Justice Sandeep V. Marne delivered the judgment on 24 September 2026 in Writ Petition No. 751 of 2019 filed by Dr. Omprakash B. Soniminde and his wife Chandrakala. The couple own flats 601 and 602 in Le Chateau Co-operative Housing Society Limited on Plot No. 14, TPS IV, Santacruz. They challenged orders of the Cooperative Court (30 January 2017) and the Cooperative Appellate Court (11 January 2018 and review dated 13 July 2018) that had dismissed their claim to extra flats built with Transferable Development Rights (TDR).

How the extra flats were meant to be shared

The society owns the land and two structures: Le Chateau (stilt plus six floors, 12 flats) and an older tenanted building called Shamrock. In an Extraordinary General Body Meeting on 24 April 1996, members resolved to buy TDR/FSI and construct additional floors. The extra flats were to be allotted only to existing members, at the cost of TDR plus construction. The agreed rate with the contractor was ₹4,000 per sq.ft.

Under that resolution, flats 701 and 702 on the seventh floor of Le Chateau were reserved for the Sonimindes. Other members were allotted flats in Shamrock. Mrs. Kedia, who was not interested, was excluded. Jet Speed Developers Pvt. Ltd. was appointed contractor under an agreement dated 20 June 1996. Its role was limited to procuring TDR and constructing the extra floors. It had no ownership interest in the land or the building.

The Court noted that about six of the original 12 flats in Le Chateau were held by the Mankani family and their relatives. The directors of Jet Speed — Ramesh C. Mankani and Renu R. Mankani — are close relatives of that family. Their contractual role, the Court said, was only that of a paid builder.

Default, cancellation and a new allotment

Dr. Soniminde was chairman when the scheme began. The society later alleged that the couple did not pay the initial contribution of about ₹35 lakh (later demanded at over ₹43 lakh) despite letters in 1997 and 1998. The petitioners asked for accounts, TDR details and a payment schedule and denied that a firm schedule had been fixed. They claimed they had paid ₹5 lakh in cash; both the Cooperative Court and the Appellate Court rejected that claim.

On 24 July 1998 the society held an Annual General Meeting. The petitioners said they did not receive notice of the original date or the changed date, and that the agenda did not clearly provide for cancellation of their allotment. In that meeting the society treated their allotment of 701 and 702 as terminated and allotted the two flats to Ramesh and Renu Mankani, stating that Jet Speed’s last certified bill was about ₹77.40 lakh and that no other member wanted the flats. The consideration shown was ₹62 lakh, to be adjusted against amounts payable to the contractor.

The High Court held that non-payment by the petitioners could not justify handing members’ entitlement to the contractor’s directors. If the couple had defaulted, the society ought to have auctioned 701 and 702 and used the sale proceeds to pay the contractor. Instead, flats meant only for members were given to outsiders who were relatives of the controlling family.

Two more flats on Shamrock

The original 1996 plan was construction up to the seventh floor on Shamrock. The society later took up two more flats — 801 and 802 — on the eighth floor of Shamrock and allotted those as well to the same two directors. The Court called this “adding premium to the illegalities already committed.” Construction of extra flats, it said, was not meant to create a private stock for the contractor’s family.

The petitioners later amended their dispute to seek at least 801 and 802 at the cost of TDR and construction. They had also filed a separate dispute (CC/I/210/2014) challenging the 21 August 2000 resolution on the eighth-floor work. That dispute was dismissed for non-prosecution. The High Court held that the dismissal did not bar the prayer for allotment of 801 and 802 in the present case, because the other dispute did not seek allotment of those flats to the petitioners.

What the High Court would and would not disturb

Justice Marne held that allotment of all four flats to the contractor’s directors was arbitrary. A contractor’s remedy for unpaid bills is a money claim against the society, not allotment of flats on society land. The Court also recorded that other members had already paid large sums — figures placed on record included about ₹4.62 crore — and that giving four large flats in Santacruz on top of those payments amounted to a windfall.

At the same time, the Court refused to take away 701 and 702. Those flats have been occupied for years. The petitioners themselves had not paid their contribution on time. “It is too late in the day,” the Court said, to unsettle that allotment.

Flats 801 and 802, however, remain unfinished and unoccupied. Counsel for the directors submitted that finishing work could not be completed for want of funds. The Court held that these two flats can still go to the original member couple.

The ₹2.5 crore arrangement

In 2002 the petitioners had applied to deposit ₹62 lakh plus interest towards 701 and 702. Before the High Court they offered ₹2.5 crore for 801 and 802, accepting that the flats are unfinished and that they will have to spend more on completion or wait for redevelopment.

The Court directed that this ₹2.5 crore be paid to Ramesh and Renu Mankani, not to the society, because the eighth-floor flats had been given to them to recoup alleged extra construction cost. On payment within six weeks:

• the society must cancel the allotment of 801 and 802 in favour of the two directors and enter the petitioners’ names in the membership register;
• the directors must hand over possession;
• if they refuse the money, the petitioners may deposit it with the society in an interest-bearing account and take possession with police assistance;
• maintenance is payable by the petitioners only from the date of possession; no past maintenance can be demanded from them.

If the ₹2.5 crore is not paid within six weeks, the allotment of 801 and 802 revives in the name of the two directors.

The Court set aside the Cooperative Court award and the Appellate Court judgments, partly decreed the 1999 dispute, and made the rule partly absolute. There was no order as to costs.

Why the judgment matters for societies

The ruling restates a simple rule that housing societies often blur when a contractor is related to the managing group: extra FSI or TDR loaded on society land belongs to members. A builder engaged to construct additional floors is entitled to the agreed cost of TDR and construction, not to flats. If a member defaults, the lawful course is recovery or auction — not a private allotment to the contractor’s family. The Court also made clear that long occupation can protect an allotment even when it was irregular at birth, which is why 701 and 702 stay where they are, while the empty eighth-floor flats are treated differently.

For Le Chateau and Shamrock, the immediate test is practical. The Sonimindes have six weeks to pay ₹2.5 crore. If they do, two unfinished flats on Shamrock’s eighth floor change hands after nearly three decades of litigation. If they do not, the “bizarre” allocation the High Court criticised will stand for those two flats as well.

Also Read: Bombay HC Orders Demolition of 14-Storey Illegal Building

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