Trouble for Valmark realty, ED attaches ₹4.06 Cr assets in TDR fraud

Bengaluru

The Directorate of Enforcement (ED) has provisionally attached assets worth about ₹4.06 crore in connection with a Transferable Development Rights (TDR) scam involving M/s Valmark Realty Holdings Pvt. Ltd. (VRHPL) and certain officials of the Bruhat Bengaluru Mahanagara Palike (BBMP).

The attached properties — comprising land and flats — are registered in the names of TDR brokers and fake owners, the ED said.

The action follows an investigation launched on the basis of an Anti-Corruption Bureau (ACB) FIR, which alleged that VRHPL, led by its director Ratan Lath, obtained Development Rights Certificates (DRCs) and sold the TDRs to real estate companies and individuals, generating illegal gains of about ₹27.68 crore.

According to the ED, earlier searches at nine locations — including VRHPL’s office, its director’s premises, and those of builders, brokers, and bogus TDR applicants — uncovered evidence of fraudulent issuance of TDRs.

Records revealed that VRHPL retained ₹17.47 crore of the proceeds, while brokers B.S. Surendranath, K. Gautham, and K. Suresh received ₹3.50 crore, ₹3.36 crore, and ₹3.35 crore respectively. The heirs of late Shri Revanna allegedly received about ₹2.7 crore from VRHPL’s share.

The ED claims these funds were routed through multiple bank accounts and invested in real estate and business expenses to disguise their origin.

Investigators allege a “concerted conspiracy” between VRHPL, the brokers, and BBMP officials, in which property mutations were fraudulently procured in favour of previous owners despite the land having been converted into revenue layouts with third-party purchasers in possession.

The BBMP then issued grossly inflated TDRs based on fabricated inspection reports and valuations, without taking possession of the land — in violation of its own circulars.

The ED added that similar fraudulent TDR issuances may have taken place at several other sites earmarked for road widening and other public projects, and these are now under scrutiny.

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