Buying property in Bangalore without A-Khata
Hello, we are planning to buy a property in Bangalore (Whitefield area) and the builder has informed us that while the land is A-Khata, due to deviations in setback area, they will not be able to provide us an CC/OC or a A-Khata for the property. According to him, most properties in the area and in Bangalore have deviations from original plan and hence it is not a big problem.
I would like to know the implications of buying such property related to staying, renting out or re-selling in future and how can I negotiate with the builder on this issue.
Asked 3 years ago in Property Law from Bangalore, Karnataka
1) don't purchase property if the building does not have building completion certificate or occupation certificate
2) since the builder has failed to carry on construction as per sanctioned plans no completion certificate Is being issued
3) municipal corporation can always demolish the unauthorised construction made
4) don't negotiate with the builder for purchase of flat
5) You will have problems in selling the flat as building does not have OC or BCC
1.Such properties will be regularised in the ensuing 'Akrama-Sakrama' scheme of the Government.
2. Because of deviations from the approved plan, the BBMP will not issue Completion Certificate/Occupancy Certificate for such buildings and as of now it is considered as illegal construction only and before the Akrama-Sakrama' scheme comes into effect the risk of demolition cannot be ruled out. However if 'Akrama-Sakrama' is implemented, the illegal building will be regularised after levying penalty to be paid to BBMP.
3. Better to wait till the 'Akrama-Sakrama' scheme is notified by the Government and when once the scheme is in operation you can buy the same property.
4. Inspite of impending danger and if you are still bent upon buying the property, negotiate for a lesser price with the builder. Before 'Akrama-Sakrama' is implemented if you want to resell the property, you may not get on par with the price commanded by litigation free property. For staying or renting out, there may not be any problem.
Thank you Advocate Sethi & Sastry. While I understand your guidance, I would like to bring to your notice some additional points:
1. The project is pre-approved by two leading public sector banks and loan facility is being provided by them.
2. There seems to be a recent Karnataka High Court ruling asking BBMP to stop issuing B-Khata and instead issue A-Khata.
3 I also have heard of a Govt scheme to regularize such properties by paying a betterment fee.
Keeping these points in mind would you still suggest we don't buy this property?
If yes, then why would leading national banks pre-approve such properties and provide loans?
Asked 3 years ago
1) merely because project is pre approved does not only construction had been carried on as per sanctioned plans
2) BBMP will issue A khata only if construction is as per sanctioned plans
3)let builder regularise the unauthorised construction then purchase the flat
4) banks pre approve loans on basis that title to land is clear and marketable . But If builder fails to carry on construction as per sanctioned plans purchasers will always have a damoscles sword hanging over their head
1.Before buying the property, one has to go through all the relevant documents and then can only decide. In anticipation of the regularisation of such deviations by a government scheme called 'Akrama-Sakrama', perhaps for this reason, loan facility is being provided by leading public sector banks.
2.Its true that the Karnataka High Court has asked BBMP to stop issuing B-Khata. The reason for this is there is only one Khatha in Municipal records and such property details are entered in a register maintained in the BBMP and the register is named as 'A' and it is only valid and the so called B-Khatha does not exist and the BBMP in order to collect tax from the illegal properties enter the receipt of tax in a register named as 'B' and hence the name B-Khatha.
3.To regularise such properties government introduced the scheme 'Akrama-Sakrama', but there is a stay for the scheme from Karnataka High Court.
4. Leading nationalised banks pre-approve such properties and provide loans because they are pretty sure of the implementation of the 'Akrama-Sakrama' scheme by the Government.
In my opinion too, without having proper papers or relevant document, it will not be advisable to purchase the said property. Why the banks will grant loan means that they know how to recover, they want business now, they are not bothered if by any government order the property are seized or sealed, because the bankers can escape quoting the latest government rules, so their liability will be on hold. You will be the sufferer or victim, so take opinion of a local lawyer before deciding to purchase.
1. The B Khatha in actual sense does not exist. It is merely a record maintained by the BBMP in which property identification numbers are entered into a register called the ‘B’ register. This keeps a record of dues paid by property owners to the civic agency. B Khata is a temporary measure which will allow you to buy or sell a site, but you will face problems when you go for construction.
2. B-khata means BBMP did not issued Occupancy Certificate. BBMP will issue Occupancy Certificate (OC), if and only if the building has been constructed according to the sanctioned Plan and is compliant with all bye-laws. BBMP has rights to allow up to a maximum of 5% deviations (but that too subjected to certain conditions). If deviations are more than 5% BBMP will not issue OC. Without OC, you will not get Khata (so called ‘A’ Khata). You can pay property tax etc, but you will not get your ‘A’ Khata (I mean Khata Certificate and Khata Extract). Without ‘A’ Khata, neither you can sell your property nor you can mortgage it to get loan from the bank.
If the property can be regularised then there is no harm in buying this property but mere approval by the leading public sector banks and providing of loan facility is not sufficient and is no criteria to check the genuineness of the property hence it would be advisable that if there is deviation from the original plan, you must not invest in such a property. in future, it may cause problem.
1. The building has not been constructed as per the sanctioned plan for which the construction is illegal,
2. Illegal construction is liable to be demolished legally and it is up to the decision to be taken by the BBMP,
3. Most of the properties in Bangalore has flouted the construction plan can not be a reason for treating the deviation as rule,
4. There is cerytainly a risk for buying such illegally constructed property.
1. Yes, I also heard about validating such illegal deviation by collecting fees for such deviation,
2. ask the builder to pay the said fee and get the deviation regularised,
3. Once the said deviation is regularised, you can safely buy the said property.
A. Generally, people should understand the legal process like approval process that the banks will give the approval based on the documents verification blindly at the time of project launch. so it means land documents and marketable title is perfect and construction stages is still going on and once the plan approved by the BBMP by putting ample terms and conditions that the builder will infringe the same and deviate the same so it means that land documents is correct and builder violated the procedural aspects.
B. I would like to recommend to you that purchase the flat which belongs oc/cc for the purpose of to have marketable title in future.