BPP CHAIRMAN MISLEADS THE POOR, INNOCENT OCCUPANTS OF BPP COLONIES

The New Year has brought a new liability to the poorer and middle class section of the Occupants of BPP colonies.

A circular without any reference number dated 7th January 2017 signed by Yazdi Desai as Chairman of BPP but recently received by the residents has shocked all residents of BPP colonies (except the well to do occupants) of the sudden increase of service charges by Rs. 750/ per month peremptorily from 1st February 2017.

For the last 15 years the previous Trustees in their wisdom did not burden its beneficiaries and limited the service charges to a mere Rs. 150/ per month. However, as per the new circular BPP Colony residents will now have to shell out a whopping Rs. 900/- per month per flat.This amounts to each resident paying the BPP Rs. 10,800/ annually for services which they hardly receive.

The above coupled with the recent Doubling of the parking charges from Rs. 150/ per month to Rs. 300/ per month is bound to cause some financial hardship to the colony residents, many of whom feel the increase of service charges is unjustified and uncalled for.

We are given to believe that the BPP has a corpus plus deposit of over Rs. 300 crores. With a conservative interest rate of 8% p.a., it would yield Rs. 24 crores in itself. The BPP Trustees have conveniently failed to mention the interest income from the deposits they are sitting on obtained through the flats in the same colonies. The BPP Baugs are mostly occupied by the poor and low income group as well as middle income group for whom this additional increase would be a huge burden on their resources.

The BPP has failed to disclose that it continues to earn substantial revenue from deposits, hoarding and cable charges, and other income that have to be taken into account.

Our forefathers who bequeathed this property to the community for free – did not ever imagine that the present Trustees would fleece the community members by suddenly charging them service charges of over Rs. 10,000/ per annum from the earlier Rs. 1800/ per year.

It is about time that the BPP Trustees be made accountable for their actions! The BPP spends lakhs a month on vengeful litigation. It is believed that the Trustees like Yazdi Desai have been appointing the finest of lawyers to fight his cases and the BPP is made to pay all his legal fee bills. When Yazdi Desai was a Trustee he spent over Rs. 3 Crores on the Renegade Priest matter. Recently it is estimated that the BPP has already paid over Rs. 10 lakhs on legal fees only for the Change Report matter of Trustee Mr. Cama to avenge his wife’s defeat. Why should the tenants suffer with an increase in service charges whilst the BPP Trustees get to use these same charity funds to fight their personal cases! The Trustees should bear such legal costs from their own pockets.

The warring BPP instead of fighting and spending funds on litigation should consider other avenues to earn funds. On the one hand the Trustees complain that BPP has no funds but no steps are taken to increase its revenue from its vast land assets but wants to raise resources only by burdening its tenants.

• There is a building in Navsari, over which BPP spent several crores for its construction and is now ready for occupation since last few years but for some reason is lying unallotted and if sold even at reasonable rates could yield a revenue of over Rs. 10 to 12 crores for the BPP.
• The BPP has spent over Rs. 10 crores for partial construction of an ownership building at Godrej Baug but the same is now lying as a ruin since last several years due to infighting among Trustees. If completed it will fetch a revenue of well over Rs. 80 crores but for a paltry 3 lakhs required to remove a lis pendens affecting the project. The completion is held up for years and now a fresh demand of property tax of over Rs. 5 crores has been received by BPP from BMC, who is threatening to auction it to recover its dues.
• The costs defrayed so far on both these projects have been shown as work under progress and if these costs are accounted in income statement then surplus of income would increase substantially.
• The Refundable Deposit Scheme by the earlier pragmatic Trustees had increased the Corpus/Deposit source from Rs 15 crores to over Rs. 300 crores today allowing BPP to take up various new social welfare activities, due to the higher interest income earned therefrom. But the same has been stopped by the new board due to obstinacy of one of them to seek legal opinion for its advocacy. It is in everyone’s interest to Revive the Refundable Deposit Scheme so that beneficiaries wishing to move out of their houses can earn by transferring their tenancy rights and the Trust also benefits by 50% to 70% of its value. There are over 20 beneficiaries who have approached the BPP to transfer their tenancy rights by which the BPP can earn immediately a further Rs. 20 crores at the very least. Even the Courts have favorably commented on this as a viable source of raising revenue by charitable Trusts and sharing the proceeds of encashment of the tenancy value so that all three parties involved are winners. All legal opinions obtained so far by them have found favor in continuing the Refundable Deposit Scheme however this one Trustee is not only stalling the scheme but is also instrumental in increasing the service charges to residents of Rs.10,800/ per year.
• The same Trustee had during their elections speeches promised the community that he would bring into the coffers of BPP, a thousand crores through the sale of Heritage TDR of Khareghat Colony. The community is still waiting for such a windfall bonanza but it now seems that the entire scheme was just a sham to garner votes. Commodore Bhada had recently reminded the Trustees of this election promise but very deftly his query was sidelined by Noshir Dadrawalla.
• It is apprehended that the BPP may issue a further statement that out of the Rs. 300 Crores lying with the BPP, Rs.150 crores are actually the funds of the Wadia Trusts, to show their need for funds. It is not understood which Wadia Trusts the Trustees refer to. As per ex-Chairman Late Jamshed Guzder, the Wadia Trusts of the erstwhile four Wadia Baugs has ceased to exist since 1954 when the then Trustees of Wadia Trusts conveyed by a Registered Conveyance all its properties and funds to the Trustees of BPP and since then the Wadia Trusts have ceased to exist though its objects may have to be followed by BPP as far as possible
• The BPP has around 5500 flats, and a service charge of Rs. 900/ per month from February 2017 would amount to a revenue of almost Rs.50 lakhs per month for the BPP and a yearly income of Rs. 6 crores. Even assuming an annual deficit of Rs 3.72 crores as stated by Yazdi Desai as correct (which is in any case doubtful) yet the Chairman wants to earn a revenue of Rs. 6 crores and further fools the community that even with the increase of Rs 750/ per month, only 65 % of the deficit would be recovered and warns that annual increase in service charges is an inevitable reality in future. Thus he has already paved the way for further increases in future. Probably the Chairman is building a huge corpus to enable him to use it for all his legal costs which are bound to escalate shortly the way the Trustees are going.
• The Accounts filed by BPP in the office of the Charity Commissioner shows an excess of Income of Rs 11 crores after deducting all expenses of all Baugs cited by Yazdi Desai for year 2013-14 ending March 2014 and further excess Income of Rs. 8 crores for year 2014-15 ending March 2015 when the infighting among Trustees was at its height. In fact BPP auditors have warned the Trustees that carrying forward of such huge incomes every year would ultimately lead to its being taxed and therefore advised them to use this large carried forward income for community benefit rather than pay income tax on it. Yet the Trustees prefers to increase the burden on its beneficiaries rather than stop the accumulation of income year after year.

The 7th January 2017 Circular also talks of BPP sharing 50% cost of repairs which is not taken into account according to him in the cost analysis as if they are doing a favour to the residents. In fact the Trustees should thank the residents for voluntarily sharing 50% cost of repairs and only burdening the Trust by 50% of the repairs expense.

In law, repairs and maintenance is the burden of the landlord. Recently a landlord was even jailed for not repairing his building. The Petit Trust and Cama Trust and the Garib Zarthosti Rahethan Fund have carried out full repairs and renovation bearing 100% cost themselves without any burden to the occupants, even though their rents are less than Rs. 300/ per month.

Recently it is believed that the BPP has denied to pay even its 50% share on the ground that BPP has no funds and has called upon the occupants to bear 100% costs of repairs and the Trustees will reimburse their 50% share in future as and when they have the funds.

UNITY IS STRENGTH.

All the colonies must come together and question the Trustees for detailed accounts leading to this demand from Yazdi Desai and his unsolicited advice to the residents to voluntarily bear this increase. Gamadia Colony, Captain Colony, Panthaky Baug, Kharegat Colony, Bharucha Baug, Contractor Baug, Dhunbai Wadi, Nirlon, Khan Estate and Godrej Baug must unitedly oppose this increase which is arbitrary and unnecessary, even though some may be able to afford to pay the same. The BPP seems to have funds to fight legal cases of its trustees however does not have funds to take care of its own beneficiaries. This should not be allowed.

From time to time the Trustees have been recovering the differences in the name of 1) Security charges in 2012 and 2015, 2) water charges in 2000 and 2014 and 3) property tax in 2014. So much for his claim that service charges have not been increased for last 13 years.

In 2014 Yazdi Desai, running the BPP due to his majority, had started recovery proceedings from residents of Bharucha Baug for increased water charges levied by BMC. Their active committee member Mr. Karkaria of Bharucha Baug came with full details of how water charges had already been periodically increased and recovered from the residents in their monthly rent bills and ultimately the truth prevailed and Yazdi Desai had to withdraw his circular for recovery of additional water charges. Similarly the Trustees have recovered full 100% additional property taxes from the occupants due to conversion of property taxes from rateable value to capital value system. But in turn the BPP has paid only 50% additional tax to BMC as per High Court stay order whilst pocketing the full 100% tax from tenants. When the Godrej Baug residents requested Yazdi Desai for a confirmatory letter that the 50% will be refunded/adjusted once the High Court gives such relief, the same was ultimately issued by Yazdi Desai only after continuous follow up by the Association members.

We have just been informed that Yazdi Desai has instructed all custodians/managers of BPP colonies not to accept rent from the tenants unless they pay the increased service charges. This is nothing short of terrorism by the Trustees to frighten the tenants to succumb to the illegal demands of the Trustees or face threatened legal action. Rent cannot be used to extract other payment demands from tenants which is per se unlawful. Some occupants who wanted to oppose the increase have admitted that they paid it up with the rent to avoid legal ramifications. Yazdi Desai had given similar orders to Bharucha Baug tenants when he wanted to illegally recover additional water charges but with their unity he had to withdraw those instructions.

It is further learnt hat this huge increase of service charges from Rs.150/ pm to Rs. 750/ pm were approved only by three Trustees at that meeting–Yazdi Desai, Kersi Randeria and Noshir Dadrawalla- as Zarir Bhathena was in USA for his medical treatment and Armaity Tirandaz and Viraf Mehta had opposed the increase as being unreasonable and not warranted. It seems that only these three Trustees are running the BPP.


Will the community wake up and question the increase by calling upon the Trustees for the detailed Account statements of last five years showing the correct picture of the state of BPP’s finances. After all the Trustees are accountable to the community which elected them and in interest of transparency this is the least expected from them. If the last Board avoided any burdening of the beneficiaries why should the newly elected Trustees impose this cavalier increases on all and sundry, especially to fuel their litigation expenses.