HASSAN: The Hassan Urban Development Authority's (HUDA) ambitious plan of developing a satellite town on the outskirts of the city, hit a roadblock with the Union Ministry of Environment and Forests (MoEF), objecting to implementation of the project.

Sources in HUDA disclosed that, in its recent notification, the MoEF had clarified that it was mandatory for any urban development authority, to obtain environmental clearance from the Ministry before developing a satellite town. After the notification, the HUDA had now applied for permission. This would lead to further delay in implementing the project, sources added.

HUDA planned to develop a satellite town with 5,000 sites on 453 acres on Hassan-Arsikere Road at a cost of Rs. 58.31 crore. The authority had borrowed Rs. 15 crore from Vijaya Bank and spent Rs. 13.02 crore to pay compensation to land owners. Work on developing the layout was handed over to the Land Army Corporation (LAC) in 2004, which submitted a Rs. 34.84-crore proposal to the Government.

However, as the corporation had not made provision for permanent underground drainage and drinking water supply, the proposal was rejected. It was decided to invite tenders in accordance with the Transparency Act of 1999. Technical assistance from the Karnataka Urban Infrastructure Development Corporation (KUIDC) was taken. The KUIDC submitted a Rs. 75.62-crore proposal in November 2004 to construct permanent underground drainage system and supply drinking water from Yagachi. Approving the proposal, the Government directed the authorities concerned to collect 25 per cent of the site value from the applicants.

Demand survey

After the Janata Dal (S)-BJP coalition Government came to power, Janata Dal (S) alleged that the previous body did not conduct the "demand survey", before planning the layout and paid uniform price to land owners without assessing land value.

According to Hassan MLA, H.S. Prakash, an offer was initially made to Vijaya Bank (which granted a loan of Rs. 15 crore) to collect the applications along with 25 per cent of the sites' value.

However as the bank refused, other commercial banks were allowed to collect the applications. Now with delay in allotting sites, the authority appealed to applicants to withdraw their money to save the applicants from paying "unnecessary interest" to the bank.

Sources said that the HUDA would appoint a consultant to obtain clearance from MoEF and on getting permission, sites would be allotted to 1,658 applicants. "It needs only 130 acres to alienate sites to those who applied for sites and remaining 323 acres will be allotted to various organisations and government departments to collect funds to repay the loan from Vijaya Bank," a senior official of HUDA told.

He said that it had been planned to allot 200 acres to the police department for setting up the Karnataka State Reserve Police Battalion at Rs. 4 lakh an acre and another 23 acres of land to the Karnataka State Cricket Association (KSCA) at Rs. 3 lakh an acre, to construct cricket stadium.

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