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Karnataka Lokayukta uncovers alleged INR 29 crore PMAY scam in Belagavi housing projects

#Law & Policy#India
Last Updated : 23rd May, 2026
Synopsis

The Karnataka Lokayukta has uncovered alleged financial irregularities worth over INR 23 crore in Pradhan Mantri Awas Yojana (PMAY-Urban) housing projects in Belagavi district. The investigation relates to PMAY houses developed in Ramdurg town, where officials and contractors allegedly cleared fake bills and inspection records despite several homes remaining incomplete. Authorities found that around INR 29.45 crore was released for the project between 2019 and 2024, while construction material worth only about INR 6.1 crore reportedly reached beneficiaries. Multiple raids were conducted across Karnataka and documents linked to project approvals, inspections and billing were seized for further investigation.

The Karnataka Lokayukta has registered a case against officials of the Karnataka Slum Development Board and a private contractor over alleged irregularities in Pradhan Mantri Awas Yojana (Urban) projects in Belagavi district. The case is linked to affordable housing works executed in Ramdurg town under the central government’s PMAY scheme aimed at providing houses to economically weaker sections and low-income families.


According to the investigation, several houses sanctioned under the PMAY housing project were allegedly left incomplete even after payments were cleared. Officials reportedly approved project completion documents and inspection records despite the work not being fully executed on the ground. Investigators found that fake bills, utilisation certificates and GPS-tagged inspection photographs were allegedly prepared to process payments.

The probe revealed that nearly INR 29.45 crore was released through multiple bills and approvals between 2019 and 2024 for the housing work. However, Lokayukta officials stated that only around INR 6.1 crore worth of construction materials was reportedly supplied to beneficiaries. Authorities suspect that more than INR 23 crore may have been diverted through fraudulent billing and false documentation.

The case has been filed against retired Assistant Executive Engineer Shambulingappa B.S., contractor Prasad N.P. associated with National Projects Construction Corporation Limited (NPCC), along with other officials connected to the project execution and approval process. The Karnataka Lokayukta’s Belagavi unit is investigating the matter under the supervision of senior officials from the anti-corruption agency.

Search operations were conducted at multiple locations including Belagavi, Hubballi, Bengaluru and other premises linked to the accused officials and contractors. During the raids, investigators reportedly recovered project files, billing documents, inspection reports and records connected to payment approvals under the PMAY housing scheme.

Pradhan Mantri Awas Yojana (Urban) was launched in 2015 to improve urban affordable housing and support first-time home ownership for lower-income households. Karnataka has been among the states with a large number of PMAY housing sanctions, especially in urban and semi-urban regions. Over the past few years, there have been concerns in different states regarding delays in construction, incomplete units and irregularities in project execution under welfare housing schemes.

The latest development has raised fresh questions over monitoring systems, contractor verification and fund utilisation in government-backed affordable housing projects. The investigation is expected to examine whether similar irregularities took place in other PMAY-linked projects handled by the same agencies or contractors.

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