Personal Experiences Real Estate Advice

The land site that was never allotted…

This is Uday’s experience with real estate purchase in India

City: Bangalore
Application and deposit for land placed: 2007
Possession: ???

I was living in California, in the United States. My father called me up urgently from India. “Aunty told me about an excellent opportunity to buy a BDA approved site. This is a golden chance. Let’s not miss it!”. It is indeed the GOLD standard in the city of Bangalore.

BDA is Bangalore Development Authority. People wait in lines for years to get a site that has been converted for residential use and allotted by BDA. It also assures that the site owners get access to drinking water on tap, electricity supply for another government body, paved roads and public transport connection, among others. The risk for a land owner who has BDA approved site is quite low. The property is well documented and cannot be encroached on easily.

Aunty told us that many of our relatives and acquaintances are also putting their deposits and we should rush before the opportunity is closed. I was living in the United States and my father in Bangalore, it was hard for us to decide how to proceed. In addition, neither of us had bought land in Bangalore before. No wonder, we followed the herd and scrambled to fill the paperwork and put our deposit within a couple of days, without even a cursory due diligence.

It turns out that we applied for the site from a Layout proposed by Karnataka Department Telecom Employee’s Cooperative Society (KDTECS), who supposedly got an approval from Bangalore Metropolitan Region Development Authority (BMRDA) for the layout. It was not even the BDA, which was the urban district or Bangalore. Anekal Planning Authority (APA) was the real approval authority here. KDTECS engaged “Sree Balaji Krupa Enterprises” to develop the land, as they had “extensive experience” in developing real estate projects.

Layout is the term used in Bangalore for a parcel of land that is being developed for residential use. Sree Balaji Krupa is considered as a “developer” and needs to provide a plan that shows each site in the layout marked clearly with the connecting roads inside the layout, provision for access to utilities, including water.

Whenever we call the developer of the layout, we get the standard answer – “Sir, you will get the site in the next few months. Don’t worry”.

This has been the saga for the past 8 years. All that we have is a piece of paper which says we put in an application and deposit for a site in the layout.

The developer has to work towards receiving all the approvals from government authorities and the proceed to allot the sites to the applicants, usually on a first-come first-serve basis, in the order in which application was submitted. They are not supposed to divert the deposit money to other projects or investments and should promptly allot the sites to the applicants.

The layout has 4 phases and when we visited it a couple of years ago, all we could see was that the land has been converted from agricultural use, but there was no sign of markings for each site in any phase. We don’t know what phase our site comes in. The site office was closed and we could not talk to anyone.

It is quite common to have multiple phases in a layout, each supposed to evolve it’s own community characteristics and also to distribute the work of the developer over years.

All told, how did we end up here? Who is to blame for the mess we are in? What could we have done differently? What are the options we have in front of us?

That’s when we asked around and talked to real estate experts and learned about rampant fraud in the system. Can we ask for our money back? It seems we can, but we will lose all the interest that the deposit would have earned in an fixed deposit or else where. Not a great financial choice, by any means. Can we file a lawsuit against KDTECS or Sree Balaji Krupa Enterprises? Experts tell us they have not made any time-bound commitments and we can’t have any success.

The correct approach, as I found out from my personal experience, is talk to experts, engage a real estate lawyer, get the property verification done and buy a verified property with a clear understanding of the risks involved. Get leads from your relatives, friends and colleagues, by all means. They are your well wishers anyway, but ensure you get expert opinions in addition.

Have you purchased land in India? What was your experience like? Please share your story in the comments section below. If we find it useful for our audience,

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