In a significant ruling that strengthens the rights of flat purchasers across Maharashtra, the Bombay High Court on 17 July 2026 dismissed a writ petition filed by developer Ariisto Realtors Private Limited and upheld the unilateral deemed conveyance granted in favour of the Ariisto Cloud Cooperative Housing Society.
Justice Sandeep V. Marne held that a developer cannot indefinitely delay conveyance of land and building by claiming rights over future additional Floor Space Index (FSI) arising from a change in development regulations. The Court made it clear that once the building is complete and flats have been sold, the statutory obligation under the Maharashtra Ownership Flats Act (MOFA) to convey the property must be fulfilled, and the possibility of additional FSI cannot be used as a permanent shield.
The case concerned land at Survey No. 161A/2 and other survey numbers, CTS No. 1520/A, Village Vile Parle (West), S.V. Road, Mumbai. Ariisto Realtors had entered into a Development Agreement and Supplementary Deed dated 3 March 2010 with the landowners. The developer constructed the building known as Ariisto Cloud comprising ground plus nine upper floors with 12 residential flats, one commercial unit and two commercial shops. Flat purchasers of this building formed Respondent No. 2 Society, which was registered on 28 June 2016.
Under the Development Agreement, the developer was given an option to utilise future additional FSI or TDR by paying ₹51,000 per square metre to the landowners. After the introduction of the Development Control and Promotion Regulations, 2034 (DCPR 2034), the developer claimed that additional FSI of 841.16 sq.m. had become available and filed applications with the Brihanmumbai Municipal Corporation to utilise the same.
The society first applied for unilateral deemed conveyance under Section 11(3) of MOFA (Application No. 179 of 2024). The District Deputy Registrar, Co-operative Societies, Mumbai City (3) and Competent Authority rejected the application on 10 March 2025 as premature. The Authority noted that construction work on the ground and first floors was pending, that 81.03 sq.m. of sanctioned FSI remained unutilised, and that the developer had a claim to additional FSI under the Development Agreement. Liberty was, however, granted to the society to file a fresh application.
Thereafter, the society filed a second application (Application No. 56 of 2025). By this time, the building had received a completion certificate and the balance FSI, according to the society, was only 3.25 sq.m. The Competent Authority allowed the application on 14 July 2025 and issued a certificate of unilateral deemed conveyance of land admeasuring 1241.65 sq.m. from the larger plot along with the building standing thereon.
Ariisto Realtors challenged this order before the High Court. Senior Advocate Chetan Kapadia, appearing for the developer, argued that the Competent Authority had effectively reviewed its earlier order dated 10 March 2025, a power it does not possess. He submitted that the second application was barred by the principle of res judicata and that the liberty granted earlier could be exercised only after the developer utilised the balance and future additional FSI. Reliance was placed on the Supreme Court judgment in Faime Makers Pvt. Ltd. vs. District Deputy Registrar, Co-operative Societies and other decisions holding that the power of review is not inherent and must be specifically conferred by statute.
Counsel for the society and landowners opposed the petition. They contended that the second application was filed strictly in terms of the liberty granted after completion of construction, that the society had already been registered for nearly a decade, and that private contractual arrangements between the developer and landowners could not override the statutory rights of flat purchasers under MOFA. It was also pointed out that the landowners themselves had expressed willingness to convey the land.
Justice Marne rejected the developer’s challenge on multiple grounds. The Court held that the Competent Authority had not exercised the power of review. It had merely allowed the society to exercise the liberty that had been expressly granted in the earlier order. The Court carefully distinguished the facts from Faime Makers and B.K. Corporation, noting that in those cases the liberty was conditional upon the outcome of pending civil court proceedings involving complex title issues. In the present case, no such civil adjudication was required. The only dispute related to the developer’s claimed right over future additional FSI.
The Court observed that the main reason recorded in the March 2025 order for treating the application as premature was the incomplete construction of the building. Once the construction was complete, the society was entitled to approach the Authority again. Accepting the developer’s interpretation would mean that the liberty might never become exercisable, because the developer is not entitled in law to put up additional construction by exploiting FSI arising from a subsequent policy change.
Justice Marne emphasised the settled position of law that a promoter cannot continuously exploit the development potential of the land for eternity without conveying it to the society. Referring to the Division Bench judgment in Lakeview Developers vs. Eternia Co-operative Housing Society Limited and the recent decision in Flagship Infrastructure Ltd., the Court reiterated that the obligation to convey arises within the period prescribed under Rule 9 of the MOFA Rules — four months from the date of registration of the society. Clauses in private agreements that attempt to postpone this obligation indefinitely are void to the extent they conflict with the statute.
The Court noted that the society was registered on 28 June 2016. The developer was under a statutory duty to execute the conveyance within four months of that date. The additional FSI generated under DCPR 2034, introduced in 2018, belongs to the society and not to the developer or even the original landowners once the flats have been sold and the building completed.
Justice Marne further observed that the petition appeared to be motivated by the developer’s desire to “milk” the additional FSI made available by the new regulations. The Court stated that no other party — neither the landowners nor the neighbouring society — was opposing the conveyance. Extraordinary jurisdiction under Article 227 of the Constitution cannot be invoked to secure an undue commercial advantage or to perpetuate an unjust gain. Citing Supreme Court decisions including Gadde Venkateswara Rao and MP Mittal vs. State of Haryana, the Court held that it would not interfere merely on technical grounds when justice clearly lay on the side of the homebuyers.
The writ petition was accordingly dismissed with no order as to costs.
The judgment is expected to provide substantial relief to numerous cooperative housing societies across Mumbai and Maharashtra that continue to face resistance from developers citing unutilised or future FSI as a ground for delaying conveyance. It reinforces the clear legislative intent of MOFA that once flats are sold and the organisation of flat purchasers is formed, the land and building must be transferred without indefinite delays.
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