The Plot, the Builder, and the Buildings

The dispute centres on a large plot of land in Vile Parle, admeasuring 21,736 square metres, bearing CTS No. 69/6 (PT) and CTS No. 35 of Village Vile Parle. The developer, Kiran Builders Pvt. Ltd., undertook phased construction on this land over several decades, eventually completing twelve buildings — numbered A to H, J, K, L, and M.

The flat buyers of the first ten buildings (A to H, J and K) formed Kalpita Enclave Co-operative Housing Society Ltd. (Respondent No. 1). When buildings L and M were subsequently completed and their occupancy certificates issued in November 1990, their residents formed two separate societies — Kalpita Enclave Building No. L CHSL (Respondent No. 2) and Kalpita Enclave Building No. M CHSL (Respondent No. 3).

All three societies wanted what the law entitled them to: conveyance of the land on which their buildings stood.

Four Decades of Dispute

The conflict between the builder and the societies did not begin in 2017. It stretches back to 1985.

When Kiran Builders proposed constructing four additional buildings — L, M, N, and P — on the plot by utilising FSI flowing from land surrendered for a 44-feet Development Plan road, Respondent No. 1 Society was opposed. It filed S.C. Suit No. 3226 of 1985 before the City Civil Court, Bombay, seeking conveyance of the entire land of 21,736 sq. mtrs in its favour and effectively challenging the developer’s expansion plans.

During the pendency of that suit, Kiran Builders succeeded in constructing buildings L and M, which received their occupancy certificates in November 1990. The City Civil Court, taking note of this changed reality, passed a decree on November 7, 1997, directing conveyance of only the land appurtenant to buildings A to H, J and K in favour of Respondent No. 1 Society. The prayer for conveyance of the entire land was not granted.

Respondent No. 1 Society challenged this decree before the Bombay High Court in First Appeal No. 1091 of 2000. That appeal remained pending for sixteen years.

By 2016, the picture had changed further. Two more societies had formed in buildings L and M. Respondent No. 1 Society reconsidered its approach — rather than fighting for the entire land solely for itself and excluding the other two societies, it chose to join hands with Respondent Nos. 2 and 3 and seek joint conveyance of the entire land. On September 16, 2016, Respondent No. 1 withdrew First Appeal No. 1091 of 2000, expressly stating its intention to apply for deemed conveyance. All three societies then filed a joint application under Section 11(3) of MOFA before the District Deputy Registrar, Co-operative Societies-3, Mumbai, who also functions as the Competent Authority under MOFA.

On May 15, 2017, the Competent Authority granted a certificate of unilateral deemed conveyance of the entire land admeasuring 21,736 sq. mtrs in favour of the three societies.

Kiran Builders challenged this order before the Bombay High Court in Writ Petition No. 9694 of 2017. The High Court admitted the petition in March 2024 and stayed the operation of the deemed conveyance order pending final hearing. The petition was finally decided on June 18, 2026.

The Three Grounds Raised by the Builder

Kiran Builders raised three principal grounds to challenge and resist the deemed conveyance order.

Ground One: The 1997 Civil Court Decree

The builder’s first argument was that the decree dated November 7, 1997 passed by the City Civil Court had attained finality — since Respondent No. 1’s First Appeal was withdrawn — and that this decree, which directed conveyance of only the land appurtenant to buildings A to H, J and K, created a binding determination that could not be overridden by the Competent Authority under MOFA. The builder contended that the Competent Authority had no jurisdiction to pass an order contrary to what the Civil Court had already decided.

The court rejected this argument. Justice Sandeep V. Marne held that the 1985 suit was filed in an entirely different context — at a time when only buildings A to H, J and K existed and Respondent Nos. 2 and 3 had not yet been formed. The 1997 decree accordingly directed conveyance of only the land appurtenant to those buildings, since buildings L and M had come up during the pendency of the suit and the court had to accommodate that reality. Respondent Nos. 2 and 3 were not parties to the suit or to the First Appeal. A decision on land entitlement could not have been effectively rendered without hearing them.

The court held that it is always open to a party to withdraw a conveyance suit and file an application for deemed conveyance instead. Legislature had consciously provided this faster remedy under amended MOFA. Since the suit itself could have been withdrawn with liberty to seek deemed conveyance, the same course was equally available during pendency of the appeal. The objection of res judicata was also repelled since the appeal was withdrawn expressly for the purpose of filing a deemed conveyance application — not as an abandonment of the claim.

Ground Two: Reserved and Surrendered Land

The builder’s second argument was that the Competent Authority had erred in conveying the entire land of 21,736 sq. mtrs, since portions of that land had already been surrendered for a DP road or were reserved in the Development Plan for a municipal market and a primary school. These portions, the builder argued, could not legally be conveyed to the societies.

On this ground, the court agreed with the builder — but only partially, and the societies themselves conceded the point. Respondent Nos. 1 to 3 voluntarily offered to exclude not just the three portions flagged by the builder, but two additional ones: land admeasuring 123.12 sq. mtrs taken over by MCGM in 2001 for widening of Sahar Road, and land admeasuring 2,328.41 sq. mtrs encroached upon by slum dwellers and lying outside the societies’ compound wall.

The total deductions worked out to 4,711.65 sq. mtrs, reducing the conveyance area to 16,584.55 sq. mtrs. The court accepted this and held that the Competent Authority had committed an error in directing conveyance of the full 21,736 sq. mtrs — an error that needed correction.

Ground Three: Future Construction of Buildings N and P

This was the builder’s most ambitious argument, and the one the court dealt with most firmly.

Kiran Builders contended that it retained the right to construct two more buildings — N and P — on the plot, on the basis of plans sanctioned in 1983. It argued that conveyance could not be granted until the entire layout development was complete, and that even the 16,584.55 sq. mtrs sought by the societies could not be conveyed since Buildings N and P would come up on that land.

The court traced the history of this claim carefully. The construction of buildings N and P was always premised on the builder’s belief that the land surrendered for the DP road measured 2,200 sq. mtrs — which would have generated sufficient FSI for four additional buildings, L, M, N, and P. However, when the actual area surrendered was determined to be only 1,859 sq. mtrs, the FSI available was reduced, allowing construction of only buildings L and M. Buildings N and P could not be built.

Critically, this was not a recent discovery. MCGM had communicated this position to Kiran Builders in a letter dated April 23, 1991 — over three decades ago — explicitly stating that there was no balance FSI in lieu of the DP road and that construction of buildings N and P was not possible.

Faced with this, the builder advanced a novel argument: that it expected to receive development rights — possibly in the form of Transferable Development Rights (TDR) — when the lands reserved for the municipal market and primary school were eventually acquired by the Municipal Corporation, and that it intended to use those rights to construct buildings N and P.

The court called this argument “preposterous to the core” and dismantled it on six grounds. First, there is no certainty that the Planning Authority will ever acquire those reserved lands — if they are not acquired within the stipulated period, the land owner can invoke Section 127 of the Maharashtra Regional and Town Planning Act, 1966 and have the reservations lifted. Second, if the lands are acquired, the builder’s entitlement is to compensation — monetary or through TDR. Third, TDR, if issued through a Development Rights Certificate, is freely tradable and can be used in any other project or sold in the market — there is no obligation to use it on the subject land. Fourth, the builder retains ownership of the slum land, which can be independently redeveloped using any TDR received. Fifth, and as the court underlined most importantly, compensation received for acquired land — whether monetary or in TDR form — cannot be treated as a development potential for the land being conveyed to the societies. Once land is acquired, it is separated from the layout entirely. Sixth, the acquisitions have not happened yet, and cooperative of neighbouring landowners required for the process is absent — making the entire premise even more uncertain.

The court also invoked the settled legal position established by the Division Bench of the Bombay High Court in Lakeview Developers vs. Eternia Co-operative Housing Society Ltd. (2015), which held that a developer cannot exploit building potential for eternity without conveying land to the society. Once the full development potential is exhausted and the obligation to convey has arisen, any future FSI or TDR that may become available cannot be used to justify withholding conveyance. This principle was reiterated in Rajkumar Gulati and Ors. vs. S.D. Corporation Pvt. Ltd. and Ors. (2025).

The Court’s Order

Justice Marne held that the Competent Authority was fully justified in exercising jurisdiction under Section 11 of MOFA and granting deemed conveyance. The petition by Kiran Builders was partly allowed — but only to the extent of correcting the area of land to be conveyed.

The order dated May 15, 2017 passed by the Competent Authority, along with the certificate of unilateral deemed conveyance issued in pursuance thereof, was set aside. The matter was remanded to the Competent Authority with a direction to issue a fresh certificate of unilateral deemed conveyance in respect of land admeasuring 16,584.55 sq. mtrs in favour of the three societies — within three months. Parties were directed to appear before the Competent Authority on June 24, 2026.

The occupancy certificates for the buildings of Respondent No. 1 Society were issued in the 1970s. Those of Respondent Nos. 2 and 3 followed in November 1990. The court noted that the builder had already delayed performance of its statutory obligation for an extraordinary length of time. No costs were awarded.

Also Read: Stuck With Deemed Conveyance? Maharashtra Govt Launches Statewide 4-Day Camp for Housing Societies

The post Deemed Conveyance Cannot Be Held Hostage By Builder to Future FSI appeared first on Square Feat India.

For years, thousands of flat buyers across India have lived in a peculiar legal limbo — they own their apartments, they pay their maintenance, their cooperative housing society is registered and functioning, and yet the land their building stands on remains in the name of the builder. The reason given, almost always, is that some other wing or tower in the same large layout is still under construction, and the builder insists that conveyance of land will happen only once everything is done. A Supreme Court bench of Justice P.S. Narasimha and Justice Alok Aradhe has now firmly shut the door on that argument.

On April 10, 2026, the Supreme Court dismissed the Special Leave Petition filed by M/s Mahanagar Realty, a Pune-based developer, against a Bombay High Court judgment delivered in February 2026. In doing so, it has affirmed a ruling that carries consequences far beyond the plot of land in Dhankawadi, Pune that sparked the original dispute. The judgment establishes, with the Supreme Court’s seal of approval, that a completed housing society is entitled to its proportionate share of land under the provisions of the Maharashtra Ownership Flats Act, 1963 (MOFA) — regardless of whether the builder has finished constructing other buildings in the same layout.

How It All Began

The story begins in the early 2010s, when Mahanagar Realty proposed a large residential development on a 22,609 square metre plot on Pune-Satara Road in Dhankawadi. The project was to consist of four wings — A, B, C, and D — forming three independent sub-projects. Wings A and B were clubbed together as “Ganga Ishanya AB,” Wing C was a separate project called “Ganga Ishanya C,” and Wing D was envisioned under the name “Ganga Nakshatra.”

Flat buyers began signing agreements from 2011 onwards. Over the next several years, construction of Wings A, B, and C was completed. The occupancy certificate for Wings A and B came through in September 2018, and for Wing C in June 2021. Two separate co-operative housing societies were duly registered — one for Wings A and B, and another for Wing C. Members moved in, the buildings were fully functional, and yet no conveyance of land was executed by the developer in favour of either society.

2011

Original layout sanctioned for Wings A, B, C and a small ground+one floor Wing D. Flat purchase agreements begin.

2017–2022

Developer repeatedly revises sanctioned plans. Wing D is quietly expanded from a small commercial structure to a proposed 26-floor, 203-unit residential tower — without flat buyers’ explicit consent.

Sept 2018 & June 2021

Occupancy certificates issued for Wings A&B and Wing C respectively. Two co-operative housing societies registered. Land conveyance still not executed by developer.

2023

Both housing societies file Application No. 167 of 2023 before the District Deputy Registrar under Section 11 of MOFA, seeking deemed conveyance of their proportionate land share.

November 17, 2023

Competent Authority grants deemed conveyance — 11,890.53 sq.m. to Ganga Ishanya AB and 4,174.39 sq.m. to Ganga Ishanya C, calculated proportionately based on the 2018 sanctioned plan.

February 23, 2026

Bombay High Court (Justice Sharmila U. Deshmukh) dismisses Mahanagar Realty’s writ petition, fully upholding the Competent Authority’s order.

April 10, 2026

Supreme Court dismisses Special Leave Petition. The societies’ land rights are now final and binding.

The Developer’s Objections

Mahanagar Realty’s opposition to the conveyance was not a blanket refusal — the developer acknowledged that some land had to be conveyed. The dispute was about how much. The developer produced an architect’s certificate showing smaller land entitlements for the two societies, which would have left a larger portion available for the under-construction Wing D. The developer argued that the competent authority had conveyed more land than the societies were entitled to, and that this made it practically impossible to complete Wing D as per the building permissions already granted.

The developer also leaned on a contractual clause present in some flat purchase agreements, which stated that conveyance would be executed to an apex society — comprising all three sub-projects — only after the last building in the entire layout was completed. In essence, the argument was: wait for Wing D to finish, and then everything will be conveyed together. The developer further contended that without a formal architect’s certificate placed before the competent authority, there was no proper basis for the area calculation.

What the Courts Found

The Bombay High Court was unimpressed by each of these arguments. On the question of the architect’s certificate, Justice Deshmukh noted that the calculation was straightforward arithmetic — the constructed built-up area of each wing as a proportion of total permissible FSI, multiplied by the total plot area, as directed by a Government Resolution of June 22, 2018. The sanctioned plan of 2018 was already on record and the built-up areas were undisputed. No separate architect’s certificate was needed for a calculation of this nature.

The architect’s certificate the developer sought to rely on was, in any event, disqualified on multiple grounds — it had been produced before the High Court for the first time (never placed before the competent authority), it was based on a revised 2022 sanctioned plan rather than the 2018 plan, and it came with a disclaimer that its figures were subject to a pending decision before the Pune Municipal Corporation. The court declined to place any reliance on it.

A builder cannot use the unfinished portion of a layout as a shield to indefinitely delay handing over land rights to residents whose buildings are long completed.

On the contractual clause requiring conveyance only after the apex society is formed, the High Court cited a coordinate bench ruling in Lok Housing & Construction Ltd vs State of Maharashtra, which had held that such clauses directly conflict with Rule 9 of the MOFA Rules. The law does not permit a developer to tie conveyance to an indeterminate future event — the completion of another building — no matter what the agreement says. A contractual term cannot override a statutory right.

The court went further and addressed what it found to be the real motive behind the developer’s resistance. Over the years, Mahanagar Realty had progressively revised the sanctioned plan for Wing D — from a modest ground-plus-one commercial structure envisioned in the 2011 plans to a 26-floor, 203-unit residential tower. To fund this enhanced construction, the developer had been loading additional Transfer of Development Rights (TDR). The mathematical consequence of loading more TDR is that the proportionate share of already-completed buildings in the total plot area gets diluted. By opposing the area conveyed to the two societies, the court found, the developer was effectively asking the flat buyers of Wings A, B, and C to subsidise the enhanced construction of Wing D with their own land entitlement.

The Supreme Court, on April 10, 2026, saw no reason to interfere with this reasoning. The petition was dismissed without qualification.

What This Means for Flat Owners Across India

The immediate effect of this ruling is concrete and clear for the residents of Ganga Ishanya — their land is now theirs, legally and finally, without any further obstacle. But the significance of this judgment reaches well beyond one housing complex in Pune.

What This Ruling Means for You — If You Live in a Large Layout

• If your building is complete and your co-operative housing society is registered, you are entitled to seek deemed conveyance of your proportionate land share — even if other wings or towers in the layout are still being built.
• A builder cannot use the “wait for the apex society” or “wait for the last building” argument to delay your land rights indefinitely. Such clauses in sale agreements have been held to conflict with MOFA Rules.
• The proportionate area you are entitled to is calculated based on the sanctioned plan at the time your building was completed — the developer cannot dilute your share by loading additional TDR for other under-construction wings.
• You do not need to wait for the developer to voluntarily execute the conveyance deed. Section 11 of MOFA allows your society to approach the Competent Authority (District Deputy Registrar) directly for deemed conveyance.
• The Government Resolution of June 22, 2018 provides a clear formula for calculating proportionate land area in multi-building layouts. Competent authorities are bound to follow it.

India’s real estate landscape is full of large township projects and multi-tower layouts where some buildings have been completed and occupied for years while other phases remain under construction. In many of these cases, flat buyers have received their homes but not the land beneath them. Developers have routinely cited the ongoing construction in other phases as a reason to defer conveyance. This judgment categorically rejects that position.

The ruling also sends a pointed message about TDR manipulation. Where a developer seeks to enhance construction in an unfinished wing by loading additional development rights, courts will not allow this to come at the cost of residents in already-completed buildings. The FSI and TDR position as it stood when a building was completed will be the basis for calculating that building’s land entitlement — it cannot be retroactively diluted.

For housing societies considering action against their developers, this judgment provides a clear and well-reasoned legal foundation. The path to the Competent Authority under Section 11 of MOFA is open, the formula for calculation is settled, and the Supreme Court has now confirmed that no contractual sleight of hand can take away what the law guarantees.

As for Mahanagar Realty, the developer retains the remaining land and is free to continue constructing Wing D. But if the developer wishes to claim additional TDR benefits for an expanded Wing D, the High Court has made clear that the appropriate forum is a civil court — not a proceeding that compromises the land rights of the residents next door.

The post Landmark Verdict: Housing Societies Need Not Wait for Builder to Complete Entire Project to Claim Their Land, Rules Supreme Court appeared first on Square Feat India.

A recent Bombay High Court judgment in Velantine Properties Private Limited vs. State of Maharashtra and Ors. (Writ Petition (L) No. 35377 of 2025, pronounced on December 23, 2025) serves as a compelling case study. This ruling highlights the delicate balance between protecting developers’ contractual rights and ensuring timely conveyance of property to housing societies. Let’s delve into what residual rights entail, using this case to illustrate their real-world implications for homebuyers.

Understanding Developer’s Residual Rights

In large-scale real estate projects, developers often acquire land and secure approvals for layouts that span multiple buildings or phases. Residual rights typically include:

• Unused FSI and TDR: FSI determines how much built-up area can be constructed on a plot. TDR allows developers to transfer development potential from one site to another. If not fully utilized in initial phases, developers can retain these for future expansions.
• Retained Land Portions: Agreements with buyers may explicitly reserve small parcels (e.g., for amenities or additional structures) to the developer, preventing immediate full conveyance.
• Phased Development Clauses: Contracts under MOFA often stipulate that conveyance (transfer of title) occurs only after the entire project is complete, allowing developers flexibility in evolving plans.

These rights are rooted in agreements executed under Section 4 of MOFA, which mandates that conveyances align with buyer-developer contracts. However, they must comply with statutory timelines and government resolutions, such as the Maharashtra Government’s Resolution dated June 22, 2018, which guides deemed conveyances in multi-building layouts.

While residual rights enable efficient urban development and prevent underutilization of land, they can frustrate homebuyers who seek clear title to their properties sooner. Delays in conveyance can affect resale value, access to loans, or even basic society management.

Case Study: The Velantine Properties Dispute

The Velantine Properties case revolves around a 27,116.30 sq. mtr. plot in Mumbai, subdivided into plots A through G for multi-storied buildings. Sub-Plot A (6,536.30 sq. mtrs.) housed buildings for three co-operative societies, including Respondent No. 3 (comprising Wings A, B, C, and F of Building A-2).

• The Developer’s Stance: Velantine Properties, the promoter, argued that agreements with flat buyers (e.g., a sample dated July 31, 1999) reserved rights to develop residual areas using TDR. Specifically, they claimed entitlement to retain 146 sq. mtrs. for future construction. They offered a draft joint conveyance in February 2025, covering 43.21% of the land for Respondent No. 3, but insisted on limiting it to plinth and appurtenant areas as per the 2018 Government Resolution (Clause B(2)), given TDR usage.
• The Society’s Application: Registered in 2004, Respondent No. 3 demanded conveyance in 2025, citing developer delays. They filed for unilateral deemed conveyance under Section 11 of MOFA, seeking 3,215.19 sq. mtrs. (49.19% based on built-up area, including 5% amenity space). The District Deputy Registrar granted this on October 16, 2025, rejecting the retention claim for lack of evidence.
• High Court’s Intervention: Justice Firdosh P. Pooniwalla quashed the order, remanding it for fresh consideration. Key reasons:
  • Contractual recitals supported the developer’s retention of 146 sq. mtrs. for phased development.
  • The 2018 Resolution mandates conveyance based on plinth/appurtenant areas in TDR-utilized layouts (Clause B(2)).
  • In multi-society setups where only one applies (as here), an independent architect from the authority’s panel must measure the land (Clause B(3)) to resolve disputes fairly.
  • Clauses postponing conveyance until “full development” are invalid, overriding developer arguments of prematurity (citing Lok Housing and Construction Limited vs. State of Maharashtra, 2025).

The court emphasized that deemed conveyance must align with MOFA agreements and cannot exceed what the developer agreed to convey. It stayed its order for six weeks, preventing immediate registration.

This ruling underscores that while developers cannot indefinitely delay conveyance (statutory four-month timeline under MOFA Rule 9 applies), their residual rights— if clearly reserved—must be verified independently to avoid prejudice.

How Residual Rights Impact Homebuyers

For homebuyers, residual rights can be a double-edged sword:

• Positive Aspects: They enable larger, phased projects with better amenities, potentially increasing property value over time. In the Velantine case, retained land could lead to additional facilities benefiting all societies.
• Challenges and Risks:
  • Delays in Ownership Transfer: Buyers may wait years for full title, as seen here where conveyance was demanded two decades after society registration. This can hinder society autonomy, like managing common areas or securing redevelopment.
  • Disputes Over Area: Without independent verification, societies might receive less than entitled, or developers could over-retain, leading to litigation. The court’s remand highlights how discrepancies (built-up vs. plinth area) fuel conflicts.
  • Financial Implications: Uncertain title affects mortgage approvals, resale, or insurance. In Mumbai’s competitive market, such delays can erode buyer confidence.
  • Legal Recourse: MOFA empowers buyers via deemed conveyance, but as this case shows, courts will protect developer rights if substantiated, potentially prolonging resolutions.

Homebuyers should scrutinize agreements for residual clauses, insist on clear timelines, and form societies early to invoke MOFA protections.

Broader Implications for Real Estate

This judgment reinforces MOFA’s buyer-centric ethos while safeguarding developers’ investments in phased projects. It aligns with precedents like M/s. S & M Enterprises vs. The Palazzo Building No. 1 CHSL (2022), limiting conveyance to proportionate shares in incomplete layouts, and M/s. ACME Enterprises vs. Deputy Registrar (2023), clarifying that title disputes belong in civil suits, not summary proceedings.

For the industry, it signals the need for transparent contracts and adherence to government guidelines. Regulators might push for stricter enforcement of independent assessments to minimize disputes.

In conclusion, developer’s residual rights are essential for sustainable urban growth but must not undermine homebuyers’ security. The Velantine Properties case exemplifies how courts are striking this balance, ensuring fairness through evidence-based, impartial processes. As Mumbai’s skyline evolves, informed buyers and ethical developers will be key to harmonious real estate ecosystems.

Also Read: MahaRERA asks Developers to mediate with Developers of lapsed housing projects

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