The BDA has ramped up its initiative to augment its incomes after it launched a large wave to collect overdue betterment charges (improvement fees), owing to its layout. Faced with heavy criticism in a recent Comptroller and Auditor General (CAG) report for “lackadaisical” financial management, the authority is now aiming to claim some ₹3,000 crore in dues from land that was notified and subsequently omitted from its layout projects.
Though intended to help facilitate financial recovery, the move will hit property owners in the pockets of 22 BDA-developed layouts in the city hard.
The Legal Mandate and Strict Warnings
In compliance with the Bangalore Development Authority Act, 1976, the BDA is well authorised to levy a betterment tax on the plots of land which has been developed through the use of the infrastructure and management work done by its own authorities. The BDA has issued an ultimatum to property owners: you pay up or else property will be seized.
- Interest and Penalties: Default won't be something one is simply owing; the BDA will apply a 2% per month fine to those who pay too late.
- Auction Threats if: Those who have not acted upon notices the BDA will consider confiscating those in possession, in addition to public auctions, to get paid.
- Notice Period: BDA has already announced that the organisation will begin formally issuing notices to all landowners in these 22 layouts as indicated on the documents.
The CAG Connection
The sudden urgency follows a scathing report issued by the CAG that the BDA had lost over ₹3,500 crore in not collecting betterment taxes in the previous decade. The report noted that though it was reeling with high-interest loans, the authority had not recovered on its main revenue streams, including the Arkavathi and Nadaprabhu Kempegowda layouts.
How much would you pay?
The BDA has fixed specific rates per square foot for different layouts. The Arkavathi Layout owners also are the biggest victims from this, as they experience significant appreciation in their value owing to a lot of “left-out” land categories.
The Impact on Property Owners
For a 30x40 site as an average (1,200 sq. ft.) would mean a property owner in Arkavathi Layout would have to pay more than ₹4 lakh as the principal betterment fee. If you add to that the penalty for those who missed payment entirely off for years, the sum could double. Property owners’ associations have voiced concerns, saying the BDA should ensure basic amenities like decent roads and sanitation facilities before charging high “improvement” fees for layouts that are underdeveloped, in many sectors.
