Karnataka’s B-Khata To A-Khata Conversion Scheme: A Significant Step Towards Property Regularisation

Posted On - 14 July, 2026 • By - B. Jayprakash

The Karnataka Government’s recent decision to introduce a 100-day One-Time Settlement (OTS) Scheme for the conversion of B-Khata properties into A-Khata marks one of the most significant real estate reforms in recent years. Under the scheme, eligible property owners can obtain an A-Khata by payment of 2% of the property’s guidance value, subject to the applicable eligibility criteria prescribed under the scheme.

Background: The B-Khata Challenge

For years, B-Khata properties have occupied a grey area in Karnataka’s real estate market. While many owners regularly paid property taxes, they continued to face practical challenges, including:

  • Obtaining building approvals
  • Securing institutional finance
  • Facilitating smooth resale transactions

The new scheme seeks to address these long-standing concerns by providing an opportunity for eligible property owners to regularise their records.

It is important to understand that the scheme does not automatically convert every B-Khata property into an A-Khata. Eligibility remains subject to statutory conditions, including:

  • Verification of title documents
  • Compliance with applicable planning regulations
  • Satisfaction of the requirements prescribed by the competent authority

Property owners should therefore undertake careful legal due diligence before assuming that their property qualifies for conversion.

Impact on Property Transactions

From a legal perspective, the reform is expected to improve certainty in property transactions by encouraging the maintenance of updated land records and reducing ambiguities relating to municipal documentation.

Developers, purchasers, lenders, and investors should also review the status of properties involved in ongoing or proposed transactions, as the availability of an A-Khata may significantly influence:

  • Financing options
  • Marketability of the property
  • Future development prospects

Key Takeaway for Property Owners

The scheme presents a valuable opportunity for eligible property owners. At the same time, it reinforces the importance of obtaining proper legal advice before initiating the conversion process or entering into any real estate transaction.

Last Updated on 14 July, 2026