BS READS: Manipur, TN, Sikkim IAS officers among biggest property owners

Business Standard examined immovable property returns of close to 5,000 IAS personnel and found each officer has declared owning property worth Rs 58 lakh on average

From apartments in London and suburban Boston, to bungalows in cities and towns, orchards in the Himalayas, office space in World Trade Centre, shops and retail spaces, agricultural land in the rural hinterland, coffee estates in the Western Ghats, and warehouses and apartments in high-profile residential complexes — India’s elite bureaucrats from the Indian Administrative Service (IAS) seem to have quite a penchant for property.

Business Standard examined immovable property returns of close to 5,000 IAS personnel and found that each officer declared owning Rs 58 lakh worth of property on average.

Officers from to the Manipur-Tripura cadre on average spent more than Rs 1 crore on property. They were followed closely by Sikkim-cadre officers, who reported spending an average Rs 93 lakh on buying real estate – the highest among all 25 cadres in the country. This is much higher than even Assam and the Arunachal, Goa, Mizoram, Union Territory (AGMUT) cadres, which have considerably larger personnel than Manipur-Tripura.

The two northeastern states were followed by Tamil Nadu, where IAS officers reported spending Rs 87 lakh on realty purchases – the highest among all big states. The next were officers from the Haryana and West Bengal cadres. They spent around Rs 79 lakh on average buying houses, land and other forms of immovable properties.

These figures were arrived at by taking into account the original purchase cost of the property. In cases where the actual cost was not mentioned, the disclosed prevailing value was taken into account. Overall, these figures are more representative of the original purchase cost of the property than their appreciated present value. In cases where no figures were revealed, the officer in question was assumed to be owning no property. In effect, the actual value of property owned by India’s elite bureaucrats could be worth several thousand crores of rupees more than what is disclosed publicly.

To get a fair picture of the actual property owned by IAS officers, their inheritances, property acquired before joining service, those acquired by their family members before their joining the service and any property acquired by them before being allotted to a particular cadre (even though they may have been in government service) was not taken into account.

The assets owned by IAS officers include their declared acquisition after being assigned to their respective cadres, gifts received during service, property acquired by their families during their service tenure and property received as gifts in marriage while in service. In the event of both spouses being in service, only one officer’s property was taken into account.

IAS officers spent almost Rs 3,000 crore on buying property across India during their careers. Of the 5,274 serving officers, 4,921 had filed their property disclosures as of January 2020. The remaining are yet to file their returns. Hundreds of officers have filed incomplete property returns, which neither mention the purchase cost nor the present value of the property. A handful have filed blank signed sheets masquerading as property returns. The 4,921 IAS officers who filed their returns in January this year declared property worth Rs 2,838 crore.

Several broad trends are discernable from these. Almost all officers start buying property five years into their service. Most who were allotted to different cadres from 2016 onwards haven’t bought any property. An exception to this trend are officers from the Andhra Pradesh cadre. Like their seniors, most of them, including those of the 2019 batch, have joined the gold rush to buy a piece of land in Amaravati, the state’s envisaged new capital.

They spent about Rs 25 lakh each for 500-square-yard plots. For these officers, who were expecting a windfall from the creation of the new state capital, the decision by the Jagan Mohan Reddy government in the state to put predecessor Chandrababu Naidu’s dream on the back burner sent the value of their land investments in Amaravati plummeting. Almost all officers got land at heavily discounted rates from governments of various states. Here they formed cooperative group housing societies to build their dream homes.

Property-purchasing patterns also reveal the emergence of geographic clusters, where many IAS officers cutting across cadres have bought property. One of the most prominent is Sahastradhara road in Dehradun – not far away from Mussoorie, where many of them were trained at the Lal Bahadur Shastri Academy after selection. Others include Rajarhat in Kolkata, Amrapali Sapphire and Greenwoods Society in Noida, besides Darjeeling, Mullanpur in Mohali (called New Chandigarh), Gomti Nagar in Lucknow and Nerkundram in Chennai. Like many middle-class Indians, most officers rely on bank loans to fund their acquisitions. However, there are many who, by the virtue of their plump foreign postings at the United Nations (UN), World Bank and other international organisations, managed to save enough money to buy multi-crore properties without relying on bank credit.

Receiving property in gifts also seems to be quite common, with in-laws, blood relatives and at times ‘others’ gifting valuable property to those in service.

There is also a strong affinity to buy land and property in native states. This often leads to multiple property ownerships as most IAS officers often also end up buying houses in their cadre states through group housing schemes in attractive localities. Most of these houses are in their respective state capitals. Although there are a few officers in every cadre who have declared no property – either inherited or purchased – this type is a rarity. There are a handful of senior bureaucrats who have declared owning no property at all.

In absolute terms, IAS officers of the Tamil Nadu cadre owned the most amount of property, with purchases pegged at Rs 287 crore. This was much higher than other larger states like Uttar Pradesh, which has over 500 IAS officers, or for that matter the Maharashtra cadre.

Property ownership patterns show that like most working-class Indians, IAS officers tend to accumulate more property as they move up the hierarchy and witness a rise in their pay grades over the years. The senior-most bureaucrats – those allotted cadres from 1984 to 1995 (including those allotted from state cadres to the IAS) constitute 23 per cent of all IAS officers in service. Yet they collectively spent almost Rs 1,100 crore buying property. That’s roughly 38 per cent of the estimated property spend by all bureaucrats. Those junior to them — belonging to batches from 1996 to 2005 across cadres — are roughly 1,000, or a fifth of all IAS officers in service. Yet they owned 31 per cent of the property among all bureaucrats. Those a rung further down the hierarchy and much junior and younger than the above two include those allotted cadres from 2006 to 2015. Numbering over 2,000, they form the ‘big bulge’ of the bureaucracy comprising 42 per cent of all IAS officers. They collectively bought property worth Rs 832 crore, or 30 per cent of the total assets of all bureaucrats. The youngest of the lot, belonging to the 2016 to 2019 batches and numbering around 700, own one per cent of the declared property.

On an average, every IAS officer from 1984 to 1995 batches declared buying property worth Rs 1 crore during their career. Officers from 11 out of the 25 cadres in this batch bought more than Rs 1 crore worth of property, with those in Haryana being the richest. Every officer from 1984 to 1995 batches in Haryana declared buying Rs 1.6 crore worth of property on average. Those in Kerala and Maharashtra followed closely, with Rs 1.3 crore worth of property per officer. Even those in smaller northeastern state cadres like Sikkim and Nagaland spent Rs 1.2 crore on average.

IAS officers in the 1996 to 2005 batches declared almost Rs 90 crore worth of property while those from 2006 to 2015 batches across all cadres declared spending Rs 40 crore buying real estate. In the 1996 to 2005 batches, bureaucrats of the Manipur cadre were the richest, with property in excess of Rs 4 crore on an average. In the 2006 to 2015 batches, no cadre had average property ownership exceeding Rs 1 crore, with those from Tamil Nadu being the richest, owning Rs 67 lakh worth of property each.

In the youngest batches (2016-2019), those from Andhra Pradesh were the richest, owning Rs 30 lakh worth of property within five years of service. This was primarily due to the mass purchase of land by most Andhra Pradesh-cadre officers in Amaravati from the Andhra Pradesh Capital Region Development Authority. Among the highest-ranking bureaucrats in the central government, 26 bought properties in excess of Rs 1 crore. These senior-most bureaucrats included secretary-level officers in all ministries and the Prime Minister’s Office (PMO). Some of them had not declared the purchase price or value of properties, despite buying them in high-end localities of metropolitan cities.

According to All India Service Rules (AIS), 1968, IAS officers have to submit their property returns annually to the Department of Personnel and Training (DoPT). The erstwhile Manmohan Singh-led government had in April 2011 ordered that these disclosures should be made public. Those who do not submit their returns could be denied vigilance clearance and be bypassed for promotion and empanelment for senior positions in the government. In line with its ‘Digital India’ push, the Narendra Modi government introduced online filing of returns by public servants in 2016. While most of these disclosures are not checked by the government, there have been many instances in the past of IAS officers being found owning benami properties worth crores of rupees.