The locality boasts a large Hindu populace, which has been living in harmony with Christians and Muslims in the area for several decades now.
Being one of three active places of worship for the Hindu community, Valmiki Mandir or Balaknash Temple, as it is commonly known, might be razed along with several Hindu residences in the area to make way for an educational and housing complex.
Built in 1935, the temple hosts religious festivals, which are attended by the city's Hindu families.
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On August 12, 2014, Station Headquarters issued notices to the residents of Block 141, Gracy Lines, Chaklala, to vacate the area within 10 days.
Fearing that they might lose the temple as well as their houses, the area's Hindus filed a petition with the civil court against the planned demolition and managed to obtain a stay order on August 21.
But the order only provides them temporary relief as they can live in the area until September 13.
Talking to Dawn, Ashok Chand, who represents the local Hindu community, said: "Though we have not received any written notice regarding the temple's demolition, we fear the worst."
Mr Chand said his members of the community met authorities at Station Headquarters and relayed their concerns to them.
According to Mr Chand, the authorities had informed them that the temple might have to be demolished, but they promised to handle the matter amicably.
The officials had assured the Hindus that they would build a new temple wherever the residents of Gracy Lines were relocated, "even if it costs Rs2 million", Mr Chand said.
"We have written to the authorities to resolve the issue amicably and save the historic temple; our only concern is the temple," Mr Chand said.
Member of the National Assembly from the Pakistan Muslim League-Nawaz (PML-N) Isphanyar M. Bhandara told Dawn: "This is the locality of the poor Hindus, and the temple is their only place of worship in the area. They have been living here for the last 82 years, they should not be asked to shift like this."
"It is matter of grave concern for these people to be asked to leave the area," Mr Bhandara said.
He stressed that the authorities must spare the temple, adding that the Hindu community feared that they may not be welcome in any other part of the city if they were to be relocated.
Despite several attempts, Chakala Cantonment Board Executive Officer Rana Kalil Ahmed, could not be reached for comment.