Compensation for palace land: DPAR directs UDD to consider 1996 Act

The ambiguity surrounding the extent of compensation for 15 acres and 39 guntas of Bangalore Palace land has finally been settled. The Department of Personnel and Administrative Reforms (DPAR)—the custodian of the 472-acre palace land situated in the heart of Bengaluru—has recommended that the Bangalore Palace (Acquisition and Transfer) Act 1996 be used as a basis for calculating the compensation.

The DPAR’s opinion is significant as it reports directly to Chief Minister Siddaramaiah. The compensation determined by the DPAR is also far less than what the Bruhat Bengaluru Mahanagara Palike (BBMP) originally estimated, which was Rs 1,400 crore.

While the state government approved the utilisation of 15 acres of palace land for widening Jayamahal and Ballari roads in March this year, there was no clarity over the extent of compensation to be paid. The order did specify that the compensation should be based on transferable development rights (TDR) rules, but the absence of a guidance value for the palace land had left officials in a fix.

In its letter to the Urban Development Department (UDD), the DPAR stated that the compensation for 15 acres and 39 guntas should be in proportion to the valuation of 472 acres of palace land. The 1996 Act — which had received assent of the President of India — had fixed Rs 11 crore as compensation for the entire 472-acre land. The validity of the Act was upheld by the high court while the Supreme Court had ordered a ‘status quo’.  

In the same letter, the DPAR cites two instances where compensation was issued to the legal heirs under the 1996 Act. In one, the Supreme Court ordered compensation of Rs 7.46 lakh in February 1999 for 13,000 square metres of land used to build the Palace Cross Road leading to Vasanthnagar. In the second instance, the government was directed to follow the 1999 compensation formula, resulting in approximately Rs 12 lakh for the utilisation of 8,510 sq metres of land for an underpass at Mehkri Circle.

Sources in the UDD confirmed that it has received the DPAR’s letter. 

The letter follows a communication from the UDD, which sought clarity on compensation and the transfer of the relinquishment deed to the BBMP for land utilisation. On the relinquishment deed, the DPAR informed the UDD that there is an overlap of land identified for fresh utilisation as well as the property already used for road widening and underpass construction. The DPAR sought fresh sketches of the land needed for road widening.

It has been learned that the government is treading cautiously with the matter related to the utilisation of the palace land, as the Supreme Court is currently hearing a batch of petitions which also includes the Bangalore Palace (Acquisition and Transfer) Act 1996. If the government succeeds in vacating the status quo, it will enjoy complete control over 472 acres of palace land by paying compensation of Rs 11 crore.