In Bihar, Land Prices Generate More Heat Than Country Guns: Naubatpur Emerges as Hotspot as Government Prepares 400% Circle Rate Hike

While the word “katta” (country-made gun) once dominated political discourse in Bihar—echoing even in Prime Minister Narendra Modi’s election speeches—the real heat in the state today is over “kattha” (land measurement). With land prices soaring across urban and semi-urban Bihar, disputes and speculation over property have intensified, turning land into the state’s most combustible asset.

As demand for housing rises and available land shrinks, builders and real estate intermediaries have aggressively entered the market, particularly in and around Patna. A common model involves purchasing four katthas of land and constructing multi-storey apartment complexes with 15–20 flats, generating massive profits—often at the cost of state revenue.

The Registration Game: Huge Gap Between Official Rates and Reality

At the heart of the problem lies the wide gap between government-notified circle rates and actual market prices.

For instance, while the official circle rate in some areas may be as low as ₹40,000 per kattha, the same land is often sold at ₹15–20 lakh per kattha—or even higher. Registrations are carried out at the official rate, but large sums are exchanged in cash, benefiting builders and middlemen while depriving the government of stamp duty and registration revenue.

Recognising the scale of the distortion, the Bihar government is now preparing a major overhaul of circle rates.

Government Plans Up to 400% Increase

According to official sources, the state government is considering a proposal to raise land circle rates by up to 400% in select areas, bringing them closer to prevailing market values. The proposal is expected to be placed before the state cabinet soon.

In areas where the difference between circle rate and market price is relatively smaller, a moderate hike of up to 50% has been proposed.

Currently, in prime Patna localities such as West and East Boring Canal Road, the circle rate stands at ₹30 lakh per decimal. However, officials admit that even these rates fall short of actual transaction values.

One Crore on Paper, Seven Crore in Reality

According to data from the Registration Department, land deals in Patna are often recorded at around ₹1 crore per kattha, while the real transaction value ranges between ₹6–7 crore.

This phenomenon is not limited to the capital. In Banka district, where the circle rate is approximately ₹12,000 per kattha, land is being sold for ₹6–7 lakh. The mismatch reflects a systemic undervaluation across districts.

Naubatpur: Bihar’s New Land Epicentre

Among all regions, Naubatpur block in Patna district has emerged as the state’s most active land trading hotspot. Here, the official circle rate is about ₹22,000 per kattha, while market prices range between ₹20–25 lakh per kattha.

Circle rate, which determines stamp duty and registration charges, is meant to represent the minimum value of land. However, in most cases, deals are struck at far higher prices—often involving substantial cash components—while official documents show much lower values.

Why Raising Circle Rates Matters

Experts argue that outdated circle rates:

• Cause massive revenue losses to the state
• Encourage the circulation of black money
• Strengthen the builder–broker nexus
• Distort the real estate market

Sources in the Prohibition, Excise and Registration Department say that if the cabinet does not approve the proposed rates, an alternative plan is ready, under which circle rates would be doubled at the very least.

Even a twofold increase is estimated to generate an additional ₹1,000 crore annually. At present, the state earns approximately ₹7,600 crore per year from land registration based on existing rates.

A High-Stakes Reform

As Bihar grapples with rapid urbanisation and rising housing demand, the proposed revision of circle rates is being seen as a crucial structural reform—one that could curb black money, boost state revenue, and bring transparency to the land market.

In today’s Bihar, it is no longer firearms but land values that carry the real firepower.