The Karnataka government introduces a draft bill to enhance apartment ownership rights, seeking public feedback until August 6.
Bengaluru, India Jul 15, 2026 ALN: The Karnataka government has initiated a public discussion regarding a draft bill aimed at reforming apartment ownership laws in the state. This engagement took place with representatives from Bengaluru's apartment owners' associations on July 15. The move is a part of the government's broader strategy to enhance the regulatory framework surrounding real estate and apartment management, which has been a growing concern in urban areas like Bengaluru, where the population density and demand for housing have surged dramatically over the past few decades.
The proposed Karnataka Apartment (Ownership and Management) Bill seeks to replace two outdated lawsâthe Karnataka Apartment Ownership Act, 1972, and the Karnataka Ownership Flats (Regulation of the Promotion of Construction, Sale, Management and Transfer) Act, 1972. These laws, which have been in place for over fifty years, have not kept pace with the evolving real estate landscape, leading to numerous challenges for apartment owners, developers, and regulators alike. The government has made the draft bill available for public review, inviting stakeholders to submit their comments and suggestions by August 6, which underscores the administration's commitment to transparency and stakeholder engagement in the legislative process.
Once enacted, existing owners will automatically transition to the new regulatory framework without the need for re-registration, thereby minimizing disruption and confusion. Key proposals in the bill include a standardized method for calculating undivided area shares, a clear definition of super built areas, and a requirement for at least 75% owner consent for redevelopment schemes. This last provision is particularly significant as it aims to protect the interests of minority owners who may otherwise be pressured into agreeing to redevelopment projects that do not align with their interests. Additionally, the bill mandates the formation of ownersâ associations within three months of the majority of apartments being allotted and introduces a 'deemed conveyance' provision for older complexes lacking formal land transfers, thereby addressing a long-standing issue of ownership clarity.
The event was led by Bengaluru Development Minister Krishna Byre Gowda and attended by Chief Minister DK Shivakumar, along with other prominent ministers and legislators. Chief Minister Shivakumar emphasized the government's commitment to addressing the persistent issues faced by apartment owners, stating, "We are aware of the problems faced by property owners, and they should have complete ownership rights. Our objective is to help people. Citizens have worked hard to build a roof over their heads. That is not an easy task." This statement reflects a broader recognition of the challenges faced by urban residents in securing their property rights and navigating complex legal frameworks.
He also highlighted the government's aim to decentralize powers and resolve disputes without resorting to litigation. This approach could potentially alleviate the burden on the judiciary, which is often overwhelmed with civil cases related to property disputes. During the discussion, several representatives from ownersâ associations expressed the need for provisions that would prevent minor disputes from escalating into civil court cases, which often lead to prolonged litigation. They also called for mandatory annual audits, a streamlined process for obtaining No Objection Certificates, and measures to ensure builders collect maintenance fees in escrow accounts prior to handover, which would enhance financial transparency and accountability.
Additional Chief Secretary of the Urban Development Department, Tushar Giri Nath, explained that the existing legal framework has left apartment owners without essential registration requirements, clarity on building by-law approvals, or a defined mechanism for dispute resolution. He noted that many provisions of the current laws overlap with the central Real Estate (Regulation and Development) Act (RERA), leading to confusion and prolonged legal disputes between developers and apartment owners. This overlap has contributed to a fragmented regulatory environment that has often left apartment owners vulnerable to exploitation and mismanagement.
The new bill will apply to any project with more than eight apartments, including villas within approved layouts, while exempting government buildings and properties not divided for separate ownership. This broad applicability is intended to cover a significant portion of the residential real estate market in Karnataka, thereby enhancing the rights and protections available to a large number of homeowners.
Formally recognizes an apartment, along with its share of project land and common areas, as heritable and transferable immovable property. This recognition is crucial for ensuring that owners can freely transfer their property rights without legal hindrances.
Allows owners to sell, mortgage, lease, gift, or bequeath their apartments, with subdivision of land shares requiring competent authority approval. This flexibility is essential for owners to manage their assets effectively.
Introduces a standard formula for calculating the "super built-up area," which includes carpet area, external walls, balconies, and a capped share of terraces. This standardization aims to eliminate ambiguities and disputes over property sizes, which have been a common source of contention.
Ensures that any future increase in development rights belongs collectively to apartment owners, not developers. This provision seeks to protect owners from losing out on potential value increases due to unauthorized developments.
Clarifies the distinction between common and private parking, with specific regulations for each. This clarity is expected to minimize conflicts over parking spaces, which are often a contentious issue in urban apartment complexes.
Developers must file a declaration with the competent authority within 60 days of receiving the occupancy certificate. This requirement aims to ensure timely compliance and transparency in the handover process.
They are also required to hand over all original project documents and maintenance deposits, along with an audited statement of accounts. This measure is designed to protect owners by ensuring they have access to all necessary documentation regarding their property.
Owners' associations must be formed within three months of the majority of apartments being allotted, with shared responsibilities between promoters and allottees. This requirement emphasizes the importance of collective governance among residents.
Promoters remain liable for defect-rectification obligations even after the handover. This provision is crucial for ensuring that developers are held accountable for the quality of their construction.
A redevelopment scheme requires written consent from at least 75% of building owners, binding all parties. This high threshold is intended to protect minority owners from being forced into redevelopment projects against their will.
Dissenting owners can opt for a monetary settlement based on market value, determined by a government-recognized valuer. This provision offers a fair exit strategy for owners who do not wish to participate in redevelopment.
Settlement disputes will be addressed by the competent authority, with further appeals possible. This framework aims to provide a structured approach to resolving conflicts that may arise during redevelopment.
Buildings over 30 years old must undergo structural assessments every five years. This requirement is critical for ensuring the safety and habitability of older structures.
Associations are responsible for insuring common property and maintaining audited annual accounts. This accountability is essential for the financial health of the community.
Unpaid maintenance dues will become a legal charge on the apartment, enforceable against future buyers. This provision aims to ensure that all owners contribute to the upkeep of shared facilities.
The Urban Development Department will oversee enforcement, with a designated officer acting as the competent authority. This centralized oversight is expected to streamline regulatory processes and enhance compliance.
Penalties for non-compliance can reach up to Rs 1 lakh, with additional daily fines for ongoing violations. These penalties are intended to deter non-compliance and encourage adherence to the new regulations.
A public online portal for applications and registrations is expected to be launched within two years of the law's enactment. This digital initiative aims to improve accessibility and transparency in the regulatory process.
The draft bill represents a significant step towards modernizing apartment ownership laws in Karnataka, aiming to empower owners and streamline the management of apartment complexes. By addressing the long-standing issues faced by apartment owners and introducing a clear legal framework for governance and dispute resolution, the Karnataka government seeks to create a more equitable and efficient housing market. The implications of this bill could extend beyond just legal reforms; it may also foster a sense of community among residents, enhance property values, and ultimately contribute to the overall development of urban infrastructure in the state.
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