Police said the building suddenly collapsed around 4.30 pm. Fire brigade and police personnel, who were informed, launched rescue operations assisted by local people. The National Disaster Response Force (NDRF) is also helping with the operations.
Two labourers were found dead under the debris while one of the rescued succumbed to injuries in hospital, news agency Press Trust of India quoted Bengaluru mayor R Sampath Raj as saying.
The construction work began six years ago but was stopped later. Six months ago, work started again, said a senior police official.
"We are concentrating on the rescue operation. All aspects will be investigated and action will be taken against those responsible," said Bengaluru Development Minister KJ George.
The minister also announced Rs 5 lakh for the relatives of each dead labourer.
"The building belongs to one Rafeeq. We are trying to see when it was sanctioned and the number of floors that were approved. If anyone is found to be negligent, action will definitely be taken," said Bengaluru police commissioner T Suneel Kumar.
Mr Kumar said that some of the workers at the site were from Jharkhand.
(With inputs from PTI)