Karnataka Apartment (Ownership and Management) Bill, 2025
Introduction
Apartment living has become the dominant form of urban housing in Karnataka, particularly in Bengaluru, Mysuru, and other rapidly expanding cities. Despite this reality, apartment ownership and management have long been governed by outdated and fragmented legal frameworks, most notably the Karnataka Apartment Ownership Act, 1972, coupled with society registrations and contractual arrangements drafted by developers. This mismatch between modern housing realities and archaic legal structures has led to recurring disputes over common areas, maintenance, association powers, redevelopment, and developer obligations.
The Karnataka Apartment (Ownership and Management) Bill, 2025 (“KAOM Bill, 2025”) seeks to correct these systemic issues by introducing a single, comprehensive legislation governing apartment ownership, management, and dispute resolution. While the Bill has been welcomed as a progressive step, it has also attracted criticism for certain ambiguities and potentially onerous provisions.
Necessity of the Karnataka Apartment (Ownership and Management) Bill, 2025
The Karnataka Apartment (Ownership and Management) Bill, 2025 addresses the urgent need for a modern legal framework to govern the rapidly expanding apartment housing sector in Karnataka. With apartments forming a major share of urban housing, particularly in Bengaluru, governance has continued under the outdated Karnataka Apartment Ownership Act, 1972, which is ill-suited for contemporary high-density developments. In practice, apartment management has relied on a fragmented mix of outdated legislation, society registrations, and developer-drafted agreements, leading to persistent disputes over common areas, delayed handovers, weak resident associations, and excessive litigation. Although the Real Estate (Regulation and Development) Act, 2016 improved protections during construction and sale, it leaves post-handover governance largely unregulated. The KAOM Bill, 2025 seeks to fill this regulatory vacuum by establishing a uniform framework that clarifies ownership rights, mandates statutory associations, enhances developer accountability, and introduces specialised dispute resolution, thereby improving governance and legal certainty.
Objectives and Legislative Intent
The primary objective of the KAOM Bill, 2025 is to bring legal clarity, uniformity, and enforceability to apartment living. The Bill aims to:
- Clearly define ownership rights over apartments, common areas, and land;
- Strengthen the legal status and powers of Associations of Apartment Owners (AAOs);
- Ensure timely and complete handover by developers;
- Reduce reliance on civil courts by creating a specialised dispute resolution mechanism; and
- Align apartment governance with modern real estate laws such as RERA.
At its core, the Bill reflects a policy shift from developer-centric control to owner-centric governance.
Clearer Definition of Apartment Ownership and Common Areas
One of the most significant improvements introduced by the Bill is the detailed clarification of ownership concepts. The Bill recognises apartment ownership as a combination of:
- Exclusive ownership of the individual apartment unit; and
- An undivided interest in the land and common areas, proportionate to the super built-up area.
The Bill elaborately defines common areas and facilities, including staircases, lifts, basements, corridors, fire safety installations, recreational areas, and other shared infrastructure. It also introduces the concept of limited common areas meant for the exclusive use of certain apartments.
Mandatory Association of Apartment Owners (AAO)
The KAOM Bill, 2025 mandates the formation of a registered Association of Apartment Owners for every qualifying apartment project. This association becomes a statutory body corporate with the authority to manage common areas, levy charges, frame by-laws, and represent apartment owners in legal proceedings. Existing associations registered under other laws are deemed to be valid, thereby ensuring continuity and avoiding administrative disruption.
Expanded Obligations on Developers and Promoters
The Bill significantly curtails the long-standing control exercised by developers post-completion. Promoters are obligated to:
- Transfer land and common areas to the association within a prescribed period;
- Hand over sanctioned plans, approvals, completion certificates, and other essential documents;
- Facilitate the formation and registration of the AAO; and
- Withdraw from maintenance and management after lawful handover.
These provisions aim to address one of the most persistent grievances of apartment owners—delayed or incomplete handover.
Maintenance Charges and Financial Governance
The Bill provides statutory backing for levying maintenance charges based on super built-up area and allows differential charges for facilities such as clubhouses or commercial components. It also mandates the creation of a Common Capital Fund for long-term repairs, major maintenance, and redevelopment.
This framework aims to bring predictability and transparency to association finances.
Redevelopment and Structural Alterations
Acknowledging the ageing apartment infrastructure in urban Karnataka, the Bill introduces a structured redevelopment framework. Major alterations or redevelopment require the consent of at least 75% of apartment owners, along with detailed disclosures regarding plans, costs, and timelines.
Dispute Resolution Mechanism
To reduce the burden on civil courts, the Bill establishes a competent authority empowered to adjudicate disputes between apartment owners, associations, and developers. An appellate mechanism is aiming for faster and specialised resolution.
Alignment with RERA and Regulatory Overlap
The Bill attempts to align its provisions with the Real Estate (Regulation and Development) Act, 2016. This alignment strengthens buyer protection and accountability but also raises concerns about overlapping jurisdictions.
Applicability and Grey Areas
The KAOM Bill, 2025 is expected to apply to apartment projects above a prescribed threshold. However, ambiguity remains regarding its applicability to villa developments, row houses within gated communities, and mixed-use projects.
This lack of clarity could result in inconsistent enforcement and fresh litigation.
Key Criticisms
Despite its reform-oriented intent, the Karnataka Apartment (Ownership and Management) Bill, 2025 has drawn sustained criticism from resident welfare associations, developers, and legal experts due to several unresolved legal and practical concerns. A central issue is the Bill’s continued reliance on the super built-up area for calculating undivided land interest and maintenance charges. In the absence of standardised measurement norms, independent verification, or transparent disclosure mechanisms, this approach risks perpetuating opaque practices that courts have repeatedly questioned.
Another significant concern is regulatory overlap with the Real Estate (Regulation and Development) Act, 2016 (RERA). Although the Bill claims alignment, it fails to clearly define jurisdictional boundaries between RERA authorities and the proposed competent authority, potentially leading to parallel proceedings, inconsistent rulings, and forum shopping in matters such as delays, construction defects, and common area transfers.
The Bill also applies a uniform compliance framework across all apartment projects, imposing mandatory registration, audits, and reporting obligations even on small associations. Critics argue that this disregards proportional regulation and may overburden associations lacking professional management capacity.
In redevelopment matters, while the 75% consent requirement appears participatory, the Bill inadequately protects dissenting or minority owners. The absence of clear provisions on compensation, interim accommodation, or exit options raises concerns over coercion and dilution of property rights. Additionally, the dispute resolution framework lacks clarity on independence, expertise, and timelines, while ambiguities regarding villas, gated communities, and mixed-use developments further complicate enforcement. Collectively, these issues risk undermining the Bill’s effectiveness and may increase compliance costs, impacting affordability and market confidence.
Analysis and Conclusion
The Karnataka Apartment (Ownership and Management) Bill, 2025 represents a long-overdue attempt to modernise the legal architecture governing apartment living in the State. Its greatest strength lies in recognising that apartment communities are no longer peripheral housing arrangements but the primary mode of urban residence, requiring a dedicated, coherent statutory framework. By consolidating ownership norms, mandating statutory associations, and imposing clearer post-handover obligations on developers, the Bill seeks to correct structural deficiencies that have historically fuelled disputes and litigation.
However, the Bill’s effectiveness will ultimately depend on how its ambiguities are addressed before enactment. Continued reliance on super built-up area, without standardised measurement safeguards, risks perpetuating the very conflicts the legislation seeks to resolve. Similarly, the absence of clear jurisdictional demarcation between RERA authorities and the proposed competent authority may lead to regulatory overlap, forum shopping, and inconsistent adjudication. These concerns are not merely theoretical; they reflect patterns already observed in India’s fragmented real estate dispute resolution ecosystem.
The uniform compliance framework, while well-intentioned, also raises proportionality concerns. Smaller apartment complexes may struggle to meet regulatory and financial obligations designed with large developments in mind. Further, the redevelopment provisions, though necessary, insufficiently protect minority owners and vulnerable residents, raising potential constitutional and property rights implications.
In conclusion, the KAOM Bill, 2025 is a progressive and necessary legislative intervention that has the potential to significantly improve apartment governance in Karnataka. Yet, for the Bill to achieve its stated objectives of reducing litigation, enhancing transparency, and empowering apartment owners, it must be refined through clearer definitions, graded compliance norms, stronger procedural safeguards, and precise regulatory coordination. With these calibrations, the Bill could emerge as a model statute for apartment governance across India rather than another well-intentioned law undermined by avoidable ambiguities.
Author:–Karri Sahiti Ananya Reddy, in case of any queries please contact/write back to us at support@ipandlegalfilings.com or IP & Legal Filing.
References
- Karnataka Apartment (Ownership and Management) Bill, 2025 (Draft), Urban Development Department, Government of Karnataka.
- Karnataka Apartment Ownership Act, No. 17 of 1973, Acts of Karnataka.
- Karnataka Societies Registration Act, No. 17 of 1960, Acts of Karnataka.
- Real Estate (Regulation and Development) Act, No. 16 of 2016, India Code.
- Deccan Herald, Karnataka Apartment Bill Mandates Body to Resolve Conflicts (2025).
- BLR Post, New Bill Seeks to End Disputes Over Apartment Ownership and Maintenance in Karnataka (2025).
- Sugruha Apartment Federation, Analysis of the Proposed Karnataka Apartment (Ownership and Management) Bill, 2025.
- Ghar.tv, Karnataka Apartment Bill 2025: A Landmark Reform to Transform Society Governance (2025).
- Law Commission of India, Reports on Housing Laws and Urban Property Governance (relevant excerpts).
- Ministry of Housing and Urban Affairs, Government of India, Model Apartment Ownership Act / Urban Housing Policy Documents.
