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The Bombay High Court ruled that developers cannot indefinitely postpone their statutory duties by citing contractual or procedural contingencies. It directed the district deputy registrar (DDR) of co-operative societies in Mumbai to issue a conveyance certificate to a Kandivali-based cooperative housing society that had been awaiting it for the past decade. Justice Amit Borkar stated that the developer's argument, which insisted on awaiting the completion of redevelopment and the formation of a federation before granting conveyance, lacked legal merit. The court highlighted that the Maharashtra Ownership Flats (Regulation of the Promotion of Construction, Sale, Management, and Transfer) Act, 1963 (MOFA) provides societies with an immediate and enforceable right to conveyance, irrespective of external contractual considerations.
The Bombay High Court has ruled that developers cannot indefinitely defer their statutory obligations by citing contractual or procedural contingencies. It instructed the district deputy registrar (DDR), co-operative societies, Mumbai city, to issue a conveyance certificate to Veer Tower Co-operative Housing Society in Kandivali, which had been awaiting the certificate for the past ten years. Advertisement
A single-judge bench stated that the developer's argument-that the petitioner-society must wait for redevelopment to be completed and a federation to be formed-had no legal merit. The judge pointed out that the statutory provisions under the Maharashtra Ownership Flats (Regulation of the Promotion of Construction, Sale, Management, and Transfer) Act, 1963 (MOFA), particularly Section 11, were designed to grant societies an immediate and enforceable right to conveyance, regardless of any external contractual or developmental contingencies. The judge, therefore, directed the registrar to issue a unilateral deemed conveyance certificate in accordance with the architect's certificate submitted by the society.
Veer Tower CHS had challenged the DDR's rejection of its application under Section 11 of MOFA for unilateral deemed conveyance. The DDR had previously denied the society's request for conveyance of its built-up area, which comprised 9,140.83 square metres of the total 17,676.95 square metres.
The developer, Shree Sainath Constructions, opposed the plea, arguing that the sale agreement with the society's members had explicitly stated that conveyance would be granted to a federation, which would include Veer Tower, five Dev Nagar housing societies, and other societies to be formed in the future. The developer contended that the petitioner-society had already agreed to the amalgamation of adjoining plots and the execution of a redevelopment project undertaken by M/s Bhadra Enterprises and M/s Vandana Properties for Dev Nagar buildings.
According to the developer, since the formation of a federation and completion of redevelopment were preconditions for conveyance, Veer Tower CHS was not entitled to unilateral deemed conveyance. Additionally, the developers raised concerns regarding the authenticity of the architect's certificate and questioned the society's authority to seek a separate conveyance.
However, the judge dismissed these objections, particularly since ten years had already passed since Veer Tower flats were handed over to buyers, and the redevelopment of the remaining land had not yet received approval from the planning authority. The judge asserted that the claim that the federation's right to conveyance was contingent upon redevelopment was legally unsustainable. The court clarified that the MOFA Act does not allow a society's statutory rights to be subjected to uncertain and unapproved redevelopment projects.
The statutory framework prioritises the rights of purchasers over speculative contractual obligations imposed by developers. The court underscored that indefinite redevelopment delays cannot override the legal provisions of Section 11 and that the petitioner's right to conveyance had already matured upon the execution of agreements and payment of consideration. Therefore, the society's rights could not be subordinated to the developers' unverified commitments to future compliance.
The court noted that the ten-year delay in granting unilateral deemed conveyance constituted an unreasonable deprivation of the society's statutory and equitable rights. As a result, the DDR was directed to issue the conveyance certificate to the housing society in accordance with its architect's certificate within four weeks from the date when both parties are required to appear before the DDR.
The ruling sets a significant precedent, ensuring that cooperative housing societies are not deprived of their statutory entitlements due to prolonged procedural and contractual hindrances.
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