In a significant judgment likely to influence hundreds of ongoing redevelopment projects across Mumbai, the Maharashtra Real Estate Appellate Tribunal (MREAT) has ruled that a housing society cannot be treated as a “promoter” under the Real Estate (Regulation and Development) Act, 2016 (RERA) merely because it initiated redevelopment of its property.
The ruling came in Samaj Kalyan Co-operative Housing Society Ltd. vs. Santosh Sable & Ors., where MREAT quashed a MahaRERA order that had directed the society to share redevelopment details and progress reports with certain aggrieved members, holding that such directions were “legally untenable” as the society was not a promoter within the meaning of RERA.
Background: Members’ Apprehensions Over Redevelopment
The dispute stemmed from the Samaj Kalyan Co-operative Housing Society’s redevelopment plan for its aging building in Mumbai. The society had appointed a private developer under a redevelopment agreement approved by the general body.
However, a few members raised apprehensions that the redevelopment project had not been registered with MahaRERA, and that they were not being provided details of timelines, approvals, and construction progress. Citing the RERA mandate for transparency and disclosure, these members approached MahaRERA, contending that the society, being a signatory to the redevelopment agreement, was jointly responsible with the developer as a “promoter”.
In April 2024, MahaRERA partly accepted their plea, directing the society to share project information with the complainants. This order effectively treated the society as a co-promoter, prompting the society to challenge it before MREAT.
Tribunal’s Key Findings
The MREAT bench, presided over by Judicial Member Shriram R. Jagtap, carefully examined whether a housing society involved in redevelopment qualifies as a promoter under RERA.
The Tribunal noted that the society’s intent was not to commercially develop or sell flats but to reconstruct its old premises for existing members’ benefit. Hence, it could not be equated with a promoter who develops and markets real estate projects for profit.
“The Society neither sells flats nor derives profit from redevelopment; its role is limited to facilitating the process for its members. It, therefore, cannot be fastened with obligations meant for commercial promoters under RERA,” the order stated.
The Tribunal, therefore, stayed MahaRERA’s directions and allowed the society’s appeal, clarifying that such societies cannot be burdened with promoter-level compliance under RERA.
Implications for Redevelopment Projects
The decision brings much-needed relief to co-operative housing societies across Mumbai and Maharashtra that are undertaking redevelopment through appointed developers.
Legal experts believe it clarifies a recurring ambiguity — whether societies, when they sign redevelopment agreements or assist in obtaining permissions, become liable as promoters under RERA.
The ruling reiterates that RERA’s accountability framework applies primarily to developers who market and sell units to new purchasers, not to societies reconstructing their own homes.
Why It Matters
Mumbai has over 20,000 aging housing societies awaiting or undergoing redevelopment. Many of them have faced uncertainty over whether they need to register their projects under RERA or face penalties.
This MREAT order sets an important precedent that could streamline redevelopment processes while maintaining accountability on developers where due.
Also Read: MAhaRERA cancels registration of 49 projects
