern India moved illicit proceeds through a web of relatives, associates and real estate assets, prompting the provisional attachment of properties valued at hundreds of crores of rupees.
A Case Built on Land and Paper Trails
Federal enforcement officials in India say their investigation into alleged irregularities at the Mysore Urban Development Authority, known as MUDA, has uncovered a pattern of illegal land allotments and the subsequent laundering of proceeds through property transactions. According to the Directorate of Enforcement (ED), the inquiry centers on how sites meant for public allocation were allegedly diverted in violation of government orders and then converted into private assets.
The ED has described the process as one involving “routing and layering” of undue gratification — a term commonly used in money laundering cases to describe the movement of illicit funds through multiple channels to obscure their origin. Investigators say these proceeds were ultimately used to purchase immovable properties and to construct a commercial building, often in the names of relatives or associates of those accused.
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Allegations Against MUDA Officials
At the core of the case are former senior officials of MUDA. Investigators allege that S.K. Marigowda, a former chairman of the authority, received gratification in the form of land sites in return for making illegal allotments. Another former official, G.T. Dinesh Kumar, who served as MUDA commissioner, was arrested last year under the Prevention of Money Laundering Act (PMLA), 2002, following allegations of large-scale irregularities in the allotment of sites.
Searches conducted by the ED in October 2024, on two separate dates, reportedly revealed what officials described as a “deep nexus” between MUDA officers and real estate businessmen. According to the agency, evidence collected during these searches pointed to cash payments being made for the allotment of sites, as well as for approvals of real estate layouts.
Properties Under Attachment
The enforcement agency says it has provisionally attached assets with a market value of approximately ₹460 crore so far in connection with the case. These include illegally allotted MUDA sites, personal immovable properties, and at least one commercial building constructed using the alleged proceeds of crime.
In a more recent action, the Bengaluru zonal office of the ED provisionally attached 10 immovable properties under the PMLA. Officials said these assets included six MUDA sites, three personal properties, and one commercial building, together valued at about ₹20.85 crore. The attachments are provisional, a legal mechanism that allows the agency to prevent the transfer or sale of assets while the investigation continues.
A Wider Political and Legal Context
The ED has stated that its investigation was initiated on the basis of a first information report filed by the Lokayukta police in Mysuru, Karnataka’s anti-corruption watchdog. The alleged MUDA scam has drawn wider attention because it involves senior public figures, including Chief Minister Siddaramaiah, alongside other individuals named in the inquiry.
For now, the case remains at the investigative stage. Officials emphasize that attachments and arrests are part of an ongoing process under the PMLA, which allows for parallel financial investigations alongside criminal proceedings
