The proposed Karnataka Apartment Management Bill, 2026 is an important step towards simplifying apartment governance in the state. By replacing the overlapping provisions of the Karnataka Ownership Flats Act (KOFA) and the Karnataka Apartment Ownership Act (KAOA) with a single legislation, the government has an opportunity to create a more transparent and efficient legal framework for apartment communities.
Many of the proposed provisions are likely to benefit homebuyers, apartment associations and developers alike, by reducing legal ambiguity and providing a common framework for the management of residential communities.
However, one provision deserves urgent reconsideration before the Bill becomes law.
Formation of an association based on 50% allotment
Under Chapter V, Section 21(5), the Bill proposes that a promoter must form an apartment owners’ association within three months of achieving more than 50% allotment of the apartments. This requirement appears to have been carried forward from the Karnataka Ownership Flats Act, 1972 (KOFA).
While the intention is understandable — to involve homebuyers early in the project and ensure better governance — a trigger based on “allotment” may not achieve the intended objective.
Why allotment is a weak legal benchmark
An allotment letter merely indicates that a unit has been earmarked for a prospective purchaser. It is not, by itself, conclusive proof of ownership or a binding, long-term commitment by the buyer.
In the real estate industry, allotments are issued for a range of commercial reasons. Developers may allot units to friends, relatives, investors or short-term financiers during the course of project financing or marketing. Such allotments may not represent genuine end-users who intend to become members of the future apartment community.
Whether or not this practice is widespread, the law should recognise only those milestones that clearly establish genuine buyer participation.
The practical difficulty for genuine developers
The proposed provision may also create difficulties for developers acting in good faith.
During the construction phase, many genuine purchasers are reluctant to become office-bearers or committee members of an association. At that stage, they have neither possession of their apartments nor the expertise required to oversee construction quality, statutory approvals, contractual compliance or financial decisions.
Most homebuyers purchase an apartment expecting the developer to complete the project in accordance with the approved plans and applicable laws. They are generally not equipped to monitor engineering standards, building regulations or legal compliance while construction is still underway.
As a result, even developers who wish to comply with the law may find it difficult to form a functional association immediately after crossing the 50% allotment threshold.
An unintended incentive
Whenever a legal requirement is difficult to comply with in practice, it can unintentionally encourage workarounds.
If forming an association becomes mandatory before enough genuine buyers are ready to participate, developers may come under pressure to rely on nominal or temporary allottees simply to satisfy the statutory requirement.
Such situations can create unnecessary disputes over the legitimacy of the association, the validity of its decisions and the rights of genuine purchasers. Instead of improving governance, the provision could increase litigation and administrative complexity.
Good legislation should minimise opportunities for such disputes rather than inadvertently create them.
Read more: Frequently asked questions on laws for registration of apartment associations
A better alternative
The trigger for forming an apartment owners’ association should instead be linked to a milestone that reflects genuine ownership and readiness for collective management.
Possible alternatives include:
- Registration of a specified percentage of sale deeds.
- Handing over possession of a specified percentage of apartments.
- Receipt of the Occupancy Certificate, together with a minimum percentage of registered apartment owners.
These milestones are objectively verifiable and better represent a community that is capable of assuming management responsibilities.
Building a stronger law
The Karnataka Apartment Management Bill, 2026, has the potential to become a landmark reform benefiting lakhs of apartment residents across the state. Its objective of consolidating multiple laws into a single, comprehensive framework is both timely and necessary.
But the success of any legislation depends not only on its intent, but also on whether its provisions reflect the practical realities of apartment development. Replacing the “50% allotment” criterion with a more reliable and legally meaningful benchmark, such as registration, would reduce ambiguity, discourage misuse, protect genuine homebuyers and make compliance easier for responsible developers.
A small amendment at the drafting stage could prevent years of avoidable disputes, and help ensure that the new law delivers the transparent, accountable apartment governance that Karnataka’s citizens deserve.
The State Government released the draft legislation for public consultation on July 15th, 2026. Citizens can share their feedback and submit comments/suggestions till August 6th through kaomablr@gmail.com.
I fully subscribe to the ALTERNATIVE suggested by Shri Mahesh Bhat.
The trigger for forming an apartment owners’ association should instead be linked to a milestone that reflects genuine ownership and readiness for collective management.
Possible alternatives include:
Registration of a specified percentage of sale deeds.
Handing over possession of a specified percentage of apartments.
Receipt of the Occupancy Certificate, together with a minimum percentage of registered apartment owners.
These milestones are objectively verifiable and better represent a community that is capable of assuming management responsibilities.