Legal & Documents
A Khata vs B Khata: The Difference That Costs Lakhs
The B khata discount is real. So is the reason for it. Bengaluru's most consequential two letters.
The short answer
An A khata means the property is fully compliant. Legal layout, approved plan, all conversions and charges done.
A B khata means the municipality has recorded it for tax purposes while acknowledging it is NOT fully compliant.
The practical consequences: most banks won't lend, you can't get a building plan approved, and resale is hard. Which is why B khata properties trade 10–30% below equivalent A khata ones.
The comparison
| A Khata | B Khata | |
|---|---|---|
| Compliance | Fully compliant — legal layout, approved plan, land converted, betterment charges paid | Not fully compliant. Recorded for tax only. |
| Home loan | Yes, any bank | Most mainstream banks refuse. Some NBFCs lend, at a higher rate. |
| Building plan approval | Yes | No. You cannot lawfully build or extend. |
| Trade licence | Yes | No |
| Water & electricity | Standard connections | Can be difficult; sometimes only temporary connections |
| Resale | Straightforward | Hard. Your buyer faces every problem you did. |
| Price | Full market value | 10–30% below an equivalent A khata property |
| Convertible? | — | Sometimes — via betterment charges under a regularisation scheme. No guarantee, no timetable. |
Neither is 'illegal' exactly. A B khata property is recorded and taxed. What it is not, is certified as compliant — and the practical consequences of that flow through every part of owning it.
Why B khatas exist
Bengaluru grew very fast, and it grew ahead of its planning.
Layouts were formed on revenue land that was never converted to non-agricultural use. Buildings went up that deviated from approved plans. Development charges went unpaid. Land was sold and subdivided outside any approved layout.
The BBMP faced a choice: pretend these properties did not exist, and lose the tax — or record them, tax them, and mark them as non-compliant.
It created the B register. It was an accounting decision, not a legalisation. And that distinction is exactly what a B khata buyer inherits.
What a B khata actually costs you
1. The loan — the big one
This is the single largest practical consequence, and it cuts both ways.
Buying: you may need to fund it largely in cash, or borrow from an NBFC at a materially higher rate.
Selling: your buyer faces exactly the same problem — which shrinks your pool of buyers to those who can pay cash. That is a small pool, and it prices accordingly.
The discount you enjoyed on the way in, you pay for on the way out.
2. You cannot build
No sanctioned plan. So no lawful construction, no extension, no additional floor. If you were planning to build on that plot, a B khata makes it impossible to do lawfully.
3. The uncertainty never quite goes away
Regularisation schemes open, close, and are periodically challenged in court. A property that is "about to be regularised" has been about to be regularised, in some cases, for well over a decade.
Can a B khata become an A khata?
Sometimes. Broadly it requires:
- Land conversion to non-agricultural use, if that was the original defect
- Payment of betterment charges to the BBMP
- A regularisation scheme being open, and the property qualifying under it
- Compliance with the approved layout, or regularisation of the deviation
Schemes come and go. They get challenged in the High Court. They get stayed. Deadlines move. Some properties simply do not qualify.
Buy a B khata property on the basis of what it is today, at a price that reflects that — not on the basis of what a seller says it will become.
If it is regularised later, that is an upside. It is not a plan.
Should you ever buy one?
Some people do, knowingly, and it works out.
It might make sense if: you are paying cash and don't need a loan; the discount is genuinely large; you know the area and the specific property well; you have had a lawyer look at it properly; and you understand that your exit will be to another cash buyer.
It does not if: you need a home loan; you plan to build; you will need to sell within a few years; or you are buying because a broker told you it would 'become A khata soon'.
“Is this an A khata or a B khata?”
Ask early, directly, and do not accept 'it's in process' — that phrase has been doing a great deal of work in Bengaluru for a very long time.
Then verify it yourself on the BBMP portal. Do not take a seller's paper at face value. Khatas have been forged.
Frequently asked questions
What is the difference between A khata and B khata?
An A khata means the property is fully compliant — legal layout, approved plan, land converted, charges paid. A B khata means the municipality has recorded it for tax purposes while acknowledging it is not fully compliant. The practical difference: most banks won't lend against a B khata, you can't get a building plan approved, and resale is significantly harder.
Can I get a home loan on a B khata property?
Most mainstream banks refuse. Some NBFCs will lend, at a materially higher rate. This is the single biggest practical cost — and it cuts both ways, because your eventual buyer will face the same problem, which shrinks your pool of buyers to those who can pay cash.
Why are B khata properties cheaper?
Typically 10-30% cheaper, because of everything the B khata prevents: no mainstream home loan, no building plan approval, difficult resale, and the ongoing uncertainty of whether it will ever be regularised. The discount is real, and so is the reason for it.
Can a B khata be converted to an A khata?
Sometimes — through land conversion, payment of betterment charges, and a regularisation scheme being open and the property qualifying. But schemes come and go, get challenged in court, and get stayed. Do not buy a B khata property on the assumption it will be regularised. If it happens, that's an upside; it is not a plan.
Is a B khata property illegal?
Not exactly. It is recorded and taxed by the municipality. What it is not is certified as compliant — and the practical consequences of that flow through every part of owning it: the loan, the building approval, the resale.