Bengaluru Palace land takeover: Karnataka clears ordinance to withdraw TDR offer to avoid paying Rs 3,014 crore to Mysuru royal family

The Bengaluru Palace Grounds spread over 472 acres of land was acquired by the Karnataka government through the passage of the Mysore Palace Transfer and Acquisition Act of 1996 which received the assent of the President and came into force on November 18, 1996.

The state was to pay Rs 11 crore as compensation for the land at the rate of Rs 2.30 lakh per acre.

However, the acquisition by the state has remained in limbo since the royal family challenged validity of the acquisition law in the Supreme Court after the Karnataka HC upheld the law on March 31, 1997.

Subsequently, the Karnataka government acquired 15.36 acres of the palace land for widening of the Jayamahal Road and the Palace Road over a stretch of 2 km and a TDR compensation provision was provided.

The Supreme Court, in an order dated December 10, 2024, – in a contempt plea filed by the royal family – directed the Karnataka government to pay the transferable development rights or TDR for the palace land acquired for road widening – as per the prevailing guideline values for the areas adjacent to the Bangalore Palace grounds.

The TDR that has to be paid to the royal family for acquisition of 15.36 acres of land or 13,91,742 sq ft of land at the prevailing guidance value of Rs 2.70 lakh per sq metre would amount to Rs 200 crore for every acre and a total of Rs 3,014 crore, the law minister said.

“Even today the litigation is pending and there is no stay and if the development work costs Rs 3,014 crore then Karnataka will be in danger as far as development is concerned,” Patil said.

“Once TDR is paid it cannot be regained. It would affect the state’s economy. We have decided not to pay the TDR. Since it is under litigation there are a lot of complications. The ordinance will empower us to keep control over the land. The appropriate decision on compensation will be taken at the right time,” the law minister said.

The Karnataka government will file an affidavit in the Supreme Court during the next hearing of the Palace Grounds matter indicating the decision to issue an ordinance to keep the Palace Grounds under the control of the state which would negate the TDR compensation demands.

“If Rs 3,014 crore i.e. Rs.200 crores per acre is given for the development of only 2 km of road in the state, the economic situation of the state will be wrecked,” Patil said. He said the ordinance would supplement the 1996 Palace Land Acquisition Act.

“Promulgation of the ordinance empowers the state government to use as much space as required and abandon the other proposals. The Minister explained that the Ordinance would allow partial or complete withdrawal from any infrastructure project based on any court order or any decision.