In a short-term relief for the Karnataka government in its long-standing dispute with the former royals of Mysore over the 472-acre Bangalore Palace grounds, the Supreme Court Thursday allowed an application filed by the state government against depositing transferable development rights (TDRs) worth over Rs 3,000 crore with the royals.
The Supreme Court (SC) allowed the Karnataka government’s plea for keeping the TDRs in the court registry until the settlement of review petitions filed by the state against an SC order of December 10, 2024, in a contempt plea to pay TDR to the royals.
The SC has also directed that the original dispute over the Palace grounds – located in the heart of – be placed before a three-judge bench for commencement of hearings from August 18.
The SC bench comprising Justice Surya Kant, Justice Dipankar Datta, and Justice N K Singh heard the interlocutory application filed by the Karnataka government on Thursday after it was initially (CJI) on May 27 for orders on the administrative side.
“As an interim measure, all the TDRs issued pursuant to the interim/contempt orders passed by this Court, shall be kept in the Registry of this Court during the pendency of the present appeal. If the TDRs have been handed over to the appellants (non-applicants), they are directed not to utilize or sell the TDR/DRCs (Development Rights Certificates) till further orders,” the SC bench ruled Thursday.
“It is made clear that no third-party interest or personal benefits shall be created/drawn out of TDRs/DRCs released by the Registry of this Court,” the SC said.
The SC further said that all the civil appeals filed by the former royals in 1997 against the acquisition of the palace land by the Karnataka government in 1996 must be placed before a three-judge bench for final hearings on the dispute to start in August this year.
The top court also said that the hearing of review petitions of the state government against the December 10, 2024, order of the SC to deposit TDRs – for portions of the Bangalore Palace land sought to be acquired by the state for road development – should commence from the week of July 21.
The interim directions “are subject to the outcome of the Review Petitions. However, if the Review Petitions are declined, in that event, the interim direction shall remain in force for a period of four weeks from the date of passing of such order and/or the matter is heard by a three-Judge Bench, whichever is later,” the court said.
The apex court added that orders issued earlier on 21.11.2014, 17.05.2023, 19.03.2024, and 22.05.2025 to the state to pay the TDR to the royals “shall be kept in abeyance” in order to avoid complications.
The Karnataka government moved the new interlocutory application in the original Bangalore palace civil dispute cases of 1997 after a bench of the SC on May 22 rejected the state government’s plea not to allow release of TDRs worth over Rs 3,000 crore to the former royals until the main dispute over the Bangalore Palace grounds is settled by the SC.
The state was directed by the SC on December 10, 2024, to pay compensation in the form of TDRs at the prevailing market value to the erstwhile royal family as agreed by the state and ordered by the SC in November 2014 for acquisition of a 15.36 acre portion – out of the 472 acres of the disputed Bangalore palace property – for a road widening project.
The SC order came in the wake of contempt of court petitions filed by the erstwhile Maharaja of Mysore, the now deceased Srikantadatta Wadiyar, his wife Pramoda Devi Wadiyar, and others, over the delay in the payment of compensation by the state.
With the market value of the land sought to be acquired for road work assessed to be in the range of Rs 3,014 crore at present, the Congress government in Karnataka introduced an ordinance on January 29 to withdraw the TDR offer for the Bangalore Palace land.
The SC, however, rejected the Karnataka government’s effort to counter the compensation payment with the ordinance and indicated on February 13 that the December 10, 2024, order by a three-judge bench in the contempt pleas is not negotiable.
The Bangalore Palace grounds spread over 472 acres of land were 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.
In 1996, the state was to pay Rs 11 crore as compensation for the entire 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 the validity of the acquisition law in the Supreme Court after the Karnataka HC upheld the law on March 31, 1997.
Subsequently, the Karnataka government tried to acquire 15.36 acres of the palace land for widening of the Jayamahal Road and the Palace Road in central Bengaluru – over a stretch of two km – and a TDR compensation provision was provided for the acquisition.
The TDR that is to be paid to the royal family for the 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 state has argued.
“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,” Karnataka Law Minister H K Patil has stated.
