No. It is not mandatory. The college allows you to have full freedom on whether you want to live in the hotel or outside. If someone has a problem with hostel life he/she can stay outside. But if you do not take hostels for a year you are going to miss a lot of things in life.
The main crux of college life lies in a hostel and it is better to join the hostel for the first 2 years. Also, it is easier to maintain the 8–5 classes from hostels and after the whole day tiring classes you can hang with your friends, play on the two grounds or go to the gym.