THE RISKS IN INVESTING IN UNAUTHORIZED LAYOUTS

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In recent times, Bangalore has witnessed phenomenal growth in population due to various reasons such as pleasant weather conditions, better career opportunities and the like.As a result of this, there has been a rapid increase in the demand for house and house-sites here. In order to cater to this increasing demand, a large number of Developers and Property Dealers have come into picture and have been forming private layouts without following the mandatory procedure and requirement of law making the innocent purchasers to suffer.

To avert this mishap, it is necessary that the intending purchasers of immovable property in Bangalore to have some knowledge about the nature of the property proposed to be purchased by them to save themselves from the risk of investing in the immovable property with no valid and marketable title.

Authorities
There are only two authorities, which have been authorized to approve layouts in and around Bangalore viz., Bangalore Development Authority [B.D.A.] and Bangalore Metropolitan Rural Development Authority [B.M.R.D.A].

While the BDA approves the layout plans for formation of layouts in the lands falling within the metropolitan areas, BMRDA approves layout plans for formation of layout in the lands situated in the outskirts of Bangalore. Getting approval for the land conversion and layout formation from BMRDA is less time consuming, less expensive and easier when compared to procedure laid down by the BDA.

Development Plan

For planned development of a city, proper road network, parks, open space, civic amenities, and a proper approved layout is necessary. BDA is the authority in charge of planning and development to Bangalore Metropolitan Area. Comprehensive Development Plan [CDP] is prepared by BDA under the Karnataka Town and Country Planning Act, 1961.The last CDP was prepared and approved by Government in the year 1995, which is still in force.

Zonal Regulations

In order to promote public health, safety and the general well-being of the community, it is necessary to apply reasonable limitations on the use of land and buildings. This is to ensure that the development of the city takes place in accordance with the land use plan as proposed in the CDP in a most appropriate and healthy manner.

Generally, CDP is valid for a period of 20 years from the date of preparation of the plan. The following are the classification of land uses for various zones:

1.Residential
2.Commercial(retail and whole sale business)

3.Industrial (light and service industries, medium industries and heavy industries)

4.Public and Semi-public Utilities and Services.

5.Parks and Open space and playgrounds (including public recreational area)

6.Transportation and Communication.

7.Green-belt area

Unauthorised Layouts

Sites formed in unauthorized layouts are called Revenue Sites. The lay-outs which are formed without following the mandatory procedure and the requirements of law are called unauthorized layouts and can be classified into two:.

Converted land

In this type of layouts, sites are formed in the lands which are converted from agricultural to non-agricultural residential purpose after obtaining conversion order from the Deputy Commissioner and in conformity with the zonal regulations but without obtaining approved layout plan from the competent authority. Village Panchayats are not competent to approve the lay-out plans.

Agricultural land

In these layouts, sites are formed on the agricultural lands not converted and without obtaining approved layout plan from the competent authority. Purchase of this type of site is very risky as marketable title would not be available to the purchaser.

Sites formed in either of the classification referred to above are called as revenue sites. In such sites, electricity, water, sanitation and civil amenities will not be available to the site owners though providing of these facilities are the mandatory requirements as envisaged under the Karnataka Town Planning Act, 1961.

In formation of sites in these unauthorized layouts, Developers play a key role. In order to achieve maximum saleable area, the width of the road and the space allotted for providing civic amenities would not be as per law. The only intention of the developers in such unauthorized layouts would be to enrich themselves without providing even the basic amenities to the buyers.Purchasing sites formed in the converted land unauthorized layout is comparatively a better option to the one formed in the non-converted agricultural land. However, purchasing sites in unauthorized layouts will not convey valid and marketable title to the transferees.In fact, Bankers even refuse to provide loans for such sites either for the purchase or for putting up construction thereon. Thus, sites in unauthorized layouts are not recommended for purchase.

Approved Layouts

It is advised that the people who are desirous of purchasing house site may prefer to purchase sites in approved layouts for the reason that water supply, underground drainage, street lights, electricity supply, civic amenities are available in these layouts.

Valid and marketable title are conveyed to the purchasers. Value of sites appreciate considerably. Housing loan facilities can be availed for purchase of site and for construction and above all it is easy to dispose of these sites whenever needed. The following types of sites are suggested for purchase:

1.Sites allotted by BDA without lease.

2.Sites allotted by KHB without lease.

3.Sites allotted by Co-operative societies after obtaining approval for formation of layout from BDA or BMRDA along with order of release of sites.

4.Sites formed in the private layout, approved by BDA or BMRDA along with order of release of sites.

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