Lira Municipal Council is in the process of demolishing buildings which authorities say are constructed on road reserves.
The houses are located along Ojwina road near Cuk Atat, a suburb of the town.
Lira Municipal engineer, David Bagenda says the buildings were raised without consulting the municipal experts.
Bagenda says the buildings should be demolished to allow the opening up of Ojwina road.
The owners of the buildings claim that their plots were surveyed and approved by municipal authorities before the work commenced.
They allege that land surveyors could have connived with some rich people to divert the original road plans.
Patrick Otim, a businessman in Ojwina division says the road has been diverted and it now passes too close to his house, which has affected his business.
Otim says all his building plans were approved by the municipal engineer and he wonders why the problem is cropping up now.
Richard Okabo, a local resident claims his house worth 700 million shillings was demolished in 2004 because of the same problem.
Lira Municipal Council is now fighting with some developers as it struggles to reopen access roads, which have been illegally sold off.
Lira town clerk Paul Omoko has halted further construction on the land, which is being opposed by the developers saying they will go on with their construction work.
Omoko has meanwhile ordered that the work on Ojwina road be stopped as it could lead to insecurity in the area.
But resident district commissioner, Susan Akany attributes the mess on what she called unprofessional behaviour of Lira municipal engineers, who give residents a go a head to build on road reserves. She said the engineers should be investigated.