Mr. Nandkishor Shyamlal Garg And Ors vs District Deputy Registrar Of Co-Operative Societies And Ors
- Court
- Bombay High Court
CNR No : HCBM010289642022
2026:BHC-AS:44048
Neeta Sawant WP-11882-2022.docx
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
CIVIL APPELLATE JURISDICTION
WRIT PETITION NO. 11882 OF 2022
WITH
INTERIM APPLICATION NO. 17359 OF 2022
Mr. Nandkishor Shyamlal Garg & Ors. ...Petitioners
: Versus :
District Deputy Registrar of Co-
...Respondents
operative Societies, Mumbai City (4) &
Ors.
Ms. Anita R. Dwivedi with Dr. Pawan K. Pandey & Ms. Aishwarya J.
Kadam, for the Petitioner.
Mr. Aseem Naphade with Mr. Rupesh Singh, Mr. Ameet Mehta & Ms.
Avani Rathod i/b Solics Lex, for Respondent No. 3.
Mr. P.G. Sawant, AGP for Respondent-State.
CORAM: SANDEEP V. MARNE, J.
Reserved On: 14 OCTOBER 2026.
Pronounced On: 28 OCTOBER 2026.
Judgment:
1) The Petitioners are aggrieved by the Order dated 10 May
2022 passed by the District Deputy Registrar, Co-operative Societies,
Mumbai City (4), granting unilateral assignment of lease of land
admeasuring 1,237.5 sq. m. in favour of Respondent No. 3-Society.
PAGE NO. 1 of 21
28 October 2026
Uploaded on - 28/10/2026 Downloaded on - 28/10/2026 21:21:43
Neeta Sawant WP-11882-2022.docx
2)
Petitioners claim to be the joint owners and landlords of
land bearing Survey No.78 (pt), CTS No. 245 & 245/1 admeasuring 1237.5
sq.mts of Village-Malad, Taluka-Borivali, Mumbai Suburban District.
Petitioners claim to have purchased the said land vide Deed of
Conveyance dated 5 June 1991 from M/s. F.E. Dinshaw Trust, who was
the original owner of the land. It is Petitioners’ case that National and
Grindlays Bank Ltd. was the Trustee of M/s. F.E. Dinshaw. The Trust was
created under the last Will and Testament dated 23 July 1934 by Mr. F.E.
Dinshaw and the land involved in the Petition is one of the lands of the
said trust. By Deed of Transfer dated 18 September 1969, National and
Grindlays Bank Ltd. transferred the land in favour of Ms. Bachoobai
Woronzow Daschkow and Mr. Edulji Dinshaw as tenants in common. By
Deed of Trust dated 28 December 1973. Ms. Bachoobai settled her half
undivided share upon F.E. Dinshaw Charities, a public charitable trust
and Mr. Nusli Wadia was appointed as the administrator of the estate of
F.E. Dinshaw Charities pursuant to order dated 21 December 1972 passed
by this Court in Misc. Petition No. 29 of 1972. According to the
Petitioners, F.E. Dinshaw Charities and Mr. Nusli Wadia executed and
registered Deed of Conveyance dated 5 June 1991 and sold and conveyed
the writ land to the petitioners/their predecessors. This is how
Petitioners claim ownership in respect of the writ land.
3) A building has been constructed on the writ land by M/s.
Sheth & Co. Builders, who sold the flats in the building in the year 1977
and the flat purchasers have formed and registered Respondent No.3-
Society on 10 September 1999. According to Petitioners, Respondent
PAGE NO. 2 of 21
28 October 2026
Uploaded on - 28/10/2026 Downloaded on - 28/10/2026 21:21:43
Neeta Sawant WP-11882-2022.docx
No.3-Society claims rights from Firozshah/Phirozshah Irani and M/s.
Mulraj H. Gendia & brothers who were the judgment debtors in respect
of the decree dated 11/12 September 1985 passed by this Court in S.C.
Suit No. 464 of 1973. According to the Petitioners, M/s. Seth & Co.
Builders, had no right in the land and could not have constructed
structure on the writ land. Respondent No.3-Society filed Application
No. 34 of 2019 before the Competent Authority seeking deemed
conveyance of the land and the building. The Application was rejected by
an order dated 20 January 2021. According to the Petitioners, the
Application was rejected on the ground that there were serious disputes
regarding the title, and liberty was granted to file a fresh Application
only after resolving the legal issues. However, Respondent No.3-Society
filed fresh Application No. 185 of 2021 before the Competent Authority,
which has been allowed by order dated 10 May 2022 and the Competent
Authority has issued certificate of unilateral assignment of lease in
favour of Respondent No.3-Society of land admeasuring 1237.5 sq.mts.
Petitioners have accordingly filed the present petition challenging the
order dated 10 May 2022.
4) Ms. Dwivedi learned counsel appearing for the Petitioners
submits that the Competent Authority has erred in entertaining second
application filed by Respondent No. 3-Society seeking deemed
conveyance, despite the rejection of its earlier application by order dated
20 January 2021. According to her, the earlier application was rejected
upon finding that the Society had failed to establish its entitlement to
seek conveyance of the land. She further submits that M/s. Sheth & Co.
Builders, which allegedly constructed the building, had no right to do so,
PAGE NO. 3 of 21
28 October 2026
Uploaded on - 28/10/2026 Downloaded on - 28/10/2026 21:21:43
Neeta Sawant WP-11882-2022.docx
as there was no chain of title establishing its right to construct the
building. That since the alleged promoter of the flat purchasers did not
have any right in the land, there is no question of the society securing
any conveyance from the Competent Authority. She further submits that
under the decree passed by this Court on 11/12 September 1985 in favour
of the lessor, Defendant Nos.2 to 4 therein were directed to handover
possession of the suit properties along with the structure standing
thereon in favour of the Plaintiffs. That therefore if any right is claimed
through Defendant Nos.2 to 4, the same automatically got extinguished.
That the decree specifically records that any sub-lessee claiming rights
in the land is required to vacate the leased land. She submits that in
absence of any change in title, M/s. Sheth & Co. Builders claimed lease in
respect of the land merely on the strength of revenue records. That the
revenue records indicate alleged creation of lease for only 25 years
whereas the promoter falsely represented to the flat purchasers that the
lease was for 97 years. She submits that if there is no valid or subsisting
lease in favour of the promoter, the Competent Authority cannot convey
to the society what does not even belong to the promoter. That in any
case since Application No. 185 of 2021 was barred by res-judicata, the
Competent Authority has grossly erred in entertaining the same.
5)
Ms. Dwivedi further submits that in their capacity as owners,
Petitioners are in the process of redeveloping the whole land. That
Petitioners are already negotiating with the developer. That conveyance
is sought by the society with a view to disrupt the redevelopment
process. She therefore submits that the impugned order passed by the
Competent Authority is ex-facie illegal and deserves to be set aside.
PAGE NO. 4 of 21
28 October 2026
Uploaded on - 28/10/2026 Downloaded on - 28/10/2026 21:21:43
Neeta Sawant WP-11882-2022.docx
6)
Mr. Naphade, the learned counsel appearing for Respondent
No.3 submits that the principle of res-judicata is not applicable in the
facts and circumstances of the present case since in the first application,
the society had claimed conveyance/ownership of the land whereas after
realizing that the promoter had only leasehold rights in the land, the
second application was filed for the purpose of assignment of lease. That
the Competent Authority has rightly exercised jurisdiction under Section
11 of Maharashtra Ownership Flats, (Regulation of the Promotion of
Construction, Sale, Management and Transfer) Act, 1963 (MOFA) not
warranting any interference in the impugned order. He submits that the
judgment of the Apex Court in Faime Makers Private Limited Versus.
1
District Deputy Registrar Co-op Societies (3) Mumbai and others has
no application to the present case. That Petitioners have purchased
merely an obligation to convey the land and building to the organization
of flat purchasers as held by this Court in Darshan Mandir CHSL Versus.
2
District Deputy Registrar Co-op Society Mumbai (4) And others . That
the intention of Petitioners is to reap the benefits of redevelopment. He
submits that under various clauses of MOFA Agreement, the promoter
had specifically undertook to transfer and assign the leasehold rights to
the organization of flat purchasers. He submits that name of Mr.
Vrundavan Sheth of M/s. Seth & Co Builders is clearly mutated to the
revenue records thereby indicating existence of leasehold rights in him.
He submits that in exercise of limited jurisdiction under Section 11, the
Competent Authority cannot undertake intrinsic inquiry into the issue of
title. That in the present case, the Competent Authority has rightly
1
2025 (5) SCC 772
2
WP No. 16318 of 2025 decided on 22 June 2026
PAGE NO. 5 of 21
28 October 2026
Uploaded on - 28/10/2026 Downloaded on - 28/10/2026 21:21:43
Neeta Sawant WP-11882-2022.docx
transferred the promoter’s claim of right of lease in the land as well as
the ownership. He prays for dismissal of the Petition.
7) Rival contentions urged on behalf of the parties now fall for
my consideration.
8) Petitioners claim ownership of the land on the strength of
Deed of Conveyance dated 5 June 1991 executed in their favour by F.E.
Dinshaw Charities. Copy of the Conveyance Deed is placed on record
which indicates that the conveyance notes existence of a building on the
land admeasuring 1237.5 sq.mts. More importantly, by way of the
conveyance the land is sold on ‘as is where is basis’.
9) M/s. Sheth & Co. Builders claimed rights in the land. The
order of the Competent Authority records that commencement
certificate was issued on 25 August 1977 and building plans were
sanctioned on 13 July 1977. Ms. Dwivedi has however branded the
building as unauthorised structure. According to her, the so-called
commencement certificate was not in the name of M/s. Sheth & Co.
Builders. In my view, the building is standing for the last 49 long years
and in these proceedings, this Court cannot go into the issue of legality
of the structure. It appears that the name of M/s. Sheth & Co. Builders,
through its partner, Mr. Vrundavan Sheth was mutated to the revenue
records. The relevant entry shows that the name of M/s. Sheth & Co.
Builders was entered into the revenue records by virtue of lease dated 31
December 1973 which was executed for a period of 25 years. On the other
hand, when M/s. Sheth & Co. Builders commenced selling units in the
PAGE NO. 6 of 21
28 October 2026
Uploaded on - 28/10/2026 Downloaded on - 28/10/2026 21:21:43
Neeta Sawant WP-11882-2022.docx
building, it represented that it held a lease for a term of 97 years.
However, according to Ms. Dwivedi, no lease had been granted in favour
of M/s. Sheth & Co. Builders, even for a period of 27 years. Here again,
this Court need not go into the intrinsic issue of title as the same is
beyond the scope of jurisdiction of Competent Authority under Section
11 of MOFA.
10) Perusal of Agreement for Sale executed with one of the flat
purchasers in the year 1977 would indicate that the promoter had agreed
to assign leasehold rights in the land in favour of the organization of flat
purchasers. This is clear from the following covenants in the Agreement
for Sale:
Nothing contained in this agreement shall be construed to be a grant or
demise of the land or building thereon in favour of the holder. The
builders have agreed to convey and assign the building together with
their interest in the lease-hold in favour of Co-operative Society to be
formed and the holder has agreed to become the member of the said
Society.
The builders agree that after all the Flats are sold or earlier at their
discretion, they the builders will help and co-operate with the members
to form a Society and get the same Registered and to convey the
building along with the assignment of their entire interest in the lease-
land in fovour of the Society. It is provided that if the Society is formed
before the sale of all the Flats then and in that case the builders will be
considered to be the Flat owners of the said unsold Flats and they will
have absolute right to allot and assign the said unsold Flats to
purchasers of their choice and such Holder/Holders will be accepted as
the Members of the Society and the Second Party will not rise any
objection to the same. It is provided that all expenses and charges in
respect of the formation of the Society, Conveyance and etc will be
borne by the Holder proportionately.
The second party had seen the Lease Deed which is granted for a period
of 97 years. The lease will be assigned in favour of the Society when
PAGE NO. 7 of 21
28 October 2026
Uploaded on - 28/10/2026 Downloaded on - 28/10/2026 21:21:43
Neeta Sawant WP-11882-2022.docx
formed if the Lessors are agreeable otherwise a sub-lease will be made
in the name of the Society by the Builders if law permits. If the Lease
period of the Builders is extended the said benefit will be enjoyed by the
Society Even if lease remain in the name of Builders (or any one of
them), right to enjoy the lease will remain with the Society.
11) The flat purchasers have formed and registered co-operative
housing society on 10 September 1999. No one objected to construction
of the building by M/s. Sheth & Co. Builders. No injunction was sought
by the original land owners when M/s. Sheth & Co. Builders undertook
construction of the building in the year 1977. It appears that the original
land owners had filed S.C. Suit No. 464 of 1973 in this Court which was
pending when construction of the building took place. However, neither
M/s. Sheth & Co. Builders nor the flat purchasers were impleaded to the
said suit which was ultimately decreed on 11/12 September 1985 against
Defendant Nos.2 to 4 therein. Ms. Dwivedi has strenuously relied on
some of the findings recorded by this Court in support of her contention
that once decree for possession and eviction is passed, everybody
occupying the land and the structure must vacate the same in pursuance
of the decree. She has particularly relied on following findings made by
this Court in the decree dated 11/12 September 1985:
11. The Defendants contended that the suit instituted by the plaintiffs
is bad for non-joinder of the occupants of the structures built on the
suit land as party defendants. Shri Seth urged that defendants 2 to 4
have created several structure on the suit "property and have Iet it out
to certain people, and the occupants of those structures are necessary
parties to the suit. It is impossible to agree to this submission. Order 1
Rule 9 of the Code of Civil Procedure prescribes that no suit shall be
defeated by reason of the mis joinder or "non-joinder of parties, and the
Court may in every suit deal with the matter in controversy so far as
regards the rights and interests of the parties actually before it. Shri
Seth sounded an apprehension that the non-joinder of the occupants of
the structures would cause obstacles in the way of the plaintiff from
PAGE NO. 8 of 21
28 October 2026
Uploaded on - 28/10/2026 Downloaded on - 28/10/2026 21:21:43
Neeta Sawant WP-11882-2022.docx
recovering possession. The question as to whether the decree-holder
would face difficulty in executing the deerce is not relevant to decide
whether certain persons are necessary parties to the suit. The plaintiffs
have let out the lands to defendant No.1, who has submitted to the
decree and defendant No.1 has sub-let it to defendant No.2. In-case
defendant No.2 inducts any person on the suit land, then those person
can claim interest to remain in occupation only through defendant
No.2, and once decree is passed against defendant No. 2, then other
persons claiming through defendant No.2 must submit to the decree
and hand over possession to the plaintiffs. It is futile for Shri Seth to
urge that defendant No.2 would induct several people on the land from
time to time and the plaintiffs must go on adding those persons as
party defendant to the suit. In my judgment, it was not necessary for
the plaintiffs to join the occupants of the structures as party defendants
and those occupants are not the necessary parties to the suit. The
finding to issue N о.2 is therefore in the negative.
xxx
The rights of defendant No.2 were regulated by the sub-lease between
defendant No.1 and defendant No.2 and once the lease is extinguished,
every person claiming under that lessee must surrender possession
favour of the lessor. The contention of Shiri Seth that the plaintiffs are
not entitled to possession of the structures is without any substance.
12)
As observed above, the Competent Authority cannot
undertake an in-depth evidentiary inquiry into questions of title. Under
Section 11 of the MOFA, the Competent Authority has limited
jurisdiction to examine whether the promoter has failed to convey its
right, title, and interest in the land and the building. Once failure on the
part of the promoter is established, the Competent Authority can pass
order of deemed conveyance under Section 11(3) and (4) of MOFA. In
conducting such an inquiry, the Competent Authority is not expected to
adjudicate competing claims to the land between persons asserting
rights therein and the promoter who constructed and sold the building.
Such disputes are required to be adjudicated independently of the
proceedings under Section 11 of the MOFA and before a competent Civil
PAGE NO. 9 of 21
28 October 2026
Uploaded on - 28/10/2026 Downloaded on - 28/10/2026 21:21:43
Neeta Sawant WP-11882-2022.docx
Court. To illustrate, where a promoter claims to have purchased or taken
a plot of land on lease and constructs a building thereon, upon selling
the flats in the building, he incurs an obligation to convey its right, title
and interest in the land and building to the organisation of flat
purchasers. If any person claims that the promoter did not acquire valid
rights in the land, such person needs to injunct the promoter from
constructing the building. Even if building is constructed, person
claiming rights therein can always file a civil suit to seek a declaration of
title in the land. Even after the land is conveyed to the Society by the
Competent Authority, a person claiming rights in the property is not
precluded from approaching the Civil Court to seek a declaration to the
contrary. Thus, what the Competent Authority performs is to merely step
in the shoes of the erring promoter who shuns the responsibility of
conveying his right, title and interest in the land and the building. The
Competent Authority merely ensures that conveyance is executed in the
absence of cooperation from the promoter. Thus, Section 11 of the MOFA
has been enacted with the objective of obviating the need for an
organisation of flat purchasers to institute a suit for specific performance
against the promoter.
13) Thus, the rights represented by the promoter at the time of
sale of flats in the building are the rights that are transferred by the
promoter to the organisation of flat purchasers. If the promoter
inherently lacks any right, title or interest in the land, then mere
issuance of a certificate of unilateral deemed conveyance by the
Competent Authority does not conclusively vest title of the land in the
PAGE NO. 10 of 21
28 October 2026
Uploaded on - 28/10/2026 Downloaded on - 28/10/2026 21:21:43
Neeta Sawant WP-11882-2022.docx
organisation of flat purchasers. The true owner of the land may always
seek a declaration to the contrary from the Civil Court.
14) This Court has consistently ruled that claims of original land
owners or title disputes cannot be adjudicated or raised before the
Competent Authority in proceedings for a unilateral deemed conveyance
under the MOFA. According to various judgments of this Court the
Competent Authority is a quasi-judicial body with a strictly limited
mandate. Its primary task is to address a promoter's failure to convey the
title of land and building to flat purchasers, and not to resolve
underlying title or ownership disputes. If original landowners or third
parties wish to raise title disputes/claims over the conveyed land, or
civil rights, their proper legal remedy is to file a regular civil suit
before a competent Civil Court rather than intervening in MOFA
proceedings
15) Following the above settled position of law, in my view, if
the Petitioners believe that the promoter-M/s. Sheth & Co. Builders, did
not possess leasehold rights in the land which can be conveyed in favour
of Respondent No. 3-society, it can always seek a declaration to the
contrary from the Civil Court. In the present case, promoter represented
to the organization of flat purchasers that he had leasehold rights for a
tenure of 97 years and agreed to assign his leasehold rights in favour of
the organization of flat purchasers. Since the promoter failed to perform
his promise, the Competent Authority has stepped in under Section
11(3) of MOFA. Petitioners cannot seek to secure a certificate of title in
the application for deemed conveyance before the Competent Authority.
PAGE NO. 11 of 21
28 October 2026
Uploaded on - 28/10/2026 Downloaded on - 28/10/2026 21:21:43
Neeta Sawant WP-11882-2022.docx
If Petitioners, their predecessor in title really believe that M/s. Sheth &
Co. Builders did not have right to construct the building or to convey his
rights in the land in favour of the organization of flat purchasers, they
ought to have injuncted the promoter from undertaking construction of
the building. The building is standing for the last 49 long years. The
same is now in the need of redevelopment process. The society has
approached the Competent Authority with to view to secure title in the
land so as to undertake the process of redevelopment. At this stage,
Petitioners have parachuted on the scene to claim ownership rights in
the land. If they have ownership rights in the land based on the deed of
conveyance, they are free to assert the same by filing appropriate
declaratory and injunctive suit. As of now, what is done by the
Competent Authority is to convey what the promoter believes belonged
to the promoter. If promoter’s belief was wrong, Petitioners can always
secure declaration to the contrary.
16) What is purchased by the Petitioners vide deed dated 5 June
1991 is mere obligation to convey the land and the building in favour of
Respondent No.3-society. It is well settled that when promoter or the
land owner conveys land to a third party instead of conveying the same
to the organization of flat purchasers, what is purchased by such
purchaser is mere obligation to convey the land and the building. Mere
subsequent purchase by a third party does not nullify right of
organization of flat purchasers to secure conveyance under Section 11 of
MOFA. In this regard, following observations made by this Court in
Darshan Mandir CHSL (supra) are apposite:
PAGE NO. 12 of 21
28 October 2026
Uploaded on - 28/10/2026 Downloaded on - 28/10/2026 21:21:43
Neeta Sawant WP-11882-2022.docx
20. Prima-facie therefore it appears that what is purchased by
Respondent No.4 is merely an obligation to convey the land and
building in accordance with Section 11(1) of MOFA. This Court does not
appreciate action on the part of Respondent No.3 in selling land in
favour of a third developer when the title therein was statutorily
required to be transferred in favour of the Petitioner-Society. Thus,
what is done in the present case is purchase of land by Respondent No.4
which is statutorily meant to be conveyed to the Petitioner-Society.
This is apparently done with the aim of exploiting additional
development rights either through TDR or out of change in FSI regime
due to introduction of Development Control Regulations. However, this
Court is not proposing to delve deeper into this aspect since
adjudication of Petitioner-Society's application for deemed conveyance
is yet to be made by the Competent Authority. The only reason why
these observations are made even before adjudication of Petitioner's
obligation for deemed conveyance is because Respondent No.4 is
opposing the application for deemed conveyance by claiming that he is
now the promoter and its IRP has taken a stand that pendency of CIRP
against Respondent No. 4 suspends right of the Petitioner to seek
conveyance of land.
28. What must also be borne in mind is the fact that in most of the
cases, there is virtual loss of right of the promoter in the land and
building due to combined effect of provisions of Section 4 and Section
11 of MOFA. With sale of each flat in the building, there is dilution of
title of the developer in the land. The moment all the flats in the
building are sold, the developer is virtually divested of title in the land.
While things may look slightly complicated in respect of multistory
towers, one may take into consideration a simple illustration of a
developer undertaking construction of four flats on a plot of land. When
all four flats in the building are constructed and sold, the four flat
purchasers acquire 25% right each in the land and the developer looses
its title in the land. In a similar manner, when all flats in a multistorey
tower are sold and a cooperative society/company of flat purchasers is
formed, the promoter’s title in the land gets divested and such
society/company becomes entitled to own the land on which the
building is constructed. The things may also get slightly complicated in
a layout development. However, even qua layout development, similar
analogy would apply and the developer loses proportionate title in the
land to the extent of completed buildings in the layout. It cannot be
that the developer exploits development potential in the land,
constructs flats and sells them to the purchasers, but still retains
ownership in the land. This concept is unknown to law. On the other
hand, provisions of Sections 4 and 11 of MOFA ensure that the
developer is divested of his right, title and interest in the land and the
building which is statutorily required to be transferred/conveyed to the
PAGE NO. 13 of 21
28 October 2026
Uploaded on - 28/10/2026 Downloaded on - 28/10/2026 21:21:43
Neeta Sawant WP-11882-2022.docx
organisation of flat purchasers. Thus what is conveyed by the
Competent Authority need not necessarily be the ‘asset’ of the
promoter on account of operation of concept of divesting.
29. Ordinarily only an owner of the immovable property can execute
conveyance thereof. However, a unique concept of ‘deemed conveyance’
is introduced in MOFA for reasons discussed above. The concept of
deemed conveyance envisages transfer of title of land owner without
his consent and in absence of his signature on the instrument of
conveyance. The transaction of deemed conveyance is effected through
registration of a certificate issued by the Component Authority. This
concept of deemed conveyance envisaging transfer of title of a
landowner against his desire is thus based on the principle of divesting
of title. Once the development potential as per the sanctioned plan is
exploited, buildings are constructed, flats are sold and an organization
of flat purchasers is formed, the developer loses title in the land and the
building. The law enjoins a duty on him to transfer the title in the land
and the building in favour of the organization of flat purchasers
[Section 11(1) of MOFA]. However, if the developer fails in performance
of statutory duty by not transferring the title, the Competent Authority
steps into developer’s shoes and issues a certificate of unilateral
deemed conveyance. The law thus presumes loss of title of the
developer once failure occurs on his part to perform the duty under
Section 11(1) of MOFA. This presumption is however rebuttable. Even
after the certificate of unilateral deemed conveyance is issued and
registered, the developer can still institute a suit and demonstrate that
the title in the land or in portion thereof still vests in him. Thus, the
statutory scheme of Section 11 of MOFA is such that there is
presumption of loss of title in the land and the building and it is on this
presumption that a certificate of unilateral deemed conveyance is
issued by the Component Authority. Till the developer secures a
declaration from a Court to the contrary through a decree, the
instrument of deemed conveyance based on such presumption
continues to remain valid for all purposes. Considering this peculiar
statutory scheme of Section 11 of MOFA, it is difficult to hold that the
deliberate act of the developer in not transferring the title in the land in
violation of statutory duty under Section 11(1) results into holding of
any ‘asset’ by him within the meaning of Section 14 of IBC, which
cannot be transferred on account of imposition of a moratorium. What
is effected by the Competent Authority is, not transfer of property of
the corporate debtor in real sense, but mere certification that the title
in the land and building has now vested in the organization of flat
purchasers by reason of failure to perform statutory duty by the
developer. In my view therefore, provisions of Section 14 of IBC do not
come in the way of Competent Authority exercising powers under
Section 11 of MOFA.
PAGE NO. 14 of 21
28 October 2026
Uploaded on - 28/10/2026 Downloaded on - 28/10/2026 21:21:43
Neeta Sawant WP-11882-2022.docx
17)
Coming to the objection of res-judicata, the same appears to
be attractive in the first blush. However, upon deeper scrutiny the same
appears to be baseless. Respondent No.3-Society filed Application No.
34 of 2019 seeking deemed conveyance of the land and the building in its
favour. Copy of Application No. 34 of 2019 is placed on record which
indicates that Respondent No.3-Society sought ownership rights in the
land which is clear from the prayer of Application No. 34 of 2019 which
reads thus:
a. This Hon'ble competent Authority be pleased to grant a Certificate
that the Applicant is entitled to have unilateral deed of Conveyance of
the Property under section 11 of the Maharashtra Ownership flats
(Regulation of the Promotion of Construction, sale, and Transfer) Act,
1963 and to have it registered.
b. For costs of the application to be provided.
c. For such other reliefs as this Hon'ble Competent Authority may deem
fit.
18)
The Competent Authority, while rejecting the Application
No. 34 of 2019 granted liberty to Respondent No.3-Society to file fresh
application for deemed conveyance. Respondent No.3-Society
accordingly filed Application No. 185 of 2021, this time seeking
assignment of leasehold rights in the land. Thus, the prayers in the two
proceedings were not the same. The Competent Authority has now
granted assignment of leasehold rights in favour of Respondent No.3-
Society.
19) Ms. Dwivedi has strenuously raised objection of res-judicata
on account of dismissal of earlier Application No. 34 of 2019. According
to her, Application No. 34 of 2019 was dismissed on account of
PAGE NO. 15 of 21
28 October 2026
Uploaded on - 28/10/2026 Downloaded on - 28/10/2026 21:21:43
Neeta Sawant WP-11882-2022.docx
involvement of serious title disputes between the parties making it
impossible to grant deemed conveyance of the land. She particularly
relies on findings recorded in para-14(f) of the order dated 20 January
2021 in which it was recorded that the land is not free from
encumbrances and that the title is disputed making it improper for the
Competent Authority to decide the application for deemed conveyance.
Ordinarily this Court would have accepted the objection sought to be
raised on behalf of the Petitioners since the principle of res-judicata is
held to be applicable to proceedings before the Competent Authority
under Section 11 in Faime Makers Private Limited . In the present case
there are few factors which make the ratio of the judgment of the Apex
Court in Faime Makers Private Limited inapplicable. Firstly, the
Competent Authority itself granted liberty to Respondent No.3-Society
to file a fresh application. Secondly, Application No. 34 of 2019 sought
prayer for conveyance of land on ownership basis even though the
promoter had claimed lease for a period of 97 years in the agreements for
sale. Respondent No.3-Society accordingly accepted the position that it
cannot secure ownership rights in the land and accordingly applied for
assignment of lease hold rights in Application No. 185 of 2021. As
observed above, the Competent Authority need not concern itself with
disputes relating to title between the landowners and lessees or between
the landowners and the promoter, as such disputes cannot be
adjudicated in an application filed under Section 11 of MOFA. At the
time of rejection of Application No. 34 of 2019, the Competent Authority
held that the documents sought to be relied upon by Respondent No.3-
Society did not assist its cause. It specifically held that it was necessary
PAGE NO. 16 of 21
28 October 2026
Uploaded on - 28/10/2026 Downloaded on - 28/10/2026 21:21:43
Neeta Sawant WP-11882-2022.docx
to bring all documents and facts on record. It was held by the Competent
Authority in paragraph 15 of its order thus:
15 . In the circumstances aforesaid, I am not inclined to consider the
aforesaid application for Unilateral Deemed conveyance filed for and on
behalf of the applicant society in view of the fact that the documents
sought to be relied upon by the applicant society does not help and / or
assist the cause of the applicant. It would not be prudent to adjudicate
upon the aforesaid application at this stage as the same would
tantamount to causing injustice to the other party. Also it is necessary
to bring all the documents and facts on record. Hence I pass the
following order.
20)
Thus, the Competent Authority granted liberty to
Respondent No.3-Society to approach it again with complete documents
for the purpose of re-adjudication of its prayer. Considering this
position, in my view, the objection of res-judicata cannot apply in the
facts and circumstances of the present case.
21)
Considering the overall conspectus of the case, I am of the
view that no interference with the impugned order passed by the
Competent Authority is warranted. As held by the Hon’ble Apex Court in
Arunkumar H. Shah Vs. Avon Arcade Premises Co-operative Society
3
Limited & Ors. , a certificate of unilateral deemed conveyance is not
conclusive or determinative of the rights and entitlements of the parties
in respect of the conveyed land. It is always open for an aggrieved party
to seek an appropriate declaration from the Civil Court to the contrary. If
the Petitioners believe that Respondent No. 3–Society is not even
entitled to a lease, they are at liberty to seek an appropriate declaration
to that effect from the Civil Court. At this stage, the Competent
3
Civil Appeal No. 5377 of 2025 decided on 21 April 2025.
PAGE NO. 17 of 21
28 October 2026
Uploaded on - 28/10/2026 Downloaded on - 28/10/2026 21:21:43
Neeta Sawant WP-11882-2022.docx
Authority has merely assigned in favour of Respondent No. 3 the rights
that the promoter himself claimed to possess.
22) MOFA is beneficial piece of legislation enacted to protect
the rights of the flat purchasers and their organisations. The objective
behind Section 11 of MOFA is to ensure that the title in the land and the
building is conveyed by the promoter in favour of organisation of flat
purchasers. Since promoters play mischief by deliberately not conveying
land in favour of the organisation of flat purchasers and with a view to
provide a swifter remedy to secure conveyance of the land, provisions of
MOFA have been amended in the year 2008 by inserting sub-sections (3)
to (5) in Section 11 by making a provision for deemed conveyance. The
concept of ‘deemed conveyance’ is dealt with by this Court in judgment
4
in Satellite Garden I CHSL Vs. State of Maharashtra in which it is held
thus:
91) 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.
4
Writ Petition No. 1128 of 2026 decided on 16 September 2026
PAGE NO. 18 of 21
28 October 2026
Uploaded on - 28/10/2026 Downloaded on - 28/10/2026 21:21:43
Neeta Sawant WP-11882-2022.docx
92) 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.
93) 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 10th 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.
PAGE NO. 19 of 21
28 October 2026
Uploaded on - 28/10/2026 Downloaded on - 28/10/2026 21:21:43
Neeta Sawant WP-11882-2022.docx
23)
Since Section 11 of MOFA is aimed at preventing the
mischief by the promoters and developers and for ensuring that the land
and the building is owned by the organisation of flat purchasers, the said
objective is fulfilled in the present case. This Court is otherwise satisfied
with the outcome of the proceedings. Jurisdiction of this Court under
Article 227 of the Constitution of India is supervisory and
corrective in nature. It is well settled position of law that in exercise
of extra-ordinary jurisdiction under Article 227 of the Constitution
of India, the High Court need not correct every error of law
especially when the final conclusion reached by authority is
acceptable. Reference in this regard can be made to the judgment of
5
Garment Craft V/s. Prakash Chand Goel
the Apex Court in in
which the Apex Court has held in paragraph 15 as under:
15. Having heard the counsel for the parties, we are clearly of the view
that the impugned order is contrary to law and cannot be sustained for
several reasons, but primarily for deviation from the limited jurisdiction
exercised by the High Court under Article 227 of the Constitution of
India. The High Court exercising supervisory jurisdiction does not act as
a court of first appeal to reappreciate, reweigh the evidence or facts
upon which the determination under challenge is based. Supervisory
jurisdiction is not to correct every error of fact or even a legal flaw when
the final finding is justified or can be supported. The High Court is not
to substitute its own decision on facts and conclusion, for that of the
inferior court or tribunal. The jurisdiction exercised is in the nature of
correctional jurisdiction to set right grave dereliction of duty or flagrant
abuse, violation of fundamental principles of law or justice. The power
under Article 227 is exercised sparingly in appropriate cases, like when
there is no evidence at all to justify, or the finding is so perverse that no
reasonable person can possibly come to such a conclusion that the court
or tribunal has come to. It is axiomatic that such discretionary relief
must be exercised to ensure there is no miscarriage of justice.
5
(2022) 4 SCC 181
PAGE NO. 20 of 21
28 October 2026
Uploaded on - 28/10/2026 Downloaded on - 28/10/2026 21:21:43
Neeta Sawant WP-11882-2022.docx
24) In the present case the only motive of Petitioners is to
carry out redevelopment of building of Respondent society and milk
profits therefrom. The society is entitled to redevelope its property and
the petition is aimed at depriving the society from undertaking
redevelopment of its building. I am therefore not inclined to interfere in
the impugned order at the instance of the Petitioners, who have
purchased the land with their eyes wide open that the building of the
society was standing therein. They cannot seek to secure a certificate of
their own title, in the deemed conveyance proceedings filed by the
society. If they believe that no land can be conveyed to the society as the
promoter itself had no rights, it can file a Civil Suit challenging
conveyance of land in favor of the society.
25)
In view of the above discussion, the Writ Petition is
dismissed . The Interim Application also stands disposed of.
NEETA
SHAILESH
SAWANT
[SANDEEP V. MARNE , J.]
Digitally signed by
NEETA SHAILESH
SAWANT
Date: 2026.10.28
18:38:27 +0530
PAGE NO. 21 of 21
28 October 2026
Uploaded on - 28/10/2026 Downloaded on - 28/10/2026 21:21:43
Powered by TCPDF (www.tcpdf.org)