Bengaluru IT Park Land Row: Karnataka HC Issues Notice Over Alleged Violations
Karnataka High Court issues notice over a plea by Royal Fragrances seeking action against KIADB regarding Bengaluru IT park land violations.
The Karnataka High Court has stepped into a legal battle concerning a prime piece of real estate earmarked for a software park in Bengaluru. Justice R Devdas has issued a notice following a petition filed by Royal Fragrances Private Limited, which is urging the Karnataka Industrial Areas Development Board (KIADB) to take strict action and potentially resume land that was allegedly managed in violation of allotment and lease conditions.
The Core of the Dispute
The legal conflict centers on a substantial plot of land measuring approximately 9 acres and 34½ guntas, located across Devarabeesanahalli and Kariyammana Agrahara villages in the Bengaluru East taluk. Originally acquired by the state government for the development of an IT park, the land has become the subject of intense scrutiny over how it was leased and financed.
Royal Fragrances claims a financial stake in the matter, stating that they paid Rs 1.34 crore to the KIADB under an agreement dating back to October 18, 2001. The company is now questioning the legitimacy of several commercial and financial dealings involving the current lessee, Sai Srushti Infrastructure Innovation Projects India Private Limited, and its predecessor, RR Platina Infra.
Allegations of Financial Irregularities
The petition brings to light several complex transactions that Royal Fragrances believes warrant a thorough examination:
- Premature Sales: The petitioner alleges that an agreement to sell proposed built-up space on the property was signed even before the land had been formally allotted, potentially bypassing prescribed approval requirements.
- Mortgage Violations: The plea points toward financing arrangements documented in a debenture trust deed (April 18, 2022) and a deed of hypothecation (May 2, 2022). Royal Fragrances argues that the lease-cum-sale agreement requires prior written consent from the KIADB for any mortgage, and that such financing must be strictly used for construction on the project land.
- Massive Debenture Issuance: The petition mentions that three group entities issued debentures totaling Rs 625 crore, with an Oaktree Capital Management-managed fund (OCM India Opportunities XB Alternate Investment Fund) acting as a debenture holder.
Other Entities Involved
While the primary allegations of violations are aimed at the present lessee and its predecessor, the petition also references Micro Labs Limited and the Oaktree-managed fund in the context of these financing and space-agreement arrangements. It is important to note that the court has not made any findings of wrongdoing against these specific entities.
The Demand for Action
Royal Fragrances asserts that they submitted a formal representation to the KIADB on April 17, 2026, requesting the authority to act on these alleged breaches. However, claiming that the board failed to respond or take action, the company approached the High Court.
The petitioner is seeking a court direction for the KIADB to consider their representation and make a decision under Section 34B of the Karnataka Industrial Areas Development Act, 1966, which governs the resumption of land in cases of breach of conditions.
Current Legal Status
In the order dated October 9, Justice R Devdas recorded the appearance of counsel for the first two respondents and directed the issuance of notices to the remaining parties. The court has permitted the filing of objections to impleading applications and has scheduled the matter to be listed again after two weeks.
At this stage, the High Court has not adjudicated the merits of the dispute, and the allegations regarding the land's misuse and financial irregularities remain to be examined.