Sudden twist in the plot

Many buyers acquire Bangalore Development Authority (BDA) sites as investments. They do not immediately start construction work, leaving the plots vacant. However, the BDA has decided to go stricter and reduced the number of years that the plot can stay vacant before it attracts a penalty to three years from the previous five years.

This measure aims to address the issue of vast amounts of vacant land, as numerous layouts were developed with the intention of fostering residential growth, but many plots have remained empty for years.

Previously, there was a five-year deadline to build a house on an allotted site. This has now been shortened to three years, with penalties set at 25% of the land’s guidance value for non-compliance. The increase in the penalty from the previous 10% fine reflects the BDA’s effort to deter speculative holding of plots.

The new regulation is intended to ensure that sites are developed rather than left idle for investment purposes. Additionally, neglected plots have become eyesores, with waste dumping and overgrown vegetation creating habitats for pests. The BDA has given extensions to some allottees to address these issues before enforcing the new penalties. The authority is working on creating awareness and plans to enforce the new rule more rigorously in the near future.

An official said, “Previously, fines for not building within five years ranged from Rs 5,000 for a 600 sq ft plot to Rs 6 lakh for plots larger than 4,000 sq ft. Now, with over 70,000 vacant plots across 64 layouts, the increased penalty aims to compel development and curb speculative practices. Ownership disputes are pending for over 20,000 of these plots.”

Selling restriction
In a related change, the BDA had initially allowed plots to be sold immediately after registration, but this was restricted to a 10-year hold during the Arkavati Layout construction due to political opposition. This rule has since been relaxed, allowing plots to be sold at any time, though purchasers from the original allottees will incur an additional 25% penalty based on the guidance value. This measure is designed to discourage investment-driven transactions and ensure plots are used for their intended residential purposes.

Ankit Kumar, who owns a BDA plot, told BM that though the BDA’s intention to encourage the development of allocated plots is understandable, the new three-year deadline for construction is unscientific and impractical. “The abrupt reduction from five years to three, coupled with a hefty 25% penalty, fails to consider the real challenges faced by plot owners. Construction timelines are influenced by various factors including financial constraints, market conditions, and the availability of construction resources.

Imposing such stringent deadlines without accounting for these variables is unrealistic and does not accommodate the diverse circumstances of plot owners. Moreover, the increased penalty might deter potential buyers, impacting the real estate market further,” Kumar said.

The decision to enforce this penalty without providing adequate time for property owners to plan and execute their construction is more punitive than corrective, he said. “Instead of fostering development, this approach could lead to unnecessary legal disputes and financial strain for individuals who genuinely intend to build but are faced with unforeseen delays,” he said.