Karnataka Rent (Amendment) Act 2025: What Changed for Bangalore Tenants and Landlords
The Karnataka Rent (Amendment) Act, 2025 became law in January 2026 and changed how breaches of the state's rent law are punished. This guide explains what the amendment contains, which Bangalore tenancies the rent law covers, and what it leaves untouched, including the security deposit.
What the Amendment Is
The amendment changes the Karnataka Rent Act, 1999, the state law on rented premises. The Bill was introduced in the Legislative Assembly in December 2025, during the Belagavi session. The Governor gave assent on 7 January 2026 and the law was published in the Karnataka Gazette on 8 January 2026 as Karnataka Act 07 of 2026.
Its purpose is narrow. The stated aim is to decriminalise minor offences and rationalise money penalties, in line with the central Jan Vishwas Act of 2023. The amendment came into force at once and touches four sections of the 1999 Act.
The Four Changes
Each change moves the rent law away from criminal courts and towards penalties decided by the Rent Controller:
- Section 24: the Rent Controller becomes the adjudicating officer who decides penalties
- Section 53: the provision on prosecution before a magistrate is removed
- Section 54: jail terms of up to one month are dropped and the money penalties are raised
- Section 55: breaches by companies and their officers are now called contraventions, with penalties in place of prosecution
A new sub-section in Section 54 also builds in a periodic rise. The penalties go up by 10% of the minimum penalty amount after every three years from the start of the amending Act.
Old and New Penalties
The table below sets out the main breaches and how the consequence changed:
| Breach | Before | After the amendment |
|---|---|---|
| Landlord or tenant fails to present the lease agreement or file tenancy particulars | Fine up to Rs. 2,000, jail up to one month, or both, plus Rs. 500 for each day of default | Penalty up to Rs. 2,000 plus Rs. 5,000 for each day of default |
| Tenant sub-lets or hands over the premises without the right to | Fine up to Rs. 5,000, jail up to one month, or both | Penalty up to Rs. 50,000 |
| Landlord claims a premium or pugree barred by the Act | Fine up to Rs. 3,000, jail up to one month, or both | Penalty up to Rs. 30,000 |
| Landlord re-lets premises recovered for own use or rebuilding | Fine up to Rs. 5,000 or double the new rent, with possible jail | Penalty up to Rs. 50,000 or double the new rent, whichever is more |
| Landlord or tenant cuts off an essential supply or service | Fine of three months' rent, jail up to one month, plus Rs. 100 a day | Three months' rent plus Rs. 1,000 a day until the supply is restored |
| Failure to furnish particulars asked for under the Act | Fine up to Rs. 1,000, jail up to one month, or both | Penalty up to Rs. 10,000 |
| Estate agent works without registering under the Act | Fine up to Rs. 2,000, jail up to one month, plus Rs. 2,000 for each day of default | Penalty up to Rs. 2,000 plus Rs. 20,000 for each day of default |
The pattern is the same in every row. Prison is gone, and the sums are roughly ten times higher than before. A person in charge of a company escapes the penalty only by proving the breach happened without their knowledge or despite due care.
Which Tenancies the 1999 Act Covers
The amendment matters only to tenancies that fall under the 1999 Act, and many modern Bangalore lettings fall outside it. The Act leaves out any premises whose standard rent is above Rs. 3,500 a month in the areas listed in Part A of its First Schedule. Elsewhere in the state the limit is Rs. 2,000 a month. Most non-residential premises are also outside it, apart from small commercial units of up to 14 square metres.
A flat let at a typical market rent in Whitefield or HSR Layout is therefore governed mainly by its rental agreement. General law fills the gaps, chiefly the Transfer of Property Act, 1882 and the Registration Act, 1908. Older tenancies at low rents are where the 1999 Act, and so the amendment, applies in full.
What the Amendment Leaves Unchanged
Several claims about this law have circulated in 2026 that the text does not support. The amending Act is five clauses long and deals only with penalties and who decides them. It contains nothing on the points below:
- A cap on the security deposit, whether two months' rent for homes or six months' rent for commercial space
- Compulsory online registration of every rental agreement, or a fixed penalty for skipping it
- A 90-day notice period before a rent increase
- A 24-hour notice rule before a landlord enters a let home
Those ideas come from the Model Tenancy Act, 2021, a template the central government sent to the states. A model law binds nobody until a state passes its own Act based on it. Karnataka's January 2026 amendment is a decriminalisation measure and should be read as that.
Is the security deposit capped in Bangalore?
For a tenancy outside the 1999 Act, the deposit is whatever the landlord and tenant agree in writing. The amount, the refund date and the deductions allowed should all be written into the agreement.
What Tenants Should Do
A written agreement is the tenant's main protection, since the deposit and notice terms rest on it. These steps keep a tenancy on firm ground:
- Insist on a written agreement that states the rent, the deposit, the yearly increase and the notice period
- Pay the deposit and the rent through a bank and keep the records
- Photograph the home on the day of moving in and attach an inventory to the agreement
- Register a lease that runs for more than a year, as the Registration Act requires
- Ask for the refund terms and the list of permitted deductions in writing
Where the 1999 Act applies, a tenant whose water or power is cut by the landlord may approach the Rent Controller. The daily penalty of Rs. 1,000 now gives that complaint more weight.
What Landlords and Investors Should Do
Owners who let a flat should check first whether the tenancy falls under the 1999 Act. Where it does, the lease has to be in writing and presented as the Act requires, and sub-letting and re-letting rules carry far larger penalties than before. An estate agent handling such lettings must be registered under the Act.
Buyers who plan to let a new flat can keep working with deposits set by agreement, because the law has no ceiling on them today. A change would need fresh legislation, so rental plans should be reviewed if the state takes up a tenancy Bill. Non-resident owners who let homes in the city will find related guidance on our NRI page.
Key Points
The January 2026 amendment swaps jail for larger money penalties and puts the Rent Controller in charge of deciding them. It does not alter deposits, notice periods or registration. For most market-rent homes across Bangalore, a clear written agreement remains the document that decides the outcome of a dispute.
