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The Bengaluru Development Authority (BDA) will now strictly enforce a one-time penalty on allottees who fail to begin construction within three years, and will not issue final sale deeds until buildings are completed. The move targets beneficiaries who left plots vacant or transferred them illegally while land values soared. Exceptions have been made for Arkavathy and Nadaprabhu Kempegowda Layouts due to delays and incomplete infrastructure. Many older allottees had secured sites at very low rates but never built on them. The BDA has also flagged cases of unauthorised transfers, which will now attract a 25% penalty. The policy aims to curb speculation and encourage timely, compliant development.
The Bengaluru Development Authority (BDA) is set to strictly enforce its policy of levying a significant one-time fine on allottees who have not begun construction on their plots within the stipulated three-year period. Officials have confirmed that they will not issue final sale deeds unless the construction is successfully completed. Advertisement
This action is specifically aimed at beneficiaries who have illegally transferred their plots or chosen to leave them vacant, despite enjoying massive appreciation in land values over time. However, two major developments, Arkavathy and Nadaprabhu Kempegowda Layout (NPKL), are exempt from this new rule due to existing factors like extensive delays, prolonged litigation, and incomplete essential infrastructure, which have prevented allottees there from initiating building work.
Historically, the BDA allotted these sites at non-market rates strictly to applicants who did not already own a house. The original agreement-cum-sale deeds prohibited the transfer of the property for a period of ten years, a restriction later reduced to five years. While many original allottees proceeded with construction, a considerable number left their plots vacant after paying minimal amounts, sometimes as low as INR 5,000 during the 1960s and 1970s. Today, many of these sites are valued at nearly INR 10 crore.
Furthermore, the BDA has flagged approximately 50 cases where allottees approach the authority solely for sale deeds to obtain the e-khata, but subsequently fail to return and regularise their construction violations while continuing to enjoy full ownership benefits. Officials confirmed that such violations will attract a substantial 25% penalty on the loss transaction value for transferring sites without explicit BDA approval.
This stringent new penalty structure marks a definitive turning point in Bengaluru's urban planning and compliance landscape. By directly linking the penalty to the current market value, the BDA has effectively closed a long-exploited loophole, actively discouraging speculative land banking and promoting responsible development.
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