BDA bonanza: Sites sold within lock-in to be regularised

Bengaluru: Deputy Chief Minister D K Shivakumar has given a new lease of life to a rule prevalent when his political mentor S M Krishna was the chief minister nearly 20 years ago. 

The Bangalore Development Authority (BDA), the government agency responsible for the city’s planning and development, has taken steps to regularise sites sold before the mandatory lock-in period of 10 years. 

The rule — brought in February through an amendment to the Bangalore Development Authority (Allotment of Sites) Rules, 1984 — will apply to regular as well as ‘G’ category sites sold to third parties before December 31, 2022. 

As per the rule, a person who bought a BDA site from an allottee during the moratorium period can get the absolute sale deed by paying 25% of the guidance value prevailing during the last sale transaction. 

While the BDA says it wants to end confusion over genuine transactions, critics fear the new rule will favour people who bought sites only to sell them for a profit. 

The new rule could potentially cover many buyers because sites in all BDA-developed residential layouts, barring three, were allotted on a lease-cum-sale basis. 

The BDA Act specifies that no allottee can sell the site before 10 years (lock-in period). If the allottee faces financial difficulties after buying the site, he or she has to give the site back to the BDA and seek a refund or get the government’s approval before selling the site. 

The previous rule prevented allottees from selling sites before 10 years of allotment. However, it was temporarily withdrawn during Krishna’s reign as the chief minister.

The withdrawal helped allottees immediately get absolute sale deeds of sites in Banashankari, Anjanapura and Sir M Visvesvaraya Layouts. 

The BDA reintroduced the rule after a change in the government, saying it wants to discourage people with real-estate interests from buying the BDA sites. 

What BDA chief says

BDA commissioner N Jayaram said the amendment would provide relief to people who bought sites from allottees when the lock-in period was in force. 

“We first issue lease-cum-sale deeds to allottees, and the absolute sale deeds are registered 10 years after the allotment,” he said. “In some cases, allottees have disappeared after selling their sites. The buyers are unable to take complete possession of their sites. Hence, we have fixed a penalty of 25% of guidance value to regularise such transactions.” 

The new rule will also benefit many influential people, who were allotted sites under the ‘G’ category, or alternative sites at throwaway prices.

Some of them sold the sites almost immediately for a handsome profit. The exemption will help them, a source said.