Mahabanoo vs M/S. Kalikund Developers
- Court
- Supreme Court
2026 INSC 737
Non-Reportable
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
Civil Appeal No.9342 of 2026
(@ Special Leave Petition (C) No.4498 of 2026)
Mrs. Mahabanoo Contractor and Anr.
….Appellants
Versus
M/s. Kalikund Developers and Ors.
….Respondents
J U D G M E N T
K. VINOD CHANDRAN, J.
Leave granted.
2. The appellants assert their status as ‘occupant’ and seek
enforcement of the Permanent Alternate Accommodation
Agreement (PAAA) dated 17.10.2019 produced as Annexure P4.
3. The respondent is the owner-developer of the building who
obtained consent and possession from various occupants of the
building; tenants continued for long in the cessed building, found
unfit for human habitation by the local authority for the purpose of
demolition and reconstruction/redevelopment on the assurance
Signature Not Verified
Digitally signed by
VISHAL ANAND
Date: 2026.07.23
16:34:44 IST
Reason:
that all the occupants will be provided alternate premises for
st
occupation in the reconstructed building. The 1 respondent had
Page 1 of 19
Civil Appeal @ SLP (C) No. 4498 of 2026
proceeded for such redevelopment under the Maharashtra
Housing and Area Development Act, 1976 (MHAD Act) on the basis
of a No Objection Certificate (NOC) issued by the Maharashtra
Housing and Area Development Authority (MHADA). The MHADA
has overall supervision and is the regulatory authority under the
MHAD Act and Development Control Regulations for Greater
Bombay, 1991 (DC Regulations) inter alia ensuring
reconstruction/redevelopment of cessed buildings and also
securing alternate accommodation to the occupants of the old
building; who vacated the premises and gave consent for such
redevelopment, as per the agreements entered into.
st
4. The 1 appellant was an occupant with another, Ms. Gool
Peshotan Unwalla, who died leaving the appellants together, as
sole legal heirs entitled to succeed to her estate; the estate being
the occupancy status in Room No.5 of the Third Floor of the old
building. The MHADA after completion of the redevelopment
issued two orders dated 28.05.2025 & 27.06.2025 and a Show Cause
Notice (SCN) dated 10.07.2025; which were challenged in a writ
petition before the High Court of Bombay. The first two impugned
st
orders directed the 1 respondent to execute the PAAA in favour
of the appellants as per the certificate of probate dated 30.01.2024
Page 2 of 19
Civil Appeal @ SLP (C) No. 4498 of 2026
and register it as specified in PAAA and handover possession of
the promised premises to the appellants. The SCN was against non-
compliance of the earlier orders, threatening action under Section
91A of the MHAD Act.
5. A Division Bench of the High Court in the writ petition filed by
the developer found that there was complete non-application of
mind by the MHADA since the original proposal was to build 34
floors now confined to 30 floors. The developer’s contention was
that since the height was confined to 30 floors, the fungible Floor
Space Index (FSI) was not utilized and hence the area available for
reallotment would be lesser than that agreed to be accorded as a
benefit to the different tenants who were in occupation earlier. It
was noticed that the developer offered two flats with carpet area of
2108 sq. ft. (1054 sq. ft. each) comparable to the area occupied
prior to redevelopment, which according to the appellants fell
short of the agreed upon area in the PAAA. It was found that the
PAAA was a private arrangement, not amenable to writ
jurisdiction; an appropriate remedy being available only before
st
the civil court. The concession made by the 1 respondent that two
flats would be kept encumbrance free till appropriate orders are
passed in a civil suit, the writ petition stood disposed of. The
Page 3 of 19
Civil Appeal @ SLP (C) No. 4498 of 2026
Division Bench finding non-application of mind injuncted the
MHADA from taking any further coercive steps as per the
impugned orders and the SCN. The directions left the parties in
limbo since though the undertaking of the developer that no
encumbrance will be created on two flats till the civil court decides
the matter was recorded, there was in fact no civil case pending
between the parties.
6. A civil suit bearing CS No.4579 of 2026 was filed only on
06.02.2026, after the impugned judgment before the High Court of
Bombay, by the developer. The plaint produced in the counter
affidavit as Annexure – 1 indicates that the prayers made are
against the very claim of the appellants, who are defendants 4 & 5
therein, for allotment in the reconstructed building, either as an
occupant or as the legal heir of the deceased occupant, of the
entire 3336.92 sq. feet area; quite contrary to and in violation of the
undertaking made before the High Court. The PAAA is also
challenged in its entirety as invalid, nonest and unenforceable.
7. Mr. Shyam Divan, learned Senior Counsel appearing for the
appellants would emphasize on the definition of the term
‘occupant’ as available in the MHAD Act and Rule 33(7) of the DC
Regulations which is the reigning consideration in identification of
Page 4 of 19
Civil Appeal @ SLP (C) No. 4498 of 2026
persons entitled to allotment in a project for
reconstruction/redevelopment of cessed buildings. Mr. Divan, in
addition to the PAAA pointed out various documents in which the
st nd
1 appellant, who along with the 2 appellant is the legal heir and
the joint occupant of one Ms. Gool Peshotan Unwalla. Various
proceedings before the MHADA are also referred to, in which the
only dispute raised in reallotment was that the appellants had no
right to such allotment under the redeveloped project since the
original occupant had died. The first appellant has the status of an
‘occupant’ and the appellants are the only legal heirs of the other
occupant, which is evidenced from the probate proceedings
issued by the competent court.
8. The High Court misconstrued the PAAA as a private
arrangement, especially since it was entered into under a statutory
scheme as provided under the MHAD Act and the DC Regulations
which facilitated redevelopment/reconstruction of cessed
buildings so that the landlord could avail the benefit of having
additional space while ensuring that the tenants who were
continuing in the old building is not thrown out to the streets. The
PAAA is regulated by the statute and the regulations, the
enforcement of which is an authority conferred on the MHADA
Page 5 of 19
Civil Appeal @ SLP (C) No. 4498 of 2026
under whose NOC the project itself is commenced. The space as
delineated in the PAAA by the developer has to be necessarily
handed over to the appellants is the contention.
9. Mr. Vinay Navare, learned Senior Counsel, on the other hand
submits that the PAAA is a concocted document. It was entered into
st
by a person who was expelled from the 1 respondent for
misdemeanours carried out without proper authorisation, one of
which was the instant PAAA. It is further pointed out from the
st
affidavit in reply filed by the 1 appellant before the High Court, as
produced at Annexure P11, that the probate proceedings are
noticed as Testamentary Petition No.1607 of 2022 initiated on
27.02.2022 based on the Will of 27.05.2009. While the PAAA dated
17.10.2019 speaks of an application for grant of probate of the last
Will and testament of Ms.Gool Peshotan Unwalla is pending. It is
asserted that Ms. Unwalla was the original tenant and the only
tenant of Room No.5 situated on the third floor of the building, and
st
the recital including the 1 appellant as ‘occupant’ along with the
original tenant was only by mistake. It is further argued that in the
st
certified list approved by MHADA the 1 appellant appears only in
the column of ‘occupants’ and not as a ‘tenant’ and she has no right
to get allotment on redevelopment, especially when the rent
Page 6 of 19
Civil Appeal @ SLP (C) No. 4498 of 2026
receipts, the contemporaneous electricity and telephone bills and
the notarized irrevocable consent for redevelopment are in the
sole name of the original tenant.
10. It is argued that the original tenant passed away on
21.03.2012 and she was the sole occupant of the whole premises.
The appellants as legal heirs have no right to succeed to the
tenancy which stood extinguished on the death of the original
tenant. It is also argued that as per the certified list, the total carpet
area of the original tenement was 185.09 sq. mtrs. against which
the total built up area as per the PAAA comes to 219.81 sq. mtrs.;
far in excess. It is urged, without prejudice, that if at all, the
appellants are only entitled to two flats each having an area of 1054
sq. ft. (Flat No.1403 and 1702) comparable to the area occupied in
the original tenement, which was offered to the appellant even
before the High Court, which offer was declined. It is urged that
st
even now the 1 respondent is ready to concede the said two flats
to the possession of the appellants while the appellant has
absolutely no right over the third premises, which is far in excess
of the space occupied in the original tenement. The suit now filed
before the High Court too is also urged to restrain us from
interfering with the impugned order which had left the parties to
Page 7 of 19
Civil Appeal @ SLP (C) No. 4498 of 2026
agitate their cause before the civil court which is the remedy as
available to the parties to the dispute.
11. Mr. Chirag M. Shroff, learned counsel appearing for the
MHADA emphasized that it is the statutory authority which issues
an NOC for redevelopment under Regulation 33(7) of the DC
Regulations read with Appendix III thereof for old, cessed
buildings. There is a statutory procedure involving the preparation
of a certified list of eligible occupants which certified Ms. Unwalla
st
and the 1 appellant as eligible tenant/occupant. The orders
passed by MHADA is only to facilitate due occupation by the
eligible tenants/occupants who have vacated the land for the
purpose of redevelopment/reconstruction on the basis of the NOC
issued by MHADA. Only if the PAAA is executed, registered and
the possession handed over to all the original certified occupants
the developer gets a right to seek ‘Occupation Certificate’. It is
asserted that MHADA had exercised its statutory powers
judiciously and in the best interest of the tenant/occupants based
st
on the records which were submitted by the 1 respondent itself
for the purpose of NOC.
12. The MHAD Act defines only ‘occupier’ under Section 2 (25)
which includes (i) any person who is liable to pay to the owner the
Page 8 of 19
Civil Appeal @ SLP (C) No. 4498 of 2026
rent or any portion of it; (ii) the owner in occupation or otherwise
using his land or building; (iii) a rent-free tenant; (iv) a licensee in
occupation; or (v) any person who is liable to pay damages for the
use and occupation; of land and building. An occupancy, hence is
not a statutory tenancy which continues at the will of the owner or
on the strength of an agreement. A person in occupation without
any rent, or liable to pay the owner damages, brings in even a rank
trespasser who can have a valid claim of occupancy based only on
her possession enabling reallotment of space, when there is
attempted a redevelopment/reconstruction. Rule 33(7) under
which the proceedings of redevelopment/reconstruction clearly
provides for the application of MHAD Act and specifies landlords
and/or ‘ occupiers’ of a cessed building.
13. Annexure P1 is the public notice issued by the respondent
initiating the process for obtaining the NOC of MHADA for the
building known as “ 18/20, 20C, 20D, 20A, 20F, WIMBRIDGE
COMPOUND” situated at N.B. Marg, Grand Road (W), free from all
encumbrances but subject to monthly tenancies clearly shown in
the statement as appended to the public notice. At Item No.24 of
the first column having the heading ‘Name of the tenants’ appears
Mrs. Gool Peshotan Unwalla, while in the next column for
Page 9 of 19
Civil Appeal @ SLP (C) No. 4498 of 2026
st
‘Occupants’ along with the original tenant, the 1 appellant’s name
is also shown. The public notice specifically called upon any
person having claim or interest against the same property to
proffer their claim, in writing, to the developer/owner within 15
days of the publication. Relevant is the fact that the public notice
issued by the developer/owner as early as in 2010, when the
st
original tenant was alive showed the 1 appellant to be in joint
occupation of the premises in the old building. There is also no
allegation that any other person had made a claim to the specified
premises shown to have been occupied by the original tenant and
st
the 1 appellant any time after the public notice dated 21.04.2010.
14. The NOC issued by the MHADA is produced as Exhibit 15 in
I.A. No.42662 of 2026 which is dated 21.09.2010; which is obviously
after the public notice and presumably since no claims were raised
or those raised were settled amicably. The NOC stipulates that all
occupants of the old building shall be accommodated in the
redeveloped building and given equal carpet area as occupied by
her for residential purposes, subject to a minimum and maximum
as provided in the MHAD Act. Clause (2) specifies that the
tenements in the reconstructed building shall be allotted by the
landlord to the occupiers as per the list certified by the Mumbai
Page 10 of 19
Civil Appeal @ SLP (C) No. 4498 of 2026
Repairs and Reconstruction Board (MBRR Board). Clause (15)
brings in a rigor in so far as the full and final occupation certificate
for any free sale building/component would be given only after all
the occupants as certified by the Executive Engineer of the MBRR
Board, including those staying in the pre-transit camps are housed
in the newly constructed buildings. This ensures that the
owner/developer would be entitled to its share of the additional
space in the new building only after complete rehabilitation of the
‘occupants’ of the old building. The list of certified tenants
appended to the NOC as certified by the Executive Engineer of the
MBRR Board also shows Ms. Unwalla as the tenant and herself and
st
the 1 appellant as the occupants, as was shown in the public notice
of the owner/developer. The revised NOC as available in the same
I.A. produced as Exhibit E dated 21.08.2012 reiterates the above
mandate.
15. The PAAA, Annexure P4 executed on 17.10.2019 concedes to
st
the 1 appellant 219.81 sq. mtrs. + 35% fungible area i.e. in all,
309.98 sq. mtrs. and thus one flat of 1227.42 sq. ft and two flats of
1054.75 sq. feet each. Clause (v) of the said agreement stipulating
the above area measurements also speaks of the said area being
inclusive of fungible area as permissible under DC Regulations; to
Page 11 of 19
Civil Appeal @ SLP (C) No. 4498 of 2026
be constructed in the new building with three covered parking
space in the Podium; which are referred to as the Permanent
Alternate Accommodation. On the very same day, the possession
st
is handed over to the 1 respondent as per Annexure P25
produced in I.A. No.187553 of 2026. Pertinently, the possession
st
was handed over by the 1 appellant, the original tenant having
died in the year 2012. Annexure P25 specifically indicates the
possession having been accepted by the developer/owner, which
document is not at all disputed.
st
16. The approved plan was amended on 30.06.2021 by the 1
respondent which is produced as Annexure P16 in I.A. No.42662 of
2026. As per Annexure P16 the amended plan, Ms. Unwalla was in
occupation of carpet area excluding balcony of 294.95 sq. mtrs.
(Column 9) and the built-up area as per the plan of rehabilitation is
shown as 324.45 (Column 19) while the total area of the three flats
would come to 309.98 sq. mtrs. (3336.50 sq. feet). The approved
plan, as amended and the measurement shown therein more or
less align with the measurement of the premises which was agreed
st
to be conceded to the 1 appellant, as per the PAAA.
17. Despite the further communication of MHADA to the
developer as per Annexure P26 dated 22.11.2022 to comply with
Page 12 of 19
Civil Appeal @ SLP (C) No. 4498 of 2026
the extended time limit i.e., up to 21.09.2023 the flats in the
st
reconstructed building were not handed over. The 1 appellant
approached the MBRR Board as per Annexure P27 dated
10.06.2024 seeking MHADA’s intervention to register the PAAA
and handover vacant and peaceful possession of the premises in
the new building. The continued refusal of the developer to
handover the premises to the appellants resulted in the orders
which were impugned before the High Court.
18. The writ petition filed is produced as Annexure P9 in which
the appellant has produced a consent affidavit of 26.02.2009,
showing the appellant as an occupant, which is alleged to have
been stated wrongly. The other documents, including the certified
list of tenants were also alleged to have shown the name wrongly;
all of which are documents which are even prior to the date of the
public notice in the year 2010. It is alleged that the person who
executed the PAAA on behalf of the developer, though was
authorised to represent the developer, serious disputes arose
between the present managing partners and the said person and
his associates, resulting in criminal/arbitration proceedings
having been initiated against them. It is also stated that it was in
March-April 2024 that the present partners came into the
Page 13 of 19
Civil Appeal @ SLP (C) No. 4498 of 2026
management of the company. It is pertinent that after the present
management came into office, there was neither communication
addressed to the MHADA against the PAAA or the validity of the
st
claim of the 1 appellant as an occupant nor was any denial of such
st
claim addressed to the 1 appellant herein whose name admittedly
was available in all the contemporaneous documents as an
occupant from 2009 when the consent affidavit was obtained.
19. The anomaly pointed out by the learned Senior Counsel; the
PAAA in its recital having noticed the pendency of a probate
application, which admittedly was initiated much later does not
st
vitiate the agreement as such. Even without a probate, the 1
appellant was entitled to the premises as an occupant as per the
documents of MHADA and the developer. Further the consent
obtained for redevelopment and the possession handed over was
st
specifically from and by the 1 appellant. The developer cannot
casually after all these years having obtained a consent, leading to
vacation of premises and possession being handed over for the
purpose of redevelopment, on the promise of allotment of
premises as specified in the PAAA, turn around and challenge the
st
very claim raised by the 1 appellant as an occupant. The probate
Page 14 of 19
Civil Appeal @ SLP (C) No. 4498 of 2026
if at all is by way of abundant caution since the developer had
defaulted to handover the premises even after its completion.
20. The writ petition in its averments also speaks of the inter se
dispute between the partners of the developer, having been
settled by mutual understanding, having been reduced into
writing as per the Consent Terms dated 09.03.2024. It is the
contention of the developer that as per the Consent Terms, any
writing, document or agreement executed by the earlier partners
with the original tenant or her heirs or Respondent No. 4 herein
shall not be binding on the first respondent firm in any manner. We
are surprised to see such a contention having been raised in a writ
petition, especially since there is no averment as to the
beneficiaries of the agreements executed by the erstwhile
authorised partner, having been made a party to the Consent
Terms. The settlement of inter se disputes between the partners
without the junction of the beneficiary of the PAAA, who has the
right to seek a validly executed conveyance and handover of the
premises, cannot absolve the developer from his obligations as
per the validly executed agreement based on which vacant
possession of the premises was obtained, the old premises
demolished and the new building constructed wherein the earlier
Page 15 of 19
Civil Appeal @ SLP (C) No. 4498 of 2026
occupants had a clear claim for allotment of alternate premises
with excess fungible area.
21. The mere fact that fungible area was not fully utilised cannot
be a ground to allow the developer to resile from its agreement to
redevelop and allot alternate premises to the occupants of the old
building as agreed upon. Significant is also the fact that despite the
Consent Terms having been brought into effect in the year 2024
st
and the 1 appellant having raised a claim before MHADA in which
the developer also participated the order dated 28.05.2025
indicates that the Advocate who appeared on behalf of the
st
developer raised only a contention that the 1 appellant did not
produce any document showing her relationship with Ms. Unwalla
st
who was again pointed out as certified along with the 1 appellant
as the occupant of Room No.5 in the third floor of the captioned
property. The MHADA by the said order after looking at the
st
documents directed execution of the PAAA with the 1 appellant as
per the probate dated 30.01.2024.
st
22. As we already observed, even without the probate, the 1
appellant was entitled to the premises in the new building as per
the PAAA executed with her; validating her status as an occupant
which cannot be merely brushed aside as having been wrongly
Page 16 of 19
Civil Appeal @ SLP (C) No. 4498 of 2026
executed which contention falls in the wake of the various
contemporaneous documents in which she was clearly shown as
the occupant. The orders dated 28.05.2025 and 27.06.2025 passed
by the MHADA which are produced as Annexures P6 and P7 are
perfectly sustainable under the statutory scheme of
reconstruction/redevelopment of cessed buildings. The failure of
the developer to comply with the orders led to initiation of SCN
dated 10.07.2025 which is produced as Annexure P8. The final
order of MHADA passed on 30.10.2025 was passed immediately
after the impugned order of the High Court; obviously without
being made aware of the restrain issued in the impugned order.
23. We are satisfied that the impugned judgment erred in
restraining MHADA from taking further proceedings as per the
orders issued against the developer with respect to the execution
st
of the PAAA, handing over of possession of premises to the 1
appellant herein and the show cause notice issued. We set aside
the impugned judgment of the High Court and in that circumstance
Annexure P10 order is revived which we find to be perfectly valid
and sustainable in the facts and circumstances of the case.
24. In this context, we have to also notice the suit filed by the
developer after the undertaking before the High Court that the two
Page 17 of 19
Civil Appeal @ SLP (C) No. 4498 of 2026
st
flats were conceded by the developer as the 1 appellant’s
entitlement. Reliefs were sought challenging the PAAA in its
entirety and also seeking interference to the very claim raised by
st
the 1 appellant as a joint occupant of the premises in the old
building. We are of the opinion that the Civil Suit itself is
misconceived and mala fide in the context of the undertaking given
before the High Court which is sought to be resiled from, which
more than reflects the conduct of the developer/landlord.
st nd
25. We direct the 1 and 2 respondents to execute the PAAA
and handover possession of the three apartments in the new
building within a period of two months from today, failing which
the appellants would be entitled to the damages at the monthly
rental value for the three flats in that location, which they would be
st nd
entitled to recover from the 1 and 2 respondents. We also make
it clear that the appellants would be entitled to sue for damages for
the delay caused in delivering the property, computed on the
value as hereinabove mentioned. In the interest of justice, we are
also of the opinion that the High Court be directed not to proceed
with Civil Suit No.4579 of 2026.
26. With the above directions, the appeal stands allowed with
costs of Rs.50,000/- (Rupees Fifty Thousand) each before the High
Page 18 of 19
Civil Appeal @ SLP (C) No. 4498 of 2026
st nd
Court and this Court, payable by the 1 and 2 respondents to the
appellants herein.
27. Pending application(s), if any, shall also stand disposed of.
……………………………... J.
(J. B. PARDIWALA)
..………….…………………. J.
(K. VINOD CHANDRAN)
NEW DELHI;
JULY 23, 2026.
Page 19 of 19
Civil Appeal @ SLP (C) No. 4498 of 2026