Bakelite Hylam Limited And Others vs M/S. Dattani Constructions Thr. Its Mr. Satish Jamnadas Dattani And Others

CNR No : HCBM010430462026

AO 895-2026 (J) C2.doc
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
CIVIL APPELLATE JURISDICTION

APPEAL FROM ORDER NO. 895 OF 2026
1. Bakelite Hylam Limited,
a company registered under the provisions of the
Companies Act, 1956 having its address at 'Surya
rd
Towers' 3 Floor, 'C' Block, 104, S.P. Road
Secunderabad 500 003.
SNEHA
NITIN
CHAVAN
2. Deve Paints Limited
(Earlier known as Garware Paints Ltd.)a
company incorporated under the Companies Act,
1956 having address at GC-1, Ground Floor,
Gundecha Enclave, Kherani Road, Sakinaka
Andheri (E), Mumbai 400072
Digitally signed
by SNEHA
NITIN CHAVAN
Date: 2026.10.28
20:53:02 +0530
3. Mr. Abhishek Ashok Dutt.
Age 41 years, Occupation : Business having his
address at 1101, Beach Classic, J.P. Road,
Versova, Andheri West, Mumbai 400061.
4. Peak Agencies Pvt. Ltd.
a Company registered under the provisions of
Companies Act, 1956 having its address at 101,
Niranjan Building, 1st Floor, 99, Marine Drive 'E' ...Appellants/
Road, Mumbai 400002. Ori. Plaintiffs.
Versus
1. M/s. Dattani Constructions
a partnership firm which is the Sole Proprietor of
M/s. Excel Builders having its address at Laxmi
nd
Shopping Centre, 2 Floor, L.V. Lane, Kandivali
(West), Mumbai 400 067 through its partner viz.
Mr. Satish Jamnadas Dattani
Adult, Occupation : Business having his address
at Laxmi Shopping Centre, 2nd Floor, L.V. Lane
Kandivali (West), Mumbai 400067.
2. Gokuldas Khimji Pvt. Ltd.
a Company registered under the provisions of the
Companies Act, 1956 having its address at Laxmi
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Shopping Centre, 2nd Floor, L.V. Lane,
Kandivali (West), Mumbai 400 067
3. The Municipal Corporation of Greater Bombay,
a Body Corporate constituted under the Bombay
Municipal Corporation Act, 1888 having its office
at Mahapalika Marg Opp. C.S.T., Fort, Bombay ...Respondents/
400 001 Ori. Defendants
WITH
INTERIM APPLICATION NO. 6868 OF 2026
IN
APPEAL FROM ORDER NO. 895 OF 2026
Bakelite Hylam Limited ...Applicant
In the matter between:
Bakelite Hylam Limited and Ors. ...Applicants
V/s.
M/s. Dattani Constructions and Ors. ...Respondents

Mr. Mayur Khandeparkar a/w Mr. Kaustubh Patil, Mr. Rohan Sawant
and Mr. Dixit Parmar for the Appellants.
Mr. R.D. Soni a/w Mr. Sanjay Agre i/b Vinod Singh for Respondent
No.1.
Ms. Smita Tandwalkar i/b Komal Punjabi for Respondent
No.3/Corporation.
Mr. Manoj More (Sub. Engg.) D.P. ‘L’ Ward, officer is present.

CORAM : M.M. SATHAYE, J.
th
DATE : 26 OCTOBER, 2026
JUDGMENT :
1. The Appellants are original plaintiffs in Suit No. 638 of 2022.
The said Suit is filed for compliance of statutory obligations under the
Maharashtra Ownership Flats (Regulation of the Promotion of
Construction, Sale, Management and Transfer) Act, 1963 (‘MOFA’ for
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short), for declaration that the Respondent No. 3/Municipal
Corporation cannot invoke Section 56 of the Maharashtra Regional And
Town Planning Act, 1966 (‘MRTP’ for short) to divest the Appellants
either of their title or possession over the suit property, for declaration
that Respondent No. 1 can not claim any right, title, interest upon the
suit property save and except area acquired by Respondent No. 3/
Municipal Corporation and for permanent injunction restraining
Respondent No. 3/Municipal Corporation, from providing any
compensation to Respondent No.1, restraining Respondent No. 3/
Municipal Corporation permanently from divesting the Appellants
either of their title or possession over the suit property.
2. During pendency of the Suit, certain prayers are deleted and
fresh prayers are made for permanent injunction restraining Respondent
No. 1 from creating third-party interest/right in respect of DRC No.
RES/0067/2025 dated 11.02.2025. Appellants have also sought
declaration that certain letters issued by Respondent No. 3/ Municipal
Corporation are illegal bad in law and permanent injunction is sought
against Respondent No. 3 Municipal Corporation from taking any action
pursuant to said letters.
3. The Appellants filed Notice of Motion No. 1155 of 2022, 3177
of 2025 and 247 of 2024 in essence, seeking interim injunction
restraining Respondent No. 1 from creating any third-party right, title,
interest in respect of Transferable Development Rights (‘TDR’ for short)
admeasuring, 4436.60 square meter FSI issued by Respondent No. 3 in
respect of suit property and also seeking injunction restraining
Respondent No. 3 from providing any compensation to Respondent No.
1. Direction is also sought to Respondent No. 3/Municipal Corporation
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to determine the amount of compensation payable for open land
acquired by Respondent No. 3/ Municipal Corporation along with
details and basis of working.
4. Suit property includes suit building, land beneath it and open
area around building. Appellant Nos. 1, 2 & 4 are Private Limited
companies and Appellant No. 3 is a private individual. The Appellants
have purchased godown No. 3, 4, 1A and 2 admeasuring respectively
6350, 7497, 3044.69 and 6350 sq. ft. carpet area situated at Kranti
Nagar Bridge, Bail Bazar, Kurla West, Mumbai 400070. Plot No. 1
forming part of city survey No. 7603 admeasuring about 3344.80
square meter contains suit building of said godowns with open land
around it.
5. Respondent No. 1 entity is the vendor/promoter of Appellants.
th
Respondent No. 1 is in possession of 5 godown No. 1B in the suit
property.
BACKGROUND
6. In May 2013, Respondent No. 3/Municipal Corporation served
a notice under section 56 of MRTP Act, informing the Appellants that
the suit property is coming in the alignment of proposed widening of
Mithi river, which was sought to be widened and desilt as a result of
heavy rainfall and deluge that Mumbai faced in the year 2005. The
Appellants were called upon to submit documents for eligibility as to
compensation. According to Appellants, till filing of the suit, their
eligibility was not decided by Responding No. 3/Municipal Corporation.
7. Respondent No. 3 thereafter served a letter dated 18.03.2021,
along with its enclosures to Respondent No. 1 and its copy was sent to
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the Appellants being occupiers of the four godowns. This letter,
according to Appellants, is an offshoot of order passed by this Court
dated 21.11.2019 in Writ Petition No. 1741 of 2015. According to
Appellants, they are not concerned with this petition and were not party
to it. In furtherance of said order, Respondent No. 1 requested the
Respondent No. 3 to takeover possession of the suit property (part) and
grant compensation to Respondent No. 1.
8. According to the Appellants, Respondent No. 1 was duty
bound as promoter/vendor to form society/company of Appellants and
and convey the title of suit property but has failed to do so and it cannot
take benefit of its failure and claim full interest in compensation on the
suit property. The Appellants claim to have undivided right title interest
in the suit property, for enforcement of which the suit is filed.
9. Correspondence ensued between parties, where Respondent
No. 1 has taken a stand that since there are only four godowns
constructed on suit property, co-operative society cannot be formed.
According to Appellants, Respondent No. 1 has not given any reason for
not forming co-operative society or company and has made a false claim
that it alone is entitled to compensation in respect of Suit property
which is open land and godowns.
10. Respondent No. 1 filed its reply opposing the notices of
motion, contending there being only four members having
godowns/industrial units, registered co-operative society cannot be
formed. It is contended that Yamuna Development Corporation is
involved and is necessary party, which is a partnership, in which
Respondent No. 1 was one of the partners. It is further contended that
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since differences arose between partners of Yamuna Development
Corporation, dispute was referred to sole Arbitrator, who has given an
award dated 10.12.1986, pursuant to which Retirement Deed dated
01.01.1987 is executed by all partners, including Respondent No.1
under which Respondent No.1 has become absolutely well and
sufficiently entitled to all the rights, interest and possession of Plot No.
1 along with godown No. 1B. It is contended that Respondent No. 1 has
made application to the Municipal Corporation and constructed
godowns according to plan sanctioned by the Municipal Corporation, to
which occupation certificate is issued in February 1990. It is contended
that by agreements of sale, Respondent No. 1 has sold / transferred and
assigned the godowns to respective Appellants.
11. Respondent No. 3/Municipal Corporation filed affidavit-in-
reply in the reply, contending inter alia that notice under section 56 of
MRTP Act has been issued to all the appellants and Respondent No. 1 in
respect of land Plot No.1 and godown No.1B. It is contended that by
virtue of sale agreements, owners are claiming joint ownership in open
space of plot No.1. It is contended that after issuance of notice,
Respondent No. 1 filed writ petition in this Court, which was disposed
of with a direction to Respondent No. 3/Municipal Corporation to
demarcate the affected portion by Mithi River widening and handover
of affected portion. It is contended that joint survey and demarcation
has taken place, however, possession has not been taken. It is further
contended that Respondent No. 3 is ready to award compensation to
persons having legal right and title in the affected portion. It is
contended that according to demarcation plan, plot admeasuring
3143.30 sq. meter is affected by service road and Mithi river widening,
which needs to be acquired for subject work. It is contended that the
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Appellants and Respondent No. 1 had approached the concerned
department of Municipal Corporation, however, due to want of requisite
documents, yet the ownership as to open space in plot No. 1 has not
been decided. It is contended that Municipal Corporation will award
compensation to person/s whose title / interest is upheld by the Court.
It is further contended that the Appellants have not described the suit
property and exact share or area in the open space and therefore suit is
not maintainable as per provisions of Order VII Rule 3 of Civil
Procedure Code,1908 (‘CPC’ for short).
12. The Trial Court considered the agreements for sale executed
by Respondent No. 1. It is held that the Respondent No. 1 has accepted
that by virtue of the agreements, the Appellants have become absolute
owners of the respective godowns.
13. It is not disputed that pursuant to order of Division Bench of
this Court dated 21.11.2019, Respondent No.1 has handed over
possession of the acquired portion of the Suit property to Municipal
Corporation and TDR has been granted to Respondent No. 1 as per
possession receipt dated 02.06.2022. The Trial Court has held that
mixed questions of various interconnected facts and law including
tenability of suit, non-joinder of necessary party are involved and
critical analysis of documents with the help of oral evidence is
necessary. Trial Court held that Appellants have made out prima facie
case for grant of injunction partly. The Trial Court held that the prayer
of mandatory direction to Respondent No. 3/ Municipal Corporation to
determine the amount of compensation is in the nature of monetary
relief requiring expert and technical evidence and there is no question
of irreparable loss and therefore that prayer is rejected. So far as the
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prayer of restraining Respondent No. 3 from awarding compensation to
Respondent No. 1 is concerned, the trial Court has partly allowed it,
thereby restraining Respondent No. 3 from providing/awarding any
compensation to Respondent No. 1 in respect of the suit property
excluding land bearing plot No. 1 and godown 1B. Also, Respondent
No. 1 is restrained from transferring title and interest in respect of the
suit premises, excluding land bearing plot No. 1 and godown No. 1B.
14. In these circumstances, the present appeal from order is filed.
15. In the earlier round of litigation (Appeal From Order No. 254
of 2025), statement was made on behalf of Respondent No. 1 that third
party rights will not be created in respect of Development Rights
Certificate (DRC for short) dated 11.02.2025. Considering the same, on
01.09.2026, it was directed by this Court that during pendency of the
present appeal, no further steps will be taken with reference to the said
DRC and thereafter the appeal has been heard finally.
SUBMISSIONS
16. Learned Counsel Mr. Khandeparkar appearing for the
Appellants submitted as under.
16.1 That pursuant to sale agreements in favour of all the
Appellants, rights under MOFA are created. He invited the Court’s
attention to clause Nos. 1 to 4 of the agreements. He submitted that
Respondent No. 1 has a statutory obligation under Section 10 of MOFA,
read with Rule Nos. 8 and 9 of MOFA Rules, 1964 to form a
Society/Company and convey the suit property to such society /
company. He submitted that Respondent No. 1 is in default of this
statutory obligation which is a continuing wrong. He submitted that the
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society / company which is required to be formed is deemed owner of
the land of the suit property.
16.2 He submitted that benefits due to change in law or arising
out of acquisition, enures to the benefit of society/company and not to
the developer/Respondent No. 1. He further submitted that execution of
conveyance is mere formality.
16.3 He further submitted that Respondent No. 3/Municipal
Corporation has breached its statement made on affidavit about
awarding compensation to person whose right is upheld by the Court
and on mere indemnity dated 28.06.2022, the Respondent No. 3 has
awarded TDR in favour of Respondent No. 1 without having regard to
the rights of the Appellants.
16.4 He submitted that rights created in favour of the proposed
society/company cannot be traded by Respondent No. 1 to the
detriment of Appellant’s right under MOFA. He relied on various
calculations showing total area of land, area affected by godown, area
affected by land acquired and eligibility of TDR.
16.5 He also contended that the learned Trial Judge despite
holding that Appellants’ rights are required to be preserved and
adjudicated and despite holding that it is necessary to protect
Appellant's right, refused injunction in respect of land described in first
schedule i.e. plot no. 1, without any reason.
16.6 He submitted that the fact that there is larger layout is
irrelevant for the present dispute because the construction on plot no. 1
uses FSI of only said plot and not of the layout.
16.7 He submitted that it is only plot no. 1 that is affected by
the Mithi River widening and no other part of the larger layout (Plot
Nos. 2, 3 and 4) are affected.
16.8 He further submitted that Plot No. 1 was given to
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Respondent No. 1 as his share as per the Award passed by Arbitrator
and Respondent No. 1 retired from the partnership and it is provided in
retirement Deed that Respondent No. 1 shall not have any right over
Plot Nos. 2, 3 and 4 and other partners shall not have any right over
Plot No. 1. He submitted that therefore Plot No. 1 is distinct and
separate.
16.9 He submitted that Respondent No. 1 himself in retirement
deed has stated that no balance FSI is left in plot no. 1 which is also
pleaded in plaint of SC Suit No. 1109 of 2018.
16.10 He submitted that Yamuna Development Corporation is not
a necessary party because it is not a promoter/vendor and is only a
confirming party in only one of the 4 sale agreements. He submitted
that suit is for enforcement of statutory obligations against only
promoter which is Respondent No. 1 and who is also shown as vendor
in the agreement of sale in favour of Appellants.
16.11 He submitted that requirements of Order VII Rule 3 of CPC
are met inasmuch as description of suit property is given in paragraph 1
of the plaint, where both the suit land and suit building forming suit
property are sufficiently described. He submitted that portion of land
taken over by Respondent No. 3 is described in paragraph 6(j) of the
plaint. He submitted that Exhibit ‘L’ to plaint i.e. notices seeking
possession of the affected godown areas gives area calculations,
whereas, in affidavit in reply of Respondent No. 1 as well as possession
receipt, total area acquired is also on record.
16.12 He submitted that the order passed by this Court dated
21.11.2019 in earlier writ petition, will not affect the Appellants
because the said order does not adjudicate any dispute but only directs
Respondent No. 3 corporation to implement notice under Section 56 of
the MRTP Act and the said order expressly keeps open all contentions in
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the context of compensation / TDR allotted to Respondent No. 1 which
shall be resolved by appropriate proceedings. He further submitted that
Appellants were not party to said writ petition in which said order dated
21.11.2019 was passed.
16.13 He then submitted that TDR is immovable property and
therefore its value will fluctuate and therefore it cannot be said that
compensation in monetary terms is adequate remedy.
16.14 He submitted that if the Society cannot be formed for want
of minimum number of members, a company can always be formed.
16.15 He then submitted that the agreement stated to have been
executed by Respondent No. 1 in favour of third party in respect of TDR
cannot be considered because the same is dealt with by unregistered
document, in contravention of applicable regulation of Development
Control and Promotion Regulation, 2034 mandating written registered
document for such transfer.
16.16 Finally, he also submitted that the Appellants have
suppressed material fact which has now come to the knowledge of the
Appellants have been granted deemed conveyance by Order dated
13.04.2026, the godown purchasers of Plot Nos. 2, 3 and 4 have already
formed a common organization who has received the deemed
conveyance in respect of Plot Nos. 2, 3 and 4. He submitted that said
godown owners have not sought any relief in relation to Plot No. 1 and
none of the Appellants are members of that organization (Nutan
Commercial Premises Co-operative Society). He relied on the following
Judgments in support of his case :
(1) Ravindra Mutenja & ors v/s. Bhavan Corporation & ors,
2003(5) Mh.L.J. 23.
(2) Noopur Developers v/s. Himanshu V. Ganatra & Ors.
(2010) 7 Mh.L.J. 694.
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(3) Madhuvihar CHSL v/s. Jayantilal Investments,
2011 (1) Mh.L.J. 641.
(4) Vidhi Builders Pvt. Ltd. v/s. Arenbee Media Consultants
Ltd, 2012 SCC OnLine Bom 219.
(5) Lakeview Developers v/s. Eternia CHSL, 2015 SCC OnLine
Bom 3824.
(6) Dosti Corporation v/s. Sea Flama CHSL, 2016 (5) Mh.L.J.
102.
(7) Rajeshwarsingh Bechansingh v/s. Chandraraj Co-operative
Housing Society Limited & Ors, First Appeal No. 888 of
2018, decided on 12.11.2024.
(8) Rameshwar CHS v/s. Divisional Joint Registrar & Ors, WP
No. 4704/2025, dated 09.05.2025.
(9) The Lokmanya Pan Bazar Association Ltd v/s. The State of
Maharashtra & Ors, WP No. 8145/2014, dated 09.12.2025.
(10) Riddhi Gardens Building CHS v/s. District Deputy
Registrar,Co-operative Societies & Ors, (2024) 1 High Court
Cases (Bom) 339.
(11) Neelkanth Heights CHS & Ors v/s. Abhinav Real Estate Pvt.
Ltd & Ors,(2025) 2 High Court Cases (Bom) 21.
(12) Nusli Neville Wadia v/s. Ijimima – Imitation Jewellery
Market Co-operative Society & Ors, WP No. 14690/2022,
dated 24.02.2026.
(13) Rashesh Cooperative Housing Society Limited v/s. State of
Maharashtra & Ors, WP No. 10961 of 2025 dated
28.04.2026.
(14) Ariisto Realtors Pvt. Ltd. v/s. District Deputy Registrar &
Ors, WP No. 12863 of 2025, dated 17.07.2026.
(15) A.H. Wadia Trust & Ors. v/s. Municipal Corporation of
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Greater Mumbai & Ors. WP No. 1470 of 2012, dated
24.04.2019.
(16) Nahalchand Laloochand Private Limited v/s. Panchali
Co-operative Housing Society Ltd, (2010) 9 SCC 536.
(17) Chheda Housing Development Corporation v/s. Bibijan
Shaikh Farid and Ors. 2007 (3) Mh.L.J.402.
(18) Haresh Vijaysinh Bhatia & Ors. v/s. District Deputy
Registrar & Ors. 2025 SCC OnLine Bom 1981.
17. On the other hand, Mr. Soni, learned Counsel for the
Respondent No.1 submitted as under.
17.1 That the suit itself is not maintainable as the same is hit by
provision of Order VII Rule 3 of CPC and the suit property is not
properly described.
17.2 He submitted that the godowns of the Appellants and
Respondent No. 1 are admittedly situated on plot no. 1 which forms
part of larger plot including plot nos. 2, 3 and 4 and there is admittedly
no sub-division between these plots.
17.3 He submitted that plot nos. 2, 3 and 4 are owned by
Yamuna Development Corporation who had submitted a composite plan
for all the 4 plots which was sanctioned. He submitted that suit is also
bad for non-joinder of necessary party i.e. said Yamuna Development
Corporation. He submitted that there is a recital in the sale agreement
executed in favour of the Appellants that Yamuna Development
Corporation would form a society and admit the Appellants as
members.
17.4 He submitted that Appellants cannot claim any right in the
open piece of land without having any title to the plot in question.
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17.5 He submitted that the relief in the suit, is contingent upon
registration of the Co-operative Society of the godown holders and for
execution of conveyance in favour of society as and when formed. He
submitted that therefore, no relief can be sought beforehand in respect
of the open land.
17.6 He further submitted that since the development of the suit
property is pursuant to composite plan sanctioned in respect of entire
layout involving plot nos. 1 to 4, co-operative societies of few members
without participation of Yamuna Development Corporation can never
happen and therefore consequential relief cannot be granted at interim
stage.
17.7 He submitted that as per applicable DC Rules, it is only the
owner or lessee of the plot who is eligible for award of TDR and since
the Appellants, as of now, are neither owners nor lessees of the open
land in Plot No. 1, they cannot claim any TDR or pray regarding TDR.
17.8 He submitted that in the possession receipt, the Municipal
Corporation has kept aside compensation for built-up area against the 4
godowns of the Appellants.
17.9 He submitted that possession of the land was surrendered
by Respondent No. 1 pursuant to order of this Court dated 21.11.2019
and handover of possession and consequential grant of TDR in favour of
Respondent No. 1 stands concluded, at least at prima facie stage.
17.10 He submitted that Appellants have not challenged the
order dated 21.11.2019 passed by this Court.
18. Mr. Soni also pointed out certain portions of the affidavit in
reply filed by Respondent No. 3/Municipal Corporation contending that
Appellants have not proved their title as joint owners of open space in
plot No. 1. He also stressed upon the stand of the Respondent No. 3/
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Municipal Corporation that Appellants have not been able to produce
document of title as regards open land.
18.1 He also submitted that Appellants have not applied for
deemed conveyance as provided under Section 11 of MOFA because
they are aware that their title document only refers to the construction
shed / godown and not the open land.
18.2 He submitted that during hearing given by the Respondent
No. 3/Municipal Corporation, the Appellants were called upon to
submit relevant documents as regards their title to open land, but they
could not do so.
18.3 He submitted part of reliefs prayed in notices of motion
would not survive because TDR certificate is already issued in favour of
Respondent No. 1 on 11.02.2025 by taking declaration-cum-indemnity
bond from Respondent No. 1.
18.4 He also submitted that Respondent No. 1 has already
traded the said TDR in favour of one Hiranya Jaysingh Ashar by
agreement dated 27.03.2025 which was disclosed to this Court in
earlier appeal. He submitted that third party rights are already created
in respect of the TDR.
18.5 He finally submitted that there is no prima facie case in
favour of the Appellants and if interim relief is granted, irreparable loss
and harm will be caused to Respondent No. 1. He also submitted that
the relief prayed by the Appellants is amenable to monetary
compensation and therefore the appeal be dismissed. He relied on the
following judgments in support of this case.
(i) Municipal Corporation of Delhi v/s. Rishi Raj Jain and Anr.
AIR 2006 Supreme Court 3268.
(ii) Godawaribai Purushottam Bawaskar v/s. Sitaram
Bhagwan Paithane and Ors. 2020(3) Mh. L.J.102.
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19. I have considered the rival submissions and perused the
record.
20. First of all, it is most important to note the contractual
obligations and recitals of the sale documents which govern rights of
the parties which are similar for Appellants. For convenience, clauses
shown by learned Counsel for the parties from agreement with
Appellant No.1 are being referred.
20.1 It is not disputed that the sale agreements in favour of the
Appellants are having similar clauses. In all the agreements, Respondent
No. 1 is shown as vendor and the Appellants are shown as the
purchasers.
20.2. Clause 1 describes the godowns purchased along with area and
consideration.
20.3. Under clause 2, it is agreed that purchaser along with purchasers
of other godown of the land more particularly described in first
schedule, ‘shall jointly have exclusive rights to use the open space
abutting to the building’. Vendor has undertaken to take necessary steps
for formation of common co-operative society for all the unit purchases
on the said land.
20.4. Clause 3 makes specific reference to Section 10 of the MOFA Act
and it is provided that the purchasers shall join in forming and
registering co-operative Society or limited Company so as to enable the
vendor and/or Yamuna Development Corporation to register the
organization of purchasers of different godowns.
20.5. Clause 4 provides that the vendor shall cause to be transferred to
the society or company as the case may be, the right, title and interest
of the original owner in the land described in 1st, 2nd, 3rd and 4th
schedule.
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20.6 Clause 5 provides for the purchaser to be liable to bear
proportionate share in the outgoings until conveyance is executed.
21. Therefore, it is clear that all the godown purchasers on the
land described in first schedule agreed to have joint exclusive right to
use open space, abutting the godowns. Schedule I clearly mentions plot
no. 1 admeasuring 3344.80 sq. meter with boundaries i.e. public road
on the North, property belonging to Bharat Tiles factory on the South,
Nalla on the East and plot no. 2 on the West. This sufficiently describes
plot no. 1 along with its location where the godowns of the Appellants
are situated and sold. Therefore, paragraph No. 1 of the plaint with the
foundational document of the Appellants prima facie indicates
sufficiently described land as well as godowns with clarity about
location and therefore, the objection that suit suffers from non-
compliance with Order VII Rule 3 of CPC does not have merit.
22. It is not disputed that in none of the agreements in favour of
the Appellants, Yamuna Development Corporation is shown as vendor
and it is only Respondent No. 1 who has signed the sale agreements as
vendor. In that view of the matter, prima facie Respondent No. 1 is
bound as a vendor under Section 10 of MOFA Act and not Yamuna
Development Corporation.
23. True that, Yamana Development Corporation is shown as
confirming party in one of the 4 agreements. But that would not make it
vendor.
24. The Respondent No. 1 claims right, title and interest in Plot
No. 1 pursuant to an Arbitration Award passed on 10.12.1986
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whereunder the Respondent No. 1 retired from the partnership of
Yamuna Development Corporation w.e.f. 31.12.1986 and Plot No. 1
st
described in 1 Schedule was given to the share of Respondent No. 1
nd rd th
and remaining portion of land described in 2 , 3 and 4 schedule was
given to the remaining partners of Yamuna Development Corporation.
nd rd th
25. Perusal of 2 , 3 and 4 schedule indicates clear mention of
plot nos. 2, 3 and 4 separate and distinct from plot no. 1 mentioned in
st
1 schedule. This fact coupled with a deemed conveyance order dated
13.04.2026 produced on record by the Appellants showing that deemed
conveyance has been executed in favour of Nutan Commercial Premises
Co-operative Housing Society prima facie indicates that Respondent No.
1 was concerned only with the suit property plot no. 1. It is important
to note that suit property is plot no. 1 forming part of city survey
No.7603 and measuring 3344.80 sq. meters only. This portion is not
stated in the order of deemed conveyance and area of CTS No. 7603/1
stated in deemed conveyance order is 5816.35 sq. meter, which is prima
facie different.
26. It is also important to note that in the retirement deed
executed by Respondent No.1, under clause 10, it is agreed by
Respondent No.1 that it shall have no share, right, title, interest or
th
demand in land described in 6 schedule thereunder which is plot nos.
2, 3 and 4. Under clause 11 of the said retirement deed, the remaining
partners of Yamuna Development Corporation agreed that they shall
have no share, right, title, interest or demand in the property described
th
in 5 schedule which is present subject matter Plot No. 1. Prima facie it
indicates clear division of Plot No. 1 vis-a-vis remaining Plot Nos. 2, 3
and 4 as understood between Respondent No. 1 and remaining partners
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of Yamuna Development Corporation. Under Clause Nos. 3 and 4 of the
said Retirement Deed, the Respondent No. 1 has apparently agreed that
Plot No. 1 (5th Schedule thereunder) does not have any balance FSI.
Similar pleading is also made by Respondent No. 1 in its plaint
paragraph No. 29 in SC Suit No. 1109 of 2018 produced on record.
27. For the said reasons, it cannot be said that Yamuna
Development Corporation is a necessary party, leading to the suit being
bad for non-joinder of the said party. However, since said Yamuna
Development Corporation is shown as confirming party in one of the
documents of the Appellants, having other reference in the sale
agreements, it can be called as proper party. Therefore, it is required to
be impleaded in the suit, for avoiding multiplicity of proceedings.
28. The argument that there is no sub-division of plots in the
larger plot on which Yamuna Development Corporation has given
composite plan, will have to be considered on merits at the time of final
hearing of the suit. The recital that Yamuna Development Corporation
would form a society and admit the Appellants as member will also
have to be tested because Yamuna Development Corporation is not the
vendor, but Respondent No. 1 is vendor for all 4 Appellants. The
argument that the reliefs prayed in the suit are contingent upon the
registration of the co-operative society is an argument directly running
contrary to the obligation of Respondent No. 1 under MOFA.
29. The promoter/ vendor has a duty to form society and convey
the property under the provisions of MOFA Act and Rules.
30. At this stage it is apposite to consider the judgments relied
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upon by the Appellants.
30.1. In Noopur Developers (Supra), learned single Judge of this Court
has held that promoter has a duty to register society and convey the
title and no unfettered right is given to the promoter to postpone
registration of society.
30.2. In Lakeview Developers Vs. Eternia CHS (Supra), Division Bench
of this Court has held in paragraph 55 that developer can not claim that
he can continuously exploit building potential for eternity without
conveying land in favour of the society.
30.3. In Dosti Corporation Vs. Sea Flama CHS (Supra), this Court has
held that right to get conveyance deed executed is a statutory vested
right.
30.4. In Neelkanth Heights Co-operative Housing Society (Supra),
learned single judge of this Court was considering similar arguments as
advanced in the present case. While considering the objection of the
developer that land in question forms part of the larger layout, involves
additional buildings and consumption of extract of FSI including TDR, it
is held that MOFA does not prevent a promoter from undertaking
development in phases; however, such planning cannot be made a
reason to indefinitely delay the conveyance in favour of society.
30.5. In Nusli Neville Wadia (Supra), learned Single Judge of this Court
has held that the expression ‘his right, title, interest’ used in Section 11
of MOFA is not confined to the superstructure and the section expressly
refers to both land and building recognizing that ownership of the units
cannot be meaningfully separated from the land upon which the
building stands. It is also held that promoter cannot transfer less than
what he owes, nor can he retain any part of his interest once the stage
of conveyance arises.
30.6. In Ariisto Realtors Private Limited (Supra), learned Single Judge
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of this Court has held while considering the provisions of MOFA that
with sale of each unit, the title of the land owner and promoter gets
diluted in the land and once all the units are sold the title of the owner
and promoter in the land is divested and only a formal acts of
conveyance needs to be executed.
30.7 All the aforesaid judgments relied upon by the Appellants directly
support their case, so far as claim in compensation is concerned.
31. Perusal of the earlier order dated 21.11.2019 passed by this
Court clearly shows that, it was passed in a petition filed by Respondent
No. 1 against the Respondent No. 3/Municipality Corporation and the
present Appellants were not party thereto. In any case, the said order
clearly provides that in the event of any dispute pertaining to
compensation / TDR payable to Respondent No. 1 shall be resolved by
filing proceedings before appropriate forum. Though the said order
refers to dispute between parties (meaning thereby present Respondent
Nos. 1 and 3 only), it is obvious that since the Appellants were not party
to said petition, the dispute between Appellants and Respondent No. 1
is also kept open to be resolved by proceedings before appropriate
forum, including the present suit.
32. The nature of TDR as a property also requires consideration in
the peculiar form of dispute, as raised in the present appeal from order.
In Chheda Housing Development Corporation (Supra), the Division
Bench of this Court has held that FSI/TDR being a benefit arising from
the land, must be held to be immovable property. TDR is something
that can be traded in the real-estate market which can be sold and
purchased on a ‘square-foot basis’ and it is therefore as valuable as land.
Therefore, obviously its value fluctuates and undergoes
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appreciation/depreciation depending on the market forces governing
real-estate prices in a given area. Therefore, if TDR which is already
granted in favour of Respondent No. 1 developer (as a compensation of
acquisition of open land around godowns in plot no. 1) is allowed to be
traded by Respondent No. 1 during pendency of the suit, it will fetch a
certain amount ‘at that point of time’ in the hands of Respondent No. 1
which then can be subjected only to ‘per cent interest’ or ‘bank interest’
and will not necessarily follow the graph that real-estate may follow
during pendency of the suit. This is particularly so, because TDR is a
valuable commodity in city like Mumbai, which is traded regularly.
Therefore, there is no merit in the submission that the claim of the
Appellants is amenable to monetary compensation and injunction is not
necessary. Injunction is necessary to make sure that members of
society/company (which ought to have been formed long ago) are not
deprived of valuable appreciation that TDR in the hands of Respondent
No. 1 may achieve, especially when Respondent No. 1 developer has not
complied with its duty under MOFA of forming society/company and
conveying the property, for enforcement of which, main prayer is made
in the suit.
33. Clear recital in clause 2 of the agreements executed by
Respondent No. 1 creates a valuable vested right in favour of the
Appellants to use open space abutting the godowns. This right is arising
from open space in Plot No. 1. Therefore, it could not have been
excluded by the Trial Court. The learned Judge of the Trial Court has
clearly held that Appellants/Plaintiffs have made out prima facie case
for grant of injunction. However, there are no cogent reasons given for
excluding Plot No. 1 and godown No. 1B. Therefore, interference is
required in the impugned order.
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34. In the aforesaid facts and circumstances and for reasons
indicated above, the appeal from order succeeds and is allowed by
passing following order :
A) Clause Nos. 2 & 3 of the common impugned order dated
21.08.2026 passed in Notice of Motion Nos. 1155/2022,
3177/2025 & 247/2024 in Suit No. 638/2022 are modified
and substituted as follows :
“(2) Defendant No. 3 or its officers are restrained from
transferring any further compensation either in terms of
money or TDR in favour of Defendant No.1 in respect of
suit property i.e. plot no. 1 with godown nos. 1A, 1B, 2, 3
& 4 standing thereon, Near Kranti Nagar Bridge, Bail
Bazar, Kurla West, Mumbai, forming part of City Survey
No. 7603 (and bearing CTS Nos. 7597, 7598,7599, 7600,
7601 & 7602) admeasuring 3344.80 sq. mtr situated at
Village Kole Kalyan, Kurla West, ‘L’ ward, Mumbai.
(3) Defendant No. 1 is restrained from selling, alienating
and/or creating third party interest in respect of DRC No.
RES/0067/2025 dated 11.02.2025, during pendency of
the suit.”
B) Appellants are directed to add Yamuna Development
Corporation and Hiranya Jaysingh Ashar as party Defendant
No. 4 & 5 in the suit.
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35. In view of disposal of Appeal from Order, pending Interim
Application is also disposed of.
36. All concerned to act on duly authenticated or digitally signed
QR verifiable copy of this order.
(M.M. SATHAYE, J.)
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