Lost in the rubble: Malleswaram Market becomes history

The 50-year-old market was razed down this January to make way for a complex. After telling the court that they will not demolish it while the case is on, why did BBMP go back on its word? Here's a sneak peak into the events that led to demolition.

Debris left behind after demolition of Malleswaram Market. Pic: Pavan Kulkarni

Heaps of rubble are piled high over the land where the almost half century old Malleswaram market thrived till a few months ago. There were days when this place used to be scented by garlands of fresh vibrant flowers hung outside the numerous shops, patronised by loyal customers for its wide variety of fruits and vegetables.

Some shopkeepers have been rehabilitated in temporary shops built along the storm water drain next to the market that used to be spread over 2.08 acre of land. Some shopkeepers who had not been rehabilitated have set up their shops under tarpaulin sheets on the footpath outside the market, along Sampige Road.

“As of yet, nobody has asked us to vacate this place”, said a shopkeeper selling flowers. “But as soon as the construction begins, we will have to move from here as well, to make way for the trucks that enter and exit the site.”

A woman selling fruits in the shop beside him angrily admonished, “This is an entertainment for you reporters. You only want to write stories that can make you some money, while we struggle to safeguard our livelihood here,” she said, and added, turning to the shopkeeper on her left, “That fellow from TV channel who came here the other day was trying to convince us to speak against Ashwath Narayan on camera.” Ashwath Narayan is the MLA of Malleswaram constituency.

Then she requested politely, “Please don’t write anything. The market is all gone. Nothing can be done about it now. Our MLA has assured he will help us. Now if you write something offensive in your newspaper, we might not even get that help.”

Demolition planned six years ago

The plan to demolish Malleswaram Market to build a multi-storied complex has been brewing for sometime now. It was in 2010 that the Bruhat Bengaluru Mahanagara Palike (BBMP) decided to demolish the Market and build a complex with the help of Bangalore Development Authority (BDA). Here’s the timeline of events, based on documents available with Citizen Matters:

  • May 29th, 2010: The decision to develop the Malleshwaram market in a joint venture with Bangalore Development Authority (BDA) was taken by the BBMP in a BBMP board meeting (No. 616/2990-10)
  • June 9th 2010: Bharat Lal Meena, the then BBMP commissioner writes a letter to the government’s Chief Secretary, requesting permission to redevelop the market with BDA, on the grounds that the structure was in dilapidated condition.
  • July 1st, 2010: Bharat Lal Meena becomes the BDA commissioner. The then finance member, of BBMP, Ganganna, and the Chief executive engineer, Chikkarayappa, also move to BDA.
  • August 26th, 2010:  The BDA, in its board meeting (NO. 293/10), decides to  raze down Malleshwaram Market and to allocate a budget of Rs 76.3 crore for building a complex on that land.
  • November 2nd, 2010: Two months later the Chief Secretary writes to the new BBMP Commissioner, instructing the BBMP to enter into a suitable Memorandum of Understanding (MoU) with the BDA.
  • December 20th, 2011: A BDA meeting (No. 400/11) revises the tender price from Rs 76.3 crore agreed on the previous year to Rs 132 crore. It also decides to pay that amount to the contractor in installments over a span of six years at an interest rate of 14% per year, which adds up to a total sum of Rs 205.92 crore. If unable to repay the loan within that time frame, the time period could be extended to 12 years.
  • March 14th, 2012 : BDA issues a work order for Rs 132 crore to P Vijaykumar, director of 10 construction/ real estate firms. The firms are, according to the Corporate Directory,  registered between November of 2005 and March of 2011 at the same address in Malleshwaram.
  • May 9th, 2012: The MoU through which BBMP gave BDA the authority to commission work over its land,  gets signed, almost two months after BDA gave the work order.
  • March 11, 2013: Following the first few letters served by BBMP, asking the vendors to vacate the market, 48 of the 247 vendors filed a Writ Petitions in the High Court against the demolition.
  • June 28, 2013: The High Court’s verdict instructed the BBMP to make arrangements for temporary shops to rehabilitate all these 48 vendors within 2 weeks of time. The order also instructed these shop-keepers to vacate the shops they had occupied at that time and move to the temporary stalls allotted within a week from the allotment.  
  • December 3rd, 2014: These 48 vendors were served a notice to vacate their shops and move to the temporary shops assigned to them according to the high court’s verdict within seven days. The other vendors who had not approached the high court also received a notice, with an assurance that they will be assigned shops for rent in the new complex that will be built, “according to the rules prevalent at that time”.
  • December 8th 2014:  Malleshwaram market association files a writ petition against the demolition of the market and requested the court to grant two Permanent Injunctions, one to restrain BBMP and the agents acting on their behalf from demolishing the market, and the other to restrain them from interfering with the vendors’ “peaceful possession and enjoyment” of the market place.
  • December 10th 2014:BBMP files an objection to granting of the requested injunction and to the petition against the demolition as a whole.
  • December 11th, 2014:  The hearing was due on December 16th, but 18 shops in the market were razed down on orders of BBMP, before the Chief Minister intervened with a phone call and ordered the demolition to be stopped.
  • December 16th, 2014: The arguments on granting of the Injunction were heard from both sides in court. The verdict was to be announced on January 2nd, 2015.

But on January 2nd, said advocate A N Mattre, who argued the case of the vendors in City Court, “the judge did not come to the court, and the date when the order was to be declared was postponed to January 17th. On January 17th, thecase was transferred to court room number 53 and from there to 54.

Now the new judge, said Mattre, would want to hear the arguments again. But the BBMP ordered demolition of the market on January 22nd, even though the case was still going on in the court. “The BBMP advocate and Assistant Revenue Officer had even given an oral affidavit in front of the City Judge in December, assuring that BBMP will not proceed with demolition till the case is disposed from the court. Had they given it in writing,” said Advocate Mattre, “the BBMP commissioner would have been in jail today.” Because an oral affidavit is not legally enforceable. It is accepted by court as a matter of trust, which was clearly violated in this case.

Mattre says he rushed to the Market on hearing BBMP had brought its demolition force. The police gave him half hour’s time to produce a stay order, which was impossible at the circumstances. And the demolition was carried out.

Asked if a stay order was necessary or does the mere fact that the case is ongoing imply that BBMP cannot carry on with demolition, he said, although it is implied, a stay order, which is an explicit order of the court to not carry out certain task, must be provided to stop the demolition ordered by BBMP Commissioner from being carried out. Due to the problems of shifting courtrooms and judges the vendors were unable to produce a stay order.

BBMP renovates Market before deciding to demolish it

There are many curious events in this whole episode. First, the BBMP spent good amount of money renovating the Market, just at the time of deciding to demolish it in 2010. According to RTI activist Shivakumar, approximately Rs 3 crore was spent on this. But according BBMP, Rs 86,24,996 was spent; and Rs 1 crore was spent according to the figure mentioned in the city court writ petition.

In a complaint filed by Shivakumar to the Public Accounts Committee (PAC), he says a considerable amount was spent on repainting, construction of toilet and installation of organic waste converter, on June 5th, 2010, after the BBMP council took decision to demolish the Market. There are no proofs to substantiate this, however documents show that the BBMP spent lakhs of rupees on renovation before deciding to demolish it.

BBMP Commissioner Lakshmi Narayana confirmed to Citizen Matters that the correct figure is Rs 86,24,996. “However, the expenditures were incurred not in May but in March 2010, before the decision to hand over the market to BDA was taken by the (state) government,” he said. “The same was endorsed by council during May 2010.”

Could the interest rate been better?

Second, there was an option for BDA to go for a better loan at lower interest rate. When Citizen Matters asked whether the BDA could have secured a loan of Rs 132 crore from a different organisation at a lower interest rate than 14% instead of borrowing from the contractor at a higher interest rate, BDA executive engineer, Dr Muralidhara replied: “No loan has been raised for this project by BDA.”

It is not clear whether the BDA even thought of this possibility. However, given the history of fund crunch at the BDA and BBMP, it would have saved a lot of money if the interest rate were lower.

Work order given before MOU was signed

Third, the BDA gave the word order on a land owned by the BBMP, even before entering into an agreement with BBMP. Asked if the BDA was authorised to do so, without the BBMP authorising it to go ahead with demolition and construction, the BBMP commissioner said, “Even though the work order was issued by BDA on March 14th, 2012, it was kept in abeyance for want of approval to the MOU. Only after the MOU was complete, the work order was released by BDA.”

Wrong claim of ‘free from encumberances’

Fourth is the claim about having no loans on the Market. The third page of the MoU states, “BBMP hereby agrees to hand over the Project Site (Malleswaram market) free of all cost along with all easementary rights and free from all encumbrances to BDA under the terms of this Agreement for implementation of the Project.”

The term, ‘free from encumberances’ means there are no loans taken by pledging the Market. Contrary to this, RTI documents available with Shivakumar show that the Malleshwaram market was mortgaged alongwith Johnson Market and Dasappa Maternity Hospital, to the Housing and Urban Development Corporation (HUDCO) by the BBMP on March 23, 2012, for Rs. 256.53 crore. Shivakumar also claims that the HUDCO was not informed about the BBMP’s agreement with BDA.

Of this loan only 78 crores has been repaid so far, according to N R Ramesh.  Muralidhara said that the information on loans is available with BBMP, while the BBMP responded by merely saying, “Regarding borrowing of funds the decision is taken by the competent authorities.” None of these responses answer the question on how the BBMP handed over an already-pledged property to BDA saying it was “free from encumberances.”

Malleswaram Market bustling with trade before demolition. Pic: Pavan Kulkarni

The amount increased by almost two times

The tender amount was hiked from Rs 76.3 crore agreed in 2010 to Rs 132 crore when the tender was called. The reason for this change is unexplained in the documents. It is not clear whether the BBMP estimated a low amount and then rationalised it, or whether the BBMP changed the plan of the mall such as number of floors etc, or whether there is another reason.

When Citizen Matters asked the BDA why the amount was hiked from Rs 76 crore to  132 crores, the BDA officials replied: “The work was tendered on e-portal as per KTTP Act. All the formalities pertaining to e-portal has been observed and the tenders were called for. As per the procedures after deducting the lump sum provisions made in the sanctioned estimate the amount put to tender is worked out. The tenders were invited on deferred payment system based on the approvals obtained from the board.”

Is the demolition legal?

The rationale for the demolition given by the BBMP was that the vendors occupying the 48 shops which were ordered to be demolished had been allotted temporary stalls in accordance with the High court’s verdict.

In response to Citizen Matters’ question, “What legal justification can be given by BBMP for ordering demolition before the Interim Application was disposed of from the court?”, the BBMP Commissioner only asserted that, “Action has been taken legally,” without providing any justification about its legality.

Can the property be taken over by builder in case of non-repayment?

“But now that the market has been demolished the case is rendered infructuous. The market association, operating on very limited funds, is now considering fighting a case demanding rehabilitation instead of challenging the legality of demolition,” advocate Mattre said.

“The catch here is that the land is a prime property worth around 500 crores. The BBMP and the BDA does not have enough money to repay the builder the loan of 132 crores with 14% interest per year in 12 years. Neither can that amount of revenue be generated in that time span by operating the new complex that will be built on that land,” the advocate said. “And when the loan is defaulted, the builder will take over the land.”

RTI activist Shivkumar also shares the same opinion, contending, “It is not popular to sell public land to private builders at a discounted price. This is just another way of doing the same.”

The BBMP Commissioner, however, has allayed fears of private parties taking over public properties at a fraction of its cost. “If BDA fails to pay the amount”, the Commissioner said, “contractor can approach suitable forum for his claims. He has no rights to claim any part of the building.”

When asked if he is certain that BDA will repay the contractor on time, P Vijaykumar, the contactor, told Citizen Matters that he is confident that the BDA will repay. “Far as I know, they have never defaulted on their payments to any contractors. The complex, once ready, will generate revenue, adding to the revenue the BDA is already collecting from various projects. The loan can be repaid using that.”

To our question, what legal options are available to him in case the BDA happens to default, Vijaykumar said, “I have not thought about it in that way. It is a government body that has given me the contract and I trust them.”

Vendors who are not rehabilitated carrying out their business on the footpath.

Politics divides the traders’ association

Whether or not it would be correct to say that Congress and BJP leaders are now trying to capitalise on the crisis, there has certainly  developed a rift among the members of the Malleshwaram market association, with one group wanting to receive help from BLP leader and MLA Ashwath Narayan, and the other, headed by Secretary Chandrashekar, from Congress leader, B K Shivaram.

MLA Ashwath Narayan had called all the shopkeepers for a meeting at the Government school near the market on February 11th, 2015. When asked about this, Chandrashekar denied it and demanded to know who had given that information. “There is no MLA or MP helping us. No one cares,” he said.

However another vendor reiterated that the MLA had in fact called a meeting the next day. “Chandrashekar wants us to boycott the meeting and instead file a case against the demolition with the help of B K Shivram. We are desperate for help. We don’t want to take revenge on BBMP and have no interest in politics. We only want to be able to earn our livelihoods, and will go to anyone willing to help us,” he said.

However, the next day, Ashwath Narayan did not turn up in the meeting. Instead it was attended by three officials from BBMP, asking the displaced vendors to line up at their table with all their documents, after examination of which, it was promised “justice” will be done. Eager for their turn, some vendors got into heated arguments over breaking the queue.

What will constitute “justice” in this case is unclear, given the fact that only 85 temporary shops have been built so far, while a total of 247 shops have been demolished. With only 85 temporary stalls built on a storm water drain in violation of section 436 of Karnataka Municipal Council Act-1976, the remaining vendors are waiting for “justice”.

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