Rebate for converting B-Khata to A-Khata hits corporation budgets

The 60% rebate in the fees for the conversion of B-Khata to A-Khata, announced by Deputy Chief Minister and Bengaluru Development Minister D.K. Shivakumar on May 13, has upset the Budget Estimates (BE) of the five corporations presented only over a month ago. Previously, the fee was set at 5% of the guidance value of the plot to be regularised, but it has now been reduced to 2% for a 100-day window due to a lack of interest in the scheme. Ever since the scheme was introduced in the Greater Bengaluru Area (GBA) on October 15, 2025, only 949 B-Khatas have been converted to A-Khatas, collecting a revenue of ₹52.35 crore. GBA has received a total of 11,916 applications against an estimated 7 lakh B-Khata properties in the city. The five corporations put together estimated a ₹1700.5 crore revenue from this source in 2026-27. If the 60% rebate is applied to all properties, the amount will reduce to ₹680.5 crore. Ironically, Bengaluru City North Corporation, in its budget, had estimated to collect a revenue of ₹680 crore from the Khata conversion scheme. While this will hit estimated revenues of the corporations, the recent final notification to building bylaws, where the maximum permissible deviation that could be regularised with a penalty has been increased from 5% to 15%, is expected to bring in more revenues for the corporations. However, there is no estimate available. Srikanth Vishwanathan, CEO, Janaagraha Centre for Citizenship and Democracy, and a municipal finance expert, said the State government should ensure policy continuity and protect revenue streams for the Urban Local Bodies (ULBs). “Over a decade ago, the corporation used to budget a revenue of ₹1000 crore every year from Akrama - Sakrama and not a rupee materialised. Such practices undermine the integrity of the budgets. The State recently approved these five budgets, which means they approved these estimates. If the State now wants to provide a rebate, it must ideally make good the difference,” he argued. North and West hit most As B-Khata properties are more rampant on the city’s outskirts, corporations covering these areas estimate more revenues from this source. It made up 20% of the North Corporation’s own revenues and 17% of the West Corporation’s. The rebate will hit them the most. However, these corporations are now going into a special drive mode to target double the number of properties they hoped to convert this year to protect their revenues. K. V. Rajendra, commissioner, Bengaluru City West Corporation, said their budget estimate to collect ₹563 crore from the source was based on a target to convert 15,000 properties this fiscal, of the overall three lakh B-Khata properties. “On an average, we estimated that each property will pay anywhere between ₹3 lakh and ₹5 lakh. Now that will be down to ₹2 lakh, we have decided to carry out a special drive to convince property owners with big plots to avail the rebate window. We are targeting 30,000 properties to convert, to make ₹600 crore,” he said. Bengaluru City North Corporation Commissioner Pommala Sunil Kumar said the North Corporation would also take the same route and take up a special drive to target double the number of properties this fiscal than they initially thought. “We had estimated we could cover 22,000 properties this fiscal, now we will work to cover two times that,” he said.