Chapter XII PROPERTY AND CONTRACTS

(1) All property of the nature herein specified, and not being specially reserved by Government, shall be vested in and belong to the corporation and shall, together with all other property or whatsoever nature or kind not being specially reserved by Government, which may become vested in the corporation, be under its direction, management and control and shall be held and applied by it as trustee, subject to the provisions and for the purposes of this Act, that is to say,-

1. (a) all public parks, playgrounds, and open spaces reserved for ventilation;
2. (b) all public lamps, lamp posts and apparatus connected therewith or appertaining thereto;
3. (c) all gates, markets, slaughter houses, manure and refuse depots and public buildings of every description.

1. (2) The corporation may accept trusts relating exclusively to the furtherance of purposes to which the corporation funds may be applied.

Subject to the provisions of section 174, the Commissioner may, for the purpose of this Act, acquire on behalf of the corporation movable or immovable property within or without the city or any interest in such property: Provided that,- (a) the Commissioner shall be bound by any resolution of the standing committee fixing terms, rates or maximum prices for a particular case or for any class of cases; (b) the sanction of the standing committee shall be required for the exchange of any immovable property, for the taking of any property on lease for a term exceeding twelve months, or for the acceptance of any gifts or bequest of property burdened by an obligation; and (c) the sanction of the corporation and the Government shall be required,- (i) for the acceptance or acquisition of any immovable property if the value of the property which it is proposed to accept, acquire or give in exchange exceeds one thousand rupees; (ii) for the taking of any property on lease for a term exceeding three years; or (iii) for the acceptance of any gift or bequest of property burdened by an obligation if the value of such property exceeds one thousand rupees.

1. (a) the Commissioner shall be bound by any resolution of the standing committee fixing terms, rates or maximum prices for a particular case or for any class of cases;
2. (b) the sanction of the standing committee shall be required for the exchange of any immovable property, for the taking of any property on lease for a term exceeding twelve months, or for the acceptance of any gifts or bequest of property burdened by an obligation; and
3. (c) the sanction of the corporation and the Government shall be required,-
   • (i) for the acceptance or acquisition of any immovable property if the value of the property which it is proposed to accept, acquire or give in exchange exceeds one thousand rupees;
   • (ii) for the taking of any property on lease for a term exceeding three years; or
   • (iii) for the acceptance of any gift or bequest of property burdened by an obligation if the value of such property exceeds one thousand rupees.

(1) Subject to the provisions of section 182, the Commissioner may dispose of by sale or exchange of any corporation movable property

1[xxx] or grant for any term not exceeding

2[two years]

¹ Omitted by Act 32 of 2003 w.e.f. 16.6.2003.

² Substituted by Act 32 of 2003 w.e.f. 16.6.2003.

a lease of any corporation immovable property or a lease or concession of any right of fishing or grazing or of gathering and taking fruit and the like: Provided that such lease or concession shall be subject to the condition that the grantee shall not erect any permanent structure on the demised premises: Provided further that every such disposal, lease or concession made or granted by the Commissioner shall be reported to the standing committee within fifteen days.

1. (2) With the sanction of the standing committee the Commissioner may dispose of by sale or exchange any corporation movable property 1[xxx] or grant for any term not exceeding three years a lease of any corporation immovable property or a lease or concession of any such right as aforesaid.
2. (3) With the sanction of the corporation the Commissioner may lease, sell or otherwise dispose of any corporation movable property.
3. (4) The sanction of the standing committee under sub-section (2) or that of the corporation under sub-section (3) may be given either generally or for any class of cases or specially for any particular case.
4. (5) The Commissioner may lend or let out on hire any corporation movable property on such conditions and for such periods as may be specified in the regulations.
5. (6) Notwithstanding anything contained in this Act,-
   • (a) no movable property exceeding such sum in value as may be prescribed shall be sold otherwise than by public auction;
   • (b) (i) no property whether movable or immovable of whatever value shall be transferred free of cost or for an upset price;
     • (ii) no lease of any immovable property exceeding five years shall be granted 1[except with the previous sanction of the Government] ;
     • (iii) no immovable property shall be disposed of by sale or by other transfer, except with the previous sanction of the Government.

¹ Omitted by Act 32 of 2003 w.e.f. 16.6.2003.

¹ Inserted by Act 64 of 2025 w.e.f. 12.09.2025.

Land Acquisition Act, 1894.- Any immovable property which any municipal authority is authorised by this Act to acquire may be acquired under the provisions of the Land Acquisition Act, 1894, and on payment of the compensation awarded under the said Act in respect of such property and of any other charges incurred in acquiring it, the said property shall vest in the corporation.

(1) Any land or other property transferred to the corporation by the Government shall not, unless, otherwise expressly provided in the instrument of transfer, belong by right of ownership to the corporation, but shall vest in it subject to the terms and conditions of the transfer and on the contravention of any of the said terms and conditions, the land or other property with all things attached thereto, including all fixtures and structures thereon, shall vest in the Government and it shall be lawful for the Government by order to resume possession thereof. (2) The Government may, by notification and after consultation with the corporation, take over for a public purpose any land or other property, movable or immovable, belonging to or vesting in the corporation on such terms as it may determine.

and conditions of the transfer and on the contravention of any of the said terms and conditions, the land or other property with all things attached thereto, including all fixtures and structures thereon, shall vest in the Government and it shall be lawful for the Government by order to resume possession thereof.

1. (2) The Government may, by notification and after consultation with the corporation, take over for a public purpose any land or other property, movable or immovable, belonging to or vesting in the corporation on such terms as it may determine.

(1) In any city to which a survey of lands other than lands ordinarily used for the purpose of agriculture only has been or shall be extended under any law for the time being in force, where any property is claimed by or on behalf of the corporation or by any person as against the corporation it shall be lawful for the

2[Regional Commissioner of the concerned revenue region] after enquiry of which due notice has been given, to pass an order deciding the claims.

1. (2) Any person aggrieved by an order made under sub-section (1) may appeal to the Karnataka Appellate Tribunal, and the decision of the Tribunal shall be final.
2. (3) Any person shall be deemed to have had due notice of an enquiry or order under this section if the notice has been given in the prescribed manner.] 1. Section 178A insertted by Act 14 of 1995 w.e.f. 3.5.1995.

² Substituted by Act 17 of 2007 w.e.f. 5.1.2007.

The Government may with the consent of the corporation transfer to the corporation the management of any institution or the execution of any work not provided for by this Act and it shall thereupon be lawful for the corporation to undertake such management or execution: Provided that in every such case the funds required, for such management or execution shall be placed at the disposal of the corporation by the Government.

The corporation may determine for any particular case whether the Commissioner shall execute work by contract or otherwise.

The powers of the several authorities to sanction estimates shall be as prescribed.

(1) The corporation may enter into any contract and perform such contracts as it may consider necessary or expedient for carrying into effect the provisions of this Act.

1. (2) Subject to the rules made in this behalf, the following provisions shall apply with respect to the making of contract for any of the purposes of this Act, namely:-
   • (a) every contract shall be made by or on behalf of the corporation by the Commissioner;
   • (b) no contract for any performance which, in accordance with the provisions of this Act, the Commissioner may not carry out without the sanction of one or other municipal authorities or of the Government shall be made by him unless such sanction has been given;
   • (c) any contract involving any expenditure exceeding such limits as may be specified in the rules shall be made by the Commissioner unless the requirement regarding the procedure to be followed has been followed, and unless the authority which is competent to accord sanction has accorded such

sanction and where the sanction to be accorded is by the Government unless such sanction has been accorded by the Government.

1. (3) These provisions shall apply to any variation of the contract involving an increase of such percentage over the expenditure involved in the original contract as may be prescribed.
2. (4) Subject to such rules as may be made in this behalf every contract to be entered into by the Commissioner on behalf of the corporation shall be entered into in such manner and form as would bind him if it were made on his own behalf and may in like manner and form be varied or discharged. Provided that,-
   • (a) the common seal of the corporation shall be affixed to every contract, which, if made between private persons, would require to be under seal; and
   • (b) every contract for the execution of any work or the supply of any materials or goods which will involve an expenditure exceeding one thousand rupees shall be in writing and shall be sealed with the common seal of the corporation and shall specify,-
     • (i) the work to be done or the materials or goods to be supplied, as the case may be;
     • (ii) the price to be paid for such work, materials or goods, and
     • (iii) in the case of a contract for work, time within which the work or specified portions thereof shall be completed.
3. (5) The common seal of the corporation shall remain in the custody of the Commissioner and shall not be affixed to any contract or other instrument except in the presence of the Commissioner and the Commissioner shall sign the contract or instrument in token that the same was sealed in his presence.
4. (6) No contract executed otherwise than as provided in this section shall be binding on the corporation.

(1) At least seven days before entering into any contract or the execution of any work or the supply of any materials or goods which will involve and expenditure 1. Substituted by Act 32 of 1986 w.e.f. 17.6.1986 and again substituted by Act 32 of 1[exceeding such amount as may be notified by the Government from time to time] the Commissioner shall give notice by advertisment inviting tenders for such contract: Provided that such advertisment shall be published only in such newspapers having such circulation as may be prescribed: Provided further that the standing committee may, at the instance of the Commissioner and for reasons which shall be recorded in its proceedings, authorise the Commissioner to enter into a contract without inviting tenders. 2003 w.e.f. 16.6.2003. 1. Substituted by Act 32 of 2003 w.e.f. 16.6.2003. 1[(2) On receipt of the tenders made in pursuance of the notice given under sub-section (1), the Commissioner may, accept or reject any tender in accordance with the provisions of the Karnataka Transparency in public procurements Act, 1999 (Karnataka Act 29 of 2000)]

¹ Substituted by Act 32 of 1986 w.e.f. 17.6.1986 and again substituted by Act 32 of

1[exceeding such amount as may be notified by the Government from time to time] the Commissioner shall give notice by advertisment inviting tenders for such contract: Provided that such advertisment shall be published only in such newspapers having such circulation as may be prescribed: Provided further that the standing committee may, at the instance of the Commissioner and for reasons which shall be recorded in its proceedings, authorise the Commissioner to enter into a contract without inviting tenders. 2003 w.e.f. 16.6.2003.

¹ Substituted by Act 32 of 2003 w.e.f. 16.6.2003.

1[(2) On receipt of the tenders made in pursuance of the notice given under sub-section (1), the Commissioner may, accept or reject any tender in accordance with the provisions of the Karnataka Transparency in public procurements Act, 1999 (Karnataka Act 29 of 2000)]

When work is given on contract at unit rates and the number of units is not precisely determinable, the contract shall be not deemed to contravene the provisions of section 182 or section 183 merely by reason of the fact that the pecuniary limits laid down therein are eventually exceeded.

The commissioner shall take sufficient security for the due performance of every contract into which he enters after a tender has been accepted, and may take security for the due performance of any other contract into which he enters.