Key Takeaways
Introduction
Bengaluru's property market is no stranger to complexity — between BBMP jurisdictions, panchayat layouts, gram panchayat conversions, and the ever-contentious Khata classification system, navigating real estate here has always demanded diligence. But 2024 marked a watershed moment. The Karnataka government enacted the Greater Bengaluru Governance Act (GBG Act) 2024, fundamentally reshaping how the city is governed — and with it, how property ownership is classified, recognised, and taxed.
At the heart of this transformation is the B-Khata phase-out: a sweeping policy change that effectively signals the end of B-Khata certificates as a recognised form of property documentation for new constructions. If you are a homebuyer, investor, or property owner in Bengaluru, understanding what this means for you is not merely advisable — it is urgent.
This guide walks you through everything: what B-Khata is, why it is being phased out, what the GBG Act changes, and crucially, what steps you should take to protect your property interests.
Section 1: Understanding Khata — A-Khata vs B-Khata
The word 'Khata' (meaning 'account' in Kannada) refers to a property tax account maintained by the civic authority. In Bengaluru, the Bruhat Bengaluru Mahanagara Palike (BBMP) maintained two registers:
A-Khata (A Register): Properties that comply fully with the applicable building regulations, development plans, and zonal laws. These are properties within BBMP limits that were approved and built as per sanctioned plans. A-Khata properties can avail bank loans, are eligible for BBMP-issued trade licences, and can be legally transferred without encumbrance.
B-Khata (B Register): A secondary list maintained for properties that exist within BBMP limits but do not fully comply with regulations — typically unauthorised layouts, unapproved constructions, or properties in converted gram panchayat areas that were absorbed into BBMP jurisdiction without full regulatory clearance.
Historically, BBMP issued B-Khata certificates to collect property tax from non-compliant properties while acknowledging their existence — but without conferring the full legal recognition of A-Khata status. This created an enormous grey market: millions of Bengalureans living in B-Khata properties, paying taxes, yet unable to obtain bank finance or freely sell their homes.
Section 2: The Greater Bengaluru Governance (GBG) Act 2024 — What Changed
Introduced on July 23, 2024, and brought into force on April 23, 2025, the Greater Bengaluru Governance Act 2024 is one of the most significant pieces of urban governance legislation in Karnataka's history. Its key structural changes include:
2.1 Creation of the Greater Bengaluru Authority (GBA)
The GBG Act establishes the Greater Bengaluru Authority (GBA) as the apex administrative and planning body for Bengaluru. BBMP, as it was known, is being dissolved and its functions absorbed into a restructured framework with multiple municipal corporations under the GBA's umbrella.
2.2 Unified Planning and Property Governance
The GBA now holds centralised powers over land use, building approvals, property taxation, and civic infrastructure planning. This consolidation is intended to eliminate the jurisdictional ambiguity that allowed unauthorised constructions to proliferate in peri-urban and gram panchayat zones.
2.3 Formal Property Tax Integration
The GBA is mandated to bring approximately 6 lakh properties — previously operating in a regulatory grey zone — into its formal property tax framework. This includes a large number of B-Khata properties that must now achieve full compliance or face penalties.
Section 3: The B-Khata Phase-Out — Details and Timeline
The most immediate and impactful consequence of the GBG Act 2024 for property owners and buyers is the formal phase-out of the B-Khata system.
The Critical Cutoff: September 30, 2024
Under the new framework, B-Khata certificates will NOT be issued for any property constructed after September 30, 2024. This is a hard cutoff. Any property completed or approved after this date must qualify for A-Khata or will be treated as non-compliant under the GBA framework.
What Happens to Existing B-Khata Properties?
Properties that already held B-Khata certificates as of September 30, 2024 are not immediately declared illegal. However, they are in a transitional state. The government has signalled that the path forward for these properties is through regularisation — and several programmes are already in motion (including the 23 lakh property regularisation initiative announced in May 2026).
B-Khata Will No Longer Be Accepted as Valid Documentation
Once the GBA fully operationalises, B-Khata will cease to be a valid property document for the purposes of sale, transfer, mortgage, or construction approval. Financial institutions — including banks and housing finance companies — have already begun tightening their policies on lending against B-Khata properties.
Section 4: Impact on Stakeholders
4.1 Homebuyers
For anyone looking to purchase a property in Bengaluru, the B-Khata phase-out introduces a clear and non-negotiable rule: verify A-Khata status before signing any agreement. A B-Khata property purchased today (for a post-September 30, 2024 construction) could leave you with an asset that cannot be legally transferred, mortgaged, or sold to a future buyer with a home loan.
4.2 Existing Property Owners
If you own a B-Khata property built before the cutoff, your property is not immediately at risk — but inaction carries long-term consequences. The longer you remain outside the formal framework, the more complex and expensive regularisation may become. Proactive engagement with the GBA's regularisation programmes is strongly advised.
4.3 Real Estate Investors
The B-Khata phase-out is, in fact, a positive signal for the Bengaluru market in the long run. It cleans up the supply side, makes property rights clearer, and reduces the risk premium on Bengaluru real estate. Investors should use this moment to audit their portfolios and divest or regularise non-compliant holdings before the GBA enforcement mechanism fully activates.
4.4 Real Estate Agents and Developers
For professionals in the industry, the obligation to disclose Khata status to buyers is now both an ethical and legal requirement under RERA. Developers must ensure new projects are launched only after receiving proper GBA sanction and that all units are A-Khata eligible. Misrepresenting a property's Khata status can attract RERA penalties and civil liability.
Section 5: How to Convert B-Khata to A-Khata
While not all B-Khata properties can be converted — particularly those on encroached land or floodplains — a significant portion can be regularised. Here is the general process:
Step 1 — Verify Eligibility: Check whether your property falls within a regularisable zone (not on lake buffer, forest land, or government land). The GBA has been publishing lists of regularisable layouts.
Step 2 — Gather Documents: Assemble the original sale deed, encumbrance certificate, tax paid receipts, approved building plan (if any), and occupancy certificate.
Step 3 — Apply Under Regularisation Scheme: Submit an application under the applicable government regularisation scheme (such as the Akrama-Sakrama or its successor programmes). Pay the applicable betterment charges.
Step 4 — Obtain Khata Extract: Once regularised, apply to the GBA for an A-Khata extract. This document will reflect the property's correct classification in the new system.
Step 5 — Update Property Records: Ensure the updated Khata is reflected on the Kaveri 2.0 portal and in your property tax account.
PE Realtors' Legal Advisory team can guide you through each of these steps, manage document preparation, and liaise with the relevant GBA authorities on your behalf.
Section 6: What This Means for the Bengaluru Property Market
The B-Khata phase-out, while disruptive in the short term, is widely seen as a positive structural reform. Here is why:
Increased Market Transparency: A cleaner Khata classification system means buyers and sellers transact with greater confidence and clarity about property rights.
Better Access to Finance: A-Khata properties attract home loans from all banks. As more properties get regularised, credit availability across Bengaluru's housing stock will improve.
Price Appreciation in Compliant Zones: Areas with a high proportion of A-Khata properties — like Whitefield, Sarjapur Road, Hebbal, and North Bengaluru — will continue to see robust demand and appreciation.
Risk Premium on Non-Compliant Properties: Conversely, layouts with significant B-Khata exposure will face pricing pressure and reduced liquidity until regularisation is achieved.
Long-Term Investor Confidence: International and institutional investors will find the Bengaluru market more legible and investable as documentation standards improve.
In Conclusion
The B-Khata phase-out under the Greater Bengaluru Governance Act 2024 is not a procedural footnote — it is a fundamental reconfiguration of how property rights work in India's technology capital. For decades, millions of Bengalureans lived with the anxiety of holding property that was simultaneously taxed by the government and denied full legal recognition. The GBG Act draws a clear line in the sand. For buyers, the message is unambiguous: A-Khata is the only acceptable standard for new property purchases in Bengaluru. For existing owners, the window for regularisation is open — but it will not remain so indefinitely. For investors, the reform is a long-term positive, even if the short-term transition demands careful portfolio review. At PE Realtors, we have been tracking these developments closely and helping our clients navigate Bengaluru's regulatory landscape with confidence. Whether you need guidance on purchasing a compliant A-Khata property, legal advisory on converting your existing B-Khata holding, or investment strategy in the post-GBG Act environment, our team is ready to assist. Get in touch with us at pe@perealtors.com — and let's ensure your property journey in Bengaluru is built on solid, legally recognised ground.
