BENGALURU: As property tax defaulters continue to disregard multiple notices and auction alerts, the Greater Bengaluru Authority (GBA) is considering a new strategy. Officials are looking into the option of municipal corporations buying these properties at their guidance value to recoup overdue taxes.
In the past, legal actions such as issuing demand notices, seizing properties, and conducting public auctions have been implemented to recover debts. However, despite these efforts, few property owners opted to comply, and auctions often attracted no bidders, resulting in unmet revenue expectations. Consequently, authorities are now contemplating the direct acquisition of properties as a last resort.
A senior official stated, “The proposed plan involves civic bodies purchasing properties solely based on their guidance value. From this sum, outstanding property taxes, penalties, interest, and administrative fees would be deducted, with the remaining balance transferred to the original owner’s bank account. Subsequent to this, the property would be registered in the name of the respective municipal corporation. At this stage, defaulters will still have a final chance to settle all dues, including interest. Payment within the deadline will halt acquisition proceedings and return the property to the owner.”
Across the five city corporations, over 2.4 million properties exist, making property tax a crucial revenue source. However, more than 170,000 property owners have defaulted on taxes for years, leading to an estimated loss of approximately ₹600 crore. Despite persistent efforts from civic authorities, many owners remain unresponsive.
After assuming power, the Congress government introduced a one-time settlement scheme allowing relief on penalties and interest; however, only a small portion of defaulters took advantage of this opportunity. Authorities identified 7,020 properties with longstanding dues totaling several crores and commenced auction processes. Notices were issued and monitored by revenue officials, but most defaulters failed to respond, resulting in another unsuccessful initiative.
“Furthermore, tax evasion amounting to ₹688 crore has been discovered from around 23,000 properties. Since the self-assessment property tax system was implemented in 2008-09, many owners have allegedly understated their property dimensions to evade paying taxes. Utilizing drone surveys and field inspections, officials have started detecting these discrepancies. Several wards have completed surveys, and notices have already been sent to owners, verifying actual property sizes through on-site inspections and photographic evidence,” explained an official.
Meanwhile, officials observed that numerous owners misuse residential tax rates while utilizing properties for commercial purposes or renting them out to escape higher tax liabilities. Despite several enforcement actions, including notices and auction threats, most defaulters have remained uncooperative. As a result, authorities are now seriously considering the purchase of such listed properties at their guidance value to recover outstanding taxes, according to a senior official.
