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Bombay High Court
Flagship Infrastructure Ltd. Through … vs The Competent Authority Dist. Dy. Reg. … on 15 April, 2025
Author: Amit Borkar
Bench: Amit Borkar
2025:BHC-AS:17010
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Amk
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
CIVIL APPELLATE JURISDICTION
WRIT PETITION NO. 151 OF 2019
WITH
INTERIM APPLICATION NO. 18160 OF 2022
WITH
INTERIM APPLICATION NO. 19665 OF 2022
1. Flagship Infrastructure Ltd.
(Initially known as Flagship Infrastructure Pvt.
Ltd.) Behind Cognizant, Rajiv Gandhi
InfoTech Park Phase No.1, Hinjewadi, Tal:-
Mulshi District:- Pune By and through its
present director/authorized Signatory:- Ms.
Meghali Katdare
2. Flagship Infrastructure Ltd.
(Initially known as Flagship Infrastructure Pvt.
Ltd.) By and through its director/authorized
Singnatory:- Ms. Meghali Katdare
Blue Ridge, Behind Cognizant, Rajiv Gandhi
InfoTech Park, Phase No.1, Hinjwadi, Tal:-
Mulshi District:- Pune
...Petitioner
V/s.
1. The Competent Authority
District Deputy Registrar of the Co-operative
Societies, Pune (Rural) Pune.
2. Blue Ridge Unit "A" (Tower No.1 to 8) CHS
Ltd. S. No. 119/125/154 to 160/160/2 to
171/17 Plot No.1, Behind Cognizant, Rajiv
Gandhi InfoTech Park Phase No.1, Hinjwadi,
Tal:- Mulshi District:- Pune
By and through Shri. Vaibhavraj Kumthekar
Shri. Samir Gokhale ...Respondents
..........
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Mr. Prasad Dani, Senior Advocate i/b. Mr. Sarthak S. Diwan for the
Petitioners.
Ms. M. P. Thakur, AGP for Respondent No.1-State.
Mr. Anil Anturkar, Senior Advocate i/b. Sugandh Deshmukh for
Respondent No.2 in Writ Petition and and for the Applicants in all
Interim Applications.
..........
CORAM : AMIT BORKAR, J.
RESERVED ON : APRIL 4, 2025
PRONOUNCED ON : APRIL 15, 2025
JUDGMENT
1. This petition raises a narrow, but important question of law:
whether a notification issued under Section 20(4) of the
Maharashtra Regional and Town Planning Act, 1966 (MRTP Act),
granting a developer ten years’ time for completing a development
project, can override the statutory obligation cast upon the
developer under the Maharashtra Ownership Flats (Regulation of
the Promotion of Construction, Sale, Management and Transfer)
Act, 1963 (MOFA) and Rule 9 of the MOFA Rules, 1964, to execute
a conveyance of title in favor of a cooperative housing society
within four months of its formation. This Court is thus called upon
to examine the scheme and purpose of the two statutes and decide
which must prevail in the event of an apparent conflict.
2. The present petition has been instituted by the petitioners,
who are developers, questioning the legality and validity of the
judgment and order dated 27th November 2018 passed by the
District Deputy Registrar, Co-operative Societies, Pune (Rural). By
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the said order, rendered in Application No. DC 16/2018-19, a
certificate of deemed conveyance has also been issued in favor of
respondent No.2 – the Housing Society. The certificate pertains to
land admeasuring 442.25 square feet, together with the
constructed area of 85,926.373 square meters, and includes an
undivided share and interest in the common areas and common
facilities to the extent of the said area. The land in question forms
part of Survey Nos. 119 (Part) to 125 + 154 (Part) to 160/2 to
171 + 173, situate behind Cognizant, Rajiv Gandhi InfoTech Park,
Hinjewadi, Pune.
3. The petitioners, feeling aggrieved by the said order and
certificate of deemed conveyance, have approached this Court
invoking its writ jurisdiction.
4. The facts necessary for deciding the present petition, briefly
stated, are as under: The petitioners are the original developers
and owners of the property in question. They had undertaken the
development of a township project known as Blue Ridge, after
securing requisite permissions under the provisions of the
Maharashtra Regional and Town Planning Act, 1966. The
construction was to be carried out in a phased manner as per the
sanctioned plans. The dispute giving rise to the present
proceedings is confined only to Towers 1 to 8 within the said
township project. Respondent No.2-Society was registered on 12th
September 2011. According to respondent No.2, the Society
comprises eight buildings consisting of 811 flats, 12 shops, and
common amenities, spread over the land forming part of the Blue
Ridge Township. It is the grievance of respondent No.2 that despite
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repeated requests, the petitioners failed to convey the land and
constructed premises to the Society, as required by law.
5. Faced with such inaction, respondent No.2 preferred an
application for deemed conveyance before the District Deputy
Registrar under the provisions of Section 11(3) of MOFA. The
application was duly accompanied by necessary documents and
records. On receipt of notice from the authority, the petitioners
appeared and contested the application. By way of written
submissions and oral arguments, the petitioners contended that
the application was not maintainable in law. It was urged that no
cause of action had arisen, inasmuch as the petitioners had not
committed any breach of statutory duty. It was further submitted
that the description of the subject matter of the application was
incorrect, inasmuch as the entire master layout of the township
could not be the subject matter of a deemed conveyance
application restricted only to Towers 1 to 8. The petitioners also
contended that the right of respondent No.2, if at all, could only
extend to the land directly beneath the eight buildings in question,
and not to the entire larger parcel of land forming the township.
6. Both parties submitted written arguments before the
authority. After affording full opportunity of hearing to the
petitioners and the society, the District Deputy Registrar, by the
impugned order dated 26th November 2018, allowed the
application of respondent No.2 and issued a certificate of deemed
conveyance. Aggrieved thereby, the petitioners have preferred the
present writ petition.
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7. This Court, by an order dated 14th January 2019, issued
Rule and granted interim relief in terms of prayer clause (c) of the
petition, thereby staying the operation of the certificate of deemed
conveyance pending the hearing and final disposal of the petition.
The petition has now been placed for final hearing.
8. Mr. Dani, learned Senior Advocate appearing on behalf of the
petitioners, invited the attention of this Court to various provisions
of the Maharashtra Regional and Town Planning Act, 1966 (“MRTP
Act”), including Sections 2(13D), 2(27), 14(l), 17, 18(3), and
44(2), to contend that the State Government had sanctioned the
township project by issuing a notification under Section 20(4) of
the said Act. According to the learned Senior Advocate, such
integrated township, being specially sanctioned, occupies a higher
pedestal and would prevail over the other general provisions of the
MRTP Act. In the event of a conflict between regional plans,
development plans, or subordinate rules and regulations, it is the
integrated township, sanctioned under the special provisions, that
must prevail. He submitted that the township project in question,
being a special township permitted under Section 18(3) of the
MRTP Act, is entitled to benefits and concessions such as
exemption from individual Non-Agricultural (NA) permissions,
concession in stamp duty, and the grant of floating Floor Space
Index (FSI). The floating FSI, it was pointed out, could be utilized
anywhere within the township area, irrespective of the location of
the particular plot. The completion certificate for individual
buildings, he submitted, could be granted only after the
completion of the entire township as per the conditions stipulated
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in the notification issued under Section 20(4) of the MRTP Act.
9. Mr. Dani further drew the attention of the Court to the
agreements executed with the flat purchasers under Section 4 of
the Maharashtra Ownership Flats Act (“MOFA”). He submitted that
at the time of purchase of the flats, the flat purchasers were made
fully aware of the nature and character of the integrated township
project. It was specifically disclosed to them that the developers
retained the right to utilize the floating FSI anywhere within the
township area, even after the completion of individual buildings.
Thus, it was contended that the flat purchasers, having entered
into agreements with full knowledge and consent regarding the
development rights reserved by the petitioners, cannot now seek to
defeat those rights by seeking conveyance of the larger parcel of
land. Learned Senior Advocate next submitted that respondent
No.2-Society had filed the application for deemed conveyance on
18th July 2018 under Section 11 of MOFA, by which time the Real
Estate (Regulation and Development) Act, 2016 (“RERA”) had
already come into force. He pointed out that the Maharashtra Real
Estate Regulatory Authority (Form of Annual Statement of
Accounts and Annual Report) Rules, 2017, had also been notified
on 20th April 2017.
10. According to him, under the scheme of RERA and the said
Rules, in the case of a layout project, the conveyance is limited to
the structure of the building and not of the entire underlying land.
The conveyance of the land comprising the entire layout would be
permissible only after the last building in the layout has received
an occupation certificate. He contended that in case of any
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inconsistency between MOFA and RERA, the provisions of RERA,
being a later Central legislation, would prevail. In support of his
submissions, reliance was placed on the judgment of the Hon’ble
Supreme Court in Dr. Abraham Patani & Anr. v. State of
Maharashtra & Ors., (2023) 11 SCC 79.
11. Mr. Dani also referred to the Maharashtra Housing
(Regulation and Development) Act, 2012, which came into force
on 8th July 2014. He submitted that Section 19 of the said Act,
which provided for conveyance of title, recognized the right of the
developer to utilize the increased FSI within a layout even after the
completion of individual buildings, provided the entire
development of the layout was not complete. He contended that
this recognition of the right to utilize increased FSI survives, and
that the competent authority ought to have borne in mind these
legislative provisions while deciding the application for deemed
conveyance.
12. Learned Senior Advocate then submitted that although the
competent authority recorded a finding in the impugned order that
it had no jurisdiction to adjudicate upon rights relating to
increased FSI and related matters, in the operative portion of the
order, the authority proceeded to grant benefits relating to
increased FSI to respondent No.2-Society. He contended that the
operative part of the order was self-contradictory and
unsustainable in law.
13. Dealing with the objection raised on behalf of respondent
No.2 that the applicability of RERA and the Maharashtra Housing
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Act, 2012 had not been specifically pleaded in the reply before the
competent authority, Mr. Dani submitted that the petition contains
various grounds which substantively raise these points. He
contended that it was open to the petitioners to raise legal issues
during the course of hearing, and the objection to such
submissions being advanced at the stage of final arguments ought
not to be entertained. He thus submitted that the impugned order
deserves to be quashed and set aside.
14. Per contra, Mr. Anturkar, learned Senior Advocate appearing
on behalf of respondent No.2-Society, supported the impugned
order. He contended that the points relating to the applicability of
the Maharashtra Housing (Regulation and Development) Act, 2012
had not been raised in the reply before the competent authority,
and therefore, it was not permissible for the petitioners to raise
such points for the first time during oral submissions before this
Court. According to him, procedural fairness demands that points
not raised before the lower authority cannot be entertained at a
belated stage. He further submitted that the Maharashtra Housing
Act, 2012, had already been repealed by the RERA Act with effect
from 1st May 2016. The agreements for sale in the present case
had been executed in the year 2008, and therefore, the provisions
of the 2012 Act were not applicable. Dealing with the petitioners’
reliance on RERA, Mr. Anturkar submitted that the argument based
on Rule 9 of the Maharashtra Rules framed under RERA was
misconceived. Rule 9 applies only to agreements executed under
Section 17 of RERA. In the present case, the agreements were
executed prior to the coming into force of RERA and are governed
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by MOFA. Thus, Rule 9 of the RERA Rules has no application. He
submitted that under Section 11 of MOFA, the competent authority
is empowered to grant deemed conveyance in respect of the
superstructure as well as the land underneath and appurtenant
thereto. According to him, a clear distinction must be drawn
between the land immediately underneath the building and other
lands forming part of common amenities, open spaces, or lands
reserved for FSI utilization.
15. In the present case, he pointed out, the entire constructed
area measures approximately 85,926.373 square meters, and the
land admeasures 44,282.52 square meters. The FSI has already
been fully utilized. Therefore, the competent authority was correct
in granting deemed conveyance in respect of the constructed area,
as no unused FSI remained available for future exploitation by the
developer. Accordingly, he submitted that the impugned order is in
accordance with law and does not warrant interference.
16. In light of the submissions advanced on behalf of the
petitioner, it becomes necessary to examine the statutory scheme
of both the MRTP Act and the MOFA. The Maharashtra Ownership
Flats Act, 1963 (known as MOFA) is a law made for protecting
ordinary people who buy flats. It was passed by the State
Government because, at that time, many promoters were taking
advantage of home buyers. People would spend their entire life’s
savings to buy a flat, but even after paying the full price, they
would not get a clear legal title to the property. Promoters would
sometimes hand over the keys and let the buyers live in the flat,
but would not transfer the legal ownership. They would continue
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to control the land and the building. MOFA was made to stop this
kind of wrongdoing. The law puts several duties on the developer,
who is called the “promoter” in the Act, to protect the interests of
flat purchasers. One very important duty is given in Section 11 of
MOFA. This section says that after selling the flats, the promoter
must transfer the ownership rights that is, the title to the land and
the building to the body formed by the flat purchasers. This body
could be a cooperative housing society, a company, or any other
organization made by the flat owners.
17. The law does not leave the timeline for this transfer open-
ended. Rule 9 of the Maharashtra Ownership Flats Rules, 1964
clearly says that if the sale agreement does not mention the time
for handing over ownership, the promoter must transfer the
property within four months from the date the society or other
organization of flat buyers gets registered. In plain words, once the
flat owners form a cooperative society, the promoter has no choice
he must transfer the property to the society within four months.
This is a strict requirement. It is not just a guideline or suggestion.
It is a must.
18. The reason behind this strict rule is simple, a person who has
paid the full amount and completed all formalities should not be
left at the mercy of the promoter. The buyers should get clear
ownership rights quickly, without unnecessary delay. Otherwise,
the promoter would continue to have control over the property
and the buyers would remain insecure. MOFA has been recognized
by the Supreme Court, as a special law made for consumer
protection. Once the flats are sold, the promoter must take all
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steps necessary to complete his legal title and must then transfer
that title to the buyers’ society. After this transfer, the promoter’s
rights are only limited to those flats which are still unsold. Even for
those unsold flats, the promoter becomes just another member of
the society, like any other flat owner.
19. The duty of the promoter to transfer ownership is not just a
private promise. It is a legal obligation under the Act. The
lawmakers were very clear that after selling the flats and forming a
society, the promoter must lose all power and control over the
property. The flat purchasers must become full and final owners. If
a promoter tries to hold on to control by delaying transfer or
giving excuses like pending development he is going against the
very purpose for which MOFA was made.
20. To further strengthen the rights of flat owners, the
Government brought an amendment in 2008. This amendment
added a new idea called “deemed conveyance”. Under Section
11(3) to 11(5) of MOFA, if the promoter does not transfer
ownership within the prescribed time, the flat purchasers’ society
can apply to a competent authority, usually the District Deputy
Registrar. The authority will check the documents and hear both
sides. If the society’s claim is correct, the authority can pass an
order and directly execute the conveyance deed, giving ownership
to the society, even without the promoter’s cooperation. This
system shows that transferring ownership is not optional. It is a
must. The rights of flat buyers would mean nothing if promoters
could keep delaying conveyance by taking shelter under other laws
like the MRTP Act. The Legislature wanted to give flat buyers a
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clear and absolute right to become legal owners of their flats and
the land attached to them, free from any delay, conditions, or
commercial tactics of the promoter.
21. The Maharashtra Regional and Town Planning Act, 1966
(commonly called the MRTP Act) is a law made to ensure that the
growth of cities and towns happens in an organized and planned
manner. Before this law came into force, cities were growing in an
unplanned way, and there was a need for a proper system to
manage land use and development. The main purpose of the
MRTP Act is to make sure that the use of land happens in a
systematic way. It does this by creating regional plans and
development plans which set out how different areas can be used
for homes, shops, industries, gardens, schools, and so on. The law
also controls who can build what and where, so that public
facilities like roads, parks, and drainage are properly planned. In
plain words, this law looks at the “big picture” of how cities should
grow, so that there is order and not chaos. The MRTP Act is about
city planning and development control. It is not about the private
dealings between a promoter and a flat buyer. One important part
of the MRTP Act is Section 20(4). This section says that if the
Government wants to change or modify a regional plan, it can do
so by issuing a notification in the Government Gazette after
following certain steps like inviting objections and suggestions.
Through this notification, the Government can allow special rules
for particular projects.
22. At this stage, it is very important to understand that MRTP
Act and MOFA are two different laws made for two very different
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purposes. MRTP Act deals with how land is used, how cities are
developed, and how big projects should be planned and carried
out from the State’s and public’s point of view. It looks at the larger
interest where roads, parks, hospitals, and schools should come,
and how construction should happen according to development
plans. MOFA, on the other hand, is about the rights of flat
purchasers. It focuses on making sure that promoters deal fairly
with people who buy flats that they give all necessary information,
that the building is constructed as promised, and that the
ownership of the flat (and land) is properly and timely transferred
to the buyers’ society. Thus, while the MRTP Act speaks about
planning of the city, the MOFA speaks about protecting the home
buyers. This difference is very important. Even if the promoter has
permission under the MRTP Act to take ten years to complete the
entire township, that does not mean he can hold on to the
ownership of flats or land for so many years and refuse to transfer
ownership to the flat buyers who have already paid the full
amount and moved into their homes.
23. It is a well-settled rule in law known as generalia specialibus
non derogant. It simply means that when two laws apply, and one
law is general and the other law is special, the special law will
override the general law, especially when the special law is made
to protect a particular class of people. Here, even though MOFA
was made in 1963 and MRTP Act in 1966, the MOFA Act has been
amended many times (like in 1983, 1986, 2008, and so on) to
strengthen the rights of flat purchasers. It continues to be a law
that deals specially with promoter-buyer relations. The MRTP Act,
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though also amended, has remained focused on town planning,
and it does not deal with sale of flats or the obligations of
promoters towards flat buyers. Thus, there is no real conflict
between MRTP and MOFA. Even if the promoter has town
planning permissions and an extended timeline under MRTP Act,
when it comes to giving ownership to flat buyers who have already
bought and occupied their flats, MOFA must prevail. The promoter
cannot delay the conveyance by citing permissions or concessions
under MRTP Act. The promoter’s town planning rights under
MRTP Act and his legal duty under MOFA are two different things.
The town planning permission does not take away the flat
purchasers’ right to become owners under MOFA.
24. Having considered the arguments of both sides, this Court
finds as follows: The two laws, MOFA and the MRTP Act, deal with
different subjects. Both can work together without clashing with
each other. When we read these two laws in a way that makes
them both meaningful, it becomes clear that when it comes to
issues between a promoter and flat buyers, MOFA must prevail.
There is nothing in the MRTP Act, or even in the Section 20(4)
notification the promoter is relying on, that says MOFA will not
apply. The MRTP notification only gives the promoter more time of
ten years to finish the township’s construction and development
work. It does not say anywhere that the promoter is allowed to
hold on to the ownership of flats already sold and occupied. Thus,
it is very much possible for the promoter to comply with MOFA by
handing over ownership of the already completed and occupied
buildings to the flat owners’ society, and at the same time,
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continue to enjoy the other development benefits under MRTP for
the unfinished parts.
25. It is well settled if a law requires to do something in a
particular way, one has to do it exactly that way and not in any
other manner. MOFA rules state that the conveyance must be done
within four months from the date of registration of the society.
That is the only method and timeline allowed. The promoter
cannot use an excuse of a government notification that talks about
project completion to delay handing over ownership. If the law
wanted promoters to delay conveyance till township completion, it
would have clearly said so. But neither MOFA nor the MRTP Act
say that. Therefore, both laws must be followed in their own areas
and when it comes to promoter-flat buyer relations, MOFA is
supreme.
26. In the case of Lok Housing & Construction Ltd. v. Lok Everest
Co-op. Housing Society, 2025 SCC Online Bombay 711 , a promoter
made a similar excuse. He contended that conveyance should
happen only after the whole layout was complete, and pointed to a
agreement clause deferring conveyance. This Court rejected that
argument and clearly held that Rule 9 of MOFA fixes a strict four-
month time limit. Any part of the contract that tries to go against
this rule is void. In that case, the Court noted that even after 30
years, the promoter had not given conveyance. Such delay was
called “completely against the purpose of MOFA” and very unfair to
flat owners. The Court held that no clause in the agreement can
defeat a promoter’s legal duty under MOFA. If an agreement
between buyer and promoter cannot postpone conveyance, then
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surely a general government notification under MRTP, which does
not even talk about flat buyers’ rights, cannot be used to avoid the
conveyance obligation. The Lok Housing judgment also held that
Section 11 of MOFA is a very important safeguard. It is meant to
end the promoter’s control once the flats are sold. Allowing a
promoter to keep ownership for ten years or more would defeat
the very purpose for which MOFA was made.
27. The Supreme Court also gave a strong message in
Nahalchand Laloochand Pvt. Ltd. v. Panchali Co-op. Housing
Society (2010) 9 SCC 536. In that case, while dealing with the
issue of parking spaces, the Court explained the larger scheme of
MOFA. It said the promoter has the right to sell only flats and not
the common areas, land, parking spaces, or other facilities. All
those must be transferred to the society. The Supreme Court said
very clearly that any arrangement made by the promoter with
buyers that goes against MOFA is not valid. By the same reasoning,
if a promoter tries to hide behind an MRTP permission to avoid
handing over title, that too is not valid. The law (MOFA) must be
followed as it is.
28. It is therefore clear that MOFA’s provisions for protecting flat
owners, especially timely transfer of ownership, must be strictly
followed. Promoters cannot escape their duties under MOFA by
pointing to other permissions, administrative timelines, or private
agreements. Following the MOFA timeline is very important. If
conveyance is delayed for ten years (or even longer if the township
gets delayed), the society formed by the flat owners faces legal
problems such as society’s name does not get recorded as owner in
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government records like property cards and revenue entries.
Without ownership, the society cannot take loans for major repairs
or redevelopment. Banks and financial institutions usually refuse
loans if ownership is unclear. If the promoter becomes bankrupt or
gets into legal trouble, creditors can try to claim the land because
it is still in the promoter’s name. The promoter can misuse the
delay to use extra FSI or development rights without the society’s
knowledge or permission, affecting the rights of existing flat
owners. This is why MOFA insists that the “entire land and
building” must be transferred to the society once flats are sold. The
promoter should retain only the unsold flats and nothing else.
Timely conveyance gives full transparency, makes flat owners true
legal owners, and protects their investment. It also empowers the
society to manage the property, enforce their rights, and even
compel the promoter to complete pending amenities if needed.
Thus, this Court cannot support any interpretation that would
leave flat owners vulnerable and the promoter in control even after
flats are sold and occupied.
29. For all these reasons, this Court holds that:
(i) A notification under section 20(4) of the MRTP Act,
1966, cannot override or postpone the legal duty of
conveyance under MOFA.
(ii) MOFA, being a special law made to protect flat buyers,
will prevail over the general provisions of the MRTP Act.
(iii) The ten-year period given to the Petitioner (promoter)
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transfer ownership to flat buyers within four months of
forming the society.
(iv) By the time the flat owners’ society was formed, the
Petitioner had already sold flats and handed over possession.
Therefore, the obligation under MOFA became applicable,
and the Petitioner had to transfer the title.
30. In light of the legal discussion and the parameters laid down
hereinabove, it becomes necessary to scrutinize the facts of the
present case in the context of the settled legal position. After
carefully perusing the documents placed on record and giving
anxious consideration to the rival submissions advanced by the
learned Senior Advocates appearing for the parties, certain
material aspects emerge which are undisputed and stand
established.
31. Firstly, it is an admitted position that the agreements for sale
between the petitioners, who are the promoters, and the individual
flat purchasers were executed in the year 2008, much prior to the
coming into force of the Real Estate (Regulation and Development)
Act, 2016. Secondly, it is not disputed that respondent No.2, the
cooperative housing society comprising the flat purchasers of
Towers 1 to 8, came to be registered under the provisions of the
Maharashtra Cooperative Societies Act, 1960 on 12th September
2011. Thirdly, it is also admitted that the possession of the flats in
Towers 1 to 8 was handed over to the flat purchasers, and that the
flat purchasers have been in occupation thereof since the
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completion of construction of the said towers. Fourthly, it is not in
dispute that despite the registration of the society on 12th
September 2011, and despite the passage of considerable time
thereafter, the petitioners did not execute the conveyance of title in
favour of respondent No.2-society as required under Section 11 of
MOFA read with Rule 9 of the MOFA Rules. These factual aspects,
emerging from the record and admitted on both sides, form the
basis for determination of the controversy in the present case.
32. The promoter tried to justify the delay in giving ownership to
the society by pointing to two clauses (Clauses 6.3.1 and 6.3.2) in
the sale agreements. According to the promoter, these clauses
allowed them to delay conveyance for ten years after completion
of Towers 1 to 8, or until the entire township project is completed,
whichever happens earlier. In my opinion, this argument cannot be
accepted. Because there is a clear rule under Rule 9 of the MOFA
Rules, which lays down a strict time limit for the promoter to give
ownership to the society. Rule 9 says that unless both sides
specifically agree to a different period, the promoter must execute
the conveyance within four months from the date of registration of
the society.
33. The purpose of Rule 9 must be seen in the light of MOFA’s
overall goal which is to protect flat purchasers and ensure they get
clear ownership without unnecessary delay. Rule 9 is not just a
formality. It is a real protection created by law against endless
delays by promoters. The four-month period is written into law to
make sure that flat buyers are not left in uncertainty about who
owns the land and the building where they live. A promoter cannot
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escape this responsibility by simply pointing to private agreement
clauses, especially if those clauses depend on uncertain future
events like full township completion, which flat buyers themselves
have no control over.
34. The use of the word “period” in Rule 9 of MOFA Rules is very
important. In common understanding, a “period” means a fixed,
definite block of time, like four months, six months, etc. It does not
mean some vague or uncertain future event. This meaning fits the
general rule in law: unless the context requires otherwise, words in
a law must be given their natural, everyday meaning. Here, the
word “period” is clear and plainit points to a definite timeline. The
promoter’s argument that the conveyance can be delayed until ten
years after completion of Towers 1 to 8, or till the entire township
is done would destroy this certainty. It would replace a clear
deadline with an uncertain, shifting future event. That is not
allowed. Courts are not allowed to change or rewrite clear laws
under the excuse of interpretation. If courts start allowing such
changes, it would defeat the whole purpose for which MOFA was
made to protect flat buyers. If the promoter’s argument is
accepted, it would allow promoters to hold on to ownership
forever, just by pointing to some incomplete work in the township.
This would bring back the very problems MOFA wanted to prevent.
Thus, the word “period” in Rule 9 must be understood as a
definite, fixed time and not an open-ended condition. Any clause
in a sale agreement (like Clauses 6.3.1 and 6.3.2) that tries to
override this rule is void (meaning invalid) because it goes against
the law.
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35. Based on the above discussion, I am firmly of the opinion
that an agreement clause (like Clauses 6.3.1 and 6.3.2) that says
the promoter can delay conveyance until the full project is
complete goes against Rule 9 of MOFA. Especially when most of
the flat purchasers have already taken possession, have formed a
registered society, and have fulfilled their obligations, the
promoter cannot hide behind private clauses to delay conveyance.
If I accept the promoter’s argument, it would make the protection
given to flat purchasers under MOFA meaningless, and would give
complete, unregulated power to the promoter. That is not what the
law allows. Therefore, the promoter was under a legal duty to
execute the conveyance deed within four months from the date the
society was registered (i.e., within four months from 12th
September 2011). The promoter failed to do so. Thus, the
application filed by respondent No.2-society under Section 11 of
MOFA was legally correct.
36. The next contention of petitioners is based on Rule 9 of the
Maharashtra RERA Rules which talks about how and when a
promoter must transfer ownership (i.e., execute a conveyance)
under Section 17 of the RERA Act. In plain words, Rule 9 says that
if the project is a layout (meaning a bigger project with multiple
buildings or wings), the promoter must first complete the entire
layout and only then execute the conveyance of the common areas,
land, and building. If it is just one building, the promoter must
execute conveyance after the occupancy certificate for that
building is obtained.
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37. The promoter (petitioner) is trying to use this Rule to argue
that only the building structure has to be conveyed not the land
beneath it. The promoter can wait until the occupancy certificate
for the last building in the layout is obtained. In my opinion, this
argument made by the promoter cannot be accepted for multiple
reasons. First, if we read Section 17 and Rule 9(2) together, it
becomes obvious that when the law says “in the absence of local
law,” it is referring to cases where no state-specific law exists. In
Maharashtra, there is already a local law the Maharashtra
Ownership Flats Act, 1963 (MOFA). MOFA was already in place
long before RERA came into existence. It has its own complete
rules about when and how the promoter has to give conveyance to
flat buyers. Thus, the phrase “local law” under Section 17 should
be interpreted to mean MOFA in Maharashtra. In fact, the
lawmakers who made RERA were very much aware that laws like
MOFA already existed in different states. That is why, in Section
17, they clearly said that RERA timelines will apply only if no local
law exists. So, the complete code of MOFA particularly Sections 10
and 11, and Rule 9 of the MOFA Rules still applies fully in
Maharashtra. MOFA already provides a clear timeline to promoters
for transferring ownership. Therefore, the promoter cannot rely on
Rule 9 of RERA to delay conveyance where MOFA already applies.
In the present case the flat buyers’ society was formed way back in
2011. The agreements between promoter and flat buyers were
signed under MOFA, much before the RERA Act and RERA Rules
even came into force. Thus, the promoter cannot now fall back on
RERA or its Rules to escape the duty he had under MOFA.
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38. Moreover, on a careful reading of Section 17 of the RERA
Act, it becomes clear that this section puts a responsibility on the
promoter (promoter) to do two main things: First, to execute a
registered conveyance deed that means to officially transfer
ownership of the flat and a share in the common areas to the
buyers’ association (society). Second, to hand over possession of
the flats, buildings, or plots, along with the documents of title and
common areas, to the society within a specific time. This must be
done according to the sanctioned plan and the deadlines set by the
local laws. Now, the important point is this the proviso (the
condition) in Section 17 says that only if there is no local law
available, the promoter must carry out the conveyance within
three months from the date of getting the occupancy certificate.
39. Similarly, sub-section (2) of Section 17 says that the
promoter must hand over necessary documents and plans, and
again, this is to be done as per local laws. If there is no local law,
then he must do it within 30 days after getting the completion
certificate. Thus, the structure of Section 17 itself shows that local
law comes first, and the timeline under RERA applies only if no
local law exists. In Maharashtra, Rule 9(2) of the Maharashtra
RERA Rules has been made to support Section 17 of the Act. Rule
9(2) also talks about the promoter’s obligation to convey title
under Section 17.
40. Second, Section 17 of RERA itself talks about handing over
not just the flat or building structure, but also the undivided share
in the land and common areas. It does not say anywhere that only
the building structure must be conveyed. Thus, the promoter’s
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argument that only the building and not the land should be
transferred has no basis in the law. Third, if the promoter’s
interpretation is accepted that he can wait until the whole
township is completed then flat owners will be left without
ownership rights for an indefinite number of years. This would
completely defeat the very purpose of MOFA, which was made to
protect flat purchasers and to stop promoters from holding onto
ownership unnecessarily. The law expects that once people have
paid for their flats and taken possession, they should become legal
owners without having to wait endlessly.
41. Thus, in plain words the promoter cannot delay conveyance
by depending on RERA Rules because MOFA already applies. The
promoter cannot claim that only the building needs to be conveyed
and not the land. The promoter must convey both the flat, the
share in the land, and the common areas to the society. Rule 9 of
RERA does not change the promoter’s legal duty which had
already arisen under MOFA. Hence, the petitioner’s argument
based on Rule 9 of RERA Rules is rejected.
42. In the present case, a few important facts cannot be disputed
that the agreements for sale were signed under Section 4 of MOFA.
The agreements were signed before RERA came into force. The
society (respondent No.2) was registered on 12th September 2011.
The four-month period under Rule 9 of MOFA Rules for handing
over ownership ended in 2011 itself. By the end of four months
from the date of registration, the flat buyers’ society had already
earned the right to demand conveyance from the promoter under
MOFA. This right, once earned under MOFA, cannot be taken away
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by trying to apply the timelines of another law (RERA) that came
into force later. If the promoter’s argument is accepted that RERA
timelines should now apply it would defeat the whole purpose of
MOFA, which is a consumer-friendly law specially made to protect
flat buyers. It would mean giving more time to promoters to delay
conveyance, which is exactly what MOFA was made to prevent.
43. Thus, when it comes to providing the timeline for executing
conveyance there is no conflict between MOFA and RERA. MOFA
continues to apply, especially for agreements signed before RERA
came into force. The language of Section 17 of RERA supports
MOFA’s application where a local law like MOFA already exists.
Therefore, in my opinion, the promoter’s argument cannot be
accepted.
44. The next submission advanced on behalf of the petitioner
pertains to the findings recorded by the Competent Authority in
the impugned order. It was submitted that although the Competent
Authority recorded a categorical finding that it did not possess
jurisdiction to adjudicate upon the rights relating to increased
Floor Space Index (FSI), nonetheless, in the operative part of the
order, the Competent Authority proceeded to confer benefits
arising from the alleged increased FSI in favour of respondent
No.2-society.
45. Having given careful consideration to the said submission, in
my opinion, the grievance raised by the petitioner merits
acceptance. Once the Competent Authority, upon due examination,
concluded that it lacked jurisdiction to adjudicate upon disputes or
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rights pertaining to the increased FSI particularly in the light of
notification under section 20(4) of MRTP Act, it was not open for
the Competent Authority to thereafter, in the operative portion of
the order, grant any relief to respondent No.2-society in relation to
such increased FSI. It is well-settled that a statutory authority must
act strictly within the bounds of its jurisdiction. If the Competent
Authority in the peculiar facts of this case held that it had no
power to decide upon rights concerning additional FSI, any
directions issued in that regard in the operative part of the order
would clearly be beyond the scope of its authority and would be
legally unsustainable.
46. In my considered opinion, therefore, to the extent that the
impugned order purports to confer or deal with rights arising from
the alleged increased FSI, the same cannot be sustained. The
proper remedy available to respondent No.2-society, in such
circumstances, would be to approach the competent civil court by
instituting appropriate proceedings seeking adjudication of its
rights, if any, in relation to increased FSI and any related
entitlements. Accordingly, this Court deems it appropriate to clarify
that the rights, if any, of respondent No.2-society concerning the
increased FSI and other related issues are kept expressly open to
be agitated and adjudicated before a competent civil court in
properly instituted proceedings, in accordance with law.
47. With respect to the petitioners’ contention that, in view of
the promulgation of the MHRDA Act, the provisions of the MOFA
Act have been rendered inoperative by implied repeal, this Court
has already considered such arguments in Dosti Corporation,
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Mumbai v. Sea Flama Cooperative Housing Society Limited & Ors.
(2016 (5) Mh.L.J. 102). In that decision, this Court authoritatively
held that an implied repeal of an earlier law may be inferred only
where a subsequent statute is expressly empowered to override the
earlier statute and is so fundamentally inconsistent with the earlier
statute that both cannot coexist harmoniously. It was further held
that unless there is a direct inconsistency, both statutes are to be
construed as operating together in their respective spheres.
Accordingly, the right to obtain a conveyance deed under the
MOFA Act is not a mere procedural right or a right to sue, but a
statutorily vested substantive right conferred upon societies.
Moreover, no notification in respect of Section 56 of the MHRDA
Act has been issued by the State Government, and therefore, the
operative provisions of the MOFA Act, including Section 11, remain
in force and are capable of being enforced. In view of the said
judicial pronouncement, the contention raised by the respondents
that the petitioner is precluded from claiming relief under the
MOFA Act on account of its repeal is devoid of merit and stands
rejected.
48. Furthermore, it is necessary to add that the object and
purpose of the MOFA Act are distinct from those of the MHRDA
Act. While the MOFA Act primarily governs the rights and
obligations of promoters and flat purchasers, ensuring statutory
protection to purchasers in relation to conveyance and
management of properties, the MHRDA Act is regulatory in nature
and establishes authorities for regulation and promotion of the real
estate sector. The two enactments operate in different fields, and
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unless there is an express repeal or an irreconcilable conflict, the
rights under the MOFA Act cannot be abrogated by implication.
Consequently, the petitioner-society’s application for deemed
conveyance continues to be maintainable under Section 11 of the
MOFA Act.
49. The consistent judicial refrain, as articulated in Shimmering
Heights CHSL & Ors. v. State of Maharashtra (Writ Petition
No. 3129 of 2016, decided on 6th April 2016), Zainul Abedin
Yusufali Massawala & Ors. v. Competent Authority (reported in
(2016) SCC OnLine Bom. 6028), P.R. Enterprises & Ors. v. the
Competent Authority (Writ Petition No. 11251 of 2016, decided on
27th November 2018), and Mehboob Ali Humza & Ors. v. District
Sub-Registrar (3), Mumbai & Ors. (Writ Petition No. 3129 of 2016,
decided on 24th June 2016), is that writ proceedings under
Article 226 of the Constitution of India are inherently ill-suited for
resolving disputes involving competing claims to title, ownership,
or proprietary development rights. The jurisdiction of the
Competent Authority under Section 11 of the MOFA Act is
narrowly circumscribed to operationalizing and effectuating the
statutory and contractual duty to execute conveyance in favor of
flat purchasers or their legal entity in accordance with the
sanctioned plan and the terms recorded in the registered
agreements.
50. The Competent Authority is not empowered to adjudicate
intricate questions of title, ownership disputes, or competing
development rights that require examination of complex evidence
or third-party rights. These disputes necessarily fall within the
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exclusive domain of the civil courts, where full-fledged trial,
examination, and cross-examination of evidence can take place.
Therefore, any grievance raised by the petioners alleging that the
Respondent-society’s claim exceeds its lawful entitlement must be
agitated by way of a substantive civil suit. The existence of such
competing claims does not, by itself, oust the society’s right to seek
deemed conveyance under Section 11 of the MOFA Act before the
Competent Authority.
51. In view of the foregoing discussion and upon a careful
consideration of the factual matrix and the applicable legal
principles, I pass following order:
(i) The Writ Petition is partly allowed in the aforesaid
terms.
(ii) The order dated 27th November 2018 passed by the
Competent Authority granting deemed conveyance in favour
of respondent No.2-society is upheld, except to the limited
extent that the conferment of benefits relating to increased
FSI is set aside.
(iii) The rights of respondent No.2-society in relation to
increased FSI and related entitlements are kept expressly
open to be adjudicated by the competent civil court in
properly instituted proceedings.
(iv) The petitioners retain the liberty to agitate their
substantive civil rights before the civil court in a civil suit.
(v) Rule is made absolute in the aforesaid terms.
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(v) There shall be no order as to costs.
(vi) All pending applications, if any, stand disposed of.
(AMIT BORKAR, J.)
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