According to official findings and preliminary reports, the "scam" allegedly occurred between 2019 and 2024, when the YSRCP was in power.
Published Aug 30, 2025 | 11:23 AM ⚊ Updated Aug 30, 2025 | 11:23 AM
Andhra Pradesh Chief Minister Chandrababu Naidu. (Supplied)
Synopsis: The scandal has inevitably become a political weapon. After the TDP-led NDA alliance came to power in 2024, Chief Minister N Chandrababu Naidu ordered a freeze on the issuance of new TDR bonds for five months. He had made promises during the election campaign to “do justice to victims and punish the guilty.”
A major scandal involving the issuance of Transferable Development Rights (TDR) bonds in several municipal towns across Andhra Pradesh has resurfaced, creating ripples in political, administrative, and real estate circles.
The controversy, which allegedly took place during the previous YSR Congress Party (YSRCP) government, revolves around inflated bond values, fabricated records, and fraudulent transactions.
The state’s ruling Telugu Desam Party (TDP)-led coalition has described it as one of the biggest scams in urban planning and municipal administration in recent years, promising justice for victims and punishment for the guilty. However, Opposition and critics allege that the new government is dragging its feet, allowing the issue to fester.
TDR bonds are not ordinary financial instruments. They are designed as non-cash compensation for landowners whose land is acquired by the government for public purposes — road widening, master plan development, building parks, preserving heritage zones, or creating green spaces.
Under Rule 17 of the Andhra Pradesh Building Rules, 2012 (amended in 2017), the owner of the acquired land is given a certificate that grants additional Floor Space Index (FSI) or built-up rights. These rights can be used to construct extra floor space on their remaining land, or they can be sold and transferred to someone else. In essence, TDR bonds are like a government-backed coupon that can be monetised in the real estate market.
For example, if one acre of land is acquired, the owner is compensated with development rights up to four times its value. These bonds are recorded and issued through an online portal managed by the Directorate of Town and Country Planning (DTCP).
The idea was meant to be a fair and transparent way to balance urban growth with land acquisition needs. But, as the scandal shows, the system became a tool for manipulation.
According to official findings and preliminary reports, the “scam” allegedly occurred between 2019 and 2024, when the YSRCP was in power.
Fraudsters allegedly manipulated survey numbers and locations of acquired lands. Instead of recording the actual land, often in less valuable peripheral areas, they entered the details of prime localities in towns and cities.
This meant that a piece of low-value land on the outskirts was “converted” on paper into prime land in busy urban zones, multiplying its worth several times over.
The TDR bonds issued on this basis carried inflated values, which the beneficiaries could quickly sell to unsuspecting buyers in the property market.
Some bonds were sold immediately for cash, while others were transferred to developers who hoped to use them in construction projects.
The irregularities were said to be rampant in Visakhapatnam, Tirupati, Tanuku, and Guntur. Tirupati emerged as one of the biggest hotspots, with over 1,000 pending and unresolved TDRs.
Municipal Administration Minister P Narayana called the modus operandi “shocking.”
He explained how the system had been cleverly gamed to produce fraudulent high-value bonds. TDP leader Anam Venkata Ramana Reddy went a step further, estimating the total scam value at around Rs 4,000 crore.
The scam did not just enrich fraudsters. It also left a trail of suffering for innocent buyers and builders.
Many who bought TDR bonds in good faith suddenly found their certificates cancelled after vigilance agencies intervened.
Developers who had factored TDR benefits into their project designs were left stranded when their bonds were declared invalid.
Ordinary buyers, who had invested savings into purchasing what they thought was a legitimate instrument, were left with nothing in hand.
The government has floated proposals to withdraw the cancelled bonds and reissue fresh ones at corrected values. In some cases, this could mean revaluing at up to four times the actual land value as directed by the courts. However, the process is slow and complex, leaving many still in limbo.
The scandal has inevitably become a political weapon. After the TDP-led NDA alliance came to power in 2024, Chief Minister N Chandrababu Naidu ordered a freeze on the issuance of new TDR bonds for five months. He had made promises during the election campaign to “do justice to victims and punish the guilty.”
A vigilance inquiry was launched, and the Anti-Corruption Bureau (ACB) submitted a preliminary report pointing to large-scale irregularities. Minister Narayana insists that the inquiry is progressing and the government is determined to sort out the muddle. He expressed surprise at the “ingenuity” of the scamsters, saying that during his earlier tenure (2014–2019) as municipal minister no such complaints had been received.
But Opposition leaders argue that little action has been taken against the real culprits. Anam Venkata Ramana Reddy criticised the government for dragging its feet, saying: “The scam continues to fester without consequences. The masterminds are roaming free while innocent buyers suffer.”
On the other hand, YSRCP leaders have denied any wrongdoing. Former Tirumala Tirupati Devasthanams (TTD) Chairman Bhumana Karunakar Reddy, accused of involvement, dismissed the charges as political vendetta. He pointed fingers at a senior woman IAS officer, calling her an “anaconda of corruption,” and argued that the irregularities were the handiwork of officials rather than politicians. With the vigilance inquiry still in progress, more officials could soon face scrutiny.
Experts argue that the scandal offers a lesson in how digital governance mechanisms can be subverted if loopholes are left open. Though the TDR process was meant to be transparent through an online system, the manipulation of survey numbers shows that human oversight and accountability remain weak links.
Some urban planners suggest that TDR systems should be linked with satellite mapping and geo-tagged land records, making it impossible to alter survey numbers or land locations manually. Others call for an independent regulatory body to oversee issuance and transfer of such bonds.
The resurfacing of the TDR bond scandal has placed Andhra Pradesh at a crossroads of governance and credibility. What was meant to be a progressive tool for compensating landowners and promoting urban development has turned into a symbol of fraud and political mudslinging.
(Edited by Amit Vasudev)
