By I C Naik
Latest High Court (BOM) order on Conveyance opens up possibilities for housing societies to claim refund of unjust enrichment to developers of FSI and TDRs.
The Bombay high court in a recent order has disallowed transferring conveyance of a part of a plot on which a housing society stands for redevelopment, holding the society as the deemed owner not-withstanding the builder having failed to convey the title deeds to the cooperative housing society by evading statutory obligation to do so within 4 months imposed under Section 11 of MOFA 1963.
The Ashadeep housing society came up in 1984 by demolishing an old structure on part of plot spread over 1,310 sq m owned by Paresh Associates in Bandra. The new flat owners in the main building formed Ashadeep housing society and the agreement with the builder specified that the land beneath the two outhouses will be leased to the Paresh Associates, who will have to become a member of the society.
Since 2008 the society has sought conveyance of the property and has even filed a case to seek its rights. The society never got conveyance from the owner, and instead the owner clinched a deal with another builder to transfer conveyance of the land for developing the vacant part of the plot. The bid by its owner to convey the property to another firm for developing another part of the plot has come under the scanner of the Bombay high court.
In an interim order, Justice Roshan Dalvi restrained the developers from constructing or redeveloping the plot except an area of 324 sq m, which has two outhouses. The learned judge also directed the firm not to create any third party rights on the property except allowing the existing tenants of the two outhouses to reside there. Reportedly the firms sought to put up construction far in excess of the area of the two old structures (outhouses).
The two outhouses with five tenants, did not opt for redevelopment in 1984.The owners have plans to utilize the FSI of the entire plot of land, which belongs to the society. They also seek to load TDR upon the new construction. This they cannot do. The society has rightly sought to restrain such construction. It was held.
The judge observed that the society was “deemed to have been conveyed the entire property within the statutory period under Section 11 of the MOFA (Maharashtra Ownership Flats Act). The fact that a part of the construction of the two outhouses remained would not make a difference to the entitlement of the society in law”. The court said the society was the only owner of the land. “The benefits of ownership cannot, therefore, accrue to (Paresh Associates). It cannot, therefore, convey any part of the plot of land under any agreement or indenture,” said the judge listing the original suit for hearing on June 11.
In sum the HC held the society was “deemed to have been conveyed the entire property under Section 11 of the MOFA (Maharashtra Ownership Flats Act, 1963)” and was the only owner of the land.
?This order may put the Government’s benevolent move to extend dead line for deemed conveyance to rethinking. Was it really necessary? ?