Bengaluru Real Estate: KRERA Orders BDA to Complete Project and Pay Compensation
In a significant move that brings relief to homebuyers, the Karnataka Real Estate (Regulation and Development) Authority (KRERA) has issued key orders against the Bangalore Development Authority (BDA). The authority has directed BDA to complete the long-delayed Nadaprabhu Kempegowda Layout (NPKL) project with full infrastructure within two months and to pay ₹22.4 lakh in interest compensation to an allottee for the delays. Additionally, KRERA has ruled that BDA qualifies as a ‘promoter’ under the Real Estate (Regulation and Development) Act (RERA), subjecting it to the same compliance standards as private developers.
This decision comes at a time when the supply of affordable housing in Bengaluru has been steadily shrinking. Rising land and construction costs have pushed developers toward mid- and premium-segment projects, leaving budget homebuyers with limited options.
In one specific case, KRERA directed BDA to complete the Nadaprabhu Kempegowda Layout and hand over fully serviced plots within two months. The authority emphasized the need to ensure essential infrastructure such as water and electricity connections, drainage systems, roads, and street lighting. The complainant, a Jayanagar-based buyer, had purchased a site in Sector B of the layout, with allotment dating back to October 2018 and full payment completed by February 2019. While a lease-cum-sale deed and possession certificate were issued in 2020, KRERA noted that the plot still lacked basic civic amenities, rendering it unfit for use or construction.
KRERA ruled that mere physical possession without the requisite core infrastructure does not meet the legal obligations under RERA. The authority also ordered BDA to pay delayed interest compensation for the period from 2018 to 2025, with additional interest to continue until the pending infrastructure is completed.
In another order, the KRERA tribunal dismissed an appeal filed by BDA and upheld an earlier KRERA order classifying the authority as a ‘promoter’ under RERA. BDA had argued that it operates under a separate statutory framework and should be exempt from RERA provisions. However, the tribunal rejected this contention, stating that the Act’s definition of promoter explicitly includes development authorities and public bodies engaged in real estate development for sale.
The KRERA tribunal’s ruling stated, “We are of the considered view that the definition of promoter in RERA Act is an inclusive definition and explicitly includes the Development Authority, and other Public bodies in respect of plots as well as apartments developed by such Authority or body on lands owned by them, or placed at their disposal by the Government, for the purpose of selling all or some of the apartments or plots to the Allottees.”
The RERA Act, 2016, came into force on May 1, 2017, marking a decade in 2026. The law was introduced to improve transparency, accountability, and efficiency in the real estate sector, which had long been affected by project delays, opaque practices, and frequent disputes between developers and homebuyers. The KRERA’s orders are expected to bring much-needed accountability and compliance to the BDA, ensuring that homebuyers receive the infrastructure and services they are entitled to.
The Bangalore Development Authority (BDA) is a statutory body under the Government of Karnataka, responsible for the planned development of the city of Bengaluru. It plays a crucial role in land acquisition, infrastructure development, and urban planning. The recent KRERA orders are a significant step towards ensuring that BDA adheres to the same standards of accountability and transparency as private developers, thereby protecting the interests of homebuyers and promoting a more regulated real estate market in Bengaluru.
