Year end 2024: All about the e-khata initiative introduced by the Karnataka government and its impact on homebuyers

In 2024, the Government of Karnataka launched the e-khata initiative to improve transparency of property records, reduce fraud and increase property tax revenue. This initiative presented its own set of challenges. This not only resulted in a slight drop in property registration numbers in the month of October, but also affected buyers who were in the process of getting their documents registered.

E-khata had its own set of challenges. This not only led to a slight drop in property registration numbers in October, but also affected buyers who were in the process of getting their documents registered. (Photo for representation purposes only)(Unsplash)

In September, the state government launched the e-khata service to improve transparency in property records, reduce fraud and increase property tax revenue.

E-khata is an electronic version of the traditional khata certificate, a computerized record that validates the ownership details of a property in Karnataka. This digital platform verifies that all necessary approvals have been obtained and offers official real estate ownership documents.

Read also: BBMP’s rush to implement e-khata service affected property records, caused ‘distress’ to buyers: CREDAI Bengaluru

While the system was already in place in other districts, like Chitradurga and Bagalkot, the state made e-khata mandatory for property registration from September.

On September 20, the Bengaluru civic body said it has so far digitized around 21 lakh property records in the city to implement the faceless, digital e-khata issuance system. contact and online.

While e-khata has given the state a much-needed digital boost, it has also impacted property registration. On December 13, CREDAI president Amar Mysore said the sudden rollout of the service had led to almost a 60 per cent drop in property registration in the city. Registration of properties worth ₹8,000 crore has been delayed since October.

He said the sudden implementation of mandatory e-Khata has led to a rush of applications and subsequent overflow of applications from the general public, causing considerable distress to people who are in the process of getting their documents registered .

Read also: Bengaluru residents can now access e-khata services at all BangaloreOne centers across ₹45. Details: report

The new property tax system that has not been implemented

In February 2024, the Bruhat Bengaluru Mahanagara Palike (BBMP) proposed directions on value-based property tax collection to replace existing ‘zonal classification’ based tax collection. According to the proposal, properties have been classified into six clear and unambiguous categories: residential (personal use and rented), commercial, industrial, star hotels, exempt land and vacant land.

The system aimed to simplify processes, streamline taxation and establish a fair framework by using indicative values of individual properties rather than a single tax rate based on average values within an area. The BBMP subsequently halted the implementation of the new property tax regime, fearing backlash from citizens ahead of the parliamentary elections.

In February 2024, Deputy Chief Minister DK Shivakumar said the government was working on a new uniform law to protect the rights of home buyers. The new law will abolish the existing Karnataka Apartment Ownership Act, 1972, and bring it under the purview of the Karnataka Real Estate Regulation and Development Rules (RERA), 2017.

Shivakumar said the move is expected to have a positive impact on Bengaluru, where property prices have been on the rise since early last year.