High Court urges Karnataka to frame scheme for regulating sale of sites in unsanctioned layouts

Bengaluru: The High Court has observed that with the growing number of sites being purchased in lands that are not part of sanctioned layouts, there is a pressing need for the state government to devise a comprehensive scheme to regulate such land transactions.

Justice Sachin Shankar Magadum made the observation while dismissing a petition seeking a direction to issue an e-Khata for a site purchased in 2010.

The petitioner, U. Mamatha, a resident of Holalkere town in Chitradurga district, had bought the residential site in 2010. She said the local authority issued her a manual khata in 2015 and that she had been paying property tax regularly. She later applied to the Holalkere Town Municipality for an e-Khata, enclosing her title deed, conversion order, and tax-paid receipts. However, her application was rejected on June 21, 2024, based on circulars issued by the Urban Development Department and the Department of Municipal Administration on March 22, 2017, and January 5, 2018, respectively.

The municipality, in its response, submitted that the circulars prohibit issuing e-Khata for plots without layout plan approval from the competent authority. It also stated that it had written to the state government seeking directions to allow issuance of e-Khata by collecting betterment charges at 10% of the current market value of sites. However, the state government later issued another circular in March 2018 explicitly prohibiting the issuance of e-Khata for plots lacking layout approval.

After examining Section 17(2B) of the Karnataka Town and Country Planning (KTCP) Act, Justice Magadum noted that although the site in question was part of land converted for residential purposes, it did not fall within an approved layout. The judge said Section 17(2B) was introduced with the legislative intent of curbing the unregulated and haphazard formation of sites in revenue and converted lands.

“The provision imposes a mandatory duty on landowners and developers to obtain approval of the layout plan from the competent planning authority. It further stipulates that only upon development of the layout in accordance with the sanctioned plan, securing a completion certificate, and handing over the roads, civic amenity sites, and parks to the local authority, can individual site owners acquire enforceable rights in respect of the sites,” the court observed.

“The object behind the insertion of sub-section (2B) is to ensure orderly development of urban areas, proper provision of civic amenities, and to prevent the mushrooming of illegal layouts which burden public infrastructure,” Justice Magadum added.

While dismissing the petition, the court said, “With increasing instances of purchasers acquiring sites in converted lands that are not part of sanctioned layouts, there is a pressing necessity for the state to devise a comprehensive scheme to regulate such transactions. Unless and until the state formulates appropriate guidelines or a regularisation mechanism consistent with the object of Section 17(2B) of the KTCP Act, courts cannot, in individual cases, bypass the statutory mandate and issue directions contrary to law.”

The court emphasised that the legislative intent behind Section 17(2B) is to strike a balance between urban development and the rights of innocent purchasers, while ensuring that civic infrastructure and planned growth of towns are not compromised.