Supreme Court of India· 21 April 2025
Can a party bound by a deed of dissolution providing for a lease in perpetuity in his favour object to that same condition being imposed in the certificate of deemed conveyance?
ARUNKUMAR H SHAH HUF v. AVON ARCADE PREMISES CO-OPERATIVE SOCIETY LIMITED & ORS.
2025 INSC 524 · CIVIL APPEAL NO.5377 OF 2025
Coram: Abhay S. Oka; Ujjal Bhuyan
Answer
No. Sub-clause (h) of Clause 8 of the deed of dissolution, signed by the Karta of the appellant HUF, itself provided that the co-operative society formed after construction would execute a lease in perpetuity in his favour at a yearly lease rent of Re.1. The deed being binding, no fault can be found with the competent authority imposing that very condition to protect his interest.
Headnote
Maharashtra Ownership Flats (Regulation of the Promotion of Construction, Sale, Management and Transfer) Act, 1963 — ss.5A, 11(3), 11(4), 11(5) — Registration Act, 1908 — Deemed conveyance — Competent authority — Summary procedure — Question of title — Writ jurisdiction —
Maharashtra Ownership Flats Act, 1963 — s.11(3) — Competent authority — Summary procedure; reasons must be recorded —
Held: Quasi-judicial powers are conferred on the competent authority, but proceedings under Section 11(3) are of a summary nature and cross-examination of the parties is absolutely prohibited. The competent authority must nevertheless record reasons while passing the final order. (¶19, 20)
Maharashtra Ownership Flats Act, 1963 — s.11(4) — Question of title — Civil suit remains open —
Held further: Following that summary procedure, the competent authority cannot conclusively and finally decide the question of title. Notwithstanding an order under sub-section (4) of Section 11, aggrieved parties can always maintain a civil suit for establishing their rights. (¶20, 37)
Maharashtra Ownership Flats Act, 1963 — s.11(5) — Registration Act, 1908 — Registering officer's limited scope —
Held further: The registering officer is neither an appellate authority nor a revisional authority and cannot reopen the findings of the competent authority. He may refuse registration only for want of a statutory permission, a subsisting prohibitory order, or non-compliance with the procedural requirements under the Registration Act, 1908. (¶22, 23)
Maharashtra Ownership Flats Act, 1963 — s.11(4) — Beneficial legislation — Interference only if manifestly illegal —
Held further: The MOFA is a beneficial legislation enacted to protect home buyers, and the writ court should be slow to interfere with an order granting deemed conveyance unless it is manifestly illegal. The appellant's rights as a perpetual lessee having been protected, the appeal is dismissed. (¶35, 38)
In the Court's own words
Paragraph 29The first part of clause (h) provides for Lalbhai executing a conveyance in respect of the property as per the schedule to a co-operative society. The property described in the schedule is the larger plot. The reason for providing the execution of conveyance in favour of a co-operative society in respect of the larger plot is apparent. The larger plot bearing the plot No.61 was not subdivided into the Arun plot and the Lalbhai plot in the records. Therefore, Lalbhai and Arun agreed to share the FSI, which may be available in future, to the extent of 68% and 32% respectively. This is why this clause provides for the execution of a lease in respect of the Arun plot in favour of Arun by Lalbhai or a cooperative society formed after the construction of new buildings by Lalbhai. This is to protect the interests of the appellant. Admittedly, the deed of dissolution has been signed by Arun in his capacity as Karta of Arun Hiralal Shah HUF. Therefore, the deed of dissolution and the aforesaid clause are binding on the present appellant.
Paragraph 34In view of the fact that sub-clause (h) of Clause 8 of the deed of dissolution is binding, the appellant cannot object to the condition of the first respondent executing a lease incorporated in the certificate. Sub-clause (h) itself provides for the Society of the flat purchasers after the construction of the building by Lalbhai executing a lease in favour of the appellant for yearly lease rent of Re.1. To protect the appellant's interest, the impugned order of the competent authority dated 18th September 2020 and the certificate provide for the execution of a permanent lease in favour of the appellant. Thus, there will be a perpetual lease executed by the first respondent in favour of the appellant or its nominees in terms of sub-clause (h) of Clause 8 of the deed of dissolution and in terms of the lease deed dated 16th July 1991 at the instance of the appellant, no fault can be found with the order of the competent authority.
Acts & Sections
s.11(3) Maharashtra Ownership Flats (Regulation of the Promotion of Construction, Sale, Management and Transfer) Act, 1963s.11(4) Maharashtra Ownership Flats (Regulation of the Promotion of Construction, Sale, Management and Transfer) Act, 1963s.11(5) Maharashtra Ownership Flats (Regulation of the Promotion of Construction, Sale, Management and Transfer) Act, 1963s.5A Maharashtra Ownership Flats (Regulation of the Promotion of Construction, Sale, Management and Transfer) Act, 1963s.4 Maharashtra Ownership Flats (Regulation of the Promotion of Construction, Sale, Management and Transfer) Act, 1963s.10 Maharashtra Ownership Flats (Regulation of the Promotion of Construction, Sale, Management and Transfer) Act, 1963s.2(c) Maharashtra Ownership Flats (Regulation of the Promotion of Construction, Sale, Management and Transfer) Act, 1963r.13 Maharashtra Ownership Flats (Regulation of the Promotion of Construction, Sale, Management and Transfer) Rules, 1964Registration Act, 1908One judgment a day. That's the whole habit.
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