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REPORTABLE

IN THE SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO. 7934 OF 2012 (Arising out of SLP(C) NO.  33471 of 2011)

Esha Ekta Apartments Co-operative  Housing Society Limited and others …Appellants

versus

Municipal Corporation of Mumbai and others                 …Respondents

WITH

CIVIL APPEAL NO. 7935 OF 2012 (Arising out of SLP(C) NO.  33601 of 2011)

CIVIL APPEAL NO. 7936 OF 2012 (Arising out of SLP(C) NO.  33940 of 2011

CIVIL APPEAL NO. 7937 OF 2012 (Arising out of SLP(C) NO.  35402 of 2011

CIVIL APPEAL NO. 7938 OF 2012 (Arising out of SLP(C) NO.  35324 of 2011

TRANSFERRED CASE (CIVIL) NO. 55 OF 2012

J U D G M E N T

G. S. Singhvi, J.

1. In last five decades, the provisions contained in various municipal  

laws  for  planned  development  of  the  areas  to  which  such  laws  are  

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applicable have been violated with impunity in all the cities, big or small,  

and  those  entrusted  with  the  task  of  ensuring  implementation  of  the  

master  plan,  etc.,  have  miserably  failed  to  perform their  duties.   It  is  

highly  regrettable  that  this  is  so  despite  the  fact  that  this  Court  has,  

keeping  in  view  the  imperatives  of  preserving  the  ecology  and  

environment  of  the  area  and  protecting  the  rights  of  the  citizens,  

repeatedly  cautioned  the  concerned  authorities  against  arbitrary  

regularization  of  illegal  constructions  by  way  of  compounding  and  

otherwise.  In Friends Colony Development Committee v. State of Orissa  

(2004)  8  SCC  733,  this  Court  examined  the  correctness  of  an  order  

passed by the Orissa High Court negating the appellant’s right to be heard  

in a petition filed by the builder who had raised the building in violation  

of the sanctioned plan.  While upholding the appellant’s plea, the two-

Judge Bench observed:

“………Builders violate with impunity the sanctioned building  plans and indulge in deviations much to the prejudice of the  planned development of the city and at the peril of the occu- pants of the premises constructed or of the inhabitants of the  city at large. Serious threat is posed to ecology and environment  and, at the same time, the infrastructure consisting of water sup- ply, sewerage and traffic movement facilities suffers unbearable  burden and is often thrown out of gear. Unwary purchasers in  search of roof over their heads and purchasing flats/apartments  from builders, find themselves having fallen prey and become  victims  to  the  designs  of  unscrupulous  builders.  The builder  conveniently walks away having pocketed the money leaving  behind the unfortunate occupants to face the music in the event  of  unauthorised  constructions  being detected  or  exposed  and  threatened with demolition. Though the local authorities have  

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the staff consisting of engineers and inspectors whose duty is to  keep a watch on building activities and to promptly stop the il- legal constructions or deviations coming up, they often fail in  discharging  their  duty.  Either  they  don't  act  or  do  not  act  promptly or do connive at such activities apparently for illegit- imate considerations. If such activities are to stop some strin- gent actions are required to be taken by ruthlessly demolishing  the illegal constructions and non-compoundable deviations. The  unwary  purchasers  who  shall  be  the  sufferers  must  be  ad- equately compensated by the builder. The arms of the law must  stretch to catch hold of such unscrupulous builders………….

The conduct of the builder in the present case deserves to be  noticed. He knew it fully well what was the permissible con- struction as per the sanctioned building plans and yet he not  only constructed additional built-up area on each floor but also  added an additional fifth floor on the building, and such a floor  was totally unauthorised. In spite of the disputes and litigation  pending he parted with his interest in the property and inducted  occupants on all the floors, including the additional one. Prob- ably  he  was  under  the  impression  that  he  would  be  able  to  either escape the clutches of the law or twist the arm of the law  by  some  manipulation.  This  impression  must  prove  to  be  wrong.

In all developed and developing countries there is emphasis on  planned development of cities which is sought to be achieved  by zoning, planning and regulating building construction activ- ity. Such planning, though highly complex, is a matter based on  scientific research, study and experience leading to rationalisa- tion of laws by way of legislative enactments and rules and reg- ulations framed thereunder. Zoning and planning do result in  hardship to individual property owners as their freedom to use  their property in the way they like, is subjected to regulation  and control. The private owners are to some extent prevented  from making the most profitable use of their property. But for  this reason alone the controlling regulations cannot be termed  as arbitrary or unreasonable. The private interest stands subor- dinated to the public good. It can be stated in a way that power  to plan development of city and to regulate the building activity  therein flows from the police power of the State. The exercise  of such governmental power is justified on account of it being  reasonably  necessary  for  the  public  health,  safety,  morals  or  general welfare and ecological considerations; though an unne-

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cessary or unreasonable intermeddling with the private owner- ship of the property may not be justified.  

The municipal laws regulating the building construction activity  may  provide  for  regulations  as  to  floor  area,  the  number  of  floors, the extent of height rise and the nature of use to which a  built-up property may be subjected in any particular area. The  individuals as property owners have to pay some price for se- curing peace, good order, dignity, protection and comfort and  safety of the community. Not only filth, stench and unhealthy  places have to be eliminated, but the layout helps in achieving  family values, youth values, seclusion and clean air to make the  locality a better place to live. Building regulations also help in  reduction or elimination of fire hazards, the avoidance of traffic  dangers and the lessening of prevention of traffic congestion in  the streets and roads. Zoning and building regulations are also  legitimised from the point of view of the control of community  development, the prevention of overcrowding of land, the fur- nishing of recreational facilities like parks and playgrounds and  the availability of adequate water, sewerage and other govern- mental or utility services.

Structural and lot area regulations authorise the municipal au- thorities to regulate and restrict the height, number of storeys  and other structures; the percentage of a plot that may be occu- pied; the size of yards, courts and open spaces; the density of  population; and the location and use of buildings and structures.  All these have in our view and do achieve the larger purpose of  the public health, safety or general welfare. So are front setback  provisions, average alignments and structural alterations. Any  violation of zoning and regulation laws takes the toll in terms of  public welfare and convenience being sacrificed apart from the  risk, inconvenience and hardship which is posed to the occu- pants of the building.

Though the municipal laws permit deviations from sanctioned  constructions being regularised by compounding but that is by  way of exception. Unfortunately, the exception, with the lapse  of time and frequent exercise of the discretionary power con- ferred by such exception, has become the rule. Only such devi- ations deserve to be condoned as are  bona fide or are attribut- able to some misunderstanding or are such deviations as where  the benefit gained by demolition would be far less than the dis- advantage suffered. Other than these, deliberate deviations do  

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not deserve to be condoned and compounded. Compounding of  deviations ought to be kept at a bare minimum.  The cases of  professional builders stand on a different footing from an indi- vidual constructing his own building. A professional builder is  supposed to understand the laws better and deviations by such  builders can safely be assumed to be deliberate and done with  the intention of earning profits and hence deserve to be dealt  with sternly so as to act as a deterrent for future. It is common  knowledge that the builders enter into underhand dealings. Be  that as it may, the State Governments should think of levying  heavy penalties on such builders and therefrom develop a wel- fare fund which can be utilised for compensating and rehabilit- ating such innocent or unwary buyers who are displaced on ac- count of demolition of illegal constructions.”

(emphasis supplied)

In Royal Paradise Hotel (P) Ltd. v. State of Haryana and Ors. (2006) 7 SCC   

597, this Court noted that the construction had been made in the teeth of no-

tices issued for stopping the unauthorized construction and held that no au-

thority  administering  municipal  laws  can  regularize  the  constructions  

made in violation of the Act.   Some of the observations made in that  

judgment are extracted below:  

“Whatever  it  be,  the  fact  remains  that  the  construction  was  made in the teeth of the notices and the directions to stop the  unauthorized construction. Thus, the predecessor of the appel- lant put up the offending construction in a controlled area in de- fiance of the provisions of law preventing such a construction  and in spite of notices and orders to stop the construction activ- ity. The constructions put up are thus illegal and unauthorized  and put up in defiance of law. The appellant is only an assignee  from the person who put up such a construction and his present  attempt is to defeat the statute and the statutory scheme of pro- tecting the sides of highways in the interest of general public  and moving traffic on such highways.  Therefore, this is a fit  case for refusal of interference by this Court against the deci- sion declining the regularization sought  for  by the appellant.  Such violations cannot be compounded and the prayer of the  

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appellant was rightly rejected by the authorities and the High  Court was correct in dismissing the Writ Petition filed by the  appellant.  It  is  time that  the message  goes  aboard that  those  who defy the law would not be permitted to reap the benefit of  their defiance of law and it is the duty of High Courts to ensure  that such definers of law are not rewarded. The High Court was  therefore fully justified in refusing to interfere in the matter.  The High Court was rightly conscious of its duty to ensure that  violators of law do not get away with it.

We also find no merit in the argument that regularization of the  acts of violation of the provisions of the Act ought to have been  permitted. No authority administering municipal laws and other  laws like the Act involved here, can encourage such violations.  Even otherwise, compounding is not to be done when the viola- tions are deliberate, designed, reckless or motivated. Marginal  or insignificant accidental violations unconsciously made after  trying to comply with all the requirements of the law can alone  qualify for regularization which is not the rule, but a rare excep- tion. The authorities and the High Court were hence right in re- fusing the request of the appellant.”

The aforesaid  observations  found their  echo  in  Shanti  Sports  Club  v.  

Union of India (2009) 15 SCC 705 in the following words:

“In the last four decades, almost all cities, big or small, have  seen  unplanned  growth.  In  the  21st  century,  the  menace  of  illegal and unauthorised constructions and encroachments has  acquired monstrous proportions and everyone has been paying  heavy  price  for  the  same.  Economically  affluent  people  and  those having support of the political and executive apparatus of  the  State  have  constructed  buildings,  commercial  complexes,  multiplexes, malls, etc. in blatant violation of the municipal and  town planning laws, master plans, zonal development plans and  even  the  sanctioned  building  plans.  In  most  of  the  cases  of  illegal  or  unauthorised  constructions,  the  officers  of  the  municipal and other regulatory bodies turn blind eye either due  to  the influence of  higher  functionaries  of  the State  or  other  extraneous reasons. Those who construct buildings in violation  of the relevant statutory provisions, master plan, etc. and those  who  directly  or  indirectly  abet  such  violations  are  totally  unmindful  of  the  grave  consequences  of  their  actions  and/or  

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omissions on the present as well as future generations of the  country which will  be forced to live in unplanned cities and  urban areas. The people belonging to this class do not realise  that the constructions made in violation of the relevant laws,  master plan or zonal development plan or sanctioned building  plan or the building is used for a purpose other than the one  specified in the relevant statute or the master plan, etc., such  constructions  put  unbearable  burden  on  the  public  facilities/amenities like water,  electricity, sewerage,  etc. apart  from creating chaos on the roads. The pollution caused due to  traffic  congestion  affects  the  health  of  the  road  users.  The  pedestrians  and  people  belonging  to  weaker  sections  of  the  society, who cannot afford the luxury of air-conditioned cars,  are  the  worst  victims  of  pollution.  They  suffer  from  skin  diseases  of  different  types,  asthma,  allergies  and  even  more  dreaded  diseases  like  cancer.  It  can  only  be  a  matter  of  imagination how much the Government  has to  spend on the  treatment of such persons and also for controlling pollution and  adverse impact on the environment due to traffic congestion on  the  roads  and  chaotic  conditions  created  due  to  illegal  and  unauthorised constructions. This Court has, from time to time,  taken  cognizance  of  buildings  constructed  in  violation  of  municipal and other laws and emphasised that no compromise  should be made with the town planning scheme and no relief  should be given to the violator of the town planning scheme,  etc.  on  the  ground  that  he  has  spent  substantial  amount  on  construction of the buildings, etc.

Unfortunately, despite repeated judgments by this Court and the  High Courts, the builders and other affluent people engaged in  the  construction  activities,  who  have,  over  the  years  shown  scant  respect  for  regulatory  mechanism  envisaged  in  the  municipal  and  other  similar  laws,  as  also  the  master  plans,  zonal development plans, sanctioned plans, etc., have received  encouragement and support from the State apparatus. As and  when the Courts have passed orders or the officers of local and  other  bodies  have  taken  action  for  ensuring  rigorous  compliance with laws relating to planned development of the  cities and urban areas and issued directions for demolition of  the  illegal/unauthorised  constructions,  those  in  power  have  come  forward  to  protect  the  wrongdoers  either  by  issuing  administrative  orders  or  enacting  laws  for  regularisation  of  illegal  and  unauthorised  constructions  in  the  name  of  compassion and hardship. Such actions have done irreparable  

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harm to the concept of planned development of the cities and  urban  areas.  It  is  high  time  that  the  executive  and  political  apparatus of the State take serious view of the menace of illegal  and  unauthorised  constructions  and  stop  their  support  to  the  lobbies of affluent class of builders and others, else even the  rural  areas  of  the  country  will  soon  witness  similar  chaotic  conditions.”

In Priyanka Estates International  Pvt.  Ltd. v. State of Assam (2010) 2  

SCC  27,  this  Court  declined  the  appellant’s  prayer  for  directing  the  

respondents to regularize the illegal construction and observed:

“It  is  a  matter  of  common  knowledge  that  illegal  and  unauthorised constructions beyond the sanctioned plans are on  rise, may be due to paucity of land in big cities. Such activities  are  required  to  be  dealt  with  by  firm  hands  otherwise  builders/colonisers would continue to build or construct beyond  the sanctioned and approved plans and would still go scot-free.  Ultimately, it is the flat owners who fall prey to such activities  as the ultimate desire of a common man is to have a shelter of  his own. Such unlawful constructions are definitely against the  public  interest  and  hazardous  to  the  safety  of  occupiers  and  residents  of  multistoreyed  buildings.  To  some  extent  both  parties can be said to be equally responsible for this. Still the  greater loss would be of those flat owners whose flats are to be  demolished as compared to the builder.”

A somewhat similar question was recently considered in Dipak Kumar  

Mukherjee  v.  Kolkata  Municipal  Corporation  and  others  (2012)  10  

SCALE 29. While setting aside the order of the Division Bench of the  

Calcutta High Court, this Court referred to the provisions of the Kolkata  

Municipal  Corporation  Act,  1980  in  the  context  of  construction  of  

additional floors in a residential building in violation of the sanctioned  

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plan and observed:

“What needs to be emphasised is that illegal and unauthorised  constructions of buildings and other structure not only violate  the municipal laws and the concept of planned development of  the  particular  area  but  also  affect  various  fundamental  and  constitutional rights of other persons.  The common man feels  cheated  when  he  finds  that  those  making  illegal  and  unauthorised  constructions  are  supported  by  the  people  entrusted  with  the  duty  of  preparing  and  executing  master  plan/development plan/zonal plan.  The reports of demolition of  hutments  and  jhuggi  jhopris  belonging  to  poor  and  disadvantaged section of  the society frequently appear in the  print media but one seldom gets to read about demolition of  illegally/unauthorisedly  constructed  multi-storied  structure  raised by economically affluent people.  The failure of the State  apparatus  to  take  prompt  action  to  demolish  such  illegal  constructions has convinced the citizens that planning laws are  enforced only against poor and all compromises are made by  the State machinery when it is required to deal with those who  have money power or unholy nexus with the power corridors.”   

2. We have prefaced disposal of these matters by taking cognizance  

of the observations made in the aforementioned judgments because the  

main question which arises for our consideration is whether the orders  

passed  by  Deputy  Chief  Engineer,  Building  Proposals  (City)  of  the  

Mumbai Municipal Corporation (hereinafter referred to as ‘the Deputy  

Chief Engineer’) and the Appellate Authority refusing to regularize the  

illegal constructions made on Plot No.9, Scheme 58, Worli, Mumbai are  

legally sustainable.

3. At the outset, we would like to observe that by rejecting the prayer  

for  regularization  of  the  floors  constructed  in  wanton violation of  the  

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sanctioned plan, the Deputy Chief Engineer and the Appellate Authority  

have demonstrated their determination to ensure planned development of  

the commercial capital of the country and the orders passed by them have  

given a hope to the law abiding citizens that someone in the hierarchy of  

administration  will  not  allow unscrupulous  developers/builders  to  take  

law into their hands and get away with it.   

4. The  Municipal  Corporation  of  Mumbai  (for  short,  ‘the  

Corporation’)  leased  out  the  plot  in  question,  of  which  land  use  was  

shown  in  the  development  plan  as  ‘General  Industrial’  to  M/s.  Pure  

Drinks (hereinafter referred to as, ‘the lessee’) in January, 1962.   The  

lessee constructed a factory and started manufacturing cold drinks under  

the brand name ‘Campa Cola’.  After about 16 years, the lessee engaged  

an architect for utilizing the land for construction of residential buildings.  

The  architect  made  an  application  under  Section  337  of  the  Mumbai  

Municipal Corporation Act, 1888 (for short, ‘the 1888 Act’) for sanction  

of plans of the proposed residential buildings.  The same was rejected by  

the Planning Authority vide order dated 31.7.1980 on the ground that the  

required NOCs had not been obtained and the Competent Authority had  

not given exemption under the Urban Land (Ceiling and Regulation) Act,  

1976.   Another  application made by the architect  was rejected by the  

Planning Authority on similar grounds.

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5. In view of the above development, the lessee made an application  

to the Corporation for change of land use from ‘General Industrial’ to  

‘Residential’.  The  latter  forwarded  the  same to  the  State  Government  

along with a proposal for modification of the development plan of the  

area.  The State Government accepted the proposal of the Corporation  

and  passed  an  order  dated  31.12.1980  under  Section  37(2)  of  the  

Maharashtra Regional and Town Planning Act, 1966 (for short, ‘the 1966  

Act’) in respect of 13049 sq. meters leaving the balance 4856 sq. meters  

for  industrial  use.  This  was  subject  to  the condition that  development  

shall be as per the Development Control Rules for Greater Mumbai, 1967  

(for  short,  ‘the  D.C.  Rules’)  and  other  relevant  statutory  provisions.  

Thereafter, the architect engaged by the lessee submitted revised plans for  

construction  of  residential  buildings.  The  Planning  Authority  granted  

approval  on  8.6.1981  for  construction  of  6  buildings  comprising  

basement, ground and 5 upper floors. The commencement certificate was  

issued  on  10.6.1981.  On  27.6.1981,  the  Additional  Collector  and  

Competent Authority granted permission under Section 22 of the Urban  

Land (Ceiling and Regulation) Act for demolition of the structure and  

redevelopment in accordance with the provisions of the D.C. Rules.  

6. On 12.8.1981, the lessee executed an Assignment  Agreement in  

favour of P.S.B. Construction Company Limited.  Paragraphs 10 and 11  

of that agreement read as under:

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“10. The Developer shall  construct  the said buildings on the  said sub-plot in accordance with the approved plan of the said  buildings  as  sanctioned  by  the  Corporation  and/or  in  accordance  with modifications  and/or  amendments  thereto as  may be sanctioned by the Corporation on the application in that  behalf  being  made  by  the  Owner  at  the  instance  of  the  Developer.

11. The Developer shall also construct the said building on the  said sub-plot in accordance with and subject to the conditions  stipulated in the letter of Intent dated 27th May 1981 made by  the  Additional  Collector  and Competent  Authority  under  the  ULC Act or such modifications and/or amendments thereto as  may be sanctioned by the Additional Collector and Competent  Authority on the application in that behalf being made by the  Owner at the instance of the Developer and the sanction under  Section 22 under the ULC Act, to be obtained by the Owner  after compliance with the conditions in the said Letter of Intent  or  any modifications and/or amendments thereto as  aforesaid  and the development control rules of the Corporation and such  other rules and regulations as are applicable”.

Simultaneously, an irrevocable Power of Attorney was executed by  

the lessee in favour of the developer, i.e., P.S.B. Construction Company  

Limited.

7. Similar agreements were executed by the lessee on 20.8.1981 in  

favour of Mohamed Yusuf Patel son of Abdulla Patel and Mohinuddin  

son of Tayab Soni. On 16.6.1982, P.S.B. Construction Company Limited  

entered  into  an  agreement  with  S/Shri  B.K.  Gupta,  Manmohansingh  

Bhasin  and  Mohamed  Yusuf  Abdullah  Patel  appointing  the  latter  as  

promoters of the builders and authorised them to develop one portion of  

the plot by demolishing the existing structures and constructing building  

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Nos. 1, 3 and 8 in accordance with the sanctioned plan.  

8. The architect, who was initially engaged by the lessee, continued to  

work on behalf of the developers/builders and promoters. The amended  

plans submitted by him for construction of 9 buildings with ground and 5  

upper floors were also approved vide order dated 2.2.1983.  

9. In 1983, the lessee secured permission from the Chief Minister of  

the State to raise the height of the buildings up to 60 feet. However,  the  

revised plans submitted for construction of separate buildings comprising  

stilt and 24 upper floors; stilt and 16 upper floors with additional 6 th and  

7th floor on building No.2 and additional 6th floor on building No.3 were  

rejected by the Planning Authority vide order dated 6.9.1984.   

10. Notwithstanding  rejection  of  the  revised  building  plans,  the  

developers/builders  continued  to  construct  the  buildings.   Therefore,  

Executive Engineer, A.E. Division of the Corporation issued ‘stop work  

notice’ dated 12.11.1984 under Section 354A of the 1888 Act mentioning  

therein that if the needful is not done, the construction will be forcibly  

removed.  It is a different story that after issuing ‘stop work notice’, the  

authorities  of  the  Corporation  buckled  under  pressure  from  the  

developers/builders and turned blind eye to the illegal constructions made  

between  1984  and  1989.  For  the  sake  of  reference,  notice  dated  

12.11.1984 is reproduced below:

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“MUNICIPAL CORPORATION OF  GREATER BOMBAY

Notice under section 354A of the  Bombay Municipal  

Corporation Act 12.11.1984 No.EB/3347/A of 1981

To

Shri  Madanjit  Singh C.A.  Shri  Charanjit  Singh,  Pure Drinks  Pvt.  Ltd.,  Plot.  No.9  Worli  Scheme No.58 B.G.  Kher  Marg,  Worli Bombay-18.

Whereas the erection of a building work as described in section  342 of the above mentioned act is being unlawfully carried on  you at premises NO.C.S.No.868 and 1/868 of Worli situated at  plot No.9 Worli Scheme 58 B.G. Kher Marg Worli.  

And whereas under section 68 of the said Act the Municipal  Commissioner for greater Bombay has duly empowered me to  exercise the powers conferred upon him by section 354 A of the  said Act.  Now I  do hereby give you notice that  if,  after  the  expiration  24  hours  from the  service  hereof  upon  you,  it  is  found that the construction of said building work is still being  carried on by you, I shall, pursuant to section 354A of the said  Act and in exercise of the powers conferred on me as aforesaid,  direct  that  you be removed from the said-premises by police  officer.

Work being carried out beyond approved plan in as much as the  foundation work of sky scrapper is being lane site incharge plot  no.9.

B.G. Kher Marg Worli.  A.E. Division  Executive Engineer

B.P. (City) Bombay Municipal Corporation”

11. In the interregnum, the lessee and the developers/builders engaged  

a new architect, namely, Shri Jayant Tipnis.  He submitted another set of  

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plans  on  3.6.1985  proposing  7  new  buildings  and  requested  for  

withdrawal of stop work notice. The Planning Authority rejected the new  

plans  on  the  ground  that  the  construction  had  been  raised  in  gross  

violation  of  the  sanctioned  plan.   Thereupon,  Shri  Jayant  Tipnis  sent  

notice dated 9.8.1985 to the lessee that no work should continue till the  

amended  plans  are  sanctioned.  The  Executive  Engineer  of  the  

Corporation sent letter dated 28.9.1988 to Shri Jayant Tipnis with a copy  

to the lessee  and asked them to inform the developers/builders  not  to  

proceed with the work till the stop work notice was withdrawn. In turn,  

Shri Jayant Tipnis wrote to the developers/builders that they should not  

continue the construction. He also informed the Corporation about the  

intimation  sent  to  the  developers/builders  and  stated  that  despite  

intimation  they  had  illegally  and  unauthorisedly  carried  out  the  

construction work by utilizing excess Floor Space Index (FSI).  

12. In  1994,  Shri  Jayant  Tipnis  submitted  further  amended  plans  

prepared  by  M/s.  Designs  Consortium.  The  Deputy  Chief  Engineer  

rejected the new plans by recording the following reasons:

“(1) Advantage of lift, staircase lobby area claimed which is  not  admissible  as  per  the  prevailing  rules,  regulations  and  policy.

(2) Flower-beds are not counted in F.S.I.  As per then M.C.’s  order the same are to be counted in F.S.I. since they are at the  same floor level beyond balcony.  

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(3) Inadequate parking provisions.   

(4) Height of towers contravene D.C. Rule (9) provisions.  

(5) R.G. is not as per D.C. Rule.

(6) Plot area for the permissible F.S.I. shall be in accordance  with the change of user permitted by U.D. Deptt.’s order.”

13. On receipt of the letter of rejection, Shri Jayant Tipnis informed the  

lessee and the developers/builders that in view of the stop work notice,  

the construction could not have been made in violation of the sanctioned  

plan and the D.C. Rules.  This was incorporated by him in letter No.BC  

1414 (C)-91 dated 22.2.2002 sent  to the Executive Engineer,  Building  

Proposals (City-I),  the relevant portions of which are extracted below:

“Ref.No.BC 1414 (C)-91       22nd February, 2002

The Executive Engineer, Building Proposals (City-I), Municipal Corporation of Greater Mumbai, Byculla, Mumbai – 400 008.

Sub :  Violation  of  F.S.I.  at  Campa-cola  compound,  plot  No.9,  Worli  Scheme  No.58,  B.  G.  Kher  Marg,  Worli,  Mumbai – 400 018.

Dear Sir,

We thank for your letter  No.EB/3342/GS/A dated ‘nil’  personally handed over to us 21.2.2002.

Gist  of  how  file/project  moved  till  date  is  enclosed.  There  was  no  correspondence  since  the  last  several  years.  However,  there  used to  be some notice  or  letter  we used to  receive  from  a  few  members  and  correspondence  of  B.Y.Builders Pvt. Ltd.  We have time and again informed you  

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that  we  have  informed  all  the  developers/society  members,  managing  bodies  upto  what  level  the  plans  have  been  sanctioned,  what  was  the  stage  of  construction  they  have  carried out and to the developers of the project. After site visit  the summary report was worked out by the Corporation and it  was informed to owners M/s. Pure  Drinks Pvt. Ltd., copy of  which was sent to us.  However, how this file moved, summary  of  which is  enclosed which probably would  be useful  while  going through the  matter  and  would  also  be  clear  about  the  stand we have taken.

On a number of occasions we have informed you that all  the developers have been informed to stop the work in view of  the  stop  work  notice  and such  copies  have  been already  on  record.  The developers have almost vanished from the scene  and nobody is coming forward to take on the responsibility of  the  work  done  by  them  inspite  of  our  instructions  nor  the  owners  have  any  query.   To  sum  up  it  is  only  interested  parties/flat purchasers keep on running here and there for their  daily necessities and the matter is reopened after a lapse of few  years.   We  strongly  feel  that  this  is  a  gross  violation  of  Development Control Rules and since the year 1984 the stop  work  notice  is  on  record.   Action  under  MRTP  Act  was  initiated by you against the developers and the owners but we  do not know exactly what happened thereafter.

Sub:  Proposed  Development  at  Campa  Cola  Compound,  Plot No.9, Worli Scheme, B.G. Kher Marg, Worli, Mumbai- 400018.

1) to 5) xxx xxx xxx

6) By  our  letter  BC  1414  (B)-56  dated  05.01.1990  we  addressed to all the Developers stating that the STOP WORK  notice  issued  by the  Brihanmumbai  Mahanagarpalika  against  the subject  work was not  yet  withdrawn by them but  it  was  observed they continue to carry out the work of one way or  other nature of the proposed structure which was in violation of  the  directives  issued  by  EEBP  (City)  to  them,  for  which  responsibility solely rested with them.  We, therefore, instructed  them to stop the work being carried out by them on all fronts  forthwith  and  if  however,  they  continued  any  work  at  site  henceforth it would be entirely at their risk and consequences  and requested them to confirm to us in writing that the work  

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was stopped by them completely immediately on receipt of the  said letter.  Copy of the said letter was endorsed to EEBP (City)  to note the above instructions issued to the Developers.

7) xxx  xxx xxx        

8) In reply to letter dated 30.03.1992 addressed to the 4 De- velopers and copy endorsed to us by Campa cola Compound Res- idents Association, we clarified to them vide our letter No.BC 1414  (B) 6 dated 10.04.1992 bringing to their notice following facts.  

8 b) To the best of our knowledge there was no occupation permis- sion granted by Brihanmumbai Mahanagarpalika for any part of the  building except building No. 7A and B in any of the units covered  by the said proposal and therefore it was informed that they could  not  occupy the flats without OCC from the Corporation and re- quested them to vacate the flats occupied by them without delay  and to inform us accordingly.

9)  Esha Ekta Apartment Co-operative Housing Society Limited  addressed a letter dated 04.08.1994 to EEBP (City) and copy  endorsed  to  us  and  the  Director,  Engineering  Services  and  Projects  and  the  Municipal  Commissioner,  stating  that  they  were members occupying building No. 2 and requiring action  against Developers.

10a)  The  Developers  concerned  with  the  said  Development  were kept fully informed by us about the STOP WORK notice  issued on the proposal  on 24.11.1986 that no work could be  carried out at site. On the very same day of receipt of STOP  WORK notice on 24.11.1986 we instructed all the Developers  concerned to pay the penalty to BMC and also to stop the work  of  the  project  forthwith  otherwise  the  plans  would  not  be  processed  further  with  the  said  authority.  On  receipt  of  the  EEBP letter dated 02.06.1990, we have issued final instructions  to  the  Developers  /  Lessee  to  stop  the  work  on  the  project  forthwith and that the responsibility for such work carried out  but  not  cleared by the said authority  would be  on them We  further stated that we were not aware of any occupation already  obtained by Esha Ekta Apartment Cooperative Housing Society  and  therefore  we  did  not  undertake  any  responsibility  for  anything contrary to the plans submitted by us to EEBP (City)  Office, if found, carried out by the said Society through their  Developers.  We clarified that we had not been involved at all  

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by the said Developers and, therefore, did not agree with any of  their statement mentioned in the said letter.   

12) We have informed all  the 3 Developers vide our letter  No. BC 1414(B)-77 dated 25.11.1994 intimating that amended  plans were not approvable and requesting them to coordinate  with us for arranging a joint inventory of the premises and copy  of the said letter was endorsed to Dy.C.E. B.P. (City).”   

14.    It is borne out from the record that even before commencement of  

the construction,  some of  the developers/builders  executed agreements  

with the prospective buyers.   A copy of such an agreement signed on  

18.7.1985  between  P.S.B.  Construction  Company  Limited  and  Mrs.  

Manjula Devi, W/o Amar Chand and Amar Chand was placed before the  

Court  on 5.1.2012 by Shri Harish Salve, who had earlier  appeared on  

behalf of respondent No.4, to show that the buyers of the flat were aware  

that the revised plans submitted by the architect had not been approved by  

the Planning Authority till the signing of agreement. This is evinced from  

paragraphs (v), (w), (x) and (a-1) of the agreement, which are extracted  

below:  

“(v)    The  Builders  plan  to  demolish  the  present  structures  standing on the said Plot X and to put up a new multi-storeyed  buildings on the said Plot in accordance with the terms of the  said  Letter  of  intent  dated  27th  May  1981  of  the  Additional  Collector and Competent Authority or any modification thereof  may be made by him and the permission under Section 22 of the  U.L.C. Act that may be granted by him in pursuance thereof.

(w)   Building plans got prepared by the Builders for revising  the said plans sanctioned by the said corporation for putting up  such new multi-storeyed buildings on the said Plot X have been  submitted to the said Corporation for approval and sanction.

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(x)   The Purchaser has taken inspection of the documents of  title  relating  to  the  said  property, the  said  Notification  dated 25th December 1980, the said Letter of intent  dated 27th. May 1981, the said Agreements respectively  dated 12th August 1981, 20th August 1981, 1st September 1981  and 10th September 1981 and the said Power of Attorney dated  10th September 1981, and the said plans sanctioned by the said  Corporation and the revised plans, designs and specifications  prepared by the Builders’ Architects Messrs. B. K. Gupta and of  such other documents as are specified under the Maharashtra  Ownership Flats (Regulation of Construction, Management and  Transfer) Act, 1963 (which the Purchaser doth hereby confirm).  

(a-1)   The Purchaser has agreed to acquire from the  Builders  Flat/Shop  No.Two on  the  fifth  floor of the  Building No.Two and/or covered/open car parking space garage No.  NIL  in the compound (hereinafter referred to as ‘the said  Premises’) with full notice of the terms and conditions and  provisions contained in the documents referred to hereinabove  and subject to the terms and conditions hereinafter contained.”

15. Similar agreements were executed between the purchasers and the  

developers/builders. In each of the agreements it was mentioned that the  

developers/builders  had submitted  a  revised  plan  for  sanction  and the  

purchaser has taken inspection of the documents of title, etc.

16. After  executing  agreements  with  the  developers/builders,  the  

prospective buyers formed Cooperative Housing Societies, namely, Esha  

Ekta Apartments Cooperative Housing Society Limited, Patel Apartments  

Cooperative  Housing  Society  Limited,  Orchid  Cooperative  Housing  

Society Limited, B.Y. Apartments Cooperative Housing Society Limited,  

Midtown Apartments Cooperative Housing Society Limited and Shubh  

Apartment Cooperative Housing Society Limited (hereinafter referred to  

as ‘the housing societies’).

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17. Although  the  members  of  the  housing  societies  knew  that  the  

construction  had  been  raised  in  violation  of  the  sanctioned  plan  and  

permission for occupation of the buildings had not been issued by the  

Competent  Authority,  a  large  number  of  them  occupied  the  illegally  

constructed buildings.   After this, the housing societies started litigation  

in  one  form  or  the  other.  Midtown  Apartments  Cooperative  Housing  

Society Limited filed Writ Petition No.1141 of 1999 in the Bombay High  

Court for issue of a direction to the Corporation and its functionaries to  

supply water to the building occupied by its members. That petition was  

decided  by  the  Division  Bench  of  the  High  Court  vide  order  dated  

12.7.1999, which reads as under:

“1. The burning issue of non supply of water to the tenements is  now satisfactory resolved. We are not in a position to go into  the dispute between the Bombay Municipal Corporation and the  builder on the issues of FSI violation and the consequent non- granting of Occupation certificate. This is a matter where there  is  a  triangular  dispute  between  the  Petitioner-Society  the  Ist  Respondent-Bombay  Municipal  Corporation  and  the  4th  Respondent-builder.

2.  We give liberty to the parties to agitate  their  rights in an  appropriate  Court  of  law and obtain such reliefs  as  they are  entitled  to  in  law.  This  is  not  an  issue  which  can  be  satisfactorily resolved in a writ petition since there appear to be  several disputed facts.

3. The 1st Respondent BMC shall non dis-continue the water  supply of  the Petitioner-Society on the ground that  there are  outstanding arrears or disputes with the 4th Respondent-builder.

4. The 1st Respondent-BMC shall submit a copy of the bill for  water charges to the petitioner and shall accept payment from it,  

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if offered.

5. The 1st Respondent-BMC is at liberty in take such action as  is permissible in as against the Petitioner-Society and the 4th  Respondent-builder for recovery of arrears of all other charges  which are alleged to be due.

6. The petitioner and/or the 4th Respondent to comply with the  requisitions made by the 1st Respondent-BMC, as specified in  the Permission Form date 22.06.1990.

7. In view of the above directions, nothing further needs to be  done  in  the  matter  which  is  allowed  to  be  withdrawn  and  dismissed as such with liberty aforesaid.”

(Reproduced from the paper book)

18.  Thereafter, other housing societies filed Writ Petition Nos. 2402,  

2403, 2904, 2949 of 1999 and 1808 of 2000 for grant of similar relief.   

19. During  the  pendency  of  the  writ  petitions,  Shri  Jayant  Tipnis  

submitted  application  dated  22.2.2002  for  regularization  of  the  

unauthorized  construction  by  stating  that  9292.95  sq.  fts.  had  been  

consumed over and above the FSI granted for the project and this was  

done without his knowledge.  His proposal was rejected by the Deputy  

Chief Engineer vide order dated 7.7.2003, which reads as under:

“Dy. Ch. E.B.P. (C)/1627/ Gen Ben 7.7.03

MUNICIPAL CORPORATION OF GREATER MUMBAI No. EB/3342/GS/A

Shri Jayant C. Tipnis, Architect,

Sadguru Darshan, 1050, New Prabhadevi Road,

Mumbai-400 025.

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Sub: Proposed development of Plot No.9, Worli Scheme No.  53,  CTS  No.868,  1/868,  Worli  Division,  B.G.  Kher  Marg, Mumbai 400 018 Popularly known as Campa Cola  compound.

Ref: Your letter addressed to M.C. bearing No.BC-1414 (: 'C ) - 117 dated  02.06.2003

Sir,

By directions, this is to inform you that your request to exempt  the area of staircase, lift and lift lobby from F.S.I, computation  cannot be   acceded to, since  the   same   is   not in conformity  with the provisions of D.C. Regn. 35 (2)(c). Further, proposal  under reference was decided by the Corporation prior to coming  into force of D.C. Regn. 1991 and C.C. for the entire work was  issued on 08.09.82. The permissible F.S.I, has already been ex- hausted.

Yours faithfully,  Sd/-

Dy. Chief Engineer,  Building Proposals (City)”

20. Shri  Jayant  Tipnis  challenged  the  aforesaid  order  by  filing  an  

appeal  under  Section  47(1)  of  the  1966  Act  and  prayed  that  the  

Corporation be directed to reconsider the proposal under Development  

Control  Regulations  for  Greater  Mumbai,  1991  (for  short,  ‘the  1991  

Regulations’)  and  regularize  the  FSI  consumed  in  constructing  the  

buildings by charging premium.  The Chief Minister of the State, who  

was also in-charge of the Department of Urban Development, dismissed  

the appeal vide order dated 4.6.2010, the relevant portions of which are  

extracted below:  

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“The  statement  of  residential  buildings  approved  by  MCGM on the  above plot  under  reference along with  the progress of the work of the buildings constructed  is as under :-

Building  No.

Approval  details  as  plans dated 2.2.83

Present position

Building  No. 1

Basement + stilt  + 5  upper floors

No work carried out

Building  No.2

Basement  +  Ground  Floor (pt.) + Stilt (pt.) +  5 upper floor

Basement + Stilt + 7  upper  floors  +  8t h  upper floor (pt.)  

Building  No.3

Basement  + Stilt  (pt.)  +  Ground Floor (pt.  )  + 5  upper floors

Basement  +  Stilt  (pt.) + Ground Floor  (pt.  )  +  5  upper  floors  +  6  upper  floor (pt.)

Building  No.4

Basement  + Stilt  (pt.)  +  Ground Floor (pt.  )  + 5  upper floors

Basement  +  Ground  Floor  (pt.)  + 6 upper  floors + 7 upper floor  (pt.)

Building  No.5

Stilt  (pt)  +  Ground  Floor  (pt.  )  +  5  upper  floors

Stilt + 19 Upper floor  +  20t h  upper  floor  (pt)

Building  No.6

Stilt (pt) + Ground Floor  (pt) + 5 upper floors

Ground   Floor   + 17  upper floors

Building  No.7A

Stilt + 5 upper floors Stilt + 5 upper floors  + 6 upper floor (pt.)

Building  No.7B

Stilt + 5 upper floors Stilt + 6 upper floor

Building  No. 8

Stilt + 5 upper floors Work not carried out

    Accordingly, MCGM has initiated necessary action as per  

the provisions of ... M.C. Act. 1888 / MRTP Act, against the  Builder /  Developer and the same are ...  vigorously followed  and occupation permission has not been granted to any of the  building in the Campa Cola Compound till date.

Architect Shri Jayant Tipnis vide his letter dated 7.6.2002  No. BC / C-92 addressed to the Ex. Eng. (B.P.) City has stated  that roughly 9292.95 sq.ft. of area has been consumer over and  

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above the FSI granted to the said project and almost the area of  14148.22 sq.ft. has been consumed in the staircase lift and lift  lobby which if made available to the complex on payment of  premium, it is possible that the whole complex as is and as built  up  could  be  regularized  on  the  payment  of  concessional  penalty, as the builders who have developed this property are  not in developers and he can not be blamed and / or held re- sponsible for the same. Balance FSI from their remaining part  shall  not be utilized to regularize this unauthorized construc- tions. The unauthorized construction carried out by the Devel- oper is not as per the provisions of the Development Control  Regulations-1967. The MCGM has given the permission prior  to  1991.  Therefore,  Development  Control  Regulations,  1991  will not be applicable and accordingly, the unauthorized con- struction cannot be regularized. Hence, appeal may be rejected.

In this matter, Hon’ble High Court passed an order dated  17.03.2010. In this order, Hon’ble High Court gave directives  to the Minister (UDD) to hear and dispose off the appeal under  Section 47 filed by the applicant within 12 weeks from the date  of the Order.

It is pertinent to note here that Appellant Architect Shri  Jayant  Tipnis  submitted the amended plans  BC /  1414 C-95  dated 3.7.2002 by claiming the area of  staircase,  lift  and lift  lobby area free of FSI as per the Clause 35 (2) of Development  Control   Regulations   1991   to MCGM.  However the said  plan was rejected by MCGM vide letter No. Dy. Ch. Engineer  (B.P.) City / 2186 / Gen. dated 6.8.2002 stating therein that the  amended plans submitted cannot be considered for approval as  the area of staircase lift, lift lobby can not be exempted on FSI  computation. Since the proposal under reference was approved  and CCl was also issued prior to DCR (1991) coming into force  i.e. 25.3.1991 and the same was already intimated to the appli- cant vide MCGM’s letter dated 19.11.1994.

Considering  the  Hon’ble  High  Court’s  order  dated  17.03.2010 and the representation made by appellant, MCGM  & M/s Pure Drinks P. Ltd. and considering the plot under refer- ence is situated in CRZ area, exemption under Section 35 (2)(c)  of the Development Control Regulations, 1991 for the area of  staircase,  lift,  lift  lobby  from floor  space  index  computation  cannot be granted. Appeal is not maintainable. Since the land  belongs to MCGM, for the issues other than FSI appellant may  approach MCGM separately.”

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21. When the writ  petitions filed by the housing societies  and their  

members for issue of direction to the Corporation to supply water to their  

buildings  were  taken up for  hearing,  the  Division Bench  of  the  High  

Court noted that even though the buildings were constructed in violation  

of the sanctioned plan, the Corporation had not taken action against those  

responsible for such construction and passed order dated 11.10.2005 for  

appearance of Additional Commissioner of the Corporation. The relevant  

portions of that order are extracted below:

“In the course of the argument, it was revealed by the Advocate  for the Corporation on taking instructions that original licence  for construction was granted in favour of four persons viz. Shri  Manjit Singh Madanjit Singh, Power of Attorney Holder of S.  Karanjit Singh, Chief Executive Officer of Pure Drink Pvt.Ltd.,  Shri  Ishwarsingh Chawla of  PSD Construction Pvt.Ltd.,  Shri  D.K.Gupta of D.Y. Builders Pvt.Ltd. and Abdula Yusuf Patel.  Pursuant  to  the  illegality  in  construction  having been found,  notices were issued under Section 53-1 of the M.R.T.P. Act on  20th February, 2002 to all  the four persons mentioned above.  Thereafter, sanction was granted for prosecution of all the four  persons and decision in that regard was taken on 19th May, 2003  by  the  Executive  Engineer  (Building  Proposal),  CT/1  of  the  Corporation.  Meanwhile,  the  panchanama  of  the  illegal  construction was carried out on 13th November, 2002. Besides,  the prosecution was launched against builder, developer and all  the  occupants  of  the  building  and  they  were  convicted  on  admission of guilt and sentenced by way of imposition of fine  from Rs.600/- to Rs.2000/- imposed by the Magistrate. Apart  from the above actions, no other action has been taken by the  Corporation in relation to the illegal construction. The affidavit- in-reply filed on behalf of the Corporation before issuance of  rule in the petition by Shri Kurmi Deonath Sitaram, Executive  Engineer,  DP(City)(I)  discloses  that  initial  approval  was  granted  for  six  wings  consisting  of  ground  plus  five  upper  

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floors and it was issued on 9th June, 1981 and Commencement  Certificate  was  granted  on  10th June,  1981.  The  amendment  plans were approved for nine wings of ground plus five upper  floors  on  2nd February,  1983.  Thereafter,  amendment  plans  proposing  stilt  plus  twenty-four  floors  and  stilt  plus  sixteen  floors with additional sixth and seventh floor to building nos.2  and 4 and additional sixth floor for the part of building no.3  were submitted but they were refused on 6th  September, 1984.  Inspite  of  that,  the  constructive  activities  continued  and  the  work beyond the approved plans was carried out, and therefore  Stop Work notice was issued under Section 353-A of the MMC  Act  on  12th November,  1984.  However,  the  work continued.  Again new architect submitted further plan with a fresh notice  under Section 337. The same was rejected by the Corporation.

The affidavit also discloses the various illegalities committed in  the  course  of  construction  of  the  buildings  which  include  construction of additional floors without approval, increase in  the height of the building and carrying of construction beyond  the permissible limits of FSI, apart from other illegalities. The  affidavit, however, does not disclose as to what action, if any,  for prohibiting the developer and the owner from proceeding  with the construction,  was taken as wall  as  what  action was  taken after illegal construction having been carried out, apart  from launching prosecution and issuance of notices. Even in the  course  of  the  argument,  learned  Advocate  appearing  for  the  Corporation  could  not  satisfy  us  about  any  concrete  action  having been taken by the Corporation for stoppage of illegal  construction or demolition of illegal construction. In fact, the  arguments in the matter were heard partly on 27th September  and again yesterday and as well as today. On the very first day  of the argument, it was orally informed by the learned Advocate  for the Corporation that he would ensure the presence of the  officer of the Corporation to assist him in order to enable him to  give correct detail information in the matter. Inspite the officer  being  present,  we  are  not  able  to  get  the  detail  information  regarding the action taken by the Corporation as also the detail  description of the illegalities committed by the builder and any  other persons on his behalf in the matter. It is to be noted that  undisputedly the records disclose some illegalities in the matter  of construction carried out since the year 1984 onwards. Inspite  of affidavit having been filed in the year 2000, the Corporation  has  not  explained  the  reason  for  failure  on  its  part  to  take  appropriate  action  against  the  illegal  construction  and  even  

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today.  Apart  from  being  assisted  by  the  officer  of  the  Corporation,  the  Advocate  appearing  for  the  Corporation  is  unable to disclose the reason for the same. We find it necessary  to  issue  notice  to  the  Additional  Commissioner  to  appear  in  person before us on Friday i.e. 14th October, 2005 at 11.00 a.m.  to explain the same alongwith all records in the matter, as it is  informed  by  the  Advocate  for  the  Corporation  that  Commissioner is out of India.”

22. On the next date of hearing, the Commissioner of the Corporation  

appeared before the High Court  and gave an assurance that  necessary  

steps will be taken in accordance with law within a period of two months.  

Thereafter, the Corporation issued notices dated 11.11.2005, 19.11.2005  

and 5.12.2005 under Section 351 of the 1888 Act giving details of the  

illegal  structures  proposed  to  be  demolished.   The  housing  societies  

submitted their respective replies which were rejected by the Corporation  

vide order dated 3/8.12.2005.

23. Faced with the threat of demolition of the buildings, the housing  

societies and some of their members filed Long Cause Suits for quashing  

the notices issued under Section 351 of  the 1888 Act and order dated  

3/8.12.2005. They pleaded that the buyers of the flats were not aware that  

the buildings had been constructed in violation of the sanctioned plan.  

They  also  filed  applications  for  restraining  the  Corporation  from  

demolishing the illegal portions of the buildings.  Initially, the trial Court  

stayed the demolition of  the  illegal  construction but,  after  hearing the  

parties, the applications for temporary injunction were dismissed on the  

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premise that the developers/builders had constructed a number of floors  

without  obtaining  permission  from  the  Planning  Authority,  that  too,  

despite  the  stop  work  notice  issued  under  the  1888  Act  and  that  the  

application made for regularization of the illegal construction had been  

rejected by the Corporation.  The trial Court rejected the contention of the  

members  of  the  housing  societies  that  they  had  purchased  the  flats  

without  knowing  that  the  same  were  illegally  constructed  by  the  

developers/builders.   The  trial  Court  noted  that  the  architect  had  

repeatedly  told  the  developers/builders  that  construction  of  buildings  

beyond the sanctioned plan was illegal and the members of the housing  

societies were very much aware of this fact.  

24. The appeals filed by the housing societies and their members were  

dismissed by the learned Single Judge of the Bombay High Court, who  

agreed with the trial Court that members of the housing societies were in  

know of the fact that the flats occupied by them  had been constructed in  

violation of the sanctioned plan.   

25. The housing societies and their members challenged the order of  

the High Court in Special Leave Petition (C) Nos. 33471, 33601, 33940,  

35402 and 35324 of 2011.  After hearing the counsel for the parties at  

length, this Court expressed the view that the special leave petitions are  

liable to be dismissed.  However, keeping in view the submission of the  

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learned  counsel  that  demolition  of  the  illegal  and  unauthorized  

construction would adversely affect the flat buyers and their families and  

the  writ  petition  filed  by  them  for  regularization  of  the  disputed  

construction  was  pending  before  the  High  Court,  it  was  considered  

appropriate to transfer the writ petition to this Court.  Accordingly, order  

dated 29.2.2012 was passed, paragraphs 16 to 19 of which are reproduced  

below:

“16. In these cases, the trial Court and the High Court have,  after threadbare analysis of the pleadings of the parties and the  documents filed by them concurrently held that the buildings in  question were constructed in violation of the sanctioned plans  and  that  the  flat  buyers  do  not  have  the  locus to  complain  against the action taken by the Corporation under Section 351  of 1888 Act.  Both, the trial Court and the High Court have  assigned detailed reasons for declining the petitioners’ prayer  for temporary injunction and we do not find any valid ground or  justification to take a different view in the matter.  

17. The submission of Dr. Abhishek Manu Singhvi that the  constructed area should be measured with reference to the total  area of the plot cannot be accepted for the simple reason that  the State Government had sanctioned change of land use only  in respect of 13049.45 sq. meters.

18. In view of the above, we may have dismissed the special  leave petitions and allowed the Corporation to take action in  furtherance  of  notices  dated  19.11.2005  and  orders  dated  3/8.12.2005, but keeping in view the fact that the flat buyers  and their families are residing in the buildings in question for  the last  more than one decade,  we feel  that  it  will  be in the  interest of justice that the issue relating to the petitioners’ plea  for  regularization  should  be  considered  by  this  Court  at  the  earliest so that they may finally know their fate.   

19. We,  therefore,  direct  the  petitioners  to  furnish  the  particulars of the writ petitions filed for regularization of the  

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construction  which  are  pending  before  the  High  Court.  The  needful  be  done  within  a  period  of  two  weeks  from today.  Within  this  period  of  two  weeks,  the  petitioners  shall  also  furnish the particulars and details of the developers from whom  the members of the societies had purchased the flats.  List the  cases on 16th March, 2012 (Friday).”   

26. In compliance of the direction issued by this Court, learned counsel  

for the petitioners informed that Writ Petition Nos.6550/2010 filed for  

regularization of  the disputed  construction is  pending before the High  

Court. They also furnished the particulars of the developers/builders from  

whom members of the housing societies are said to have purchased the  

flats.  Thereafter, this Court suo motu ordered transfer of the writ petition  

pending  before  the  Bombay  High  Court  and  impleadment  of  the  

developers/builders with a direction that notice be issued to them.

27. The record received from the Bombay High Court  revealed that  

Writ  Petition  No.6550/2010  was  filed  by  Campa  Cola  Residents  

Association,  which is said to have been registered on 3.2.1992 and of  

which the  residents  of  the six  housing societies  are  members,  and its  

Secretary  -  Shri  Rohit  Malhotra  for  quashing  orders  dated  7.7.2003  

passed  by  the  Deputy  Chief  Engineer  and  4.6.2010  passed  by  the  

Appellate Authority as also the notices issued under Section 351 of the  

1888  Act  with  a  further  prayer  for  issue  of  a  mandamus  to  the  

Corporation to regularize the disputed constructions.  

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28. The writ petitioners have pleaded that the flat buyers should not be  

penalized  for  the  illegalities  committed  by  the  lessee  and  

developers/builders in connivance with the officers of the Corporation.  

According to the petitioners, the purchasers of the flat were not aware of  

the fact that even though the Planning Authority had not sanctioned the  

revised plans,  the developers/builders constructed additional floors and  

utilized the FSI far in excess of what is permitted by the 1888 Act and the  

D.C. Rules.   

29. The  lessee  and  respondent  No.4  have  filed  separate  counter  

affidavit.  Their  stand  is  that  the  purchasers  of  the  flat  cannot  plead  

innocent ignorance because they were very much aware of the fact that  

the  revised  plans  submitted  by  the  developers/builders  had  not  been  

sanctioned by the Planning Authority and also that construction had been  

made despite the stop work notice issued by the Corporation. It is also the  

case of  the lessee  that  while executing Assignment  Agreement,  it  had  

made it clear to the developers/builders that they must raise construction  

strictly in consonance with the sanctioned plan. On its part, respondent  

No.4 has pleaded that it had purchased the remaining portion of the plot  

in question by paying a huge amount of Rs.30 crores and the petitioners  

have nothing to do with that portion of the plot.

30. Shri Ravi Shankar Prasad, learned senior counsel appearing for the  

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petitioners  in  the transferred  case  argued that  the  order  passed by the  

Deputy  Chief  Engineer  and  the  Appellant  Authority  are  liable  to  be  

quashed because neither of them applied mind on the petitioners’ prayer  

for regularization.  Learned senior counsel laid considerable emphasis on  

the fact that the members of the housing societies were not aware of the  

illegal nature of construction made by the developers/builders and argued  

that the innocent buyers should not be penalized for the misadventure of  

the lessee and the developers/builders.  Shri Prasad read out portions of  

agreement  dated  10.6.1981  executed  between  the  lessee  and  the  

developers/builders and sample of the agreement entered into between the  

developers/builders and the flat buyers to show that the latter were not  

apprised of the fact that some floors of the buildings were constructed in  

violation  of  the  sanctioned  plan  and  submitted  that  the  Corporation  

cannot take advantage of its own wrong of not taking any action against  

the  lessee  and the  developers/builders,  who are  solely  responsible  for  

constructing the buildings in violation of the sanctioned plans. He then  

relied upon the 1991 Regulations and argued that the Corporation should  

be  directed  to  regularize  the  additional  FSI  by  charging  appropriate  

penalty.  Shri  Prasad  also  referred  to  Circular  No.CHE/2005/DP/GEN  

dated 4.2.2011 issued by the Corporation for regularization of the illegal  

construction  by  charging  penalty  and  submitted  that  this  Court  may  

exercise  power  under  Article  142  of  the  Constitution  for  directing  

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regularization of  the disputed construction else  the flat  buyers will  be  

deprived of the only shelter available to them.  

31. Dr. A. M. Singhvi, learned senior counsel appearing for some of  

the housing societies and their members emphasized that the flat buyers  

should not be made victim of the illegalities committed by the lessee in  

collusion and connivance with the developers/builders. He argued that the  

Corporation cannot take advantage of its own wrong, i.e., failure to take  

prompt steps to stop the illegal construction. Learned senior counsel then  

referred  to  the  provisions  of  the  Maharashtra  Ownership  Flats  

(Regulation  of  the  Promotion  of  Construction,  Sale,  Management  and  

Transfer)  Act,  1963  (for  short,  ‘the  1963  Act’)  and  argued  that  the  

developers/builders  and  promoters  should  be  held  liable  for  acting  in  

violation of the sanctioned plans but the disputed construction should be  

regularized by invoking the provisions of the 1991 Regulations.  

32. Learned Attorney General referred to Sections 44, 45, 47, 52 and  

53 of the 1966 Act and argued that the extra floors constructed by the  

developers/builders cannot be regularized because that would tantamount  

to violation of the D.C. Rules.  He further argued that the Deputy Chief  

Engineer  and  the  Appellate  Authority  did  not  commit  any  error  by  

refusing to entertain the prayer made by the architect of the lessee for  

regularization of the buildings because the same fall within the CRZ area.  

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He  relied  upon  the  judgment  in  Suresh  Estates  Private  Limited  v.  

Municipal  Corporation  of  Greater  Mumbai  (2007)  14  SCC  439  and  

argued that  the  petitioners  cannot  rely upon the 1991 Regulations  for  

seeking regularization of the illegally constructed floors.

33. Shri C.U. Singh, learned senior counsel  appearing for the lessee  

and Shri Dave, learned senior counsel for respondent No.4 relied upon  

the  sanction  accorded  by  the  State  Government  vide  order  dated  

31.12.1980 for change of land use subject to the condition of compliance  

with relevant statutory provisions including the D.C. Rules and argued  

that the appellants do not have the locus to challenge the action taken by  

the  Corporation  for  demolition  of  the  illegal  and  unauthorized  

construction or seek regularization thereof, more so, because even before  

commencement  of  the  construction,  the  flat  buyers  knew  that  the  

Planning Authority had not sanctioned the revised plans submitted by the  

developers/builders through their architect.  

34. We  have  considered  the  respective  arguments/submissions.  The  

first  question  which arises  for  consideration  in  the  transferred  case  is  

whether  the  writ  petitioners  are  entitled  to  seek  regularization  of  the  

illegal  and unauthorized construction made by the developers/builders.  

At the cost of repetition, it will be apposite to note that the Deputy Chief  

Engineer had rejected the request made by the architect for exemption of  

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the area of staircase, lift and lift lobby from FSI by observing that the  

same is not in conformity with Clause 35(2)(c) of the 1991 Regulations  

because the Corporation had decided the proposal prior to coming into  

force  of  those  regulations  and  the  permissible  FSI  had  already  been  

exhausted.  The  Appellate  Authority  agreed  with  the  Deputy  Chief  

Engineer that the 1991 Regulations cannot be invoked for regularization  

of the disputed construction because the same were enforced much after  

rejection of the amended plans and the plot in question is situated in CRZ  

area.  

35. In our view, the reasons assigned by the Deputy Chief Engineer  

and the Appellate Authority are in consonance with the law laid down by  

this Court in Suresh Estates Private Limited v. Municipal Corporation of  

Greater Mumbai (supra).  The facts of that case were that after purchasing  

a plot measuring 8983 sq. mtrs. situated at Dr.Babasaheb Jaykar Marg,  

appellant  Nos.  1  and  2  submitted  plans  to  develop  the  same  by  

constructing a luxury hotel in terms of the D.C. Rules. In the application,  

the appellants mentioned that they are entitled to additional FSI as per  

Rule 10(2) of the D.C Rules. The Corporation made a recommendation to  

the State Government that in view of the CRZ notification and the D.C.  

Rules,  additional  FSI  be  granted  to  the  appellants.  The  Ministry  of  

Environment  and  Forest  sent  communication  dated  18.8.2006  to  the  

Principal  Secretary,  Urban  Development  Department,  Government  of  

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Maharashtra clarifying that the D.C. Rules, which existed on 19.2.1991  

would apply to the areas falling within the CRZ notification and the word  

‘existing’  means  the  rules  which  prevailed  on  19.2.1991.  It  was  also  

mentioned that the draft regulations of 1989, which came into force on  

20.2.1991  would  not  apply.  At  that  stage,  the  appellants  filed  a  writ  

petition before the High Court with the complaint that the Corporation  

had  not  communicated  its  decision  within  60  days.  The  same  was  

disposed of by the High Court with a direction to the State Government to  

decide the application of the appellants within six weeks.   Before this  

Court,  it  was argued on behalf of the Corporation that the D.C. Rules  

would not apply to the development permission sought by the appellants  

and the 1991 Regulations are applicable in the matter. According to the  

Corporation, the 1991 Regulations do not provide for additional FSI for  

the proposed hotel  project.   It  was  further  argued that  the restrictions  

contained in the CRZ notification will  be attracted because the plot is  

situated in CRZ area. This Court noted that the 1991 Regulations were  

notified on 20.2.1991 and came into force on 25.3.1991 whereas CRZ  

notification was issued on 2.2.1991 and observed:

“The  word  “existing”  as  employed  in  the  CRZ  notification  means the town and country planning regulations in force as on  19-2-1991. If it had been the intention that the town and coun- try planning regulations as in force on the date of the grant of  permission for building would apply to the building activity, it  would have been so specified. It is well to remember that CRZ  notification refers also to structures which were in existence on  

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the date of the notification. What is stressed by the notification  is that irrespective of what local town and country planning reg- ulations may provide in future the building activity permitted  under the notification shall be frozen to the laws and norms ex- isting on the date of the notification.

On 2-2-1991 when the CRZ notification was issued, the only  building regulations that were existing in city of Mumbai, were  the DC Rules, 1967. In view of the contents of CRZ II notifica- tion issued under the provisions of  the Environment (Protec- tion) Act which has the effect of prevailing over the provisions  of other Acts, the application submitted by the appellants to de- velop the plot belonging to them would be governed by the pro- visions of the DC Rules, 1967 and not by the draft development  regulations of 1989 which came into force on 20-2-1991 in the  form of the Development Control Regulations for Greater Bom- bay, 1991.

The argument that in view of the provisions of Section 46 of the  Town Planning Act, 1966, the Planning Authority has to take  into consideration the draft regulations of 1989 and, therefore,  the appellants would not be entitled to additional FSI is devoid  of merits.

Section 3 of the Environment (Protection) Act, 1986 inter alia  provides that the provisions of the Act and any order or notific- ation issued under the said Act will prevail over the provisions  of any other law.

The phrase “any other law” will also include the MRTP Act,  1966. As noticed earlier  the Notification dated 19-2-1991 is- sued under the provisions of the Environment (Protection) Act,  1986 freezes the building activity in an area falling within CRZ  II to the law which was prevalent and in force as on 19-2-1991.  The draft regulations of 1989 would therefore not apply as they  were not existing law in force and prevalent as on 19-2-1991.

In view of the peculiar circumstances obtaining in the instant  case, the Court is of the opinion that Section 46 of the MRTP  Act, 1966 would not apply to the facts of the instant case. Fur- ther, when the sanctioned DC Regulations for Greater Bombay,  

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1991 do not apply to areas covered within CRZ II, since those  Regulations  came into  force  with  effect  from 25-3-1991,  its  previous draft also cannot apply. The draft published is to be  taken into consideration  so  that  the development  plan  is  ad- vanced and not thwarted. The draft development plan was cap- able of being sanctioned, but when the final development plan  is not applicable, its draft would equally not apply as there is no  question of that plan being thwarted at all. As far as develop- ment in the area covered by CRZ II is concerned, one will have  to proceed on the footing that the draft plan after CRZ notifica- tion  never  existed.  Even  otherwise  what  is  envisaged  under  Section 46 of the MRTP Act is due regard to draft plan only if  there is no final plan. The DC Rules of 1967 were in existence  as  on  19-2-1991  and  therefore  the  plan  prepared  thereunder  would govern the case.

The draft regulations of 1989 were not in force as on 19-2-1991  and, therefore, would not apply to the plot in question. What is  emphasised in Section 46 of the MRTP Act, 1966 is that the  Planning Authority should have due regard to the draft  rules  (  sic   regulations). The legislature has not used the phrase “must    have regard” or “shall have regard”. Municipal Corporation of  Greater Mumbai which is the Planning Authority had given due  regard to the draft DC Regulations of 1989 in the light of CRZ  notification and recommended to the Government to grant addi- tional  FSI of  3.73 times permissible as per the Development  Control Rules, 1967 over and above 1.33 permissible, to the ap- pellants. Having regard to the facts of the case this Court is of  the opinion that the contention that the Planning Authority has  to  take  into  consideration  the  draft  regulations  of  1989 and,  therefore, the appellants would not be entitled to additional FSI,  cannot be accepted and is hereby rejected.”

(Emphasis supplied)

36. In view of the aforesaid judgment of the three Judge Bench, it must  

be held that the Appellate Authority had rightly declined to invoke the  

1991 Regulations for entertaining the prayer made by the architect Shri  

Jayant Tipnis for regularization of the constructions made in violation of  

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the sanctioned plan.  

37. The argument of Shri Prasad and Dr. Singhvi that the flat buyers  

should not be penalized for the illegality committed by the lessee and the  

developers/builders in raising construction in violation of the sanctioned  

plan sounds attractive in the first blush but on a closer scrutiny, we do not  

find any merit in the same.  Admittedly, the flat buyers had entered into  

agreements with the developers/builders much before commencement of  

the  construction.  They  were  aware  of  the  fact  that  the  revised  plans  

submitted  by  the  architect  had  not  been  approved  by  the  Planning  

Authority  and  the  developers/builders  had  foretold  them  about  the  

consequence  of  rejection  of  the  revised  plans.  Therefore,  there  is  no  

escape from the conclusion that the flat buyers had consciously occupied  

the flats illegally constructed by the developers/builders.  In this scenario,  

the  only  remedy  available  to  them  is  to  sue  the  lessee  and  the  

developer/builder for return of the money and/or for damages and they  

cannot seek a direction for regularization of the illegal and unauthorized  

construction made by the developers/builders.  

38. We shall now notice the provisions of the 1966 Act. Section 44(1)  

of that Act postulates making of an application to the Planning Authority  

by any person intending to carry out any development on any land. Such  

an application is required to be made in the prescribed form incorporating  

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therein  the  relevant  particulars  and  must  be  accompanied  by  such  

documents, as may be prescribed. This requirement is not applicable if  

the Central or State Government or local authority intends to carry out  

any development on any land. Similarly, a person intending to execute a  

Special  Township  Project  on  any  land  is  not  required  to  make  an  

application under Section 44(1). Instead, he has to make an application to  

the  State  Government.  Section  45  postulates  grant  or  refusal  of  

permission.  In  terms  of  Section  45(1),  the  Planning  Authority  is  

empowered  to  grant  permission  without  any  condition  or  with  such  

general or special conditions which may be imposed with the previous  

approval  of  the  State  Government.  It  is  also  open  to  the  Planning  

Authority to refuse the permission. As per Section 45(2) the permission  

granted  under  sub-section  (1),  with  or  without  conditions,  shall  be  

contained in a commencement certificate in the prescribed form. Section  

45(3) mandates that the order passed by the Planning Authority granting  

or refusing permission shall  state the grounds for its  decision.  Section  

45(5) contains a deeming provision and lays down that if the Planning  

Authority does not communicate its decision within 60 days from the date  

of receipt of application, or within 60 days from the date of receipt of  

reply  from  the  applicant  in  respect  of  any  requisition  made  by  the  

Planning Authority, then such permission shall be deemed to have been  

granted on the date immediately following the date of expiry of 60 days.  

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However, the deemed permission is subject to the rider contained in the  

first  proviso  to  Section  45(5)  that  the  development  proposal  is  in  

conformity with the relevant Development Control Regulations framed  

under the 1966 Act or bye-laws or regulations framed in that behalf under  

any law for the time being in force and the same is not violative of the  

provisions of any draft or final plan or proposals published by means of  

notice, submitted for sanction under the Act. The second proviso to this  

sub-section lays down that any development carried out pursuant to such  

deemed permission,  which is in contravention of the provisions of the  

first proviso, shall be deemed to be an unauthorized development for the  

purposes  of  Sections  52  to  57.  Section  52  prescribes  the  penalty  for  

unauthorized development or for use of land otherwise than in conformity  

with  development  plan.  Any  person  who  commences,  undertakes  or  

carries  out  development,  or  institutes  or  changes  the  use  of  any land  

without  obtaining  the  required  permission  or  acts  in  violation  of  the  

permission originally granted or duly modified is liable to be punished  

with imprisonment for a term of at least one month, which may extend to  

three years. He is also liable to pay fine of at least Rs.2,000/-, which may  

extend to Rs.5,000/-. In case of continuing offence, an additional daily  

fine of Rs.200/- is payable. Any person who continues to use or allows  

the use of any land or building in contravention of the provisions of a  

development plan without being allowed to do so under Section 45 or 47,  

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or where the continuance of such use has been allowed under that section,  

continues such use after expiry of the period for which the use has been  

allowed,  or  in  violation  of  the  terms  and  conditions  under  which  the  

continuance of such use is allowed is liable to pay fine which may extend  

to Rs.5,000/-. In the case of a continuing offence, further fine of Rs.100/-  

per day can be imposed. Section 53 empowers the Planning Authority to  

require the wrongdoer to remove unauthorized development. Of course,  

this  power  can  be  exercised  only  after  following  the  rules  of  natural  

justice, as engrafted in sub-sections (1) and (2) of Section 53. By virtue of  

Section 53(3), any person to whom notice under sub-section (2) has been  

given can apply for  permission under  Section 44 for  retention of  any  

building or works or for the continuance of any use of the land pending  

final  determination or  withdrawal of  the application.  If  the permission  

applied  for  is  granted,  the  notice  issued  under  Section  53(2)  stands  

automatically withdrawn. If, however, the permission is not granted, the  

notice becomes effective.  If  the person to whom notice under Section  

53(2) is given or the application, if any, made by him is not entertained,  

then the Planning Authority can prosecute the owner for not complying  

with  the  notice.  Likewise,  if  the  notice  requires  the  demolition  or  

alteration of any building or works or carrying out of any building or  

other  operation,  then  the  Planning  Authority  is  free  to  take  steps  for  

demolition, etc., and recover the expenses incurred in this behalf from the  

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owner  as  arrears  of  land  revenue.  Section  54 empowers  the  Planning  

Authority  to  stop  unauthorized  development.  Section  55  enables  the  

Planning  Authority  to  remove  or  discontinue  unauthorized  temporary  

development summarily. Section 56 empowers the Planning Authority to  

take various steps in the interest of proper planning of  particular areas  

including the amenities  contemplated  by the development  plan.  These  

steps include discontinuance of any use of land or alteration or removal of  

any building or work.  

39. An analysis of the above reproduced provisions makes it clear that  

any person who undertakes or carries out development or changes the use  

of  land  without  permission  of  the  Planning  Authority  is  liable  to  be  

punished with imprisonment. At the same time, the Planning Authority is  

empowered  to  require  the  owner  to  restore  the  land  to  its  original  

condition as it existed before the development work was undertaken. The  

scheme of these provisions do not mandate regularization of construction  

made without obtaining the required permission or in violation thereof.

40. Circular  dated  4.2.2011,  on  which  reliance  was  placed  by  Shri  

Prasad, cannot be invoked for entertaining the prayer for regularization.  

That  circular  only  contains  the  procedure  for  regularization  of  

unauthorized works/structures. It neither deals with the issues relating to  

entitlement of the applicant to seek regularization nor lays down that the  

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Planning  Authority  can  regularize  illegal  construction  even  after  

dismissal of the appeal filed under Section 47 of the 1966 Act. Therefore,  

the procedure laid down in Circular dated 4.2.2011 is of no avail to the  

flat buyers.

41. Though the argument of Dr. Singhvi that the developers / builders /  

promoters are responsible for the illegal construction finds support from  

the  provisions  of  the  1963  Act,  but  that  does  not  help  the  housing  

societies and their members because there is no provision under that Act  

for  condonation  of  illegal/unauthorized  construction  by  the  

developers/builders and promoters or regularization of such construction.  

Section  2(c)  of  that  Act  defines  the  term ‘promoter’  in  the  following  

words:

“Section  2(c)  “promoter”  means  a  person  and  includes  a  partnership firm or a body or association of persons, whether  registered or not who constructs or causes to be constructed a  block  or  building  of  flats,  or  apartments  for  the  purpose  of  selling some or all of them to other persons, or to a company,  co-operative  society  or  other  association  of  persons,  and  includes his assignees; and where the person who builds and the  person who sells are different persons, the term includes both;”

Section  3  specifies  general  liabilities  of  the  promoter.  Sub-section  (1)  

thereof contains a non-obstante clause and declares that notwithstanding  

anything  in  any  other  law,  a  promoter  who  intends  to  construct  or  

constructs a block or building of flats,  all  or some of which are to be  

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taken or taken on ownership basis, shall in all transactions with persons  

intending to take or taking one or more of such flats, be liable to give or  

produce,  or  cause  to  be  given  or  produced,  the  information  and  the  

documents  mentioned  in  the  section.  Section  3(2)  lays  down  that  a  

promoter, who constructs or intends to construct such block or building of  

flats, shall –  

“(a) make full and true disclosure of the nature of his title to the  land on which the flats are constructed, or are to be constructed;  such title to the land as aforesaid having been duly certified by  an Attorney-at-law, or by an Advocate of not less than three  years  standing,  and  having  entered  in  the  Property  card  or  extract of Village Forms V or VII and XII or any other relevant  revenue record;  

(b) make full and true disclosure of all encumbrances on such  land, including any right, title, interest or claim of any party in  or over such land;  

(c)  give inspection  on seven  days’  notice  or  demand,  of  the  plans and specifications of the building built or to be built on  the land; such plans and specifications, having been approved  by the local authority which he is required so to do under any  law for the time being in force;

(d)  disclose  the  nature  of  fixtures,  fittings  and  amenities  (including the provision for one or more lifts) provided or to be  provided;  

(e) disclose on reasonable notice or demand if the promoter is  himself  the  builder,  the  prescribed  particulars  as  respect  the  design and the materials to be used in the construction of the  building, and if the promoter is not himself the builder disclose,  on such notice or demand, all agreements (and where there is  no written agreement, the details of all agreements) entered into  by him with the architects and contractors regarding the design,  materials and construction of the buildings;  

(f) specify in writing the date by which possession of the flat is  

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to  be  handed  over  (and  he  shall  hand  over  such  possession  accordingly);  

(g)  prepare  and  maintain  a  list  of  flats  with  their  numbers  already  taken  or  agreed  to  be  taken,  and  the  names  and  addresses of the parties and the price charged or agreed to be  charged therefor, and the terms and conditions if any on which  the flats are taken or agreed to be taken;  

(h)  state  in writing,  the precise  nature of  the organisation of  persons to be constituted and to which title is to be passed, and  the  terms  and  conditions  governing  such  organisation  of  persons who have taken or are to take the flats;  

(i) not allow persons to enter into possession until a completion  certificate where such certificate is required to be given under  any law, is duly given by the local authority (and no person  shall take possession of a flat until such completion certificate  has been duly given by the local authority);  

(j) make a full and true disclosure of all outgoings (including  ground rent,  if  any,  municipal  or  other  local  taxes,  taxes  on  income,  water  charges  and  electricity  charges,  revenue  assessment, interest on any mortgage or other encumbrances, if  any);  

(k) make a full and true disclosure of such other information  and document; in such a manner as may be prescribed; and give  on demand true copies of such of the documents referred to in  any of the clauses of this sub-section as may be prescribed at a  reasonable charge therefor;  

(l) display or keep all the documents, plans or specifications (or  copies thereof) referred to in clauses (a), (b) and (c), at the site  and permit inspection thereof to persons intending to take or  taking one or more flats;

(m) when the flats are advertised for sale, disclose inter alia in  the advertisement the following particulars, namely: -

(i) the extent of the carpet area of the flat including the  area of the balconies which should be shown separately;

(ii) the price of the flat including the proportionate price  of  the  common  areas  and  facilities  which  should  be  shown separately, to be paid by the purchaser of flat; and  

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the  intervals  at  which the  installments  thereof  may be  paid;

(iii)  the  nature,  extent  and  description  of  the  common  areas and facilities; and

(iv) the nature, extent and description of limited common  areas and facilities, if any.

(n) sell flat on basis of carpet area only:

Provided  that,  the  promoter  may  separately  charge  for  the  common areas and facilities in proportion ‘to the carpet area of  the flat’.

Explanation – For the purposes of this clause, the carpet area of  the flat shall include the area of the balcony of such flat.”

Section 4(1) also contains a non-obstante  clause and lays down that a  

promoter who intends to construct or constructs a block or building of  

flats shall, before accepting any money as advance payment or deposit,  

which shall not be more than 20 per cent of the sale price, enter into a  

written agreement for  sale with the buyer. Section 4(1A) specifies the  

particulars to be included in such agreement and the documents which  

must form part of it. Section 4(2) casts a duty on the promoter to get the  

agreement  registered  in  accordance  with  the  provisions  of  the  

Registration  Act,  1908.  Section  7  contains  a  prohibition  against  

alterations or additions in the plans and specification without the consent  

of the persons who have agreed to take the flats. The promoter is also  

required to rectify the defects noticed within three years.  Section 7(2)  

casts a duty on the promoter to construct and complete the building in  

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accordance  with  the  plans  and  specifications.  Section  13  postulates  

punishment  to  any  promoter  who  is  found  guilty  of  violating  the  

provisions contained in Sections 3, 4, 5 (except sub-section (2)) and 10  

and 11.  

42. Rule  3 of  the Maharashtra  Ownership Flats  (Regulations  of  the  

Promotion of Construction, etc.) Rules, 1964 lays down the manner of  

making disclosure by the promoter to the flat buyers. Rule 5 specifies the  

particulars to be incorporated in the agreement required to be entered into  

between the promoter and the flat purchaser.  Form V appended to the  

rules contains the model form of agreement to be entered into between  

promoter and flat purchaser.   

43. The  above  noted  provisions  were  interpreted  by  this  Court  in  

Jayantilal  Investments  v.  Madhuvihar  Cooperative  Housing  Society  

(2007) 9 SCC 220. After noticing the relevant statutory provisions the  

two Judge Bench held:

“Reading the above provisions of MOFA, we are required to  balance  the  rights  of  the  promoter  to  make  alterations  or  additions in the structure of the building in accordance with the  layout plan on the one hand vis-à-vis his obligations to form the  society and convey the right, title and interest in the property to  that  society.  The obligation of  the promoter  under MOFA to  make  true  and  full  disclosure  to  the  flat  takers  remains  unfettered even after the inclusion of Section 7-A in MOFA.  That obligation remains unfettered even after  the amendment  made  in  Section  7(1)(ii)  of  MOFA.  That  obligation  is  strengthened by insertion of sub-section (1-A) in Section 4 of  

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MOFA by Maharashtra Amendment Act 36 of 1986. Therefore,  every agreement between the promoter and the flat taker shall  comply with the prescribed Form V. It may be noted that, in  that prescribed form, there is an explanatory note which inter  alia states that clauses 3 and 4 shall be statutory and shall be  retained.  It  shows  the  intention  of  the  legislature.  Note  1  clarifies that a model form of agreement has been prescribed  which could be modified and adapted in each case depending  upon the facts and circumstances of each case but, in any event,  certain  clauses  including clauses  3 and 4  shall  be treated  as  statutory and mandatory and shall be retained in each and every  individual agreements between the promoter and the flat taker.  Clauses 3 and 4 of the Form V of the Maharashtra Ownership  Flats (Regulation of the Promotion of Construction, etc.) Rules,  1964 are quoted hereinbelow:

“3. The promoter hereby agrees to observe, perform and  comply with  all  the  terms,  conditions,  stipulations  and  restrictions, if any, which may have been imposed by the  local authority concerned at the time of sanctioning the  said  plans or  thereafter  and shall,  before handing over  possession of the flat to the flat purchaser, obtain from  the  local  authority  concerned  occupation  and/or  completion certificates in respect of the flat.

4.  The  promoter  hereby  declares  that  the  floor  space  index available in respect of the said land is … square  metres only and that no part of the said floor space index  has  been  utilised  by  the  promoter  elsewhere  for  any  purpose whatsoever.  In case the said floor space index  has  been  utilised  by  the  promoter  elsewhere,  then  the  promoter  shall  furnish  to  the  flat  purchaser  all  the  detailed particulars in respect of such utilisation of said  floor space index by him. In case while developing the  said land the promoter has utilised any floor space index  of any other land or  property by way of floating floor  space  index,  then  the  particulars  of  such  floor  space  index  shall  be  disclosed  by  the  promoter  to  the  flat  purchaser.  The  residual  FAR  (FSI)  in  the  plot  or  the  layout not consumed will be available to the promoter till  the  registration  of  the  society.  Whereas  after  the  registration of the society the residual FAR (FSI), shall  be available to the society.”

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The above  clauses  3  and 4  are  declared  to  be  statutory  and  mandatory by the legislature because the promoter is not only  obliged statutorily to give the particulars of the land, amenities,  facilities,  etc.,  he  is  also  obliged  to  make  full  and  true  disclosure of the development potentiality of the plot which is  the subject-matter of the agreement. The promoter is not only  required to make disclosure concerning the inherent FSI, he is  also required at the stage of layout plan to declare whether the  plot  in  question  in  future  is  capable  of  being  loaded  with  additional FSI/floating FSI/TDR. In other words, at the time of  execution of the agreement with the flat takers the promoter is  obliged  statutorily  to  place  before  the  flat  takers  the  entire  project/scheme, be it a one-building scheme or multiple number  of buildings scheme. Clause 4 shows the effect of the formation  of the Society.

In  our  view,  the  above condition  of  true  and full  disclosure  flows from the obligation of the promoter under MOFA vide  Sections  3 and 4 and Form V which prescribes  the  form of  agreement  to  the  extent  indicated  above.  This  obligation  remains unfettered because the concept of developability has to  be harmoniously read with the concept of registration of society  and conveyance of title. Once the entire project is placed before  the flat takers at the time of the agreement, then the promoter is  not required to obtain prior consent of the flat takers as long as  the builder puts up additional construction in accordance with  the  layout  plan,  building  rules  and  Development  Control  Regulations, etc.”

44. It is thus evident that the 1963 Act obligates the promoter to obtain  

sanctions and approvals from the concerned authority and disclose the  

same to the flat buyers. The Act also provides for imposition of penalty  

on  the  promoters.  However,  the  provisions  contained  therein  do  not  

entitle  the  flat  buyers  to  seek  a  mandamus  for  regularization  of  the  

unauthorized/illegal construction.

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45. In view of the above discussion, we hold that the petitioners in the  

transferred  case  have  failed  to  make  out  a  case  for  directing  the  

respondents  to  regularize  the  construction  made  in  violation  of  the  

sanctioned plan.   Rather, the ratio of the above-noted judgments and, in  

particular, Royal Paradise Hotel (P) Ltd. v. State of Haryana and Ors. (supra)  

is clearly attracted in the present case. We would like to reiterate that no  

authority  administering  municipal  laws  and  other  similar  laws  can  

encourage violation of the sanctioned plan. The Courts are also expected  

to  refrain  from  exercising  equitable  jurisdiction  for  regularization  of  

illegal and unauthorized constructions else it would encourage violators  

of the planning laws and destroy the very idea and concept of planned  

development of urban as well as rural areas.

46. In the result, the appeals and the transferred case are dismissed and  

it is declared that there is no impediment in the implementation of notices  

issued by the Corporation under Section 351 of the 1888 Act and order  

dated 3/8.12.2005 passed by the competent authority.  The Corporation is  

expected to take action in the matter at the earliest.

47. We  also  direct  that  the  State  Government  and  its  

functionaries/officers as also the officers/employees of the Corporation  

shall  not  put  any hurdle  or  obstacle  in  the  implementation  of  notices  

issued under Section 351 of the 1888 Act.

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48. It  is  needless  to  say  that  the  flat  buyers  shall  be  free  to  avail  

appropriate remedy against the developers/builders.

.....…..…..……..…..………………..J.      [G.S. Singhvi]

 .....…..…..……..…..………………..J.

      [Sudhansu Jyoti Mukhopadhaya] New Delhi, February 27, 2013.

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