Satellite Garden I Cooperative Housing Society Ltd. vs State Of Maharashtra Through Ministry Of Housing & Ors.

The above ancient proverb underscores the importance of ownership of land and applies befittingly to the situation of denial of title in the land to the home buyers in multi-storey buildings. The organisations of flat purchasers struggle to secure ownership of the land on which their buildings are constructed. The developer, who constructs the building, treats the land as his own for eternity with the hope of milking the future development potential and tells the home buyers emphatically that what is sold to them is just the superstructure and not the rights in the land, which would remain the property of the developer. Noting this tendency on the part of such errant developers, the law is required to extend its long arm to reach out to them by ensuring that the ownership in the land is transferred in favour of the organisation of flat purchasers. While the issues relating to transfer of ownership in the land to the housing societies of a single building are largely sorted out, the difficulties in land division amongst the societies of multiple buildings in a layout still persist.

Rather than living in standalone buildings, home buyers prefer to live in gated communities providing integrated infrastructure, superior amenities, better security, etc. Home buyers prefer community living fostering an active social environment with shared common spaces and organised community events. A layout development involving construction of multiple buildings on a comparatively larger piece of land enables the developers to provide far better amenities to the residents as compared to standalone buildings. Therefore, by and large, the homes in the gated communities demand better prices and higher appreciation. However, when it comes to ensuring that the developer sticks to the disclosed plan and conveys the due land to organisations formed by each building, the layout development takes a beating as compared to standalone buildings. In standalone buildings, it is much easier to keep a tab on activities of the developer who usually quits after completion of construction and conveyance of the land also does not pose much difficulty. However, in a layout development, inability of the flat purchasers to keep vigil on the activities of the developer results in additional construction being put up than what was originally disclosed. More importantly, sharing of the layout land amongst organisations formed by various buildings in the layout gives rise to complications.

It is this intricate issue of land division amongst the organisations formed by multiple buildings in a layout, which this Court is tasked upon to decide in these Petitions. The issue of conveyance of proportionate land to multiple organisations of flat purchasers in a layout development is of seminal importance, giving rise to several litigations. How to share the land in a layout by housing societies many times becomes a hotbed of controversy, particularly on account of myriad ways of exploitation of development potential in the layout land as well as permissibility to import development potential of another unconnected land and load the same in the layout land. Many times, apple to apple comparison becomes impossible. The present Petitions pose a similar quandary, which I proceed to resolve.

Noting the mischief played by the promoters and developers in avoiding conveyance of the land to the organisation of flat purchasers, the concept of deemed conveyance has been introduced, under which the organisation of flat purchasers can secure title in respect of the land without cooperation from the land owner or the developer/promoter. As observed above, in a case involving construction of a single building on a plot of land, conveyance of land in favour of organisation of flat purchasers therein does not pose much difficulty as the entire land can easily be conveyed. The difficulty arises where multiple buildings are constructed in a layout. The promoters take unduly long time in completion of layout development. Quite often the delay is deliberate and aimed at milking the additional FSI made available with passage of time. The organisation of flat purchasers in respect of the first building constructed in the layout need not await completion of the entire layout development and the law in this regard is now well-settled. The right of such organisation of flat purchasers to seek conveyance of proportionate share in the land is also well-recognised. The difficulty however arises as to how much land can be conveyed to the organisation in respect of the completed building.

Even in respect of the layouts where the development is complete, disputes often arise about the manner in which the land in the layout is to be shared. Here again, when all buildings in the layout are constructed with same the FSI, no difficulty is posed as the land as well as common amenities, such are Recreational Ground (RG), can be divided proportionate to the built-up area (BUA) utilised in construction of each building. The difficulty arises where the buildings in the layout are constructed either with different FSI or where BUA arising out of Transferrable Development Rights (TDR) is utilised in construction of some of the buildings. There are cases involving mixed development where one building is constructed with the normal base FSI whereas another building is constructed by use of incentive FSI such as IT Park FSI, hospitality FSI etc. Difficulties also arise where the buildings get constructed in different FSI regimes where buildings constructed later, in the new FSI regime, often tend to consume more BUA than their former counterparts.

Thus, the difficulty in proportionate land division arises where buildings in the layout are not constructed using same parameters and there is imbalance while undertaking the exercise of proportionate land division. Through this judgment, it is proposed to resolve the difficulties in proportionate land division for grant of conveyance in a layout development. While resolving the conundrum posed in the present three Petitions, general principles governing grant of conveyance by proportionate land division are also proposed to be discussed.

To understand the controversy at hand, a very brief narration of factual background as a prelude to the judgment would be necessary.

The land admeasuring 55,696.70 sq.m. located at A.K. Vaidya Marg, Goregaon (E), Mumbai- 400063 was owned by Kadam family. Development rights in respect of the larger land admeasuring 55,696.7 sq.m. were granted by the landowners in favour of BPM Industries, now named as Satellite Developers Ltd. (developer) in the year 1995-96. An exemption under the provisions of Urban Land (Ceiling and Regulation) Act, 1976 (ULC Act) was obtained and the land was apparently subdivided into Sub-Plot Nos. A, B, C, and D. After subdivision, Sub-Plot No. A was apparently located within CTS No.620A, 1/A4(Pt), 644 (Pt), 653 (Pt) of revenue village Malad (East), Mumbai Suburban District. The developer undertook development of Sub-Plot No. A admeasuring 16,855.47 sq.m. and Commencement Certificate for construction of Building No.1 comprising of 196 flats and 2 shops with amenities was sanctioned by the Planning Authority. The developer entered into flat purchase agreements for sale of flats in Building No.1 with the purchasers. The flat purchasers formed and registered Satellite Garden I Co-operative Housing Society Limited in respect of Building No.1 on 11 October 2002.

After completion of construction of Building No.1, in which Satellite Garden I CHSL was formed, the Developer applied for amalgamation of the plots in the larger property and the sub-plots were apparently realigned under which the area of Sub-Plot A got increased to 21,807.18 sq.m. The original promoter failed to convey the land in favour of Satellite Garden I CHSL and instead executed a Development Agreement dated 17 April 2003 with Shree Swastik Developers, who applied for further permissions in respect of the development to be caried out in sub-plot A. During 2003 to 2006, the new developer constructed two buildings viz. ‘AB’ and ‘CD’ on Sub-plot No. A. The flat purchasers of AB and CD buildings formed their own respective cooperative societies. In respect of ‘AB’ building, Sadguru Complex 1 (AB) CHSL was formed. Similarly, in respect of ‘CD’ building, Sadguru Complex 1 (CD) CHSL has been formed.

On 23 April 2010, Satellite Garden-I CHSL filed Suit No.1002 of 2010 before the City Civil Court seeking conveyance of land forming part of old Sub-plot A admeasuring 16855.47 sq.m. The suit is still pending. In the meantime, the developer has also constructed the fourth building in the layout named ‘Satellite Tower’ and the flat purchasers therein have formed Satellite Tower CHSL. It appears that the fifth building has also been envisaged under the sanctioned plans, construction of which is yet to be undertaken by the developers.

Thus, there are total 5 buildings sanctioned in realigned Sub-plot No. A, total area of which is approximately 21,807.18 sq.m. As per the last sanctioned plan (OC Plan dated 9 July 2010), the position of the 5 buildings sanctioned in the layout appears to be as under:

As observed above, Satellite Garden I CHSL has already filed S.C. Suit no. 1002 of 2010 before the City Civil Court seeking conveyance of original Sub-plot A (before realignment) admeasuring 16855.47 sq.m. Thus, Satellite Garden I CHSL is aggrieved by action of Developer of amalgamating the plots and increasing area of Sub-Plot No. A from 16855.47 sq.m. to 21807.18 sq.m. It wants whole of the land admeasuring 16855.47 sq.m. conveyed to it. Satellite Garden I CHSL believes that the entire development potential of old Sub-Plot No. A was exploited in construction of its buildings and by illegal realignment of the Sub-plot, further construction is carried out by the developer.

While Satellite Garden I CHSL has filed suit for conveyance of land, the Satellite Tower CHSL filed Application No. 138 of 2023 under Section 11 of Maharashtra Ownership Flats (Regulation of the Promotion of Construction, Sale, Management and Transfer) Act, 1963, seeking proportionate deemed conveyance of land in its name. Similarly, Sadguru Complex 1 (AB) CHSL filed Application No. 22 of 2025 seeking deemed conveyance of the proportionate land in its name. Also, Sadguru Complex 1 (CD) CHSL filed Application No.153 of 2025 seeking unilateral deemed conveyance of proportionate land and the building in its favour.

Application No. 138 of 2023 filed by Satellite Tower CHSL came to be decided by order dated 16 May 2024 and the Competent Authority has conveyed to it only land admeasuring 4864.21 sq.m. being the plinth area. Thus, what is conveyed in favour of Satellite Tower CHSL by the Competent Authority is only the land covering the plinth of the building admeasuring 4864.21 sq.m.

Application No.22 of 2025 filed by Sadguru Complex 1 (AB) CHSL is decided by the Competent Authority by order dated 6 March 2025, conveying to it only land admeasuring 643.81 sq.m. out of Sub-Plot A, which appears to be less than the plinth of the building.

Application No. 153 of 2025 filed by Sadguru Complex 1 (CD) CHSL came to be decided by the Competent Authority on 31 October 2025, conveying the land admeasuring 1814.03 sq.m. and proportionate share in the RG area of 320.12 sq.m. aggregating total area of 2134.15 sq.m. in addition to road setback area advantage.

In the above manner, the Competent Authority has adopted different parameters for granting unilateral deemed conveyance in respect of the three societies. The Competent Authority has denied share in the land proportionate to BUA utilised for 2 societies (Sadguru Complex 1 (AB) CHSL and Satellite Tower CHSL) and has apparently conveyed to them only the plinth area of their respective buildings or even lesser area than that in the case of Sadguru Complex 1 (AB) CHSL. On the other hand, Competent Authority has granted proportionate share in the land in favour of Sadguru Complex 1 (CD) CHSL. The fourth society (Satellite Garden I CHSL) has filed suit for deemed conveyance in the City Civil Court, which is pending. The fifth building in the layout is yet to be constructed.

In view of the above developments, the present 3 Petitions have been filed as under:

Thus, in respect of the 4 buildings already constructed and 1 building yet to be constructed in the layout development of Sub-Plot A, conveyance has been granted in respect of 3 buildings by the Competent Authority, a Suit for conveyance of one building is pending and the 5^th building is yet to be constructed. Though Competent Authority has granted conveyance to the 3 buildings, it has not applied uniform yardstick for deciding entitlements of even those 3 buildings in respect of the land in the layout. As observed above, Sadguru Complex 1 (CD) CHSL has received conveyance of land proportionate to BUA utilised in its construction, whereas Satellite Tower CHSL has received conveyance of only plinth land. It appears that Sadguru Complex 1 (AB) CHSL has not even received conveyance of plinth area as what is conveyed to it is only land admeasuring 643.81 sq.m. though the building is constructed on plinth of 959.69 sq.m.

The following table reflects the lack of uniform approach and disparity in the matter of conveyance to the four societies:

Ordinarily, this Court could have set aside the orders passed in the case of Sadguru Complex 1 (AB) CHSL and Satellite Tower CHSL and could have directed conveyance of land proportionate to BUA utilised in construction of their buildings so that there could have been uniformity in grant of deemed conveyance to all the three societies. Even Satellite Garden I CHSL could have opted for land division proportionate to BUA utilised in construction of its building by giving up demand for conveyance of entire original Sub-Plot No. A admeasuring 16855.47 sq.m. However, in peculiar facts of this case, this Court is unable to direct that exercise. This is on account of loading of TDR in some of the buildings. The TDR is not uniformly loaded and there is massive loading of TDR in building of Satellite Tower CHSL. The position of loading of TDR in 4 constructed buildings is as under:

Considering the above position, if the principle of subdivision of land proportionate to BUA used in construction of each building is applied, Satellite Tower CHSL will receive maximum share of the land since its total BUA is 20728.06 sq.m., which is more than 50 % of total BUA used in the layout. Satellite Tower CHSL will thus own more than 50 % of layout land though the base FSI for its construction was only 5778 sq.m. (representing only 25% of base BUA). Thus, the building with only 25% base BUA will walk away with more than 50% of the land in the layout. This is how use of massive TDR of almost 3 times the base FSI would give a windfall gain to Satellite Tower CHSL, which would claim ownership of more than 50 percent of land in the layout. On the other hand, Satellite Garden I CHSL, for construction of which no TDR is utilised, would be put in a disadvantageous position.

On the other hand, if the principle of conveyance of only plinth area to each society is followed, the question as to who would own the balance portion in the layout would still beg an answer. This is because the plinths of the 4 buildings totally admeasure only 10797.23 sq.m., whereas total land available for subdivision is 21807.18 sq.m. Even if balance area excluding plinths is to be proportionately owned by all the buildings, again the difficulty of proportionate land division would arise.

During the course of hearing of the present petitions, this Court identified the above unique conundrum presented in the case and has accordingly sought assistance from various learned counsel at the bar requesting them to act as Amicus Curiae and present their views on resolving this intricate issue of grant of conveyance in a layout plan.

Accordingly, this court requested Mr. Pravin Samdani, learned Senior Advocate, Mr. Girish S. Godbole, learned Senior Advocate, Mr. Naushad Engineer, learned Senior Advocate, Mr. Mayur Khandeparkar, learned counsel, and Mr. Karl Tamboly, learned counsel to act as Amicus Curiae and present their views for resolution of the conundrum. Dr Milind Sathe, learned Advocate General, has also presented the views on behalf of the State Government on the issue of proportionate land division in a layout. In addition, I have also heard the learned counsel appearing for the rival parties in the present Petitions. I proceed to briefly capture the broad submissions canvassed and the suggestions made by the learned counsel.

Dr. Sathe has taken me through the statutory scheme of Maharashtra Ownership Flats (Regulation of the Promotion of Construction, Sale, Management and Transfer) Act, 1963 (MOFA) and the Maharashtra Ownership Flats (Regulation of the Promotion of Construction etc.) Rules, 1964 (MOF Rules). He submits that there is a statutory duty on the promoter to form a cooperative society under Section 10 of MOFA within the time prescribed under Rule 8 of MOF Rules, which is 4 months from the date of purchase of flats required for formation of society. That once the society is formed, under Section 11, there is a statutory duty to convey promoter’s right, title and interest in favour of the society within 4 months of its formation as per Rule 9 of MOF Rules. He submits that sub-sections (2) to (5) are added to Section 11 by Maharashtra Act 4 of 2008 to enforce rights of organisation of flat purchasers to obtain conveyance on failure of promoter to convey the land.

Dr. Sathe then takes the Court through the Development Control Regulations for Mumbai, 1991 (DCR 1991). He submits that Regulation 32 provides for FSI and tenement density in residential, commercial and industrial zones. That Regulation 33 provides for additional FSI in certain categories and Regulation 35 provides for computation of FSI. Dr. Sathe submits that Regulation 34 of DCR 1991 introduced, for the first time, the concept of Transferable Development Rights (TDR) which provides that the development potential of land could be separated from the plot and the same was made available to the landowner. That generation and utilisation of TDR is regulated under Appendix VII. That clauses 1 to 9 of Appendix VII provided for ‘generation’ of TDR whereas clauses 10 to 19 provide for ‘utilisation’ of TDR. That clause 14 provides that FSI of receiving plot may be allowed to be exceeded by only 0.4 by availing TDR. That this clause was substituted in 2007 by changing 0.4 to 0.8. That thus, by utilising the TDR, the development potential of the plot was allowed to be increased by 0.4 in 1991 and 0.8 after 2007. That therefore for computing the plot potential, the FSI would be base FSI and TDR permissible under Clause 14 of Appendix VII/VIIA. He further submits that under DCR 33, additional FSI is admissible in respect of various categories such as MHADA colonies [DCR 33(5)], destroyed or burnt buildings [DCR 33(6)], cessed or municipal or police buildings [DCR 33(7)], cluster development [DCR 33(9)], slums [DCR 33(10)] etc. He submits that under DCR 33(16), there is incentive FSI granted for establishment of IT parks.

Dr. Sathe invites attention of this Court to Government Resolution (GR) dated 22 June 2018 prescribing the procedure to be followed for deciding applications for deemed conveyance. He submits that under Para 2(C)(vi)(2) of the GR, there is provision for conveyance of only plinth and appurtenant area where TDR is utilised in construction of the building. Dr. Sathe however fairly concedes to the position that the GR does not assist in resolution of the conundrum of proportionate land division created in present case and in various other cases of revision of layout plans midway. He submits that GR is meant only for guidance of the Competent Authority.

Dr. Sathe submits that the concept of proportionate land division on a reasonable basis is judicially recognised and invites attention of this court to judgment of Division bench of this Court in Shree Siddharth Construction vs. Shree Saraswati Apartment CHS Limited^{11.Writ Petition No. 1439 of 2012 decided on 17 October 2013.}, in which it is held that there can be subdivision of land proportionate to FSI distribution in a reasonable manner.

Dr. Sathe thereafter has presented his views for resolving the disputes relating to conveyance of proportionate land in the layout in the following three scenarios/contingencies:

He submits that the critical date for consideration of distribution of plot/land for conveyance between competing claims may be reckoned depending upon facts of each case as follows:

a. The date of first sanction of the plans of a building.

b. The date on which the right of a building/society accrues in terms of Section 11 of MOFA.

c. The date of subsequent plan/s.

d. Whether permissible TDR at the relevant time was utilized in the plans would be a relevant consideration.

Dr. Sathe has suggested the process to be adopted for the purpose of fair and legal distribution of land in reasonable manner for conveyance to respective bodies of flat purchasers in various contingencies and considering the GR dated 22 June 2018.

Mr. Samdani fairly concedes that in a layout development where external FSI such as TDR is used or where mixed development is undertaken, problems are created for conveyance of proportionate land to the buildings constructed in such layout. He has submitted that ideally mixed use should not be permitted in a layout development after one of the buildings is already constructed. He submits that if mixed use to be allowed in such case, the planning authority must first deduct the land in respect of the building already constructed and then sanction the FSI under the incentive scheme only for balance plot area, to avoid imbalance. He has given suggestions in his Note to be followed for undertaking conveyance in (i) cases involving use of TDR and (ii) cases involving mixed development, which are discussed in the latter part of the judgment.

Mr. Godbole has submitted that while dealing with an application under Section 11(3) of MOFA, it may not be advisable for the Competent Authority to go into the issue of informed consent or lack thereof since the jurisdiction of Competent Authority under Section 11(3) of the Act is limited to issuance of a certificate certifying that the society is entitled to have unilateral deemed conveyance in its favour. He has given his views on different scenarios in his Note, which are discussed in the latter part of the judgment.

Mr. Godbole has further submitted that while considering a mixed development as contemplated under Regulation 33 of Development Control and Promotion Regulations for Greater Mumbai, 2034 (DCPR 2034), this Court needs to lay down certain conditions that a developer will be required to disclose in the plans submitted to the authorities at the outset whether there is any possibility of usage of extra TDR in such development. That in such cases, this Court may devise a way to potentially freeze the quantum of potential of each constructed building which needs to be conveyed to each society at the time of each conveyance.

Mr. Godbole further submits that for the purpose of determining what is land appurtenant, a useful reference can be made to Regulation 41 of DCPR 2034 which defines open spaces within building plot/layouts while granting conveyance of appurtenant areas.

Mr. Engineer also has taken me through the statutory scheme of MOFA and the MOF Rules. Adverting to the GR dated 22 June 2018, he has submitted that the GR was introduced to address the practical difficulties which had arisen in cases of layout development, particularly where multiple buildings are constructed on the same parcel of land and question of apportionment of land for the purpose of deemed conveyance had become contentious. That the GR seeks to provide a workable mechanism for determining the extent of land to be conveyed to each society in such layout projects.

Mr. Engineer further submits that since MOFA gives primacy to representations made in the Agreement for Sale under Section 4, the GR, even in the cases of layout development, where promoter is constructing multiple buildings, cannot be said to have an absolute operation. That the GR can be applied only in consonance with the Agreement for Sale and the disclosures made thereunder, and not in derogation thereof. He relies on the judgment of this Court in Indian Finance Construction Co. Pvt. Ltd. and Anr. vs. State of Maharashtra and Ors.^{22.2024:BHC-AS:48565} He submits that in Rashesh CHS Ltd. v. State of Maharashtra and Ors.^{33.Writ Petition No. 10961 of 2025 decided on 28 April 2026}, this Court has held that GR cannot override the statute and that it can only assist in implementation where ambiguity exists. That GR is therefore only clarificatory in nature and enabling framework, which cannot be read to displace the substantive rights flowing from Agreement for Sale, sanctioned plans and statutory obligations under MOFA.

Mr Engineer has thereafter given his suggestion for resolving the issue involved in the present 3 petitions by presenting the following table:

Mr Engineer submits that after applying the formula of “[Base FSI utilised ÷ Total Base FSI on the Plot] x Plot Area”, the respective societies would be entitled to following areas:

Satellite Garden I CHSL = 11659.88 sq.m.

Sadguru Complex 1 (AB) CHSL = 3258.64 sq.m.

Sadguru Complex 1 (CD) CHSL = 866.08 sq.m.

Satellite Tower CHSL = 6022.55 sq.m.

Mr. Engineer has submitted that if conveyance is granted solely on the basis of base or inherent FSI, completely ignoring the TDR, then Sadguru Complex 1 (CD) CHSL would receive land lesser than its plinth area. He has further submitted that the aforesaid illustration also demonstrates the inherent inequity in adopting a “purely base FSI based formula” in a TDR-loaded layout without regard to the actual development consumed by each society, as is apparent from the example of Sadguru Complex 1 (AB) CHSL and Sadguru Complex 1 (CD) CHSL. That both these societies have been constructed at the same time between 2003-2005 on a plot of land admeasuring 7,868.17 sq.m. and that the structures of the two societies are identical, as both the societies consist of two wings of ground+8 floors comprising a total of 64 flats each, and that the total built up area of both the societies is also almost identical. That, however, Swastik Developers used TDR of only 720 sq.m. for Sadguru Complex 1 (AB) CHSL and TDR of 3086.08 sq.m. on Sadguru Complex 1 (CD) CHSL. Thus, even though the two societies are virtually identical, just because the promoter has utilized the TDR unequally, Sadguru Complex 1 (AB) CHSL would get conveyance of an area of almost 4 times more than Sadguru Complex 1 (CD) CHSL as can be seen from the following:

Sadguru Complex 1 (AB) CHSL = (3,126.32/3,957.24) × 7,868.17 = 6216.07 sq.m.

Sadguru Complex 1 (CD) CHSL = (830.92/3,957.24) × 7,868.17=1652.11 sq.m.

He submits that such a result would be arbitrary and inequitable.

Mr. Engineer has further submitted another illustration where there is a plot of land admeasuring 10000 sq.m. having base FSI of 10000 sq.m. and the developer has loaded TDR of 10000 sq.m. on that land. The developer then constructs two identical structures, A and B of 10000 sq.m. each, where Structure A is constructed using inherent FSI and Structure B is constructed using TDR. In that case, applying the aforesaid formula, the entire land would have to be conveyed to Structure A, and Structure B would get nothing at all, which he submits is not the statutory intention and, in any case, is not statutorily permissible.

Mr. Engineer has therefore suggested that clause 2 (C) (vi) (2) of the GR cannot be departed from in the manner suggested, as the same would produce anomalous results. He has therefore submitted that completely ignoring the TDR cannot be a solution while undertaking proportionate land division.

Mr. Engineer has further pointed out 2 scenarios in layout development as under:

a. Whether, in a case where TDR is loaded and the same is disclosed to the flat purchasers in the Agreement for Sale, the land can be conveyed proportionately on the basis of the total BUA utilized by each society; and

b. Where a promoter starts development of a subsequent building by loading TDR which is not disclosed to the flat purchasers of the first building, then can the land be conveyed proportionately based on the total BUA utilized by each society?

Mr. Engineer has submitted that in a case where TDR is loaded and is disclosed to flat purchasers in Agreement for Sale, a conveyance / deemed conveyance proportionate to total BUA in each building can be permitted. He refers to judgment of this Court in Neelkanth Mansions and Infrastructure Pvt. Ltd. vs District Deputy Registrar^{44.Writ Petition No.3530 of 2026 decided on 25 June 2026.}. However, in a scenario where promoter starts development of subsequent building by loading TDR which is not disclosed to flat purchasers of first building, conveyance based on total BUA including TDR cannot be sustained as the same would be contrary to statutory scheme of MOFA, particularly Sections 7 and 7A. He concludes by submitting that applicability of GR depends on whether TDR was disclosed in Agreement for Sale and whether the proposed apportionment is consistent with statutory scheme under MOFA. Mr. Engineer has given suggestions by considering 3 options which are discussed in the latter part of the judgment.

Mr. Khandeparkar has submitted that given the volatility of the situations and circumstances that exist concerning the manner and mode of development, there cannot possibly be any straitjacket formula / illustrative guidelines for conveyance of land in the layout and that the aspect will have to be dealt with on a case-to-case basis. He has submitted that the Competent Authority must look at the last sanctioned plan for undertaking the exercise of proportionate land division. That the only exception to this principle is where a civil court has passed an order to the contrary, interdicting further development in the layout on the basis of revised plans. He submits that there can be cases where society formed first has never objected or has not taken steps against construction of the building in a society formed subsequently. Or there can be cases where society formed first has specifically consented to construction of building of subsequent society. That the result of both illustrations is that the vested rights in favour of subsequently formed society come into play and therefore, conveyance of proportionate land has to be on the basis of the last sanctioned plan.

Mr. Khandeparkar has submitted that Competent Authority cannot go into the issues of consent under Section 7 or 7A of MOFA and that if any society has any dispute regarding construction carried out in breach of MOFA, appropriate remedy would be to approach civil court to restrain or restrict such construction. That where such construction is not restricted, there is deemed consent and conveyance must take place by taking into consideration BUA utilised in construction of all buildings in the last sanctioned plan.

Mr. Khandeparkar has submitted that suggestion of freezing first sanctioned plan would result in anomalous/dangerous situation where a society whose building is constructed subsequently in the form of revised sanctioned plan will never be able to seek any conveyance and such limitations placed on rights of subsequent societies would be contrary to the statutory scheme of MOFA.

Mr. Khandeparkar submits that buildings constructed majorly/purely by utilising the TDR are no less than buildings constructed by utilising inherent FSI. He relies on Regulation 30 Table 12 of DCPR 2034, which states that “permissible FSI” viz. development potential includes (i) Zonal (basic) FSI, (ii) Additional FSI on payment of premium, and (iii) Admissible TDR. That therefore law does not create any distinction between buildings constructed with inherent/base FSI and TDR. That therefore such discrimination cannot be introduced while granting conveyance to various buildings in the layout. That since jurisdiction of Competent Authority is limited, it cannot go into complicated issues of consent, legality of construction of building, legality of use of additional FSI or TDR etc. That therefore the Competent Authority must accept the last sanctioned plan for the purpose of proportionate subdivision of layout land.

Mr. Khandeparkar further submits that there is another reason why no straitjacket formula can be applied in matters of deemed conveyance as under DCPR 2034, various types / modes of development are now permissible as under:

a. Development concerning basic FSI + TDR (Reg.30, Table 12)

b. Incentive schemes such as (i) cluster re-development under Reg. 33(9), (ii) slum rehabilitation schemes under Reg.33(9)

c. Development concerning combined schemes such as those permitted under (i) Clause 22 of Reg. 33(7), (ii) Clause 10 of Reg. 33(10), Clause 1 of Reg. 33(20)(B), etc.

d. Development concerning buildable reservations such as (i) under Reg. 33(17)(C) for BMC and MHADA and (ii) under Reg. 33(17)(D) for SRA, etc. in which cases, the FSI consumed for construction of the reservation is exempted, so long as the same is handed over to the concerned authority.

Mr. Khandeparkar has given two suggestions for purpose of resolving the controversy involved in the facts and circumstances in the present case, which are discussed in the latter part of the judgment.

Mr. Tamboly has assisted the Court by inviting its attention to various judgments dealing with the issue involved in the present case. By relying on judgment of Division Bench of this Court in Shree Siddharth Construction (supra), he has submitted that the principle of FSI distribution between the constructed properties existing on the land for the purpose of conveyance in a reasonable manner can be followed. That the Division Bench has held that such distinction between different claimants on the basis of FSI consumed becomes necessary where land is not allocated for each building for conveyance purposes. He submits that in Marathon Next Gen Realty Ltd. vs. Competent Authority^{55.2015 (5) Mah LJ 318}, a Single Judge of this Court has held that Competent Authority has no jurisdiction to adjudicate disputed facts and law, nor has power to decide disputed interpretation of clauses in the Agreement for Sale. That in ACME Enterprises vs. Deputy Registrar, Cooperative Societies^{66.2023 SCC OnLine Bom 1102}, Single Judge of this Court has held that Competent Authority cannot convey more than what the promoter had agreed to convey under Section 4 agreement. That this Court has held that grant of conveyance in respect of area proportionate to FSI consumed in construction of buildings would take the matter in the arena of disputed questions as to title and that Competent Authority was neither competent nor equipped to adjudicate the said issue. He submits that in subsequent judgment in Marathon Era CHS Ltd. vs. Competent Authority & DDR^{77.2024 SCC OnLine Bom 1115}, Single Judge of this Court has dealt with the concept of appurtenant land and has held that the same must go with the building and with the footprint land. That it is further held that though additional FSI can be utilised, it cannot be used in a manner in which it would reduce the promised or assured facilities and amenities. That FSI already used in completed building cannot be compromised in any manner. That utilisation of further FSI cannot come at the cost of already consumed FSI. He then invites the attention of this Court to Runwal Paradise vs. District Deputy Registrar Cooperative Societies^{88.2024 SCC OnLine Bom 2041}, in which it is held that the issue of entitlement to additional/unutilised FSI is outside the purview of the Competent Authority and that purport of guidelines of GR dated 22 June 2018 is to grant conveyance of land required to sustain the constructed structure along with proportionate areas in common amenities. He also invites attention of this Court to the judgment in Mahanagar Realty vs. Ganga Ishaniya CHS Ltd.^{99.2026 SCC OnLine Bom 1445}, in which this Court has noted the scenario of share of constructed building in plot area getting reduced with every revised sanctioned plan and the need to freeze the FSI as per the sanctioned plan after some of the buildings in the layout are constructed for the purpose of deemed conveyance. He then invites attention of this Court to Gala Complex Premises Cooperative Society Ltd. vs Gala Wood Works^{1010.2026 SCC OnLine Bom 2052}, in which it is held that when the building uses FSI of the entire plot, the land corresponding to such construction must also be determined proportionately. That this Court has held that promoter cannot retain land whose development potential has already been used for constructing buildings and that society must receive land corresponding to development potential already used for its construction. He also invited attention of this court to judgment in Nook CHS Ltd. vs Pyramid Developers^{1111.2026 SCC OnLine Bom 2774}, in which it is held that the latter plan cannot be permitted to cut down a right which had already arisen from the original arrangement unless the following 3 elements are clearly shown: (i) clear disclosure to purchasers, (ii) informed consent, and (iii) proper sanctioned basis. That this Court has held that latter sanctioned plan may be relevant but cannot supersede statutory obligations owed at earlier stage. He submits that in Rashesh CHSL (supra), this Court has held that while interpreting any provision under MOFA, the Court must lean in favour of protecting the legitimate rights of flat purchasers rather than permitting methods by which conveyance is delayed. That the Court has also dealt with the concept of appurtenant land in that judgment.

Mr. Tamboly also invites attention of this Court to the judgment in Upvan Woodlands Cooperative Housing Society Limited vs. M/s. Upvan Developers and Ors.^{1212.2026 SCC OnLine Bom 4723}, in which it is held that it is not necessary to await completion of development in the layout and society in respect of completed building can seek conveyance of proportionate land. That in Neelkanth Mansions (supra), this Court has held that where TDR is used for construction of all buildings in the layout, principle of proportionate land division can be followed by taking into consideration the BUA of each of the buildings.

Mr. Tamboly also relies on judgment of this Court in ACME Enterprises and Anr. vs. Deputy Registrar Cooperative Societies (2) and Ors.^{1313.IA No. 4859 of 2025 decided on 4 November 2025} in support of his contention that principle of land-cutting can be followed by conveying the due land to the building whose construction is completed, so as to leave open all options to the developer to utilise the balance land by loading the full development potential thereon.

Mr. Mishra submits that the Competent Authority could not have exercised jurisdiction under Section 11 of MOFA in the facts and circumstances of the present case where disputes are already sub judice and Suit No. 1002 of 2010 is pending in which his client society has sought conveyance of area of original sub-plot A admeasuring 16855.47 sq.m. That, Section 11 of MOFA confers only a limited and facilitative jurisdiction and under the guise of that jurisdiction, Competent Authority cannot go into complicated question of title. That the exercise of “proportionate allocation” is beyond the jurisdiction of Competent Authority. That Section 11(3) of MOFA permits conveyance only in accordance with Agreement for Sale, and GR dated 22 June 2018 cannot be followed in derogation of covenants of Agreement for Sale and provisions of MOFA. That the impugned order of deemed conveyance granted in favour of Sadguru Complex 1 (CD) CHSL is in complete disregard of injunction dated 29 January 2013, as confirmed by this Court by judgment dated 16 April 2013 by which the developers were restrained from creating third party rights in respect of the suit land. That by executing deemed conveyance in favour of Sadguru Complex 1 (CD) CHSL, Competent Authority has breached the said injunction order.

Mr. Mishra further submits that the impugned order of Competent Authority ignores the fact that the entire development potential of land admeasuring 16855.47 sq.m. of original sub-plot A was already consumed and exhausted in construction of Satellite Garden I CHSL. That therefore, construction of building of Sadguru Complex 1 (CD) CHSL itself is illegal. That there is suppression of material facts and collusion with developers, and therefore, impugned order is rendered illegal. That Petitioner alone is statutorily entitled to conveyance of entire land admeasuring 16855.47 sq.m. and no right, title or interest could lawfully pass on to Sadguru Complex 1 (CD) CHSL. That the impugned order is vitiated by procedural irregularity and non-application of mind.

In support of his contentions, Mr. Mishra relies on judgments in Arunkumar H. Shah (HUF) vs. Avon Arcade Premises Co-operative Housing Society Ltd.^{1414.2025 SCC OnLine SC 825}, Mazda Construction Co. vs Sultanabad Darshan Co-operative Housing Society Ltd.^{1515.2012 SCC OnLine Bom 1226} and Zainul Abedin Yusufali Massawala vs. Competent Authority^{1616.2016 SCC OnLine Bom 6028}. Mr. Mishra also opposes the petitions filed by Satellite Tower CHSL as well as Sadguru Complex 1 (AB) CHSL, contending that grant of conveyance to those societies is in the teeth of injunction order passed in the pending suit.

Mr. Shah submits that the Competent Authority has rightly followed the principle of subdivision of land proportionate to BUA utilised in construction of the building of his client society while passing the impugned order. That pendency of Suit of Satellite Garden I CHSL cannot come in the way of his client society securing due conveyance under Section 11 of MOFA. That Occupation Certificate (OC) has been granted in respect of his client society on 9 July 2010 and that the society is entitled to conveyance of proportionate portion of land. That there are 64 member flat purchasers in his client society who have purchased the flats for lawful and valuable consideration. That, the society has already expended huge sums in securing conveyance and has purchased the requisite stamp duty for conveyance of deeds. That no prejudice would be caused to other societies if the conveyance is granted in favour of Sadguru Complex 1 (CD) CHSL is allowed to sustain.

Mr. Kakkara has submitted that the Competent Authority has erroneously restricted conveyance to only plinth area of land in favour of his client society. That his client-societies are also entitled to conveyance of land proportionate to BUA used in construction of those buildings. That his client society has relied on certificates of architect indicating proportionate land entitlement. Mere loading of TDR in construction of a building becomes an irrelevant factor for deciding land division. That mere use of TDR cannot reduce lawful entitlement of society since building constructed with TDR ultimately amounts to lawful construction as per the sanctioned plan. That pending suit and injunction order therein do not justify denial of rights of his client society. That his clients are also entitled to proportionate land division in accordance with GR dated 22 June 2018 and conveyance cannot be restricted only to plinth area used in construction of the buildings. That, his client-societies are not parties to the suit and therefore their rights had crystallised before passing of injunction order. That Competent Authority already granted proportionate land in favor of Sadguru Complex 1 (CD) CHSL and therefore restriction of plinth area selectively imposed on his 2 client societies is clearly discriminatory. He accordingly prays for setting aside the impugned order passed in the case of Sadguru Complex 1 (AB) CHSL and Satellite Tower CHSL with direction for conveyance of land proportionate to BUA utilised for construction of the 2 buildings.

Mr. Kakalia has submitted that the developer has never shied away from obligations to convey the land in favour of the societies. He submits that there are following seven structures on the land bearing sub-plot A of the larger layout:

Mr. Kakalia has fairly placed on record copies of various plans including last OC plans and based on the OC plans, he has indicated utilisation of total permissible BUA of 40,343.28 sq.m. in respect of each of the buildings as under:

Mr. Kakalia further submits that TDR has been used in respect of 3 out of 5 sanctioned buildings as under:

Mr. Kakalia, at the suggestion of this Court, has submitted the figures of base FSI in respect of each of the buildings (without use of TDR) as under:

Mr. Kakalia has submitted that his client has completed the development on the plot and the last building (building No. 5) is yet to be constructed by the original owners as per the contractual arrangement between the parties.

The issue that is taken up for consideration in the present Petitions is about conveyance of land to the organisations of flat purchasers, whose buildings are situated in a layout development. When more than one building is constructed in a layout land and FSI and BUA sanctioned in respect of the entire layout land is distributed for construction of various buildings in the layout, division of the layout land for conveyance purposes many times becomes a contentious issue. This is particularly when the buildings are constructed by utilisation of BUAs under different schemes/potentials, such as (i) buildings constructed with base/inherent FSI, (ii) buildings constructed with use of full/partial TDR, (iii) buildings constructed with base FSI, but flowing through different FSI regimes (iv) buildings constructed under incentive schemes such as cluster development, slum schemes, IT Parks etc. In such a situation, it becomes difficult to have an apple-to-apple comparison for the purpose of proportionate distribution of land in the layout to be conveyed to organisations of flat purchasers formed by different buildings.

During yesteryears, the concept of house-owning was simple. A person interested in buying and owning a house would purchase the land and construct a house thereon. Alternatively, he would purchase a constructed house like a bungalow together with the plot of land. In such a scenario, the purchaser would become owner of both land as well as the constructed structure. In such a case, ownership of land goes hand-in-hand with ownership of constructed structure. However, as the time passed and lesser and lesser land became available for housing, especially in the urban areas, multistorey buildings came to be constructed by implementing house schemes, where multiple purchasers came together and decided to share ownership in the land through ownership of their respective superstructures. To illustrate, if a plot of land was taken up for development by constructing four-storey building comprising of four flats (one flat on each floor) and four different purchasers purchased one flat each of equivalent size, each of the four flat purchasers became owners in respect of the land to the extent of 25% share therein. This concept is still prevalent in many parts of the country such as in New Delhi, where limited number of floors are constructed on a plot of land and each floor owner becomes proportionate owner in the land beneath the structure.

However, in Maharashtra and particularly in Mumbai, the concept of owning flats in multistorey buildings was adopted even prior to independence. Multistorey buildings were constructed in Mumbai even prior to independence. Post independence, the activity of constructing multistorey buildings in urban areas in the State picked up pace. A landowner started engaging a professional developer for constructing building(s) on the land owned by him/her. Since there was demand for housing in urban areas, planning authorities permitted construction of multistorey buildings by implementing the concept of floor space index (FSI), meaning thereby that it was permissible to build superstructures proportionate to the size of land. For FSI 1.00, construction equivalent to the size of the land became permissible. However, on account of requirement of leaving marginal open spaces, exclusion of areas covered by staircase, verandahs, etc., need arose for the developers to go vertically, thereby constructing multiple flats on the land taken up for development.

However, the entry of professional developers in house building activities gave rise to many malpractices in construction and sale of flats to the purchasers. The developers sold only superstructures (flats) while retaining ownership in the land with the aim of milking further development potential. It therefore became necessary to regulate the activities of promoters and developers, and to safeguard the interests of flat purchasers. Need was also felt for statutory governing of relation between promoter and flat purchasers, rather than leaving the matters only in the realm of private contracts. With that objective, the State of Maharashtra enacted MOFA in the year 1963.

The MOFA has been enacted taking note of acute shortage of housing in several areas of the State and to prevent sundry abuses and malpractices by the developers and for regulating construction, sale of flats and for collective management of the buildings by the flat purchasers. The Preamble of the MOFA reads thus:

MOFA broadly deals with the compulsory execution of flat purchase agreements, project disclosures, timely possession, society formation and conveyance. It would be necessary to take a brief note of the important provisions of MOFA, which are relevant for deciding the issue taken up for discussion/consideration. Section 2(a-1) of MOFA defines the term ‘flat’ as under:

Section 2(c) of MOFA defines the term ‘promoter’ to mean every person who constructs or causes to be constructed a block or building or flats or apartments for the purpose of selling the same. The phrase has been interpreted to include the land owner also, who causes construction. Section 2(c) of the MOFA provides thus:

Section 4 of MOFA mandates that before accepting advance payment or deposit for purchase of flat, the promoter must execute and register an agreement with the flat purchasers. For the present purpose, the most vital ingredient of section 4 of MOFA is that the agreement needs to be in the prescribed form and must contain the particulars specified in clause (a) of sub-section (1A) and must accompany the documents enumerated in clause (b) of sub-section (1B). Thus, there is a statutory duty on the developer to make the necessary disclosures and also to append plans and specifications of the flat as approved by the local authority. Section 4 of MOFA provides thus:

Section 7 of MOFA prohibits alteration or addition without consent of flat purchasers after the plans and specifications are disclosed. Thus, once the approved plans are disclosed or furnished to flat purchasers, the promoter cannot make any alterations or additions in the structure prescribed therein in respect of any flat, nor can he make other alterations or additions in the structure of the building without the previous consent of all the flat purchasers. Section 7A has been incorporated by Amendment Act of 1986, which seeks to clarify that clause (ii) of sub-section 1 of section 7, which was incorporated by 1986 amendment shall be deemed to be effective at all material times and that the expression “or construct any additional structures” used therein existed before the commencement of the Amendment Act. Section 7 and 7A of MOFA provide thus:

Under Section 10 of MOFA, it is a statutory duty on a promoter to form a cooperative society or a company within the prescribed period. Section 10 of the Act provides thus:

Section 11 of MOFA imposes statutory duty on the promoter to convey in favour of organisation of flat purchasers his right, title and interest in the land and the building by executing all the relevant documents in accordance with the agreement executed under Section 4 either within the agreed period or within the prescribed period. Sub-sections (2) to (5) have been incorporated in Section 11 by 2008 amendment which confers jurisdiction on the Competent Authority to issue a certificate of unilateral deemed conveyance in the event promoter fails to execute conveyance in favour of society under sub-section (1). Section 11 of MOFA provides thus:

Accordingly, Competent Authorities have been constituted under Section 5A of MOFA which reads thus:

Section 16 of MOFA gives overriding effect to the provisions of the Act over any contract to the contrary and the same also provides that provisions of MOFA shall be in addition to the provisions of Transfer of Property Act, 1882. Section 16 of the Act provides thus:

In exercise of powers conferred under Section 15 of MOFA, MOF Rules have been framed. Rule 3 of MOF Rules deals with the manner of making disclosure and Rule 4 enumerates copies of documents to be provided to the flat purchasers. Rule 3 and 4 of MOF Rules provide thus:

Rule 5 provides for the particulars to be contained in the agreement and further provides that the agreement needs to be in Form V in MOF Rules. Rule 5 of MOF Rules provides thus:

Rule 8 of MOF Rules prescribes the period during which promoter must apply for formation of society and the period prescribed thereunder is 4 months from the date on which minimum number of persons required to form the organisation of flat purchasers have taken flats. Rule 8 provides thus:

Rule 9 of MOF Rules prescribes the period of 4 months from the date on which organisation of flat purchasers is formed for conveyance of land and building of the promoter in favour of such organisation. Rule 9 provides thus:

It would also be necessary to make a quick reference to Form V appended to MOF Rules. Under Form V, a model form of agreement to be entered into by the promoter and flat purchaser is prescribed. There are explanatory notes to Form V and Note 1 is of vital importance. Note 1 provides thus:

It is thus mandatory to incorporate clauses 1 to 5, 8, 9, 10,11,12,13 and 22 in the agreement which are declared as statutory and mandatory in nature. Any covenant contrary to those enumerated clauses automatically becomes void ab initio. Clause 13 of Form V agreement contains statutory covenant for conveyance of land and building within a period of 4 months of registration of society. Clause 13 of the Form V agreement reads thus:

Thus, there is a contractual as well as statutory obligation on a promoter to convey in favour of organisation of flat purchasers his right, title and interest in land and building within 4 months of formation of society. The obligation is contractual on account of mandatory incorporation of clause 13 in flat purchase agreement. As observed above, flat cannot be sold without executing agreement under Section 4. The agreement needs to be in accordance with Rule 5 which prescribes Form V. Form V contains clause 13, which is statutory in nature and cannot be deleted or excluded or modified. Any departure from clause 13 renders the contractual arrangement void and the statutory right to the contrary prevails. Thus, scheme of MOFA mandates that the promoter must undertake the contractual obligation to convey the land and building within 4 months of formation of society.

Notwithstanding the contractual obligation and even if in a given case, the developer omits to incorporate clause 13 of Form V agreement or privately contracts with flat purchasers otherwise, there is still a statutory duty on the promoter to convey the land and building within 4 months of formation of society. As observed above, Section 16 of MOFA gives overriding effect to provision of MOFA over any contractual clause. Thus, even if a promoter may privately contract with a flat purchaser that the land would never be conveyed or that only leasehold rights in land would be conveyed or that conveyance would be executed after 30 years or after completion of entire layout development, such contractual clause would be rendered void and combined effects of provisions of Sections 4, 11 and 16 of MOFA and Rules 5 and 9 of MOF Rules would make a promoter statutorily liable to convey the land and building within the prescribed period i.e., period of 4 months from the date of formation of society.

The amendments effected in 2008 to the MOFA mark a watershed moment in protecting the rights of flat purchasers in respect of conveyance of land and buildings. The Legislature noted the reluctance and avoidance by developers in conveying the land in favour of organisation of flat purchasers. Therefore, the concept of deemed conveyance was introduced in the form of sub-sections (3) to (5) in Section 11 of MOFA. The Statement of Reasons and Objects for Amendment Act-IV of 2008 reads thus:

Thus, the provision for deemed conveyance under Section 11 of MOFA is made by the Legislature after noticing failure on the part of the promoters and developers in the State of Maharashtra to convey lands in favour of the societies.

If the promoter fails to perform the contractual obligation (under clause 13 of the Form V Agreement) or the statutory obligation under Section 11(1) of MOFA read with Rule 9 of MOF Rules, the organisation of flat purchasers can make an application to the Competent Authority for deemed conveyance. After conducting a summary inquiry by considering the flat purchase agreements, sanctioned plans and other relevant documents and after providing an opportunity of hearing to the promoter, the Competent Authority can issue a certificate to the Sub-Registrar or any other appropriate Registration Officer under the Registration Act, 1908, certifying that it is a fit case for enforcing unilateral execution of conveyance deed conveying the right, title and interest of the promoter in the land and building in favour of the applicant, as deemed conveyance.

Thus ‘failure’ by the promoter to perform the statutory duty confers jurisdiction on the Competent Authority to entertain and decide the application for deemed conveyance. Occurrence of ‘failure’ within the meaning of Section 11(3) of MOFA thus constitutes a jurisdictional fact for the Competent Authority. [SEE: Nahar Builders Ltd. Vs. Orchid Enclave Cooperative Housing Society Ltd.^{1717.Writ Petition No. 6063 of 2026 decided on 26 July 2026}]

Once a certificate of deemed conveyance is issued under Section 11(4), the organisation of flat purchasers can present such certificate to the Registration Officer for registration under the Registration Act, 1908 and after issuing notice to the promoter, the Registrar registers the instrument as ‘deemed conveyance’.

As observed above, there is a purpose for which provisions of sub-sections (3) to (5) are inserted in Section 11 of the MOFA. The provision for deemed conveyance is consciously made by the Legislature after noticing rampant failure on the part of the promoters to convey land in favour of organisation of flat purchasers. The Legislature was alive to the situation that by the year 2008, most of the societies, associations of apartments, etc. were without conveyance of land. Many buildings in cities like Mumbai, Pune, etc. had outlived their lifespan and needed immediate redevelopment. Though Section 11(1) of the MOFA imposes statutory duty on promoters to convey land, the only remedy available to the organisation of flat purchasers was to file a suit for securing conveyance. Decision of suits was taking years. To illustrate, in the present case itself, the suit filed by Satellite Garden-I CHSL in the year 2010 for conveyance is still pending. It was therefore necessary to make available faster, cheaper and swifter remedy for investing the title in the land in favour of the flat purchasers.

However, rampant failure on the part of the promoters was observed when most of the societies remained without title in respect of the lands. Developers were taking disadvantage of this position by putting up additional construction on the strength of ownership of land by them despite sale of all the flats in the building. Societies were finding it difficult to undertake the work of redevelopment and flat owners were languishing in old and dilapidated buildings. Noticing this abject failure of objective under the MOFA, the Legislature had to step in and cure the mischief by inserting sub-sections (3) to (5) in Section 11 of the MOFA. What is done under sub-sections (3) to (5) of Section 11 is performance of duty of promoter by the Competent Authority. Ordinarily, under the Transfer of Property Act, 1882, title would pass only after the owner executes conveyance in respect of the land. However, Sections 11(3) to (5) of the MOFA make slight departure from provisions of the Transfer of Property Act and permit a non-owner (Competent Authority) to effect sale/conveyance of land in favour of organisation of flat purchasers. This is permissible only on account of the fact that the promoter is actually divested of title in the land by reason of sale of all flats in the building, but continues to commit the folly of not executing the document, which would have the effect of vesting of title in the housing society.

Sale of a flat in the building does not mean sale of only a superstructure. It is a composite sale of superstructure and some interest in the land as well. Therefore, with sale of all flats in a building, the promoter/landowner stands divested of his title in the land. There is nothing that remains to be conveyed on account of operation of concept of divestment. To illustrate, if plot of land admeasuring 1000 sq.m. is taken up for construction of building and 10 flats are constructed as sanctioned by the Municipal Corporation and the entire development potential in the land is exhausted, the moment 10^th flat in the building is sold, the landowner automatically gets divested in respect of his title in the land. What needs to be performed by him under Section 11(1) of the MOFA is actually a formality so that vesting of title in the organisation of flat purchasers takes place. Divesting happens automatically by sale of flats but vesting of title requires completion of formality of execution of Conveyance Deed in favour of organisation of flat purchasers. Thus, what is done by the promoter under Section 11(1) of the MOFA is only the latter act of vesting since the former act of divesting is already complete. The promoter already loses his title in the land and all that is required to be done by him under Section 11(1) of the MOFA is to complete the formality of execution of document, which would then vest the title in favour of organisation of flat purchasers.

The concept of divesting of title of promoter in the land and of deemed conveyance is discussed by this Court in Darshan Mandir CHSL Vs. District Deputy Registrar^{1818.2026 SCC OnLine Bom 5634} and it is held thus:

When the land is subjected to a housing scheme by the landowner, either by himself or through a promoter, the statutory obligation to convey the land automatically kicks in. Once plans are sanctioned and sale of flats commences by execution of Section 4 Agreements, the landowner continues to hold the title in the land so subjected to a housing scheme only for the purpose of completing of construction and for conveying the same to the organisation of flat purchasers. The moment the development potential as per the disclosed sanctioned plans is exploited by sale of the last flat in the building, the title in the land is lost and what remains is only an obligation to convey. Section 10 of MOFA provides for formation of a cooperative housing society even before all the flats in the building are sold. It is not compulsory for the developer to sell all the flats in the building in a particular time. If he chooses to delay sale of all flats, but a society is formed, the promoter can become member of the society qua unsold flats. But the obligation to convey the land and the building does not stop or get postponed even where there is delay in sale of flats.

The concept of dual ownership is thus ordinarily unknown to MOFA. Once the land is subjected to housing scheme by constructing a building or a block comprising ‘flats’ (as defined under MOFA) and once the flats are sold, obligation to convey the land gets attached and must be fulfilled. The landowner/promoter cannot state or even contractually provide that the flat purchasers/their organisations would own only the superstructure and that the land beneath shall always remain in the ownership of the landowner/promoter. Whatever that is owned by the promoter must be conveyed. Thus, the law does not recognize a concept where only superstructure can be sold to the flat purchasers, but the land would continue to remain in the ownership of the promoter. Except in rare cases where the land taken up for development itself is a leased land, the ownership rights in the land must statutorily be conveyed in favour of the organisation of flat purchasers. Provisions of MOFA are thus the antithesis of the concept of dual ownership.

As observed above, the former act of divestment of title of the promoter automatically occurs upon sale of the last flat in the building. However, the latter act of vesting of title in favour of the Society needs execution of a formal document. The Competent Authority only performs the latter act on account of the occasion of failure on the part of the promoter. The land is thus ‘deemed to be conveyed’ in favour of the organisation of flat purchasers even though the landowner/promoter does not desire or is unwilling to convey the same. This is the reason why Section 16 of the MOFA makes provisions of the Act in addition to the provisions of the Transfer of Property Act. Without the signature and consent of the landowner/promoter, the deeming fiction occurs and the title passes from the landowner to the organisation of flat purchasers.

Thus, the conveyance under Sections 11(3) to (5) of MOFA is treated as ‘deemed’ since the land owner or the promoter is not a party/signatory to the document/instrument of conveyance. Someone not owning the land issues a certificate that the land is conveyed and such certificate is registered as an instrument of deemed conveyance.

Thus, the Legislative intention behind empowering the Competent Authority to issue a certificate of unilateral deemed conveyance in favour of organisation of flat purchasers is to curb the malpractices on the part of the developers. Introduction of concept of deemed conveyance has largely been successful and has benefited several societies / associations of apartments / companies in securing title in respect of the land.

As observed above, no difficulty arises in case of a single building erected on a plot of land where the Competent Authority can swiftly pass an order of deemed conveyance. No difficulty arises even when multiple buildings in a layout are constructed on the basis of a single sanctioned plan. Even in such scenario, the Competent Authority can swiftly make an order of deemed conveyance of the entire land in favour of either the federation or jointly in the name of all societies. The Competent Authority can even grant partial conveyance in respect of one out of multiple societies by proportionately sub-dividing the land. The difficulty only arises where plans are revised and additional BUA is sanctioned. In this scenario, the mischief is committed again by the developer. The developer applies for revised permission and takes benefit of higher BUA due to introduction of new scheme or change in the FSI regime.

The issue for consideration is whether the Competent Authority can be prevented from exercising jurisdiction under Section 11 of the MOFA merely because the developer has committed the mischief of getting the plans revised during currency of the layout development? Can the argument of creation of title dispute relating to proportionate land division be permitted to be raised for the purpose of defeating the jurisdiction of the Competent Authority under Section 11 of the MOFA? The answer, to my mind, appears to be in the negative. After all, MOFA and particularly the 2008 amendment introducing the concept of deemed conveyance is aimed at preventing the mischief by the developers. The mischief prevention concept of MOFA is dealt with by this Court in Haresh Vijaysinh Bhatia & Ors. Vs. District Deputy Registrar & Ors.^{1919.2025 SCC Online Bom 1981}. Referring to the Apex court judgment in Municipal Corporation of Greater Mumbai v. Ankita Sinha^{2020.(2022) 12 SCC 401}, this Court held as under:

Since the objective behind enacting the provisions of MOFA is to cure the mischief, merely because layout development is completed with multiple revisions in the plan by taking benefit of additional incentive FSI/BUA, the same cannot be a ground for denying the statutory right of conveyance through the Competent Authority to the buildings of such layout. Therefore, instead of holding that the Competent Authority should stay away from such instances by relegating the parties to the remedy of civil suit, it would be more appropriate to lay down the principles governing conveyance in respect of such layout developments with a view to achieve the legislative object under Section 11 of the MOFA.

Though deemed conveyance involves a deeming fiction and is granted through a summary inquiry, once granted, it becomes a ‘conveyance’ in real sense and for all practical purposes as per the Transfer of Property Act. Once the certificate of deemed conveyance is registered under Section 11(5) of the MOFA, it vests title in the land and the building in favour of the society/company/association in whose name it is issued. Revenue entries can be effected based on registered certificate of deemed conveyance. Use of the word ‘deemed’ in such conveyance does not make it of a lesser value than a contractual conveyance.

The only exception in a deemed conveyance is that it can be challenged in a civil court and a declaration to the contrary can be secured. This is because of the summary nature of inquiry envisaged under Section 11(3) and (4) of the MOFA. Since the inquiry before the Competent Authority is not a detailed evidence-based inquiry and since the Competent Authority is not supposed to decide the intricate issue of title like a court, a contrary declaration in respect of land conveyed vide certificate deemed conveyance can be sought from a Civil Court. In Arunkumar H. Shah (HUF) the Apex Court has held thus:

Thus, like a contractual conveyance, even a statutory deemed conveyance can be challenged before the Civil Court. However, till the order of deemed conveyance is set aside by a decree of Civil Court, the same constitutes a document of title. In Dev Ashish CHSL Vs. State of Maharashtra^{2121.Writ Petition No. 13649 of 2025 decided on 7 July 2026}. This Court has held thus:

Thus, for housing societies, securing deemed conveyance in respect of the land and the building results in vesting of title, enabling them to manage and deal with the same and more importantly, to undertake redevelopment of their buildings.

Under Sections 11 (3) and (4) of the MOFA, the Competent Authority exercises summary jurisdiction and performs the statutory obligation of the promoter by stepping into his shoes when failure on his part to perform those obligations occurs. Over the period of time, the contours of scope of inquiry to be made by the Competent Authority are to some extent broadened through various judicial pronouncements. The role of the Competent Authority is not restricted to act only in accordance with Section 4 Agreements, but it can also examine whether the Agreement is in consonance with the scheme of MOFA and MOF Rules and ensure performance of statutory obligations when contractual arrangement is found to the contrary. The timeline for conveyance stipulated in Section 4 Agreement can be ignored by the Competent Authority and the one prescribed in Rule 9 of the MOF Rules can be adhered to. Contrary to the contractual stipulation for conveyance of land only in favour of a federation, proportionate land can be conveyed to individual societies. Similarly, qua the area of land to be conveyed, the Competent Authority can look into the plans and convey land in proportion to the BUA utilized for construction of building, rather than conveying the area of land stipulated in the Agreement. It would be apt to take a quick stock of judgments on these principles.

federation alone

Many Agreements executed under Section 4 of MOFA provide for conveyance of land only in favour of the federation upon completion of layout development. Under the provisions of Maharashtra Co-operative Societies Act, 1960, a federal society can be registered by constituent cooperative housing societies formed in respect of the buildings in the layout. Actually, conveyance of the entire land in the layout in favour of the federation is the ultimate panacea for all the problems of layout land division for conveyance purposes. However, in several cases, federations are not formed or the layout development takes years or decades for completion. In the present case itself, the layout development commenced in 1997 and is still incomplete after passage of 29 long years. Even though the layout development may be complete, sometimes, societies prefer to have individual conveyances rather than joint conveyance in favour of the federation. This gives them the flexibility to take decisions relating to redevelopment process. Be that as it may. This Court has recognised the principle that conveyance of proportionate land can be granted to the individual societies ignoring the contractual stipulation of conveyance only in favour of the federation. This is on account of obligation of conveyance kicking in on expiry of period specified in Rule 9 of MOF Rules upon formation of society in respect of one of the buildings in the layout. Thus, the Competent Authority can convey proportionate land to the society of completed building without waiting for formation of a federation.

In Veer Tower CHSL Vs. District Deputy Registrar^{2222.2025 SCC OnLine Bom 324} this Court has held thus:

Thus the Competent Authority can ignore the contractual stipulation in the Section 4 Agreement for conveyance of land only in favour of federation and can convey proportionate land in favour of individual societies.

The law on the issue of obligation of the promoter to convey his right, title and interest in the land and the building (ownership in the land) and not merely leasehold rights is now well settled. In Haresh Vijaysinh Bhatia (supra), it was sought to be contended on behalf of the promoter that the Competent Authority is a tribunal of limited jurisdiction and cannot travel beyond the jurisdiction conferred under Section 11 of MOFA, under which it has to direct deemed conveyance of land and building ‘in accordance with the agreement executed under Section 4’. It was contended that if the agreement executed under Section 4 of MOFA contemplates grant of only a lease, the Competent Authority does not have the jurisdiction to rule that the covenant in the agreement is contrary to the provisions of Section 11 of MOFA and to grant in favour of a society something over and above the one provided for in the agreement. It was contended that the Competent Authority must confine itself within the contours of agreement executed under Section 4 MOFA and that the limited role that it plays is to substitute itself in the place of promoter while deciding the application filed under Section 11(3) and to grant unilateral deemed conveyance of land and building strictly in terms of the agreement executed under Section 4 MOFA. It was contended that if any covenant in the agreement is found to be contrary to any provisions of the MOFA or MOF Rules, the remedy for the affected party is to file a suit to have such covenant declared void and thereafter file application for unilateral deemed conveyance under Section 11 before the Competent Authority. It was thus contended that the Competent Authority does not have jurisdiction while making an enquiry under Section 11 MOFA to rule that any particular covenant in the agreement executed under Section 4 is contrary to the provisions of the MOFA or MOF Rules. Rejecting the contentions, this Court held thus:

Thus, in Haresh Vijaysinh Bhatia, this Court has held that the Competent Authority possesses the necessary jurisdiction to direct conveyance of the land and building(s) on ownership basis where the promoter is the owner of the land by ignoring covenant in the agreement, which does not provide for conveyance of land on ownership basis or grant of mere lease thereof.

This Court has repeatedly held that it is impermissible for the developer to delay conveyance for eternity on the ground of incomplete development of the layout. Reference in this regard can be made to the judgments of this Court in Lok Housing and Construction Ltd. vs. State of Maharashtra and Ors.^{2323.2025 SCC OnLine Bom 711}, ACME Enterprises and Anr. vs. Deputy Registrar Cooperative Societies (2) and Ors. (supra) and Upvan Woodlands CHSL (supra).

In Lok Housing and Construction Ltd. (supra), this Court interpreted the term ‘period’ appearing in Rule 9 of MOF Rules and has held that the same connotes a fixed, determinable and reasonable span of time. This Court held that any clause in the Agreement for Sale that attempts to override or nullify the statutory obligation under Rule 9 must be declared void to that extent, being inconsistent with law. This Court held in paras-17 to 24 of the judgment as under:

Further, the Court finds that any interpretation of the word “period” that allows it to be supplanted by the occurrence of a future uncertain event would defeat the legislative intent of providing a time-bound mechanism for conveyance. MOFA was enacted precisely to remedy the imbalance in bargaining power between promoters and flat purchasers. To interpret Rule 9 in a manner that enables the promoter to defer conveyance indefinitely would amount to restoring the very imbalance which MOFA seeks to correct.

Therefore, this Court has no hesitation in holding that the expression “period” as used in Rule 9 must necessarily mean a fixed, determinable and reasonable span of time. It cannot be equated with any open-ended or contingent condition. Any clause in the agreement for sale that attempts to override or nullify this statutory obligation must be declared void to that extent, being inconsistent with the law.

In view of the aforesaid discussion, this Court is of the considered opinion that any contractual clause, including Clause 25 of the agreement in the present case, which seeks to defer the promoter's obligation to execute conveyance until completion of project, is in direct conflict with Rule 9 of the MOFA Rules. Such a clause cannot take precedence over a statutory duty. Where the majority of purchasers have taken possession and formed a registered society, and have complied with their obligations, the promoter cannot avoid conveyance by raising inter se disputes or conditions involving other purchasers. A condition based on a future uncertain event — neither time-bound nor within the control of the society — cannot be treated as a valid “period” under Rule 9.

Thus, a building in the layout in respect of which a society is formed need not wait for conveyance of land till completion of layout development.

In Nitin Nagarji Mehta Vs. Shree Jupiter CHSL^{2424.Writ Petition No. 12677 of 2025 decided on 28 July 2026}, this Court has dealt with a case where the developer had deliberately earmarked lesser land in Section 4 Agreements for conveyance while utilizing FSI/BUA by amalgamating other plots. This Court held that the conveyance could not be restricted only to the lands indicated in Section 4 Agreements, but land as per the entitlement as per the sanctioned plans must be conveyed. This Court held thus:

However in a converse situation, in New Sonal Industries Premises Ltd. Vs. District Deputy Registrar^{2525.2024 SCC Online Bom 391}, this Court has held that when lesser FSI than the one admissible is consciously utilized by the developer, mere availability of balance FSI potential in the land cannot be a ground for not conveying the whole plot as per the Section 4 Agreements. This Court has held thus:

(emphasis and underlining added)

Thus MOFA, being a beneficial piece of legislation enacted for the benefit of the flat purchasers and their organisations and to prevent the mischief by developers, the same is repeatedly interpreted in favour of the former class and against the latter.

In Krishna Developers Pvt. Ltd. Vs. The District Deputy Registrar^{2626.Writ Petition No. 4542 of 2024 decided on 11 February 2026}, it was contended that the clauses in the Agreement preserved right of way and balance FSI for the developer. This Court held that the private agreement cannot dilute the statutory obligations and the contractual clauses are valid only so long as they do not defeat the statute. It is further held that the statutory Form prescribed under the MOF Rules does not contemplate an open-ended reservation of future FSI in favour of the promoter once the project is completed as per the approved plans. A clause inconsistent with the statutory form and scheme cannot be enforced to the prejudice of the society. The promoter cannot contract out of his statutory duty. It is held thus:

In Kiran Builders Pvt. Ltd. Vs. Kalpita Enclave CHSL^{2727.Writ Petition No.9694 of 2017 decided on 18 June 2026.}, this Court, after referring to the judgment in Lakeview Developers (supra) has held that a developer cannot put up additional constructions for eternity on the basis of FSI made available in future, and on that ground, avoid conveyance of the land in favour of the society. It is held thus:

This Court has dealt with the issue as to whether the moratorium imposed under Section 14 of the Insolvency and Bankruptcy Code, 2016 (IBC) can come in the way of Competent Authority exercising jurisdiction under Section 11(3) of MOFA to grant deemed conveyance. In Santoshkumar Motilal Bhansali Vs. District Deputy Registrar^{2828.2026 SCC OnLine Bom 552} and Darshan Mandir CHSL (supra), this Court has held that provisions of Section 14 of the IBC cannot come in the way of the Competent Authority exercising statutory duty imposed on the promoter under Section 11(1) of MOFA. It is further held that an action initiated by a financial creditor against a corporate debtor under Section 7 of IBC and a moratorium imposed under Section 14 of IBC, while admitting the application of that financial creditor, cannot negate or even suspend the statutory duty of the Competent Authority under Section 11(3) and (4) of MOFA. It is further held that the statutory objective behind MOFA cannot be permitted to be defeated merely on account of provisions of Section 14 of IBC. As discussed above, in Darshan Mandir CHSL, this Court has discussed the concept of divestment of title of the promoter and has accordingly held that the freeze on assets of corporate debtor created under Section 14 of IBC does not affect the right of the housing society to secure conveyance as the promoter is already divested of the title and mere formal duty of execution of conveyance remains, which is performed by the Competent Authority.

In ALJ Residency Co-operative Housing Society Ltd. Vs. State of Maharashtra and Ors.^{2929.Writ Petition No.406 of 2018, decided on 25 November 2024}, this Court had an occasion to deal with the issue as to whether the Competent Authority can exercise jurisdiction under Section 11 of MOFA to grant certificate of unilateral deemed conveyance in respect of a building, which is yet to be issued an Occupation Certificate. This Court referred to the provisions of GR dated 22 June 2018, which permits conveyance of land and building in favour of Society, whose building is yet to be issued Occupation Certificate upon submission of a self-declaration by the society accepting all responsibilities and liabilities regarding the building and to make an application to the Planning Authority for issuance of occupation certificate. The judgment in ALJ Residency Co-operative Housing Society has been followed in Yogesh Jayant Khadilakar Vs. State of Maharashtra^{3030.Writ Petition No. 13755 of 2022 decided on 11 February 2025}.

Having discussed the law enunciated in various judgments on permissibility to grant certificate of deemed conveyance by the Competent Authority in various situations, it is time to revert to the core issue taken up for discussion and resolution i.e. proportionate land division in the layout. Before discussing various illustrative cases in which difficulties are posed in proportionate land division in a layout, it would be necessary to deal with the submission that the Competent Authority cannot deal with the complications involved in proportionate land division and that it must leave the matter for Civil Court to decide.

ADOPTION OF REMEDIES BEFORE CIVIL COURTS

The Competent Authority constituted under Section 5A of MOFA and exercising jurisdiction under Section 11(3) and (4) is undoubtedly a tribunal of limited jurisdiction. It makes a summary inquiry under sub-sections (3) and (4) of Section 11 of MOFA while issuing a certificate of deemed conveyance. In cases relating to single building on a plot, the scope of inquiry before the Competent Authority is extremely limited. It only satisfies itself as to whether there is failure on the part of the promoter to convey his right, title and interest in the land and the building in favour of organisation of flat purchasers, looks into the Agreement for Sale and sanctioned plans, and makes an order for issuance of certificate of deemed conveyance.

However, things get complicated while deciding applications for deemed conveyance filed by a society whose building is constructed in a layout land. The developers or landowners raise several defences for somehow denying and delaying conveyance so that future development potential can be milked. Sometimes there are other societies in the layout who also oppose the applications for deemed conveyance. Therefore the nature of inquiry before the Competent Authority gets intensified in relation to layout developments.

Since the legislative objective behind MOFA is to provide a swifter remedy to the organisation of flat purchasers to secure conveyance, mere raising of objections by developers, land owners or other societies cannot be a reason for the Competent Authorities to shun the responsibility and drive the parties to lengthy litigations before Courts. The very objective behind Section 11 (3) to (5) of MOFA is that the organisations of flat purchasers need not undertake lengthy and expensive court litigations for securing conveyance. Decision of conveyance suits can take years. In the present case itself, the suit filed by Satellite Garden-I CHSL for conveyance is pending since 2010. This also reminds me of the fact that while the principles in the Division Bench judgment of this Court in Grand Paradi Housing Society Ltd. Vs. Mont Blanc Properties^{3131.2010 SCC OnLine Bom 608} are oft quoted, the suit filed by the plaintiff society therein in the year 2002 for conveyance still remains pending. Therefore, driving the societies to litigate before Civil Courts for securing conveyance is not the best of the options. This Court of course is mindful of the law enunciated by this Court in Mazda Construction Co. (supra) and Zainul Abedin Yusufali Massawala (supra) that the Competent Authority under the MOFA cannot adjudicate complex title disputes or civil rights when granting a unilateral deemed conveyance. At the same time, expecting the organisations of flat purchasers to file suits for conveyance the moment some dispute is raised in deemed conveyance applications by the opponents would defeat the very objective behind the 2008 amendments to MOFA. Also, the law has developed post Mazda and the broad contours of jurisdiction of the Competent Authority to deal with various situations through various judicial pronouncements (as discussed above) are now well-settled.

Therefore, the approach of the Competent Authorities must be to resolve the disputes relating to proportionate land division rather than driving parties to lengthy litigations. Now that several principles relating to proportionate land division are settled through judicial precedents and additional principles are being discussed in this judgment, there would be sufficient clarity for the Competent Authorities while dealing with cases relating to proportionate land division in a layout development. The approach must be to resolve the disputes relating to land sharing in deemed conveyance applications and leaving open the remedy to the aggrieved party raising complicated issues requiring evidentiary inquiry to approach the Civil Court. By now, it is well-settled position that deemed conveyance granted by the Competent Authority under Section 11 of MOFA is not final determinative of rights and entitlements of parties qua the land conveyed and the aggrieved party can always approach civil court claiming rights in the land contrary to the conveyance so granted. [SEE: Arunkumar H. Shah (HUF) (supra)]. Therefore, the Competent Authorities must attempt to resolve the disputes relating to land division in the layout keeping in mind the statutory scheme of MOFA and MOF Rules and the settled principles through various judicial pronouncements.

Having considered the statutory scheme of MOFA and MOF Rules and few precedents on supremacy of statutory framework of MOFA over private contractual arrangements, it is now time to resolve the difficulties created in conveyance of land in the layout development. It is not that in every layout development the difficulty for proportionate subdivision of land really arises. In most of the layout developments, this difficulty may not even arise where the developer submits a layout plan for approval, gets all the buildings sanctioned at one go and commences construction and completes them within a reasonable time. There can never be any difficulty in proportionate division of land in such cases. To illustrate, a developer undertakes development on 10000 sq.m. land and is required to deduct 15 % area for RG, the balance land developable is 8500 sq.m. With FSI of 1.00, he secures BUA of 8500 sq.m. which he distributes among 4 buildings as under:

If all 4 buildings are sanctioned in one plan and are simultaneously taken up for construction and completed within a reasonable time without seeking revision in the development permission, there is no difficulty in proportionate land division as each of the 4 buildings/their societies can be conveyed proportionate share in the land and in the RG area.

There can also be no problem in a situation where TDR is loaded by the developer in the above example. To illustrate, if plot admeasuring 10,000 sq.m. is taken up for development, out of which 15 % area is earmarked for RG and sanctioned BUA is 8,500 sq.m. based on FSI of 1.00. There is permissibility to load TDR of 3500 sq.m. and the developer purchases TDR and loads the same, thereby increasing his permissible BUA upto 12,000 sq.m. He gets approved 4 buildings as under:

Even in the above example, though TDR is loaded, there is absolutely no difficulty in proportionate land division and Competent Authority / court can apply principle of division of land proportionate to BUA utilised in construction of 4 buildings. In Neelkanth Mansion and Infrastructure Pvt. Ltd. (supra), this Court has dealt with situation as above and has held in para 16,17 and 24 of the judgment as under:

The problem, however, occurs where the promoter commits the mischief of delaying the layout development and gets the plans revised after construction of the first or second building and secures benefit of higher BUA either through TDR or incentive FSI or through change in FSI regime. Here there can be multiple scenarios as under:

Plot admeasuring 10,000 sq.m. is taken up for development and after deducting 15 % RG area, normal permissible BUA on the basis of FSI 1.00 is 8,500 sq.m. The Developer gets the layout plan sanctioned for construction of 4 buildings as under:

The developer completes construction of Building Nos. 1, 2 and 3 with BUA 1500 sq.m., 2000 sq.m. and 2500 sq.m. respectively. The developer delays construction of Building No. 4, and in the meantime, the DCR permits loading of TDR on the plot. The developer accordingly purchases TDR of say, 3500 sq.m. and starts constructing Building No. 4 with BUA 6000 sq.m. The land entitlement of each building would be as under:

In this illustration, Building No. 4 with massive BUA of 6000 sq.m. would virtually eat up 50 percent of the land, even though in the original sanctioned layout, it was supposed to consume BUA of only 2500 sq.m. and would have received conveyance of much lesser land.

Suppose a developer undertakes development of land admeasuring 10,000 sq.m. and he secures base FSI of 1.00 and BUA of 10,000 sq.m. He gets the layout sanctioned for construction of 4 buildings by distributing the BUA as under:

The developer does not construct Building 4 for a considerable period of time and new DCPR is introduced, which raises the FSI to 2.5. The developer accordingly gets the plan revised. In these circumstances, MCGM or any other planning authority unfortunately takes into consideration the entire plot of 10000 sq.m. for revision of development permission. They do not exclude the land potential, which is already consumed, nor do they restrict additional FSI only in respect of balance land potential. Therefore, in this illustration, the planning authority would sanction the increased FSI of 2.5 to entire land of 10,000 sq.m. and sanction BUA of 25,000 sq.m. The planning authority would then deduct utilised BUA of Building Nos. 1, 2 and 3 of 6000 sq.m. and sanction Building 4 with BUA of 19000 sq.m. In this scenario, the original planned development and revised development would be as under:

In this case, the land entitlement of each building in the plot admeasuring 10,000 sq.m. based on the BUA utilized in construction would be as under:

The above table would indicate massive difference in relation to land entitlement of buildings on account of revision to the plan by the developer. The fourth building has eaten up the land entitlement of the first three buildings. Thus, by mere reason of mischief played by the developer in delaying the construction of the 4^th building and taking advantage of change in FSI regime, the first 3 buildings suffer immensely in terms of their share in the land. The issue for consideration is whether this can be permitted? The answer is in the latter part of the judgment.

Under DCR 1991 as well as DCPR 2034, there are different schemes under which additional FSI is granted for carrying out a specific nature of development. The incentive FSI is granted with a specific objective. To illustrate, under Regulation 33(16) of DCR 1991, the Municipal Commissioner is empowered to permit additional 100% FSI over and above the one grantable in Table 14 of Regulation 32 for building of Information Technology Establishment, which provision is now in the form of Regulation 33(13) of DCPR 2034, which specifies incentive FSI for the buildings of IT Establishments/data centers. Under Regulation 33(13) of DCPR 2034, if the road width is 27 meters, FSI of 5 can be sanctioned even though the normal FSI for similar road width is only 3.0 in the island city and 2.5 in the suburbs. There are several other schemes for incentive FSI such as buildings of biotechnology establishments, buildings for the students and/or working women hostel etc. In this illustration, even during same FSI regime, the developer revises plan during pendency of layout development and gets the same sanctioned for mixed use. The same results into imbalance.

To illustrate, in a plot admeasuring 10,000 sq.m., FSI 1.00 was admissible during DCR 1991 and 2 buildings were sanctioned with BUA of 5000 sq.m. each, Building No. 1 is complete and the society is formed. The developer delays construction of Building No. 2. Looking at the market demand, the developer decides to use incentive FSI for IT park or hostel and he applies for revision in the layout plan. In this scenario also, unfortunately, the Municipal Corporation sanctions the incentive FSI in respect of the entire plot of 10,000 sq.m., ignoring the position that half potential of the plot is already consumed by Building No. 1. The developer misuses the difficulty for Planning Authority in going into title disputes wherein it needs to consider the developer as a single owner in respect of the whole plot and accordingly gets sanctioned the revised plan with incentive FSI for the whole plot. Accordingly, the Municipal Corporation sanctions 2.00 FSI for the whole plot with BUA of 20,000 sq.m. In such case, BUA used for building No.1 of 5000 sq.m. is deducted and developer is permitted to construct building No.2 (IT park /hostel) with BUA of 15,000 sq.m. In this scenario, if principle of land division proportionate to BUA used in both the buildings is followed, Building No.1 will suffer. It is clear from the following table:

In the above manner, revision in the layout plan for additional construction poses difficulties in land division amongst various buildings in the layout and the buildings constructed by revision of layout walk away with larger pie in the layout land at the cost of buildings constructed earlier as per the originally sanctioned plans.

The difficulties in the land division in the above discussed scenarios were put forth before the learned counsel for suggestions and for resolution and various suggestions are made by the Learned Advocate General and by the Learned Amici. It would be apt to consider the same.

Dr. Sathe, the learned Advocate General has given following suggestions to tackle the above discussed problems:

In this case, the entire land needs to be conveyed to the body, if there is only one body or on pro-rata basis if there are more bodies on the basis of BUA.

If only one conveyance is granted to one body, then the entire land has to be conveyed. However, if there are more bodies than one, then here also, the land component has to be on pro-rata basis for each society considering the entire consumed FSI including permissible TDR.

Note: In cases (a) and (b), whether TDR is utilized or not is immaterial.

Mr. Samdani, the learned amicus has indicated the following suggestions:

Mr. Godbole has also made suggestions in the Note submitted by him to resolve the difficulties created due to TDR loading, different FSI regimes, mixed development, etc. His suggestions are as under:

or on payment of agreed contribution / maintenance charges without any right of ownership in such land or the building structure of such amenities.

Mr. Engineer, in his Note, has made following suggestions in the three scenarios:

If the layout is developed / constructed by using only the base FSI which is duly disclosed to all the flat purchasers of the entire layout, in their respective Agreements for Sale, then in such situation, each society forming part of the layout should be conveyed the proportionate area in the total layout / plot area on the basis of their respective built-up areas.

Applicable formula:

If the layout is developed by utilizing TDR, and the entire development potential, including the full TDR, is disclosed to the flat purchasers of the entire layout in their respective Agreements for Sale, then a departure from Para 2(C)(vi)(2) of the GR can be permitted. In such a situation, each society ought to be conveyed the proportionate area in the layout on the basis of its respective built-up area, as has been held by this Hon'ble Court in Neelkanth Mansions & Infrastructure Pvt. Ltd. vs. DDR, Writ Petition No. 3530 of 2026, paragraph 18.

Applicable formula:

If the layout is developed and/or constructed by utilizing TDR and/or additional FSI which was not disclosed to the flat purchasers of the first and/or original society or societies, then the Competent Authority must convey the land as per the declarations/plans made and disclosed to the flat purchasers of the first/original society. The subsequently constructed society would only be entitled to claim the land under the plinth and the area appurtenant thereto which comprises of the minimum open spaces that are required to be maintained as per the planning laws. It shall be open to the subsequently constructed society to file a suit to claim any higher area if it believes it is entitled to it.

Mr. Khandeparkar has a different point of view, and he has suggested that there can never be a straitjacket formula to lay down uniform principles which would govern every case. Mr. Khandeparkar has given 2 suggestions for the purpose of resolving the controversy involved in the facts and circumstances in the present case. By way of first suggestion, he submits that plinth area of all the buildings can be added (10797.23 sq.m.), deduct the total plinth area from net plot area (21807.18 – 10797.23) sq.m. = 11009.95 sq.m. and grant conveyance of plinth area of the concerned building/society along with the proportionate share in the balance net plot area by taking into consideration BUA sanctioned in the last plan. Alternatively, by way of second suggestion, he submits that proportionate share of each building/society can be calculated based on BUA actually utilised in each of the buildings and same can be conveyed to each building/society.

Thus, on behalf of the State Government as well as the learned amici have made several suggestions, particularly for dealing with the cases where some of the buildings in the layout are constructed mainly by utilising TDR. Therefore, before proceeding further, it would be necessary to consider the concept of TDR as loading of TDR in subsequent buildings post revision of plans in most of the cases poses the difficulties in the land division.

The concept of TDR was introduced for the first time in DCR 1991. Regulation 34 of DCR 1991 provided that in certain circumstances, the development potential of a plot of land could be separated from that land itself and may be made available to the owner of the land in the form of Transferable Development Rights (TDR). The TDR was made available subject to the Regulations in Appendix VII. Under Appendix VII, detailed provisions were made for generation and utilization of TDR. Restrictions were imposed on utilization of TDR in certain areas, including the island city. Under clause 13 of Appendix VII, DRC could be used on plots which are already developed for erecting of additional storeys, subject to the restriction of not exceeding the FSI stipulated in clause 14. As pointed out by Dr. Sathe, the loading of TDR was restricted until 2007 to maximum permissible BUA indicated in clause 14. Clause 14 earlier provided that the FSI of receiving plot could be allowed to be exceeded only 0.4 by availing TDR. However, by notification dated 14 May 2007, clause 14 of Appendix VII was amended and the limit of receiving plot was raised from 0.4 to 0.8. Thus, notification dated 14 May 2007 created a bonanza for the developer where TDR was permitted to be loaded to the extent by increasing the total FSI of receiving plot by 0.8. To illustrate, if FSI of receiving plot was 1, the same was permitted to be increased upto 1.8 by use of TDR. The developers started submitting proposals for revision of plans of buildings which were already constructed, for the purpose of adding construction thereon. This is how increase in the cap on TDR utilization in 2007 was one of the reasons which led to revision of several layout plans and additional constructions are put up in the layout.

As provided in DCR 34, the TDR is nothing but development potential separated from the land. It has no connection with the land on which it is loaded. In Green Garden Apartments Co-operative Housing Society Limited vs. Nitin Chaudhary and others^{3232.2025 SCC OnLine Bom 3623}, this Court has dealt with the concept of TDR by treating the same as movable property. It is held thus:

In Abdul Aziz Bharmar & Anr. Vs. Vinod Anand^{3333.Writ Petition No. 3595 of 2023 decided on 03-02-2026}, this Court has dealt with an issue as to whether owner of land from which TDR is generated has no right to claim ownership in flats constructed on another land where the TDR is used. This Court formulated the question for consideration in Para 1 and 10 of the judgment as under:

Answering the issues, this Court held that when TDR is detached from a piece of land and utilized on another piece of land, it loses the characteristic of immovable property and also loses connection with the land in respect of which the same is generated. This Court has held in paras 16 and 17 of the judgment as under:

Thus, in Abdul Aziz Bharmar, this Court has held that the land owner from whose land the TDR is generated cannot claim any right in the land in which the TDR is used. The judgment is of significance for deciding the issue involved in the present case from the point of view of absence of connection of building using TDR with the land on which the same is constructed for the purpose of conveyance.

The genesis of the problem created in proportionate land division in a layout for conveyance purposes is the manner in which the planning authorities sanction the construction plans. Till the land or part thereof is actually conveyed, the planning authorities treat the entire plot of land as developable, ignoring the position that part of the land is already developed. As illustrated above, when it comes to revision of plan upon admissibility of additional FSI/BUA, the entire admissible FSI/development potential is calculated qua the entire land, ignoring the position that part of the land is already developed. This lacuna in the manner of sanctioning the plans is taken advantage of by the developers who go on adding more construction in the layout by deliberately delaying the development of the layout.

When conveyance to completed buildings is delayed, the whole plot continues to be reflected in the revenue records/property card as belonging to the original landowner/promoter. It is only when conveyance of part of the land is taken by the completed buildings that the phenomenon of land cutting occurs and then the further revision of plans can take place only in respect of unconveyed land.

The comparison of scenarios of incomplete layout development where conveyance of part of land has taken place and where no land is conveyed is indicated in the table below:

Thus, in the above illustration, non-conveyance of land in favour of Building No. 1 and the system of sanction of plans by the planning authorities results into a bonanza for the developer who gets to construct additional area of 5000 sq.m. just by delaying the conveyance to the completed building. This Court has noticed cases where the developers have either deliberately not secured OC for the last building in the layout or where a small part of land in the layout is deliberately left undeveloped to take advantage of future additional BUA. Thus, in a plot admeasuring 10,000 sq.m., all the planned buildings are constructed and land of 100 sq.m. is deliberately shown as future development and when additional BUA gets sanctioned, a skyscraper with massive BUA comes up on that 100 sq.m. land by loading all the additional FSI/incentive FSI/TDR, etc. This is the main reason why the developers are reluctant to convey even their due portion of the land to the societies of completed buildings.

This tendency can be curbed by societies by timely applying for conveyances or by the planning authorities by altering the method of sanctioning the development permissions. Ideally, if the portion of the land of which the potential is already exploited is excluded while sanctioning revised layout plan, the above mischief can be prevented. But that is not the ambit of inquiry in the present petitions. However, the State Government can consider modifying the development control regulations providing for exclusion of developed part of the land while sanctioning the revised plan.

As discussed above, the developers undertaking the layout development misuse the lacuna in the sanctioning procedures of authorities and continue milking undue advantages. On the other hand, the developer undertaking the project of constructing a singular building on the plot does not get these undue advantages. Once the planned single building is constructed on the plot, usually the developer makes exit from the plot. Even if there is delay in effective conveyance, the developer does not get to stand out of the same. Barring the exceptional cases where the developers may make attempts to put in additional floors on the constructed buildings, usually the mischief played by layout developers ordinarily does not occur in a single building development. On the other hand, in the layout development, the developer stays on the plot for years if not decades. There are instances of incomplete layout developments in Mumbai for a quarter of century. The present case is also illustrative where the layout is still shown as incomplete despite passage of three decades.

While in a single building development, any activity to put additional construction immediately gets noticed, in the layout development, the residents of constructed building find it difficult to notice revision of plans and putting up of additional constructions. The developers add floors in under construction buildings using incentive FSI/TDR or even add a building in the layout.

Whether the law treats developer of a single building differently than developer of a layout? Whether there is any intention to shower additional benefits to the layout developments? Whether the law has intended that layout development would have a license to endlessly milk the future development potential in the land? Answers to all these questions are obviously in the negative. All these additional benefits in layout developments are outcome of mischief by the developers of not conveying the portions of land to the completed buildings and by taking disadvantage of lacuna in sanctioning process by the planning authorities.

For simplifying the procedure for deciding the applications for deemed conveyance, the State Government has issued the GR dated 22 June 2018. It lays down detailed guidelines for processing and deciding the applications for deemed conveyance. For the purpose of deciding the issue involved in the Petitions, the relevant portion of the GR is reproduced thus:

English translation of the above part of the GR is as under:

Thus, under the GR dated 22 June 2018, in a layout development involving multiple buildings, the land can be conveyed proportionate to the BUA utilized for construction of each building. However, the GR also provides that where TDR is used for construction of buildings, only plinth and appurtenant areas can be conveyed. This part of the GR is already interpreted by this Court in Neelkanth Mansion (supra) in which it is held that in every case where TDR is used, it is not necessary to give a go-by to the principle of proportionate land division.

However, in para 2(C)(vi)(1) and also in para-2(C)(vi)(2) of the GR dated 22 June 2018, the words ‘plinth’ and ‘appurtenant areas’ are used. The GR, as interpreted in Neelkanth Mansion (supra), provides that when a difficulty arises in applying the principle of proportionate land division, only plinth and appurtenant areas can be conveyed during the time the layout development is incomplete and later, the rest of the land can be conveyed to the federation or jointly to all the societies.

Before proceeding further, it must be borne in mind that the GR dated 22 June 2018 is issued merely for prescribing the guidelines and the GR, by itself, does not create any rights or liabilities, which flow from the statutory provisions of MOFA and MOF Rules. The guidelines in the GR dated 22 June 2018 are largely followed by the Competent Authorities and are aimed essentially to ensure that there is uniformity in the procedure to be followed by different Competent Authorities.

While the GR provides for conveyance of plinth land and appurtenant land in case of layout development, there are difficulties even in this arrangement, which are discussed in the paragraphs to follow.

The GR dated 22 June 2018 contemplates conveyance of plinths of buildings and sometimes the Competent Authority finds it easier to convey only the plinths of the buildings when it notices that the proportionate land division is a difficult task. Conveyance of plinth areas of buildings ensures that atleast the land in physical occupation of the buildings is conveyed and this is how the Competent Authorities find it convenient to convey plinth areas to the buildings in the layout. However, in some cases, conveyance of land as per plinths also results in a situation where a building/society secures conveyance of larger land than its due entitlement. In a given case, Building ‘A’ may be slimmer than the Building ‘B’. Building ‘A’ may be slimmer, but may occupy larger BUA. Building ‘B’ may occupy larger plinth, but lesser BUA. In such a case, if principle of land division based on plinth area is followed, the building with larger plinth but with lesser BUA would walk away with larger share in the land as compared to the slimmer building with higher BUA. This particularly happens in cases involving bungalows/rowhouses and multi-storey building in a layout. Since the bungalows/rowhouses occupy larger plinth area, but lesser BUA, they walk away with larger share in the land thereby reducing the share of land of the multi-storey building. Therefore, in my view, the plinth size of a building may not always be a relevant yardstick for determining conveyance of land. Also conveying only plinths leaves unconveyed land and here again the issue of sharing non-plinth land crops up. Therefore, the real solution is the land division proportionate to the BUA utilized in each building.

The word ‘appurtenant’ has not been defined in MOFA or in MOF Rules. In fact, the MOFA does not contemplate or recognize the concept of conveyance of appurtenant land. The concept of conveyance of appurtenant land is to be found mainly in the GR dated 22 June 2018 while dealing with the issue of conveyance of land in a layout. Since use of TDR poses a problem in determining shares of land in the layout, GR dated 22 June 2028 prescribes the procedure of conveying the plinth areas and appurtenant areas to the buildings in the layout.

Though not in MOFA, the concept of appurtenant land can be found recognised in some other enactments. Under Section 2(g) of the Urban Land (Ceiling and Regulation) Act, 1976, the term ‘land appurtenant’ has been defined thus:

Thus, under the Urban Land Ceiling Act, the term ‘land appurtenant’ means the minimum extent of land required under the building regulations to be kept as open space for the enjoyment of such building.

The term ‘land appurtenant’ is also defined under Rule 2(h) of the Maharashtra Housing and Area Development (Disposal of Land) Rules, 1981 (MHADA Rules) as under:

For the city of Mumbai, the ‘building regulation’ contemplated under Section 2(g) of the Urban Land Ceiling Act or ‘Development Control Rules of the concerned Planning Authority’ under MHADA Rules is Regulation No. 41 of DCPR 2034, which provides for the open spaces within building plot/layouts while granting conveyance of appurtenant areas. Regulation 41(1) provides for the open spaces to be separate for each building or wing. Regulation 41(2) prescribes the compulsory open and marginal spaces in a Table depending on the height of the building and the plot size on two parameters of ‘light and ventilation’ and ‘dead wall’. Regulation 41(3) provides for relaxation in open spaces if height of the building is restricted. Regulation 41(4) provides that the Front Set-backs from the Street Line/Plot Boundary and set-backs from the zonal boundary in the different zones shall be as in Table No 18. Regulation 41(5) makes special provisions in open spaces for plots in reconstruction/redevelopment schemes under the Maharashtra Housing and Area Development Authority Act, 1976, Slum Rehabilitation Authority and Redevelopment Scheme of municipal tenanted properties. Regulation 41(6) provides for open spaces for various types of buildings such as educational buildings, hospitals, cinema halls, etc. Regulation 41(7) provides for relaxation of open spaces norms for narrow plots. Regulation 41(8) provides for interior open spaces (chowks). Regulation 41(9) provides that the open spaces shall be kept unencumbered.

Thus, even if the concept of ‘land appurtenant’ is borrowed from the Urban Land Ceiling Act or MHADA Rules, such land only means the land required under building regulations to be kept as open space for the enjoyment of such building. Thus, only the marginal and compulsory open spaces required to be maintained is the land appurtenant to a building.

Therefore, mere conveyance of compulsory open spaces in addition to plinth of the building may not always resolve the problem of land sharing in the layout. To illustrate, if there are 5 buildings in the layout admeasuring 10000 sq.m. and the total plinth areas and land appurtenant of all five buildings is only 6000 sq.m., how to divide the balance land of 4000 sq.m. still poses the question. In incomplete layout developments, conveying only plinths and appurtenant lands would result in a bonanza for the developer who would milk the additional BUA on the unconveyed land by getting the plans revised multiple times and by constructing additional structure(s). This mischief is identified by this Court in Neelkanth Mansion (supra) where the developer was opposing proportionate land division and was insisting for only conveyance of plinth and land appurtenant with a view to exploit additional BUA on unconveyed land.

The scope of the term ‘appurtenant area’ in the context of provisions of MOFA and the procedure prescribed in the GR dated 22 June 2018 is examined by this Court in Rashesh Cooperative Housing Society Limited (supra) and it is held that in housing matters, appurtenant land may include compulsory marginal open spaces, access roads, passages, fire tender movement areas, common utility strips, parking areas if earmarked, gardens or amenities linked with building use, and other areas which by regulation are intended for occupants of that building or group of buildings. It is further held that a promoter cannot convey only the footprint beneath columns and staircase and retain all open areas despite those open areas being mandatory under building rules. This Court has held thus:

In Rashesh Cooperative Housing Society Limited (supra), this Court has held that transfer carries with it those surrounding lands and open spaces which are appurtenant, necessary or incidental to the beneficial enjoyment of that building and that conveyance of only plinth land without the usable rights would defeat the purpose. Before this Court, certificate of the architect of the developer was produced which stated that the appurtenant area of the building as 1050 sq.m. The area of plinth of 1151.56 sq.m. was also indicated in the certificate in addition to 19.99% share in the RG. But how this share in the RG is to be determined is the issue. As observed above, there can be land other than plinth, appurtenant land and RG. Since appurtenant land is restricted to the land surrounding the building which is compulsory marginal open space, what happens to the land beyond that limit? There can be internal roads in the layout. What happens to that land which is over and above plinth, appurtenant land and RG? Who would own that land? These questions would remain unanswered if only plinth and appurtenant land is conveyed.

For the above reasons, conveyance of only the plinth and appurtenant land in the layout to each building does not provide answer to the intricate issue of land sharing in the layout.

Having taken note of the complexities in proportionate land division in layout developments where plans are modified successively for the purpose of availing the benefit of higher FSI/BUA, it is now time to find a best possible answer to the conundrum. In my view, the answer to these complications created by the developers on account of revision of layout plans lies in combined reading of provisions of MOFA and MOF Rules, and a suggestion in this regard has also come from the State Government.

MOFA imposes twin duties on the developer once he undertakes construction of a building comprising of flats. Developer’s first obligation is under Section 10 of the MOFA, under which he must form a cooperative society or a company within the prescribed period of sale of minimum number of flats required for formation of society/company. The period prescribed for formation of the society under Rule 8 of the MOF Rules is ‘four months’. Once the promoter discharges this obligation, the second obligation immediately kicks in under Section 11(1) of the MOFA. Developer then needs to convey in favour of the society/company his right, title and interest in the land and building within the prescribed period. Prescribed period here is again ‘four months’ from the date of formation of the society/company as provided under Rule 9 of MOF Rules. The combined effect of Sections 10 and 11 of the MOFA and Rules 8 and 9 of MOF Rules is such that the promoter cannot delay conveyance and the same must be done within the period prescribed.

If this concept of twin obligations on a promoter/developer, discussed in the preceding paragraph, is borne in mind and followed in each case, there may not be much difficulty even in a case where developer commits the mischief of getting the plans revised midway for availing benefit of higher FSI/BUA. To illustrate, when development of a plot admeasuring 10,000 sq.m. is undertaken for construction of two buildings each of 5,000 sq.m. and construction of building No.1 is complete and if the required number of flats therein are sold, there is a statutory obligation to form a cooperative society within four months. Accordingly, the society is formed, say on 1 January 2005. Within four months thereafter, the next statutory obligation kicks in to convey the title in the land in favour of the society i.e. by 1 May 2005. Thus, the right of the first building/society to secure its proportionate share in the land crystallises on 1 May 2005. Its land entitlement gets ‘frozen’. In this illustration, since Building No. 1 has utilized half of the BUA sanctioned, it must get conveyance of 50% of the layout land. Since the first building/society is entitled to secure land admeasuring 5,000 sq.m. as on 1 May 2005, any delay on the part of developer in conveying the land would not defeat the entitlement to secure conveyance of the frozen portion of land of the first society/building.

As observed above, the concept of divestment of title of the promoter has already taken place qua land admeasuring 5,000 sq.m. for Building No.1 in the above illustration. What is postponed is the latter act of vesting of title in the society. In such a scenario, the title qua the land admeasuring 5000 sq.m. has gone away from the developer but is yet to fall in the pockets of the society. It is in the state of limbo temporarily. In such a case, even if developer gets the plan revised taking benefit of his mischief in not conveying the land in favour of the Society, the same would have no effect on the right of the first building/society to secure conveyance of land admeasuring 5000 sq.m. As observed above, the planning authorities unfortunately take into consideration the area of the entire plot while sanctioning the revised permission since the name of the original owner continues to figure in the record of rights. If in this scenario, the promoter was to fulfil his statutory obligation and convey land admeasuring 5000 sq.m. to the society of Building No.1, the name of that society would get mutated in the revenue records, thereby restricting the right of the promoter to construct Building No.2 only qua the balance land admeasuring 5000 sq.m. However, as observed above, the developer takes the benefit of his own wrong and misuses the facility available with the planning authority and gets the additional BUA sanctioned in respect of the whole plot admeasuring 10000 sq.m. either due to change in FSI regime, sanction for mixed user, permissibility to load TDR, etc. Therefore, even if the planning authority sanctions higher FSI for Building No.2 and the second building is constructed with BUA of 15000 sq.m., the proportionate land division can never be in proportion to the BUA of 5000 sq.m. of Building No.1 and 15000 sq.m. to Building No.2. If the sub-division of land in proportion to ‘last or revised sanctioned plan’ (as suggested by Mr. Khandeparkar) is accepted, the same would tantamount to reducing the land entitlement of the first building/society without any fault on its part. Thus, if the proposition canvassed by Mr. Khandeparkar is accepted, the same would mean that Building No.1 would receive conveyance only of land admeasuring 2500 sq.m. though its entitlement in respect of area of 5000 sq.m. was already crystallised/frozen in May 2005.

The concept of freezing/crystallisation of the land entitlement under twin effects of Sections 10 and 11 of MOFA and Rules 8 and 9 of MOF Rules is also in tune with the legislative objective of MOFA. There is a purpose behind prescribing the periods for performance of the twin acts of formation of society and conveyance of land. The legislative objective is that the organisation of flat purchasers must become owner of the land and the developers do not misuse the delay in conveyance for the purpose of putting up additional construction. As discussed above, the developer’s title in the land dilutes with sale of each flat in a building. Even in a layout development, once the plans are drawn up for construction of multiple buildings, and the first building is taken up for development and all flats therein are sold, the developer gets divested of title in the proportionate land. Mere failure on his part to convey that proportionate land does not mean that the developer can subject the land in which he is divested of the title for revision of plans for securing additional built-up area in the under construction or yet to be constructed building(s) in the layout.

Thus, what occurs by subsequent revision of plan is actually stealing of rights of the organisation of flat purchasers by the developer and loading the same on the subsequent buildings. The act of stealing is apparent in following the illustration:

In view of the above discussion, the concept of freezing of entitlement of share in the land of each society upon completion of statutory prescribed periods under MOFA Act and MOF Rules would resolve the conundrum involved in cases where layout plans are revised by the developers with a view to milk the additional FSI/BUA.

The above discussed principle of freezing/crystallisation has also emerged from the suggestions given on behalf of the State Government in the Note. For the sake of convenience, it would be apt to reproduce the relevant suggestion made by the learned Advocate General:

Therefore, the concept of freezing of the first plan for conveyance purposes would be the solution to ensure that the successive revisions in the plans do not affect the land entitlement of existing buildings in the layout.

As observed above, the act of revision of plans for putting up additional construction in a layout is often enacted by the developers behind the scenes. There are blanket consent clauses in the Agreements for Sale of flats enabling the developers to put up additional constructions. Therefore, while one of the buildings in the layout is under construction or where its construction is yet to commence, the developer may get the plans revised for availing additional BUA and the society of existing building may not even be aware of revision of plans. This Court has come across several instances where layout development remains active for couple of decades and the plans are revised on multiple occasions in those 10-20 years for availing additional BUA. Since conveyance is not executed, the revision of plans does not require consent of societies of existing buildings, and this is how the plans are revised behind the back of the societies of existing buildings. While there may be vigilant societies keeping a tap on developer’s activities, but in majority of cases, revision in the plans goes unnoticed.

Also, until 2008, securing conveyance required lot of efforts, expenses and indulgence in litigation. The conveyance suits were taking years for decision. In the present case itself, the suit filed by Satellite Garden-I CHSL (Suit No.1002 of 2010) seeking conveyance is pending for the last 16 years. It is only after the provision for deemed conveyance was introduced by the 2008 amendments to MOFA that the drive for conveyance gathered momentum. Many societies notice the factum of revision of plans only at the time of applying for deemed conveyance.

In such circumstances, if the societies whose buildings are constructed in accordance with the original plans have not objected to additional construction due to revision of plans, whether their land entitlement as frozen/crystallised on account of effect of Sections 10 and 11 of MOFA and Rules 8 and 9 of MOF Rules would stand correspondingly reduced? Whether they must face the double whammy of tolerance of additional construction (and increased density) in the layout as well as loss of land entitlement?

Provisions of Sections 7 and 7A of MOFA are already discussed in the preceding paragraphs. Under Section 7 of MOFA every flat purchaser as well as the organisation of flat purchasers have a right to ensure that no alterations are made in the flats without the consent of flat purchaser or in the structure of the building without consent of all flat purchasers in the building. By now the law is sufficiently developed on the concept of ‘consent’ within the meaning of Section 7 of MOFA, obligation to make full and informed disclosure, blanket consent being inconsequential, etc. It is unnecessary to delve deeper into that area. Suffice it to observe that the flat purchasers can seek injunction against the developer if construction is being made beyond the disclosure made. But what happens if the societies of existing buildings either do not notice that the additional construction is contrary to the disclosure or do not possess the wherewithal to file suit for injunction with necessary alacrity against a mighty developer? In a given case, the court may find it iniquitous to grant ad-interim or interim injunction on account of the stage of construction when injunction is sought. In such a case, the developer may complete the construction, sell flats and society is formed in respect of the building whose construction is contrary to the disclosure already made. The flat purchasers of earlier buildings (constructed in accordance with originally sanctioned plans) are already required to tolerate additional construction in the layout and share common amenities with additional residents. Whether their land entitlement in the layout would get reduced on account of inability to stop the developer from putting up additional construction? The answer to the question appears, to my mind, in the negative.

MOFA does not distinguish between societies who are diligent in applying for conveyance and those who are not and take some time in seeking conveyance. The societies which diligently apply for conveyance immediately after expiry of the prescribed period, secure their due share in the layout land. Even a society which takes some time in seeking conveyance is also entitled to same land entitlement. This is because, MOFA does not recognise a principle that when there is some delay in applying for convenance, what legitimately belongs to a society is lost or is reduced. Mere delay on the part of a housing society in applying for conveyance does not result in loss/reduction of share in the land. This is because MOFA violations give rise to continuing cause of action. This is discussed in the paragraphs to follow.

To answer the conundrum involved in the Petitions, it needs to be examined as to whether it is necessary for a society to apply for conveyance within any fixed time? MOFA obligations give rise to continuous cause of action. The statutory right under Section 11 of MOFA to seek conveyance does not have any prescribed period of limitation for exercise of remedy. The right of organisation of flat purchasers to secure conveyance does not get extinguished on account of expiry of any particular period of limitation. In Samruddhi Coop. Housing Society Ltd. v. Mumbai Mahalaxmi Construction (P) Ltd.^{3434.(2022) 4 SCC 103}, the Apex Court has held that MOFA obligations give rise to a continuous cause of action. It is held thus:

This Court in Sushama Tulsidas Adhav vs. Pradeep D. Shah and Ors.^{3535.2024 SCC OnLine Bom 4325}, has held that breach of statutory obligations under MOFA gives rise to a continuous cause of action. It is held in paras 36 to 38 as under:

Since MOFA obligations give rise to a continuous cause of action, merely because a society does not apply for deemed conveyance immediately after expiry of period prescribed under Rule 9 of MOF Rules, such inaction does not mean that its right to secure conveyance of the land gets extinguished. The right to have conveyance of the proportionate land, as frozen/crystallised upon expiry of period of 4 months prescribed in Rule 9, can be exercised at any point of time. What needs to be conveyed when right to seek conveyance accrues must also be conveyed when the application/suit is filed for conveyance after expiry of few years. Therefore, mere delay in applying for deemed conveyance or in filing a suit for conveyance would not mean that the frozen/crystallised land entitlement would get reduced with passage of time. The land entitlement gets frozen/crystallised for all times to come and the remedy for its enforcement can be exercised at any time. Additional construction put up by violating the disclosures and in contravention of provisions of Section 7 of MOFA during the time the first society does not apply for conveyance does not result in automatic reduction of its land entitlement.

It is sought to be suggested that if the society is aggrieved by the action of the developer putting up additional construction in the layout, it is its duty to take steps to stall the additional construction by the developer by filing a suit under Section 7/7A of MOFA. It is contended that when subsequent buildings are permitted to be constructed without any objection, the first society must accept the necessary consequence of reduced land in the layout. It is contended that additional construction can be out of express consent and where additional construction is an outcome of acquiescence, there is implied consent. In either of the cases, it is contended that the land division must happen by taking into consideration the BUA actually utilized for all buildings in the last sanctioned plan.

When there is express consent for revision of the layout, there can be no difficulty and, in such cases, land division can be made based on the plan to which there is a consent by previous flat purchasers. However, can the consent be inferred by conduct? The statutory scheme of Section 7 does not contemplate implied consent by conduct. It requires express written consent for putting up additional construction. Also, the words used in Section 7(1)(ii) of MOFA are ‘previous consent’. The law in this regard is well-settled by several judgments of this Court.

If additional construction contrary to the disclosure made in the first layout is without express written consent, whether mere inaction on the part of the flat purchasers/their societies from injuncting the developer from putting up additional construction based on revised plan would automatically entail reduction in their land entitlement? Here again, the answer, to my mind, appears to be in the negative.

Failure to take steps to stop the developer from constructing additional structure and thereby tolerating such additional structure is a concept different than the concept of ownership of land. As observed above, the right to own the land crystallises the moment prescribed statutory period ends. This crystallised right to own the land does not fluctuate upon subsequent revision of plans. It remains static. The right to own a particular piece of land has already inured in the first building/society and merely because it fails to take steps to stop developer from putting up additional construction, it does not mean that the crystallised right to own land is given away or is diluted in any manner. The law does not provide for dilution of such land entitlement. This is the reason why I have observed that the concept of tolerating additional structure contrary to disclosed plans is different than the concept of owning land as per the first disclosed plan. In fact, if the principle of reduction in land entitlement on account of additional construction contrary to Section 7 of MOFA is accepted, the same would cause violence to the entire scheme of the Act.

Therefore, mere failure to file a Suit under Section 7/7A of the MOFA to injunct the developer from putting up construction contrary to disclosure would not result in losing title in respect of frozen share in the land. Developer already commits a mischief of getting the plans revised without consent and puts up additional construction. As observed above, many a times, the scene of getting the plans revised is enacted behind the back of the society and its members. Many a times they do not even know as to whether subsequent building in the layout is being constructed as per the original disclosed plan or whether there is any modification in the plan. The Municipal Corporation does not require any NOC from the society at the time of sanction of the plan. In such circumstances, it is difficult to expect the society to keep vigil on day-to-day basis on the activities of the developer and to object to revision of plan or to putting up additional construction. In such a situation, the developer cannot be permitted to take benefit of his own wrong. He has already committed twin wrongs - firstly, by not conveying the land within prescribed period and secondly, by putting up additional construction contrary to the disclosed plan. In such circumstances, mere failure on the part of the first society to file a suit under Section 7/7A of MOFA cannot be a reason enough for holding that such society would lose its entitlement in the ownership of the land which is already crystallised / frozen upon expiry of the twin periods prescribed under Sections 10 and 11 of the MOFA.

There have been some judgments of this Court which do tend to suggest that the share of constructed building in the plot/FSI cannot get reduced with every revised sanctioned plan. It would be apt to make reference to some of those judgments.

In Malad Kokil CHSL vs. Modern Construction Co. Ltd. and Ors.^{3636.2012 SCC OnLine Bom 1310}, a coordinate Bench of this Court took note of the folly committed by the developer by loading TDR for the purpose of additional construction without conveying the land in favour of the society. As pointed out by Dr. Sathe, the concept of TDR was introduced for the first time in DCR 1991. However, its loading was restricted until 2007 to maximum permissible BUA indicated in Table 14 under Regulation 32. Regulation 34 provided that development potential of plot of land can be separated from the land itself and can be made available to the owner in the form of TDR, which can be loaded in another plot. Appendix VII of DCR 1991 included regulations for grant of TDR. Clauses 1 to 9 of Appendix VII provided for generation of TDR and clauses 10 to 19 provided for utilisation of TDR. Clause 14 earlier provided that the FSI of receiving plot could be allowed to be exceeded only 0.4 by availing TDR. However, by notification dated 14 May 2007, clause 14 of Appendix VII was amended and the limit of receiving plot was raised from 0.4 to 0.8. Thus, notification dated 14 May 2007 created a bonanza for the developer where TDR was permitted to be loaded to the extent by increasing the total FSI of receiving plot by 0.8. To illustrate, if FSI of receiving plot was 1, the same was permitted to be increased upto 1.8 by use of TDR. The developers started submitting proposals for revision of plans of buildings which were already constructed, for the purpose of adding construction thereon. The State Government took note of this folly and issued notifications dated 7 December 2007, relevant portion of which reads thus:

In Malad Kokil CHSL (supra), this Court took note of this folly committed by the developers and held that the increased limit for use of TDR could only be applicable for land which is ‘vacant’ and which is not already constructed. This Court thus froze the land which is already constructed and prevented loading of TDR on the same.

In Eternia CHSL and Ors. Vs Lakeview Developers and Ors.^{3737.2015 SCC OnLine Bom 723}, the learned Single Judge of this Court took note of the ratio of judgment in Malad Kokil (supra) and held in paragraph 75 as under:

The order in Eternia CHSL (supra) was challenged before the Division Bench of this Court in Lakeview Developers and Ors. vs. Eternia CHSL and Ors.^{3838.2015 SCC OnLine Bom 3824} While dismissing the Appeal, the Division Bench held in paragraph 65 as under:

Thus, in both the judgments of the learned Single Judge as well as of the Division Bench, in Eternia CHSL and Lakeview Developers, it is held that once development potential is fully consumed, there was an obligation on the developer to convey the land in favour of the Societies. This follows that mere sanction of additional FSI/TDR by the notification of 2007 did not defeat the right of the building already constructed to have conveyance of the entire land. Though judgments in Eternia CHSL and Lakeview Developers (supra) are rendered in the context of provisions of Sections 7 and 7A of the MOFA, the same underscore the point that mere revision of a plan for putting up additional construction does not destroy the frozen right of the society to have conveyance of its entitled share in the land.

The concept of freezing of the first layout plan is also recognised to some extent by the coordinate Bench of this Court in Mahanagar Realty (supra), in which it is held in paragraph 22 of the judgment as under:

Thus, in Mahanagar Realty, this Court has emphasised the need to freeze the FSI as per the sanctioned plan after some of the buildings in the layout are constructed for the grant of deemed conveyance, which is the purpose which is sought to be achieved by the GR dated 22 June 2018.

In Gala Complex Premises Cooperative Society Ltd. (supra), this Court has held that when the building uses FSI of the entire land, the land corresponding to that construction must also be determined proportionately and that such exercise ensures that the society gets land corresponding to the construction which already exists. More importantly, this Court has held that promoter cannot retain land of which development potential has already been used for construction of the building of the Society. It is held that once the FSI of larger plot has been used to construct the building, the purchasers of the flats therein obtain a corresponding interest in the land which supports that construction. This Court held in paragraphs 23 and 29 as under:

Again, in Nook CHS Ltd. (supra), this Court has emphatically held that the latter plan cannot be permitted to cut down a right which has already arisen from the original arrangement unless three elements are clearly shown viz. clear disclosure, informed consent and proper sanctioned basis. This Court has held that a latter sanctioned plan may be relevant but cannot supersede statutory obligations owed at an earlier stage. This Court has held in paragraphs 25, 26, 27, 28 and 32 as under:

Thus, the judgment of the coordinate bench in Nook CHS Ltd. is a direct authority on the concept of crystallisation and freezing of land entitlement based on earlier plan and ignorance of the plan for conveyance purposes which does not have consent. This Court has emphatically ruled that a later sanctioned plan may be relevant, but it cannot supersede statutory obligations owed at earlier stage. It is further held that if later plan differs from earlier disclosed scheme, the authority must first determine whether such change is permissible and that without such enquiry, mere existence of later plan cannot justify reduction in conveyance area. The judgment is also illustrative on the issue of inquiry to be conducted by the Competent Authority about existence or otherwise of a consent. Thus, the judgment of this Court in Nook CHS Ltd. is a direct precedent on the issue of later plan not resulting into reduction of land entitlement crystallised as per the earlier plan.

Thus, this Court has repeatedly emphasized the principle that there is crystallisation/freezing of land entitlement of the buildings constructed in accordance with the original sanctioned plan and mere revision in the layout plan does not result in automatic reduction in land share of the buildings constructed as per the earlier sanctioned plan.

In my view therefore, it is necessary that conveyance of the land in the layout is done on the basis of the first sanctioned plan or at least on the basis of the plan which is sanctioned at the time when freezing occurs i.e. when twin effects of Sections 10 and 11 of MOFA trigger. This means that if the plan is revised before the twin obligations occur, such revised plan can be considered for land division. Upon formation of the society and upon expiry of period of four months, freezing occurs and the sanctioned plan at that time would alone determine the proportionate share of each building in the land. This would ensure that the legislative objective of MOFA is fulfilled and the folly/mischief committed by the developers does not affect the land entitlement of buildings constructed in accordance with the originally sanctioned plans.

Conveyance on the basis of the plan sanctioned as on the date of triggering of obligation to convey land to the first building would ensure that rights of flat purchasers of that building are not trampled upon by the flat purchasers of the subsequent building. To illustrate, if a plot admeasuring 10,000 sq.m. is taken up for layout development and on the basis of FSI of 1.00, the BUA of 10,000 sq.m. is sanctioned, which is divided as under: Building No. 1 : 5000 sq.m. Building No. 2 : 5000 sq.m. The moment period of 4 months expires after formation of cooperative society in respect of Building No. 1, its right to have land admeasuring 5000 sq.m. crystallises/stands frozen. Even if the developer delays construction of Building No. 2 and applies for revision of plans by loading TDR of 3000 sq.m. with increased BUA of 8000 sq.m. for Building No.2, the same would not affect the crystallised/frozen land entitlement of Building No. 1 of 5000 sq.m. In such a case, even if Building No. 2 is constructed with BUA of 8000 sq.m., it will have to remain satisfied with the land admeasuring only 5000 sq.m. This is dealt with in greater details and better illustration in the latter part of the judgment.

This Court is aware of the difficulties that may be faced by the last or subsequent buildings in the layout on account of the mischief played by the developer by revising the plans by loading TDR or by taking benefit of new scheme or of change of FSI regime. As observed above, if the developer does not commit the mischief and conveys the land within the prescribed period and conveys proportionate land to the first society, his right to avail additional FSI/incentive BUA automatically gets restricted only to the balance portion of the land. In such circumstances, land cutting (notional) occurs. The land cutting may be notional in most of the cases since there are common amenities in the layout such as RG, internal roads, etc, which cannot be physically subdivided. Thus, once proportionate land is conveyed to the society of the first building in the layout and if the developer desires to go for revision in the plan to avail incentive FSI/TDR, sanction of such incentive FSI/TDR would get restricted only in respect of the unconveyed portion of the land, and this process does not result in additional development rights inuring to the benefit of already constructed building being transferred to the developer for being utilized on proposed buildings. This concept is recognised by this Court in the judgment rendered in ACME Enterprises (Suit judgment of 2025 Supra) in which it is held as under:

Once the land cutting (even on a notional basis) occurs on account of conveyance of proportionate share in the land in favour of first society, the developer is free to utilise the additional/incentive FSI/TDR on the balance portion (subject to disclosure under Sections 7 and 7A of MOFA). However, when a mischief occurs and the developer does not convey the land within the prescribed period to such society and he is benefited of his own folly, and secures additional/incentive FSI /TDR on the entire plot and loads the same on the subsequent building(s), application of concept of freezing of land entitlement upon expiry of prescribed period may cause some inconvenience to the purchasers of flats in the subsequent buildings. They or their organisation may get lesser share in the land than the BUA actually utilised for construction of their building(s).

To illustrate, if the concept of freezing of land entitlement is applied to a case where the first building is constructed with BUA of 5,000 sq.m. and the second building is constructed with BUA of 15,000 sq.m. (on account of additional/incentive FSI/TDR of 10,000 sq.m.) and the plot admeasuring 10,000 sq.m. is divided by conveying area of 5,000 sq.m. to the first building, only balance area of 5,000 sq.m. would be left for the second building. The second building has used BUA of 15,000 sq.m. But it needs to be content with land admeasuring only 5000 sq.m. If the concept of freezing of land entitlement is not applied, Building No. 2 would get land of 7500 sq.m. thereby eating into the share of Building No.1. This is illustrated below:

No. 2 5000 Balance plot 15000 7500 5000 left of 5000 (incentive sq.m. FSI or TDR is loaded)

The above illustration would indicate that the application of concept of crystallisation/freezing of land entitlement, when Building No. 1 became entitled for conveyance, ensures that the Building No. 2 does not eat into the land entitlement of Building No. 1.

It is sought to be contended that construction of Building No. 2 in the above illustration would be rendered illegal because it may not have requisite land for its sustenance. Here, I would like to clarify that while dealing with the concept of conveyance/deemed conveyance, the question of validity or legality of construction does not arise. Once building plans are sanctioned, building is constructed and Occupation Certificate is received, mere non-conveyance of proportionate land does not ipso facto render the construction of such building illegal. It continues to be a legal and valid construction. All that may happen is the entitlements of flat purchasers of such subsequent building would get reduced when it comes to redevelopment of the building. When redevelopment of the building is undertaken, every member of the society expects a larger home/unit. This may or may not be possible in case of a subsequent building, which is constructed by use of incentive FSI/TDR. However, the expectation of flat purchasers of building constructed by revision of plans by using incentive FSI/BUA or TDR cannot trample upon the land entitlement of building whose land entitlement was crystallised/frozen.

However, the lawmakers have ensured that when redevelopment of such subsequent building (which does not have ownership of proportionate land) takes place, the new building is reconstructed with at least the BUA equivalent to the existing BUA. This is in the form of Regulation 30(C) of DCPR 2034, which provides thus:

Thus, in the buildings where the maximum sanctionable FSI/BUA falls short of the existing BUA, DCPR 30(C) ensures that an additional FSI is granted to ensure that building of the same size (equivalent BUA) is reconstructed. In that sense, flat purchasers of subsequent building constructed with use of incentive FSI/TDR will not suffer in the matter of redevelopment of their buildings. They would get flats in size equal to what they already have. Only aspect is that they have to live with a reality that the members of society whose building was earlier constructed as per originally sanctioned plans, may receive larger sized flats in redevelopment process and they have to be content with the flats of same size as they occupy in the existing building. This is not discrimination amongst two sets of flat purchasers, but protection of rights of the buildings which are denied their due share in the land by delaying the conveyance.

Therefore, by reason of declaration of law in this judgment, the existing building, which does not receive conveyance of proportionate land, does not get declared illegal or unauthorised. Even when it comes to redevelopment, Regulation 30(C) ensures that requisite quantum of additional FSI, as may be necessary to put up reconstruction of at least the existing BUA, is sanctioned.

It must be observed that the history has indicated only northwards movement in the FSI. With acute shortage of space in the urban areas, the FSI has gone upwards with passage of time. In DCPR 2034 for Mumbai and in UDCPR for other cities, there is already a substantial increase in the FSI. In DCPR 2034, there is massive increase in the base FSI. To illustrate, in Mumbai the island city, where road width available is 27 meters and above, as against base FSI of 1.33 during 1991 DCR regime, FSI now available is 3.00. In the suburbs, FSI for plots with road-width of 27 metres has gone up from 1.00 to 2.50. With this trend, I do not find much difficulty for the flat purchasers of subsequent buildings (whose buildings are constructed with use of incentive FSI/TDR by revision of plans) in redeveloping their buildings. They may get lesser additional area than the members of the society of first building, but that is a reality with which they need to live since their building is constructed by trampling upon the rights of the first building/society. Their building is allowed to stand, which can be directed to be demolished by a civil court, if violation of provisions of Sections 7 and 7A of MOFA is demonstrated. However, merely because existence of subsequent building is tolerated by the flat purchasers of first building/society, it does not mean that the building which is constructed by eating into the rights of the first building/society would earn a premium over illegality already committed, by permitting stealing of the land meant to be conveyed to the first building/society.

In my view therefore, no real difficulty is posed in following the principle of crystallisation/freezing of land entitlement upon expiry of statutorily prescribed periods under Section 11 of the MOFA and under Rule 9 of the MOF Rules. Here, one must also bear in mind the fact that under Section 4 of the MOFA, the developer makes disclosure of the sanctioned plans. Thus, a flat purchaser of subsequent building becomes aware of the fact that building has come up largely through incentive FSI/TDR. This being the position, I do not find much difficulty in existence of two classes of societies/associations in the same layout viz., (i) societies whose buildings are constructed as per originally sanctioned plans and (ii) societies whose buildings are constructed by revision of plans by use of TDR/incentive FSI. The folly committed by the developer in eating away the FSI meant for first/earlier building by getting the plans revised cannot be a reason for equating both the classes of societies for determining proportionate share in the layout land. As observed above, if both the societies are placed on the same pedestal for conveyance, the subsequent societies would earn a premium over illegality already committed in their construction (in the sense of their construction being contrary to the first disclosed plans).

It is not that in every case the plans are revised behind the back of already constructed buildings. There may be cases where the developer has secured written consent from the society of building already constructed as per originally sanctioned plan for effecting a revision therein for availing additional BUA. In some cases, the existing societies may have monetized their right of giving consent by securing consideration in the form of money or additional facilities and may have given consent for revision in the plan. In such cases, whether the concept of land freezing/crystallisation as on the date of formation of the first society can be applied? In my view, the answer is in the negative. Where there is express consent by the flat purchasers/societies of earlier buildings for revision of plans for construction of subsequent buildings, the freezing/crystallisation concept cannot apply. Where such express written consent is given, land division can be undertaken on the basis of subsequently revised plan, which has such consent. However, in every case where such express consent is not given, proportionate land division must necessarily be on the basis of the first sanctioned plan or at least the sanctioned plan which was in existence at the time of application of concept of freezing.

It is contended that Competent Authority being a tribunal of limited jurisdiction cannot go into the issue of existence of consent. There can be no dispute about this proposition and since existence or otherwise of the consent, being a matter of intrinsic evidentiary inquiry, the Competent Authority would not have jurisdiction to decide that issue. However, in its summary jurisdiction, if the developer or society of subsequent building produces a consent letter/affidavit, I do not see much difficulty in the Competent Authority in acting on the same and assuming that there exists a consent for undertaking the exercise of proportionate land division. If a competing society has any contrary claim, the same can always be taken for adjudication to the Civil Court as the order of deemed conveyance passed by the Competent Authority is not final determinative of rights and entitlement of parties qua the land conveyed. On the other hand, if no prima facie written evidence of consent is produced, the Competent Authority can proceed on the basis of absence of consent and apply the principle of freezing/crystallisation of land entitlement as per the plan in existence at the time of expiry of the prescribed period under Section 11 of MOFA and Rule 9 of MOF Rules for the first society. In such a case, the developer/society of latter building can approach the Civil Court to establish existence of consent. In my view therefore, though the Competent Authority may not be able to resolve the issue of existence or otherwise of consent but can make an adjudication on the basis of prima facie existence/absence of material to indicate consent. I am supported in my view by the judgment of this Court in Nook CHS Ltd. (supra).

It is suggested by Mr. Khandeparkar that the buildings constructed majorly/purely by utilising the TDR are no less than the buildings constructed by utilising inherent FSI. He has relied on Regulation 30 Table 12 of DCPR 2034, which states that the term ‘permissible FSI’ or the ‘development potential’ includes (i) zonal (basic) FSI, (ii) additional FSI on payment of premium, and (iii) admissible TDR. According to him, law does not create any distinction between buildings constructed with inherent/base FSI and TDR. He therefore suggests that such discrimination cannot be introduced while granting conveyance to various buildings in the layout and that therefore the Competent Authority must accept the ‘last sanctioned plan’ for the purpose of proportionate subdivision of the layout land. I am unable to agree. As discussed above, permissibility under the building regulations to put up additional construction is a concept different than the concept of conveyance of proportionate land. Building regulations may permit additional construction on a plot of land, but for putting such additional construction, written previous consent of flat purchasers is necessary. As held above, mere inaction on the part of the society of earlier building(s) in not objecting to additional construction does not result in dilution of their crystallised share in the layout land, which was already frozen upon expiry of the ‘prescribed time’. Therefore, for conveyance purposes, the buildings constructed with incentive FSI/TDR as a result of revised plan, which does not have consent, cannot be put on the same pedestal as that of the buildings constructed as per the originally sanctioned plan.

This Court is also alive to the situation where some or one of the buildings (mostly the last building in the layout) may have been constructed mostly/purely out of TDR. Application of the principle of land freezing/crystallisation discussed above may possibly leave no land for such building for conveyance purposes. I must say that such cases are rare, and would be difficult to handle qua conveyance rights. No building can come up purely on TDR. For loading of TDR, some land in the layout is required. In normal cases, TDR is utilized by adding the BUA flowing through the Development Rights Certificate (DRC) to the base/inherent BUA. Therefore, it is ordinarily impossible to construct a building without any land. For conveyance purposes, it has to be assumed that the TDR is loaded on the inherent BUA flowing through some part of the land. Therefore, such portion of land can be identified and conveyed to the society whose building is constructed mainly by utilizing TDR.

As observed above, TDR is a transferable movable asset capable of being hoarded, monetized and freely transferable. It has no connection with the land in the receivable plot. If some land is required in receivable plot for loading of TDR, how a building can ever come up purely through TDR? If any building in the layout is an outcome of pure TDR, this again is an outcome of mischief of developers. The layout development is deliberately left incomplete by not securing occupancy certificates of buildings and when TDR loading limit increases, the layout is demonstrated to the Municipal Corporation as incomplete (for indicating availability of land for loading of TDR) and the TDR is loaded for construction of an additional building. The planning authorities act mechanically and since land is shown available in the incomplete project, they allow loading of TDR in the layout and this is how some of the buildings may have come up in the layout without much land left for being conveyed. Such cases are rare, but may exist. Majority of cases however are where lesser land becomes available for conveyance than utilised BUA on account of TDR/incentive FSI.

Can Court treat all the buildings in the layout on the same pedestal for conveyance purposes as sought to be suggested by Mr. Khandeparkar? Though the last building may have been constructed by violating provisions of Section 7 of MOFA, but since the innocent flat purchasers have purchased flats after verifying the construction permission, can principle of equity be followed to accommodate the building constructed mostly/purely out of TDR by conveying to it the proportionate land? Or whether the Court needs to uphold the true spirit of MOFA by ensuring that the building constructed as per originally sanctioned plan must receive conveyance of the land which was due to it as per MOFA? I would tend to lean in favour of the latter proposition. Adoption of the former proposition (for accommodating rare cases of pure TDR buildings) may cause violence to the legislative object of MOFA and would amount to turning the provisions of the Act on its head.

Equitable considerations cannot prevail over the statutory scheme of MOFA. As observed above, if Section 11 of MOFA crystallises the entitlement of the first building in respect of a particular area of land in the layout, that lawful area entitlement cannot be reduced by applying equitable consideration for accommodating rights of buildings which are constructed contrary to provisions of Section 7 of MOFA by revising the plans subsequently for loading of TDR/incentive FSI.

Therefore, in extremely rare cases where there is very little or no land left for being conveyed to the buildings erected out of pure TDR, the societies of such building can purchase some land from the other societies in the layout for redevelopment of its building and then take the benefit of DCPR 30(C) for securing the requisite additional FSI for reconstruction of same BUA.

As observed above, conveyance of land in the layout on the basis of the ‘last revised plan’ would cause violence to the statutory framework of MOFA and mere equitable considerations cannot be the basis for denying to the societies their lawful land entitlement merely because they could not stop the developer from revising the plans and putting up additional construction in the layout. One must bear in mind the larger impact of grant of conveyances based on the ‘last revised plan’. There may be very few or minuscule number of cases where the entire building is constructed only by utilizing TDR. But majority of cases involve use of TDR/incentive FSI for putting up additional construction than originally planned. Various illustrations discussed above and the facts of the present case would depict how use of TDR in subsequent/last building results in massive increase of BUA thereof. If the principle of grant of conveyance based on ‘last revised plan’ is followed, there would be a windfall gain or a bonanza to the societies of those buildings, who would walk away with large pie in the land at the cost of societies whose buildings are constructed as per the originally sanctioned plans. Hence, land division on ‘last plan principle’, far from resuorganizlting in equality, would actually create discrimination by making societies whose buildings are constructed with massive TDR entitled to grab the highest share in the layout land. Thus, for protecting the interests on equitable considerations of very few buildings constructed by utilizing only TDR, the Court cannot violate the objective and scheme of MOFA by offering to them on a platter a larger share in layout land at the cost of buildings constructed as per the plans existing at the time of expiry of the prescribed period.

The cases involving FSI/BUA imbalance occur mainly due to the manner in which the planning authorities sanction and revise the plans in the layout. Since conveyance of proportionate lands was not granted by the developers, they/original land owners continued to remain owners and for the planning authority, the layout development continued to remain incomplete. Therefore, the increased FSI/BUA got sanctioned by the planning authorities for whole of the land in the layout and by deducting the BUA already used for construction of existing buildings, the developers loaded the entire additional FSI/BUA/TDR on the subsequent buildings. The flat purchasers are unaware of the effect of this phenomenon, especially in the context of land entitlement of their society. The mischiefs played by the developers would ultimately affect the flat purchasers of the buildings constructed by use of TDR/incentive FSI due to revision of plans.

Some suggestions are made by the learned AG and the learned amici for protecting the interests of flat purchasers henceforth.

Dr. Sathe has suggested that if in future, the development potential increases because of the change in DCR and the developer takes the benefit of such increased development potential, including TDR and utilises the same on the balance portion of the land, in such a situation, the occupants of subsequent additional building, which is constructed by utilisation of TDR, should be informed about their building being constructed only out of TDR and cannot claim parity with the first building.

Mr. Samdani has suggested that in any layout, ‘mixed user’ should not be permitted, meaning thereby that on the same layout there should be prohibition of construction of buildings for use as residential + IT/Hotel/Hospital/other user. The reason for this suggestion is that the permissible FSI for residential purposes is different than the other users. He has suggested that the mixed user may be permitted if the layout has within itself a sub-division and the other user is on a sub-divided plot. The suggestion means that if the layout is taken up for development for construction of residential and commercial buildings with normal FSI and after construction of one or two buildings in the layout, the developer changes his mind and decides to apply for incentive FSI for IT Park, Hotel, Hostel or Hospital, such development should not be allowed. Alternatively, the planning authority should insist on sub-division of the plot by carving out the land meant for conveyance of buildings already constructed and sanction the incentive FSI only in respect of balance undeveloped land. This is an important suggestion which would ensure that the developers do not secure massive BUA for incentive use like IT Park/Hospital/Hostel/Hotel, etc. in respect of the entire layout land, but use the same only on the last building in the layout. This would be for the planning authorities to consider as this Court is not dealing with challenge to the Development Control Regulations and the issue here is restricted to only laying down principles for dividing the layout land for conveyances.

From the above discussion, following principles emerge:

Applying the above principles to the case in hand, it is seen that the first building constructed in the layout is that of Satellite Garden I CHSL, which is formed and registered on 11 October 2002. The Occupation Certificate of the building Satellite Garden I CHSL was apparently issued on 9 August 2001. The sanctioned plan as well as the Occupation Certificate dated 9 August 2001 are the basis of area of sub-plot A of about 16855.47 sq.m. However, it appears that the layout and subdivision of the plots therein have undergone changes on several occasions as under:

Thus, the rejigging of the Plots has changed the area of sub-plot No. A from time to time. In the rearrangement of the sub-plots, the area of sub-plot No. A finally became 21807.18 sq.m.

I have gone through all the rearranged layout plans. In the final layout plan dated 10 March 2005, 6 proposed buildings and a clubhouse is shown, out of which apparently Building No. 1 was shown to have received OC, plans for Building Nos. 2 to 5 were shown to have been ‘sanctioned’ and the plans for Building No. 6 were shown as ‘not approved’.

Therefore, the present case involves a peculiar situation in which the plot itself has undergone change in size. The demand of Satellite Garden I CHSL is for conveyance of land on the basis of OC plan dated 9 August 2001 and it accordingly seeks conveyance of land admeasuring 16855.47 sq.m. However, even in the OC Plan dated 9 August 2001, the total BUA sanctioned for original Sub-Plot No. A was 12671.72 sq.m, which was divided between Building No. 1: 9866 sq.m., Building No. 2: 2653 sq.m., Building No. 3: 285 sq.m. and Building No. 4: 285 sq.m. Therefore, the whole land of 16855.47 sq.m. could otherwise not have been conveyed to Satellite Garden-1 CHS even if there was no rearrangement of the sub-plots. Also, what is finally used in construction of building of Satellite Garden-1 CHS is BUA of 11186.41 sq.m. This is a reason why I have observed that the case involves peculiar circumstance, where the plot size itself underwent a change making it impossible to divide the land in the originally sized sub-plot A (16855.47 sq.m). The division of land has to be in respect of the rearranged sub-plot A which is now sized 21807.18 sq.m.

In my view therefore and in the light of the principles discussed above, the conundrum in the present case can be resolved by directing conveyance of land based on the Layout Plan dated 10 March 2005. The Layout Plan dated 10 March 2005 does not indicate use of any incentive FSI/TDR. The BUA calculated for land area of 21807.18 in the layout plan dated 10 March 2005 is as under:

Thus, for plot sized 21807.18 sq.m., BUA of 21587.60 sq.m. was sanctioned while approving the layout on 10 March 2005.

Mr. Kakalia has placed on record the OC Plan for Building A-4 dated 9 July 2010 for indicating the distribution of BUA of 21587.60 sq.m. However the OC plan dated 9 July 2010 indicates use of massive slum TDR raising the sanctioned BUA from 21587.60 to 40343.28 sq.m. Hence as per the principles discussed above, the figures of distribution of BUA of 40343.28 sq.m. cannot be taken into consideration for determining the land distribution amongst the four buildings. The OC Plan of 9 July 2010 is therefore irrelevant for deciding the proportionate land division.

In my view therefore, the proportionate land division in the present case needs to be done by following the principle of freezing based on Layout Plan dated 10 March 2005 by taking into consideration the BUA excluding TDR used for construction of each of the buildings indicated in the plans reflected as sanctioned in that layout. Mr. Kakalia, has placed on record the figures of BUA distribution amongst each of the buildings as under: Building A-1: 11186.41 sq.m. [Satellite Garden Phase I] Building A-2: 3126.32 sq.m. [3936.32 – 720] [Sadguru AB] Building A-3: 328.74 sq.m. [Not completed] Building A-4: 830.92 sq.m. [3917.76 – 3086.08] [Sadguru CD] Building A-5: 5778 sq.m. [20728.06-14949.6] [Satellite Tower]

However, Building No. 3 has not been constructed yet, for which an insignificant area of 328.74 sq.m. is reserved. The developer has already increased the density of flats in the layout by subsequent revision of plans by use of massive slum TDR. The layout is shown as incomplete for the last 29 long years. If the layout is still shown as incomplete and if the layout plan is permitted to be further revised as per DCPR-2034 , there might be further increase in the BUA for the entire plot which the developer may load while constructing building No.

Mr. Kakalia has fairly submitted that the developer is no longer interested in putting up any additional construction in the layout and that some areas in the layout are reserved for the landowners. It appears that in the OC plan of 9 July 2010, significant BUA admeasuring 244.31 sq.m. is shown for temple. But the plan dated 9 July 2010 is prepared on the basis of loading of slum TDR due to revision and is wholly irrelevant for deciding the land distribution. In my view, time has come to put a full stop on any further development in the layout and the entire land in the layout needs to be distributed only amongst the four buildings which are standing today. Both the developer as well as the original land owners (having already milked undue development potential in the layout land) need to be thrown out of the land. Therefore, there cannot be any land reservation either for the fifth building (Building No. 3) or for the temple. Even if the temple may physically exist in the land, the land beneath it would fall in the ownership of one of the four societies.

The certificate of deemed conveyance issued in favour of Sadguru Complex -1 (CD) CHS is based on architect’s certificate dated 23 May 2025, who has made the calculations based on the revised sanctioned plan dated 9 July 2010, in which massive slum TDR got loaded on buildings of Sadguru Complex-1 (CD) and Satellite Tower CHSL. As discussed above, the land distribution cannot be based on the plan dated 9 July 2010. The certificate of deemed conveyance dated 31 October 2025 based on revised plan dated 9 July 2010 is thus unsustainable and deserves to be set aside. Similarly, the certificates of deemed conveyance issued conveying only plinth areas to Satellite Tower CHSL and Sadguru Complex 1 (AB) CHSL are also liable to be set aside. Instead, the working of division of land needs to be done based on the BUA sanctioned for each of the buildings in plans reflected on layout dated 10 March 2005.

Mr. Engineer has highlighted one concern in undertaking this exercise. He has submitted that if the principle of land division proportionate to BUA utilised on the basis of base FSI is applied in the present case, buildings of Sadguru Complex 1 (CD) CHSL would receive lesser land than its actual plinth. Mr. Engineer has accordingly highlighted that Sadguru Complex 1 (CD) CHSL would receive only land admeasuring 866.08 sq.m. when in fact its plinth is 968.77 sq.m. However, this Court is not following the principle of land division based on base FSI concept. Instead, it is being directed to take into consideration the BUA figures indicated in the plans reflected in the Layout dated 10 March 2005.

In any case and in my view, the difficulty of a building receiving land lesser than its plinth alone cannot be a reason for not applying the principle of freezing as this difficulty can easily be surmounted. What is done is only the notional sub-division of the land, mainly for the purpose of redevelopment of buildings in the layout. In the layout, it is not always possible to physically divide the land because of spreading of amenities, internal roads, etc. throughout the layout. Therefore, even if any building/society receives conveyance of land less than its plinth, at the time of redevelopment, the size of the plinth can be reduced and building can go vertically for the purpose of utilising entire FSI/BUA potential available at that time. This can typically happen in case of societies of row houses/bungalows. Since the row houses and bungalows occupy larger plinth but lesser BUA as compared to a tower in the same layout which occupies lesser plinth but much larger BUA, while undertaking redevelopment of such row houses/bungalows, the plinths of the redeveloped subcultures can always be readjusted as per the proportionate land entitlement in the layout.

In my view therefore, the unique conundrum of land distribution due to change of the area of land of Sub-Plot A can be resolved on a reasonable basis by taking into consideration the BUA figures in the sanctioned plans which existed at the time of layout plan dated 10 March 2005 and by ignoring the BUA figures of OC plan dated 9 July 2010. Instead of leaving the matter for speculation as to which plan existed as on 10 March 2005 and in the facts of this case, the figures of approximate BUA distribution of 21587.60 sq.m. indicated by Mr. Kakalia can be taken into consideration for proportionate land division amongst the four societies without reserving any land for Building A-3 or for the temple. The BUA for each society to be taken into consideration of land division is as under: Satellite Garden Phase I: 11186.41 sq.m. Sadguru AB: 3126.32 sq.m. Sadguru CD: 830.92 sq.m. Satellite Tower: 5778 sq.m. Total BUA: 20921.65 sq.m. This Court is conscious of the fact that the total of the above BUAs of the four buildings falls little short of the sanctioned BUA of 21587.60 sq.m. for Sub-Plot A. However, the Architect needs to apply a reasonable formula for undertaking the exercise of distribution of the land by taking into consideration the above BUA figures. This can be done by adding the BUAs indicated above and determining the percentage share of each building in such sum total and by then applying such percentage for dividing the land in the layout. The Competent Authority shall accordingly procure a fresh certificate from the architect for division of the land in Sub-Plot A by taking into consideration the above BUA for each building. Mr. Aniket Mathakar, Architect, who had issued certificate to Sadguru Complex-I (CD) CHSL on 23 May 2025 (which is found to be erroneous) shall accordingly prepare and submit a fresh certificate by distributing the entire area of Sub-plot No. A based on the above BUAs for each of the building.

Before parting, this Court places on record its deep sense of appreciation for the able assistance rendered by Mr. Samdani, Mr. Godbole, Mr. Engineer, Mr. Khandeparkar and Mr. Tamboly, the learned amici curiae. The Court also places on record appreciation for Dr. Sathe, the learned Advocate General for assisting the Court in determining the principles for proportionate sub-division of land in a layout. Appreciation is also deserved by Mr. Kakalia who has not only been neutral throughout the hearing despite appearing for a developer, but has also assisted the Court in placing on record the statistical data of complex BUA and FSI figures as well as several old plans requested by the Court from time to time. Without the able assistance of the learned counsel who have appeared in the Petitions, it would not have been possible for the Court to resolve the intricate issue relating to proportionate land division amongst organisations of flat purchasers in a layout land.

In view of the above discussion, I proceed to pass the following order:

With the above directions, all the three Writ Petitions are disposed of. There shall be no order as to costs.