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REPORTABLE

IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO. 10930 OF 2013   (@ Special Leave Petition (Civil) No.34275 of 2009)

DLF Limited ….. Appellant

Versus

Manmohan Lowe and others         …..Respondents

WITH

Contempt Petition (Civil) No.         of 2013 (D.No.29500/12) IN      

CIVIL APPEAL NO. 10930 OF 2013   (@ Special Leave Petition (Civil) No.34275 of 2009)

DLF Limited ….. Petitioner  

Versus

B. Jaishankar & Ors.        …..Respondents

J U D G M E N T

K.S. Radhakrishnan, J.

Leave granted.

2. This  appeal  arises  out  of  a  writ  petition  filed  by  the  

Apartment  owners  of  Silver  Oaks  Apartments,  DLF  Qutub

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Enclave,  Phase-1,  Gurgaon,  seeking  a  writ  of  certiorari  to  

quash  the  declaration  dated  19.04.2001  filed  by  the  

Appellant, on the ground that the same is not in conformity  

with Section 3(f) of the Haryana Apartment Ownership Act,  

1983  (for  short  “the  Apartment  Act”)  since  the  appellant  

failed to include certain areas of the complex as “common  

areas  and  facilities”  within  the  declaration,  thereby  

effectively  depriving  the  apartment  owners  of  their  rights  

over the same.

3. The  Division  Bench  of  the  Punjab  and  Haryana  High  

Court accepted their contention and held that the apartment  

owners are entitled to undivided interest in common areas  

and common facilities under Section 6 of the Apartment Act  

and would be vitally affected if those areas are not declared  

as common areas.  The Court also held, inter alia, that the  

competent authority under Section 3(i) of the Apartment Act  

is  under  an  obligation  to  decide  the  objections  of  the  

apartment owners to the declaration filed by the colonizer–

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appellant herein.  Aggrieved by the same, this appeal has  

been preferred by the colonizer.

4. The  colonizer  purchased  large  extent  of  lands  in  

villages  Chakarpur,  Sarhaul,  Shahpur,  Nathupur  and  

Sikanderpur  Ghosi,  Tehsil  and  District  Gurgaon,  Haryana,  

with a view to develop a residential colony to be known as  

DLF  Qutab  Enclave  Complex.   Any  intending  company  or  

association having land for converting it in the colony, was  

required  to  apply  for  licence  under  the  Haryana  

Development and Regulation of Urban Areas Act, 1975 (for  

short ‘the Development Act’).   The colonizer submitted an  

application in accordance with Section 3 of the Development  

Act for necessary licences.  During the years 1980-81 seven  

licences were obtained by the Colonizer in relation to 130.62  

acres.   Licences  were  granted by  the  Director,  Town and  

Country  Planning,  Haryana (DTCP)  in  accordance with  the  

provisions of the Development Act.  The Department of Town  

and Country Planning, Haryana (the Department) in the year  

1982 approved the group complex, Silver Oaks, as part of

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the colony being developed by the Colonizer.  Licences were  

initially  granted  for  two  years,  and  later  got  periodically  

renewed.  On 30.05.1990 a condition was imposed by the  

Competent  Authority  that  the  Colonizer  should  provide  

Economically Weaker Sections Complex (EWS) and service  

units  to  the  extent  of  10%  of  main  dwelling  units.  

Consequently,  revised  plan  was  submitted,  which  was  

approved  by  the  Competent  Authority  on  08.11.1990  in  

which  residential  blocks  comprising  parking  in  basement,  

EWS  Flats  and  three  shops  were  approved.   There  was  

further  revision  for  zoning  and  building  plan  in  the  years  

1992 and 1995.

5. The Department, in the meantime, circulated norms for  

provision of community facilities vide DTCP Endst No.20028  

dated 24.11.1988.    During the year 1990, agreements were  

entered  into  between  the  Colonizer  and  the  Apartment  

Owners of the above-mentioned complex.  Apartment buyers  

agreement  provided  for  sale  of  a  quantified  ‘super  area’  

against the sale consideration specified in the agreement.

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The ‘super area’ comprises of an exclusive right to use the  

common area within the building in which the apartment was  

situated.   Agreement  also  states  that  the  colonizer  will  

transfer and convey its right,  title and interest in the said  

site, common area and common facilities in favour of the co-

operative  society  or  limited  company  or  association  of  

persons,  etc.  in  accordance  with  the  provisions  of  the  

Apartment Act and the Rules framed thereunder.

6. The Colonizer later applied for completion certificate on  

15.04.1996  for  group  housing  scheme  measuring  14.75  

acres.   The  Apartment  Act,  though  was  enforced  by  

notification  dated  08.09.1986,  issued  by  the  Haryana  

Department, the same was rescinded on 24.10.1997 as the  

concerned department which notified the Act was the Town  

Planning  Department.   Consequently,  a  fresh  notification  

dated 10.11.1997 was issued by the Department notifying  

the applicability of the Act in the entire State of Haryana.  

Later several sale deeds were executed by the Colonizer in  

favour of the apartment owners in the year 1997, wherein

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both had agreed that they would conform to the provisions  

of the Apartment Act.  Writ Petition No.960 of 2000 was filed  

by respondents 1 to 5, before the Punjab & Haryana High  

Court, seeking a direction to the Colonizer to file a deed of  

declaration in relation to the Complex under the Apartment  

Act.  

7. The  Department  later  gave  a  partial  completion  

certificate  to  the  Colonizer  on  22.01.2001,  subject  to  the  

condition of filing a deed of declaration under the Apartment  

Act within 90 days.   Later the Department on 14.03.2001  

revised  the  earlier  partial  completion  certificate  for  the  

complex, inter alia, requiring the Colonizer to file a deed of  

declaration within a period of 90 days.  It was also provided  

that  the  responsibility  of  the ownership  of  common areas  

and  common  facilities  as  well  as  their  management  and  

maintenance should continue to vest with the Colonizer till  

such time the responsibility was transferred to the statutory  

condominium  association  under  the  Apartment  Act.   The  

Colonizer  accordingly  on  19.04.2001  filed  the  “deed  of

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declaration”  along  with  bye-laws  of  the  statutory  

condominium  association  (Silver  Oaks  Condominium  

Association for short ‘the SOCA’) as required under Section  

11(2) of the Apartment Act.  The Colonizer on 20.04.2001  

issued a letter to the SOCA stating that all the dwelling units,  

areas, with the common areas and facilities along with other  

assets, plant and machinery and equipments, as declared in  

the  declaration  stands  transferred  to  the  SOCA  for  the  

maintenance.   The  Colonizer  on  23.04.2001  also  wrote  a  

letter  to  the  SOCA  requesting  them  to  take  over  the  

responsibility  of  maintaining  common  areas  and  facilities  

along  with  other  assets,  plant  and  machinery  and  

equipments etc.

8. The SOCA on  27.04.2001  passed a  resolution  that  it  

would take over the responsibility of managing of common  

areas  and  facilities  along  with  other  assets,  plants  and  

machinery  and  other  equipments,  as  transferred  to  the  

Association by the Colonizer.  The same was confirmed by

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the  Association  by  sending  a  letter  on  03.05.2001  to  the  

Colonizer.

9. Writ Petition No.960 of 2000, filed by respondents 1 to  

5 was later  amended, challenging the declaration filed by  

the Colonizer, stating that the same was not in conformity  

with  the  mandate  of  the  Apartment  Act,  and  that  the  

common areas  and facilities  should  also  include  shops  or  

parking areas, community centers, nursery school and other  

common facilities.  Amendment sought was allowed by the  

High Court on 26.11.2001.  Before the High Court Silver Oak  

Society also got themselves impleaded as party.  The High  

Court  also  impleaded  the  statutory  SOCA  as  a  party  

respondent to the writ petition.  The High Court also sought  

a  clarification  from  the  Department  with  regard  to  the  

meaning of expression “common areas and facilities”.  The  

Department clarified that the “common areas and common  

facilities” need to be defined categorically in the declaration  

to be filed under Section 2 of the Apartment Act which may  

or may not include community buildings, shops etc.

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10. The Division Bench of the High Court after hearing all  

the parties took the view that the question whether primary  

schools, shops or community center are common areas or  

any other objection of the flat owners could be decided by  

the Competent Authority,  having regard to the provisions,  

objects and spirit of the Act.  Further, the Court also took the  

view that it is not the intention of the Legislature that the  

developer/Colonizer assumes absolute power of declaring or  

not declaring areas, normally in common use, to be common  

areas.  The Court also held that Section 11, which deals with  

the contents  of  the declaration,  cannot be read as giving  

absolute  power  to  the  Colonizer/developer  to  exclude  

common areas from the said concept.  The Court also held  

that  the  apartment  owners  are  entitled  to  object  to  the  

contents  of  the  declaration  and  it  is  for  the  Competent  

Authority to decide cross-objections.  The Court after holding  

so,  disposed  of  the  writ  petition  with  a  direction  to  the  

Competent  Authority  to  take  a  decision  on  the  various  

objections  raised  by  the  apartment  owners  and  the

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association.  The legality of which is the question that arises  

for consideration in this appeal.

11. Shri  Mukul  Rohatgi,  learned senior  counsel  appearing  

for  the  Colonizer,  submitted  that  the  High  Court  has  

completely misunderstood the scope of various provisions of  

the Development Act and the Rules framed thereunder as  

well as the Apartment Act, and the Rules framed thereunder.  

Learned senior counsel submitted that the judgment of the  

High Court has the effect of rendering the provisions of the  

Development Act, particularly,   Section 3(3)(a)(iv) otiose in  

as much as it compels the Colonizer to divest its ownership  

rights  in  relation  to  community  and  commercial  facilities  

developed by it in terms of the provision of the Development  

Act.   Learned  senior  counsel  also  submitted  that  the  

direction  of  the  High  Court  that  the  declaration  must  

categorise  the  whole  property  into  “apartment,  common  

areas  and  facilities”  and  “limited  common  areas  and  

facilities” is contrary to Section 3(f) of the Apartment Act,  

which itself,  according to the learned senior counsel,  does

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not compel  the Colonizer  to  divest  its  ownership rights in  

community and common facilities developed by it as part of  

the obligation under the Development Act.  Learned senior  

counsel  also  submitted  that  the  High  Court  has  failed  to  

appreciate that the community and commercial facilities, in  

SOCA,  were  provided  as  part  of  the  Colonizer’s  over  all  

obligations under Section 3(3)(a)(iv) of the Development Act  

for  the  colony  as  a  whole  and  the  same  cannot  be  

considered separate only on account of being located at a  

specific site in the colony i.e. inside the Silver Oaks Complex.  

Learned senior counsel placed considerable reliance on the  

Judgment of this Court in  DLF Qutub Enclave Complex  

Educational Charitable Trust  v.  State of Haryana and  

others  (2003)  5  SCC 622 and submitted that  community  

facilities  and  amenities  are  not  part  of  the  “development  

work” under the Development Act.

12. Shri Vikas Singh, learned senior counsel appearing for  

the applicants in IA No.4 of 2013, supported the Colonizer’s  

contentions and also submitted that the High Court has not

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properly  appreciated  the  scope  of  Section  3(f)  of  the  

Apartment Act.  Learned senior counsel pointed out that the  

expression “unless the context requires in the declaration”  

or  “lawful  amendments  thereto”  which  finds  a  place  in  

Section 3(f) of the Act has been completely overlooked by  

the High Court.  Learned senior counsel also submitted that  

the  Colonizer  is  not  under  an  obligation  either  under  the  

conditions of licence under the Development Act or under  

the provisions of the Apartment Act to declare certain areas  

to be common areas and facilities.

13. Mr.  Narender  Hooda,  learned  Additional  Advocate  

General,  Haryana,  appearing  for  the  State  of  Haryana,  

submitted that the internal community facilities are required  

to be provided by the colonizer in terms of Section 3(3)(a)(iv)  

of the Development Act, at his own cost and the expenditure  

incurred cannot be passed on to the apartment owners and  

colonizer  continues  to  be  the  exclusive  owner  of  such  

community facilities and is free to incorporate or not, any or  

all  such  internal  community  facilities  in  the  declaration

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required to be filed in terms of the Apartment Act.  Learned  

AAG also submitted that in the instant case Silver Oaks is a  

part of a large colony of 130 acres and the same cannot be  

treated as an independent colony but only a portion of large  

colony  of  130  acres.   Further  it  is  pointed  out  that  all  

community facilities provided in the colony of 130 acres of  

which Silver Oaks is only one part is meant for the use and  

enjoyment of all the residents of the colony.

14. Shri  T.R.  Andhiyarujina,  learned  senior  counsel  

appearing for the applicants in IA No.3 of 2010 submitted  

that the High Court is right in holding that the intention of  

the legislature is that the Colonizer cannot be conferred with  

an  absolute  power  to  declare  or  not  to  declare  areas  

normally  in  common use,  to  be  common areas.   Learned  

senior counsel submitted that apartment owners are always  

entitled to object to the contents of the declaration if  the  

contents are not in conformity with the statutory provisions  

and  spirit  of  the  Apartment  Act.   Learned  senior  counsel  

submitted  that  the  High  Court  has  only  directed  the

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Competent Authority to examine the objections raised by the  

apartment owners and it is for the Competent Authority to  

decide as to whether the declaration is in conformity with  

the Apartment  Act  and the Rules  and Regulations framed  

thereunder.

15. Mrs. Madhu Tewatia, learned counsel appearing for the  

SOCA, took us extensively to the provisions of the Apartment  

Ownership  Act  and  the  Rules  framed  thereunder  and  

submitted  that  the  group  housing  complexes  are  totally  

independent  and  distinct  entity  in  terms  of  sanctions,  

applicability  of  development,  control,  norms  etc.  vis-à-vis  

plotted colonies.  Learned counsel also submitted that the  

internal development work shall include common facilities in  

the building complex, for example, common sewerage, water  

supply,  common  staircases,  corridors,  ramps,  lifts,  chutes  

etc.  and  the  community  buildings  are  in  addition  to  the  

provisions  of  development  work  mentioned  in  Rule  5  of  

Development  Rules,  1976.   Referring  to  the  licence  

agreement  under  the  Development  Act,  learned  counsel

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pointed out that the common areas and facilities do not vest  

or belong to the builder and the responsibility of ownership  

or  common  areas  and  facilities,  as  well  as  their  

management, shall continue to vest with the Colonizer only  

till  the  responsibility  is  transferred  to  the  owners  of  the  

dwelling units under the Apartment Act.   

16. Learned counsel also submitted that the development  

charges and construction work in the colony are paid for by  

the apartment owners.  Learned counsel also referred to the  

Judgment of  this  Court  in Naharchand  Laloochand  

Private  Limited v. Panchali  Co-operative  Housing  

Socities Limited  (2010) 9 SCC 536,  and submitted that  

this  Court,  while  interpreting  para-materia  definition  of  

common areas and facilities held that parking area, common  

area and facilities and that even the factum of not having  

taken money from the apartment owners could not change  

the character and nature of common area even though the  

builder  may  not  have  charged.   Learned  counsel  also  

submitted that Judgment in DLF Qutub Enclave (supra) can

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be distinguished on facts and law and is not applicable to the  

case  on  hand  since  in  the  instant  case,  learned  counsel  

submits,  this  Court  is  concerned  with  the  group  housing  

multi-storied society unlike plotted colonies.

17. Shri  Santosh  Paul,  learned counsel  appearing  for  the  

applicants  in  IA  No.5  of  2013,  submitted  that  the  

Colonizer/Developer  in  the  State  of  Haryana  have  with  

impunity  violated  the  provisions  of  the  Apartment  Act.  

Learned counsel submitted that under Section 6 of the Act  

each apartment owner is entitled to an undivided interest in  

common  areas  and  facilities  and  that  percentage  of  

undivided interest of common areas and facilities shall  be  

deemed to be conveyed or encumbered with the apartment  

even though such interest is not expressly mentioned in the  

conveyance  or  instrument.    Learned  counsel  also  made  

reference  to  the  licence  format  LC-7  and  other  relevant  

provisions of the Development Act as well as the Apartment  

Act  and  submitted  that  the  Developer/Colonizer  having  

connivance with the authorities taken shelter under Section

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3(1) to sustain for profiteering.  Learned counsel, therefore,  

submitted  that  there  is  no  reason  to  upset  the  findings  

recorded by the High Court which are in tune with the over  

all  public  interest  so  that  the  rights  of  the  vulnerable  

sections  of  the  society  would  be  safeguarded  from  the  

colonizers.

18. We  find  that  the  issue  involved  in  this  case  is  of  

considerable importance in the real estate sector, especially  

in the urban areas, while developing a Scheme in connection  

with  the  plot  development  or  group  housing,  hence,  it  is  

necessary to examine the various legal issues which arise for  

consideration in this appeal.  The primary question that has  

come up for consideration is with regard to the rights of the  

apartment owners, vis-à-vis the colonizers over “community  

and commercial facilities” referred to in Section 3(f)(7) of the  

Apartment Act.     

19. Apartments owners, as already stated, maintained the  

stand  that  “community  and  commercial  facilities”,  like  

providing community centre, schools, shops etc., would fall

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within  the  statutory  definition  of  “common  areas  and  

facilities”  under  Section  3(f)  of  the  Apartment  Act.    The  

colonizers maintained the stand that it can be so only if the  

colonizer has provided so in the statutory declaration filed by  

it under Section 3(f) of the Apartment Act.   

20. We  are,  in  this  case,  concerned  with  the  rights  and  

obligations which flow to a colonizer, vis-à-vis, the apartment  

owners on the basis of the Development Act as well as the  

Apartment Act.   Let us first examine the relevant provisions  

of the Development Act.

The Development Act:

21. Section 2(c) of the Development Act defines the term  

“colony”, which reads as follows:

“2(c)  “colony” means an area of land divided or  proposed  to  be  divided  into  plots  or  flats  for  residential,  commercial,  industrial,  cyber  city  or  cyber park purposes or for the construction of flats  in the form of group housing or for the construction

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of integrated commercial complexes, but an area  of land divided or proposed to be divided-

(i) for the purpose of agriculture; or

(ii) as  a  result  of  family  partition,  inheritance,  succession  or  partition  of  joint  holding  not  with the motive or earning profit; or

(ii) in furtherance of any scheme sanction under  any other law; or

(iii) by  the  owner  of  a  factory  for  setting  up  a  housing  colony  for  the  labour  or  the  employees  working  in  the  factory;  provided  there is no profit motive; or

(iv) when it does not exceed one thousand square  metres or such less area as may be decided  from  time  to  time  in  an  urban  area  by  Government  for  the  purposes  of  this  sub- clause, shall not be a colony.”  

The expression “colonizer” is defined under Section 2(d)  

which reads as follows :-

“2(d).  "colonizer" means an individual,  company  or  association  or  body  of  individuals,  whether  incorporated or not, owning land for converting it  into  a  colony  and  to  whom a  licence  has  been  granted under this Act.”  

The  expression  “development  works”  is  defined  under  

Section 2(e) of the Act to mean as “internal  and external

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development  works”.  Section  2(g)  defines  the  expression  

“external development works” and reads as follows:

“2(g).  “External  development  works”  include  water  supply,  sewerage,  drains,  necessary  provisions  of  treatment  and  disposal  of  sewage,  sullage and storm water,  roads,  electrical  works,  solid  waste management  and disposal,  slaughter  houses,  colleges,  hospitals,  stadium/sports  complex,  fire  stations,  grid  sub-stations  etc.  and  any other work which the Director may specify to  be  executed  in  the  periphery  of  or  outside  colony/area for the benefit of the colony/area.”

The word “flat”  is  defined under Section 2(gg)  of  the Act,  

which reads as follows:

“2(gg).  “Flat”  means  a  part  of  any  property,  intended  to  be  used  for  residential  purposes,  including one or more rooms with enclosed spaces  located on one or more floors, with direct exit to a  public street or road or to a common area leading  to such streets or roads and includes any garage or  room whether  or  not  adjacent  to  the building in  which  such  flat  is  located  provided  by  the  colonizer/owner  of  such  property  for  use  by  the  owner of such flat  for  parking any vehicle or  for  residence of any person employed in such flat, as  the case may be.”

The  expression  “group  housing”  is  defined  under  Section  

2(hh) of the Development Act, which reads as follows:

“2(hh). “Group  housing”  means  a  building  designed  and  developed  in  the  form of  flats  for  residential purpose or any ancillary or appurtenant

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building  including  community  facilities,  public  amenities and public utility as may be prescribed.”

Section  2(hhh)  defines  the  expression  “integrated  

commercial complex”, which reads as follows :-

“2(hhh).    “integrated  commercial  complex”  means  building  containing  apartments  sharing  common services  and  facilities  and  having  their  undivided share in the land and meant to be used  for office or for practicing of any profession or for  carrying  on  any  occupation,  trade,  business  or  such other  type of  independent use,  as may be  prescribed.”

The  expression  “internal  development  works”  is  defined  

under Section 2(i), which reads as follows:

“2(i).   “Internal development works” mean –  

(i) metalling of roads and paving of footpaths;

(ii) turfing  and  plantation  with  trees  of  open  spaces;

(iii) street lighting;

(iv) adequate and wholesome water-supply;

(v) sewers  and  drains  both  from  storm  and  sullage  water  and  necessary  provision  for  their treatment and disposal; and  

(vi) any other  work that  the Director  may think  necessary  in  the  interest  of  proper  development of a colony.”

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Section 3 of the Development Act deals with application for  

licence, which reads as follows :-

“3. Application  for  licence.-  (1)  Any  owner  desiring  to  convert  his  land  into  a  colony  shall,  unless  exempted  under  section  9,  make  an  application to the Director, for the grant of licence  to develop a colony in the prescribed form and pay  for it such fee and conversion charges as may be  prescribed. The application shall be accompanied by  an income-tax clearance certificate;  

Provided  that  if  the  conversion  charges  have  already  been  paid  under  the  provisions  of  the  Punjab  Scheduled  Roads  and  Controlled  Area  Restriction of Unregulated Development Act,  1963  (41  of  1963),  no  such  charges  shall  be  payable  under this section.

(2) On receipt of the application under sub section  (1), the Director shall, among other things, enquire  into the following matters, namely:-

(a) title to the land;

(b) extent and situation of the land;

(c) capacity to develop a colony;

(d) the layout of a colony;

(e) plan regarding the development schemes of  the colony land to those of the neighbouring  areas.

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(f) conformity  of  the  development  schemes  of  the colony land to those of the neighbouring  areas.

(3) After  the enquiry under  sub-section (2),  the  Director, by an order in writing, shall –

(a) grant a licence in the prescribed form, after  the applicant  has furnished to the Director a  bank  guarantee  equal   to  twenty  five  per  centum of the estimated cost of development  works  in  case  of  area  of  land  divided  or  proposed to be divided into plots or flats for  residential, commercial or industrial purposes  and a bank guarantee equal  to  thirty-seven  and a half per centum of the estimated cost  of development works in case of cyber city  or  cyber  park  purposes  as  certified  by  the  director and has undertaken-

(i) to  enter  into  an  agreement  in  the  prescribed  form  for  carrying  out  and  completion  of  development  works  in  accordance with licence granted;

(ii) to  pay  proportionate  development  charges if the external development works as  defined in clause (g) of section 2 are to be  carried out by the Government or any other  local  authority.  The proportion in which and  the time within which, such payment is to be  made, shall be determined by the Director;

(iii) the  responsibility  for  the  maintenance  and upkeep of all roads, open spaces, public  park and public health services for a period   of  five  years  from the  date  of  issue of  the  completion certificate unless earlier  relieved  of  this  responsibility  and  thereupon  to  transfer  all  such  roads,  open spaces,  public

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parks and public health services free of cost  to the Government or the local authority, as  the case may be;

(iv) to  construct  at  his  own  cost,  or  get  constructed  by  any  other  institution  or  individual  at  its  cost,  schools,  hospitals,  community  centers  and  other  community  buildings  on  the  lands  set  apart  for  this  purpose, or to transfer to the Government at  any time,  if  so  desired by the Government,  free of cost the land set apart for   schools,  hospitals, community centers and community  buildings, in which case the Government shall  be  at  liberty  to  transfer  such  land  to  any  person  or  institutions  including  a  local  authority on such terms and conditions as it  may deem fit;

(v) to  permit  the  Director  or  any  other  officer authorized  by him to inspect the  execution  of  the  layout  and  the  development works in the colony and to  carry out all  directions issued by him for  ensuring  due  compliance  of  the  execution of the layout and development  works  in  accordance  with  the  licence  granted;

Provided that the Director,  having regard to  the amenities which exist or are proposed to  be provided in the locality, is of the opinion  that it is not necessary or possible to provide  one or more such amenities, may exempt the  licensee from providing such amenities either  wholly or in part;

(vi) to  fulfill  such  terms  and  conditions  as  may be specified by the director at the time

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of  grant  of  license  through  bilateral  agreement as may be prescribed.

(b) refuse  to  grant  a  licence,  by  means  of  a  speaking order,  after affording the applicant  an opportunity of being heard.

4. the  license  so  granted  shall  be  valid  for  a  period of  two years,  and will  be renewable from  time to time for a period of  one year, on payment  of prescribed fee:

Provided that in the licensed colony permitted as a  special  project  by  the  Government,  the  license  shall be valid for a maximum period of five years  and shall be renewable for a period as decided by  the Government.”

22. The colonizer, in the instant case, has entered into an  

agreement LC-IVA under Rule 11 of the Development Rules,  

1976, whereby the colonizer has agreed to comply with the  

execution  of  internal  development  works,  external  

development  works  and  to  construct  at  his  own  cost,  

community centers, community buildings, schools, hospitals  

etc. in the areas earmarked for the same in the layout plan  

of  the  colony.    Internal  development  works  are  to  be  

executed  by  the  colonizer  between  boundaries  of  the  

licensed colony  and  the  cost  of  the  internal  development  

works,  to  be  recovered  from  the  plot  holders/apartment

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owners  in  the  colony.    External  development  works  are  

works required to be executed at the periphery of the colony  

or outside the colony limits  which are of  larger and more  

substantial nature and meant to serve the needs of a larger  

area  than  one  colony  like  town  level  infrastructure  work  

facilities etc.   External development works, which includes  

water supply, sewerage, roads, electrical works, solid waste  

management disposal, colleges, hospitals, stadium etc. are  

to be executed exclusively by the State Government and not  

by  the  colonizer.   Section  3(3)(a)(ii)  and  the  statutory  

agreement to be entered into between the colonizer and the  

State Government would indicate that colonizer is required  

to deposit with the Government the entire cost of external  

development works as quantified by the State Government,  

cost of the same invariably passed on by the colonizer to the  

plot holders/apartments owners on pro-rata basis.  Further,  

the  responsibility  for  the  maintenance  and  upkeep  of  all  

roads, open spaces, public parks and public health services  

for a period of five years is on the Colonizer from the date of  

issue of the completion certificate.

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23. We  may  now  examine  the  most  crucial  issue  with  

regard  to  the  scope  of  Section  3(3)(a)(iv)  of  the  

Development Act.  As per the said provision, an obligation is  

cast on the colonizer to construct “at its own cost” or get  

constructed by any other institution or an individual at its  

own cost, schools, hospitals, community centers and other  

community  buildings  on  the  land  set  apart  for  the  said  

purpose.  In the alternative, the colonizer can also transfer to  

the  Government,  at  any  time,  if  so  decided  by  the  

Government,  free  of  cost,  the  land  set  apart  for  schools,  

hospitals,  community centers and community buildings,  in  

which case, the Government shall  be at liberty to transfer  

such  land  to  any  person  or  institution,  including  a  local  

authority on such terms and conditions, as it may deem fit.  

In such situation, the cost of construction can either be met  

by the Government or by the transferee of the Government.  

The  cost  incurred  in  discharging  the  obligations  under  

Section  3(3)(a)(iv),  as  already  indicated,  has  to  be  borne  

either by the colonizer or, on transfer of the land free of cost,

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by the Government or the Government transferee.  The cost  

incurred for construction, in that event, cannot be passed on  

or recovered from the plot holders/apartment owners in the  

colony.    

24. Section 3(3)(a)(iv) obliges the colonizer to construct at  

his  own  cost  schools,  hospitals,  community  centers  and  

other buildings on the lands set apart for that purpose, or  

also can get them constructed by any other institution or an  

individual,  at  its  own cost,  but  the  ownership  of  land set  

apart  for  the  said  purpose  continues  with  the  colonizer.  

Option  is  also  provided  under  Section  3(3)(a)(iv)  to  the  

colonizer to transfer to the Government, at any time, if so  

desired by the Government, free of cost, the land set apart  

for  schools,  hospitals,  community  centers  and  community  

buildings, in which case, the Government shall be at liberty  

to transfer such land to any person or institution, including a  

local authority on such terms and conditions as it may deem  

fit.    But,  the  ownership  of  the  Colonizer  cannot  be  

transferred or  divested,  unless the colonizer  volunteers to

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transfer  the  same  free  of  cost  to  the  Government.   The  

colonizer  has  taken  a  specific  ground  in  this  appeal  that  

even  before  filing  the  writ  petition,  they  had  already  

transferred  its  right  to  construct  two  nursery  schools,  

community  center  and  the  shops  in  Silver  Oaks  Group  

Housing  to  third  parties  and  it  is  for  the  third  parties  to  

construct the same, though ownership of the land vests with  

the colonizer.

25. Community and other facilities like schools,  hospitals,  

community centers, shops etc. provided in the land set apart  

under  Section  3(3)(a)(iv)  are,  therefore,  meant  for  the  

benefit  of  the  entire  colony  and  not  for  the  apartment  

owners in one part of the colony and the costs incurred in  

discharge  of  the  statutory  obligations  cannot  be  passed  

on/transferred  from the  plot  owners/apartment  owners  by  

the colonizer.   The facilities  to  be provided under Section  

3(3)(a)(iv)  are  based  on  the  prescribed  norms  which  are  

population based and the number of each type of amenity  

and its placement at various places in the colony (plotted

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areas or group housing) are, as per the lay-out plans duly  

approved by the DTCP under the Development Act.   DTCP  

has  prescribed  the  requirement  for  each  

amenity/commercial  facility  for  DLF  City  Phase  I,  II  &  III,  

comprising of a total area of 1542 acres, under a composite  

layout plan of all the three phases, treating three phases as  

a single colony.   As per the approved layout plans,  these  

amenities are earmarked at various sites in the colony, some  

in the plotted areas and some in the group housing areas.  

So far as the present case is concerned, we notice that the  

layout  plans  pertaining  to  lands  covered  under  various  

licenses in the colony are not restricted to 130 acres alone,  

wherein Silver Oaks Group Housing is located in 14.75 acres.  

26. In  Ansal  Properties  and  Industries  Limited.  V.   

State of Haryana and Another (2009)  3  SCC 553,  this  

Court had occasion to examine the scope of Section 3(3)(a)

(iv) along with the Regulations Act. In that case, the Court  

held as follows:

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“42. The  responsibility  regarding  construction  of  community centres and other community buildings  could be discharged by adopting any of the three  options as mentioned hereinbefore and each one  of such options is an independent option and one  cannot be connected and related with the other.  We  cannot  read  the  provision  relating  to  construction at the own cost of the developer the  schools,  hospitals,  community  centres  and  other  community buildings on the land set apart for this  purpose, into an independent alternative provision  relating to transfer of such land to the Government  free  of  cost.  The  aforesaid  option  given  to  the  developer to construct the community centres and  other community buildings at its own cost is when  he can utilise himself to manage it. Therefore, we  cannot read the aforesaid provision in the manner  sought to be read by Mr Chaudhari, for reading by  adding certain words in the aforesaid manner does  not  appear to  be the intention of  the legislature  while  enacting  the  aforesaid  legislation,  for  otherwise the legislature would have explicitly said  so in the body of the main part of the section itself.

In that case,  the State Government sought to recover the  

cost  of  construction over  the  land set  apart  for  providing  

facilities which were taken over by the Government as part  

of  “external  development  charges”.   This  Court  held  that  

Section  3(3)(a)(iv)  only  provides  for  the  land  to  be  

transferred  to  the  State  and  no  provision  of  the  Act

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authorizes the State Government to recover charges towards  

cost of construction.   

27. Later, in  DLF Qutub Enclave Complex Educational   

Charitable  Trust  v.  State  of  Haayana  and  Others  

(2003) 5 SCC 622, while dealing with the scope of the above  

mentioned provision, this Court held as follows:

“34. At the outset, we may notice that the cost of  development  works  indisputably  is  to  be  raised  from  the  plot-holders,  but  as  construction  of  schools,  hospitals,  community  centres  and  other  community  buildings  do  not  come  within  the  purview  of  the  term  “development  works”,  the  costs therefore are not to be borne by them.

35. The  expression  “development  works”  as  noticed  hereinbefore  is  not  synonymous  with  “amenity”.  The  expression  “amenity”  has  been  used only in the proviso appended to sub-clause  (v) of Section 3(3)(a) and Rule 2(b) of the Rules.  Rules  are  subservient  to  the  Act,  although  they  may  be  read  conjointly  with  the  Act,  if  any  necessity arises therefor. Even Rule 5 specifies the  obligation of the colonizer as regard providing for  the development works. The expression “amenity”  as defined in Rule 2(b) of the Rules is wider than  “development works”. No principle of construction  of statute suggests that a wider expression used in  the  rule  may  be  read  in  the  statute  employing  narrower  expression.  Even  in  the  rule  the  said  expressions have been used for different purposes.  The  licence  also  does  not  postulate  that  all

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amenities must be provided by the colonizer at its  own expense.  If  the  terms “development  works”  and “amenity”  are treated as  carrying the same  meaning, the plot-holders may be held to be bound  to  meet  the  costs  for  construction  of  schools,  hospitals,  community  centres  etc.  The  cost  of  construction in terms of the said provisions thereof  is to be borne by DLF or its nominees.

36. Right  of  transfer  of  land  is  indisputably  incidental to the right of ownership. Such a right  can be curtailed or taken away only by reason of a  statute. An embargo upon the owner of the land to  transfer  the  same  in  the  opinion  of  this  Court  should not be readily inferred. Section 3(3)(a)(iv) of  the Act does not expressly impose any restriction.  The same is merely a part of an undertaking. …..”

28. We  have  to  now  examine  the  rights  of  apartment  

owners over the facilities referred to in Section 3(3)(a)(iv) of  

the Development Act in the light of the Apartment Act.  As  

already  indicated,  it  is  the  obligation  of  the  colonizer  to  

construct  schools,  community  centers  and  commercial  

facilities on the lands set apart for that purpose in the colony  

under Section 3(3)(a)(iv) of the Development Act and also on  

the basis of agreement executed between the colonizer and  

the DTCP.   No obligation is cast on the colonizer under the  

Apartment Act  or  the Rules framed thereunder to  provide

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those  facilities  which  are  specifically  mentioned  under  

Section  3(3)(a)(iv)  of  the  Development  Act.   But  the  

Colonizer  has  to  provide  various  other  facilities  like  

“common areas and facilities”, to the apartment owners, as  

provided under the Apartment Act.   In this regard, reference  

may be made to certain provisions of the Apartment Act.  

The Apartment Act:

29. Section 3(a) of the Apartment Act deals with the word  

“apartment”, which reads as follows:

“3(a).   “Apartment”  means  a  part  of  the  property intended for any type of independent use,  including one or more rooms or enclosed spaces  located  on  one  or  more  floors  or  part  or  parts  thereof,  in  a  building,  intended  to  be  used  for  residential  purposes  and  with  a  direct  exit  to  a  public street, road or highway or to a common area  leading to such street, road or highway.”

Section  3(b)  defines  the  term  “apartment  owner”  which  

reads as follows:

“3(b)  “Apartment  owner”  means  the  person  or  persons  owning  an  apartment  and  undivided  interest in the common areas and facilities in the  percentage  specified  and  established  in  the  declaration.”

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Section 3(f) defines the term “common areas and facilities”  

which reads as follows:

“3(f)  “Common  areas  and  facilities:  unless  otherwise  provided  in  the  declaration  or  lawful  amendments thereto means-

(1) the land on which the building is located;

(2) the  foundations,  columns,  girders,  beams,  supports,  main  walls,  roofs,  halls,  corridors,  lobbies,  stairs,  stair  ways,  fire  escapes  and  entrances and exits of the building;

(3) the  basements,  cellars,  yards,  gardens,  parking area and storage spaces;

(4) the  premises  for  the  lodging  of  janitors  or  persons  employed  for  management  of  the  property;

(5) installation of central services such as power,  light,  gas,  hot  and  cold  water,  heating  refrigeration, air conditioning and incinerating;

(6) the  elevators,  tanks,  pumps,  motors,  fans  compressors, ducts and in general all apparatus  and installations existing for common use;

(7) such community and commercial facilities as  may be provided for in the declaration; and

(8) all  other  parts  of  the property necessary or  convenient  to  its  existing  maintenance  and  safety or normally in common use.”

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Section 3(h) defines the term “common profits” which reads  

as follows:

“3(h). “Common profits” means the balance of all  income,  rents,  profits  and  revenues  from  the  common  areas  and  facilities  remaining  after  the  deduction of the common expenses.”

Section 3(j)  defines the word “declaration” which reads as  

under;

“3(j). “Declaration” means the instrument  to  be executed and got registered in the prescribed  form and includes the amended declaration.”

Section 4 of the Act deals with the “status of apartments”  

which reads as under:

“4.  Status  of  apartments.-   Each  apartment,  together with its undivided interest in the common  areas  and  facilities,  appurtenant  to  such  apartment,  shall  for  all  purposes  constitute  heritable  and  transferable  immovable  property  within the meaning of any law for the time being  in force in the State of Haryana.”

Section 5 of the Act deals with “Ownership of apartments”  

which reads as follows:

‘5.  Ownership  of  apartments.-   (1)  Each  apartment owner shall be entitled to the exclusive  ownership  and  possession  of  his  apartment  in  accordance with the declaration.

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(2) Each apartment owner shall execute a deed of  apartment  in  relation  to  his  apartment  in  the  manner prescribed.”

30. The  status  of  apartments  together  with  its  undivided  

interest in common areas and facilities, appurtenant to such  

apartment,  shall  for  all  purposes  constitute  heritable  and  

transferable immovable property and each apartment owner  

shall be entitled to the exclusive ownership and possession of  

his apartment in accordance with the declaration.   

31. Section  6  of  the  Act  deals  with  “common  areas  and  

facilities” which reads as follows:

“6. Common areas and facilities.  –  (1)  Each  apartment owner shall be entitled to an undivided  interest in the common areas and facilities in the  percentage  expressed  in  the  declaration.   Such  percentage shall be computed by taking as a basis  the  value  of  the  apartments  in  relation  to  the  value of the property; and such percentage shall  reflect the limited common areas and facilities.

(2) The percentage of the undivided interest of  each apartment owner in the common areas and  facilities as expressed in the declaration shall have  a  permanent  character  and shall  not  be  altered  without the consent of all  the apartment owners  and  expressed  in  an  amended  declaration  duly  executed and registered as provided in this Act.  The percentage  of  the  undivided interest  in  the

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common areas and facilities shall not be separated  from  the  apartment  to  which  it  appertains  and  shall be deemed to be conveyed or encumbered  with the apartment even though such interest is  not  expressly  mentioned  in  the  conveyance  or  other instrument.    

(3) The common areas and facilities shall remain  undivided and no apartment owner or any other  person  shall  bring  any  action  for  partition  or  division  of  any  part  thereof  unless  the  property  has been removed from the provisions of this Act  as provided in Sections 14 and 22.  Any covenant  to the contrary shall be null and void.

(4)   Each apartment owner may use the common  areas and facilities in accordance with the purpose  for which they are intended without hindering or  encroaching  upon  the  lawful  rights  of  the  other  apartment owners.   

(5) The necessary  work  of  maintenance,  repair  and  replacement  of  the  common  areas  and  facilities  and  the  making  of  any  addition  or  improvements  thereto  shall  be  carried  out  as  provided herein and in the bye-laws.

(6) The  association  of  apartment  owners  shall  have the irrevocable right, to be exercised by the  Manager  or  Board  of  Managers  thereof,  to  have  access to each apartment from time to time during  reasonable  hours  as  may  be  necessary  for  the  maintenance, repair and replacement of any of the  common areas and facilities therein or accessible  there  from  or  for  making  emergency  repairs  therein  necessary  to  prevent  damage  to  the  common  areas  and  facilities  or  to  another  apartment or apartments.”

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Declaration:

32. The Apartment Act casts an obligation on the colonizer  

to file a statutory declaration.  Section 6 read with Section  

3(f) of the Apartment Act clearly indicates that clauses 1 to 8,  

except 7 of Section 3(f) are to be provided by the colonizer to  

the apartment owners and each apartment owner is entitled  

to an undivided interest in the common areas and facilities,  

in  the percentage expressed in  the declaration.   The only  

exception is  clause 7,  which gives a right to the colonizer  

either  to  provide or  not  to  provide in  the declaration,  the  

community and commercial  facilities  referred to in Section  

3(3)(a)(iv)  of  the  Development  Act.   There  is  a  marked  

difference  between  “common  areas  and  facilities”  and  

“community and commercial facilities”.  A colonizer is duty  

bound to provide all the common areas and facilities as per  

Section  3(f),  except  community  and  commercial  facilities  

referred to in Section 3(f)(7).   “Common areas and facilities”  

referred to in Section 3(f)(7) of the Apartment Act has a co-

relation  with  the  “Community  and  Commercial  facilities”  

referred to in Section 3(3)(a)(iv) of the Development Act.   It

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is  for  that  reason that  a discretion has been given to the  

colonizer to either provide the same or not to provide the  

same in  the  declaration  referred  to  in  Section  3(f)  of  the  

Apartment Act.  The expression “may” used in Section 3(f)(7)  

of the Apartment Act clearly indicates that no duty is cast on  

the  colonizer  to  give  an  undivided  interest  over  those  

community  and  commercial  facilities  exclusively  to  the  

apartment  owners  of  a  particular  colony,  since  the  same  

have to be enjoyed by other apartment owners of DLF City,  

Phase I, II and III as well.  Even otherwise, the colonizer could  

not have parted with his ownership rights exclusively to one  

Colony alone.  

33. Section  11  of  the  Act  deals  with  “contents  of  

declaration” which is extracted below:

“11. Contents  of  declaration –  (1)  The  declaration shall contain the following particulars,  namely :-

(a) description of land on which the building and  improvements  are  to  be  located  and  whether  the land is freehold or leasehold;

(b) description of the building stating the number  of  storeyes  and  basement,  the  number  of

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apartments and the principal materials of which  it is or is to be constructed;

(c) the  apartment  number  of  each  apartment  and statement of its location, approximate area,  number of rooms and immediate common area  to  which  it  has  access   and  any  other  data  necessary for its proper identification;

(d) description of the limited common area and  facilities;

(e) description of the limited common area and  facilities,  if  any,  stating  to  which  apartment  their use is reserved;

(f) value  of  the  property  and  of  each  apartment  and the percentage of undivided interest in the  common  areas  and  facilities  appertaining  to  each apartment and its owner for all purposes,  including  voting  and  a  statement  that  the  apartment  and  such  percentage  of  undivided  interest  are  not  encumbered  in  any  manner  whatsoever  or  not  on  the  date  of  the  declaration;

(g) statement  of  the  purposes  for  which  the  building  and  each  of  the  apartments  are  intended and restricted as to use;

(h) the name of  a person to receive service of  process  in  the  cases  hereinafter  provided,  together with the residence or place of business  of such persons which shall be within the city,  town or village in which the building is located;

(i) provisions as to the percentages of votes by the  apartment owners which shall be determinative  of whether to rebuild, repair, restore or sell the

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property in the event of damage or destruction  of all or part of the property;

(j) any  other  details  in  connection  with  the  property  which  the  person  executing  the  declaration  may  deem  desirable  to  set  forth  consistent with this Act; and  

(k) The method  by which the declaration may be  amended consistent with the provisions of this  Act.

 (2) A true copy of  each of  the declaration and  bye-laws and all amendments to the declaration or  the  bye-laws  shall  be  filed  in  the  office  of  the  competent authority.”

“Contents of deed of apartment” is dealt with in Section 12 of  

the Act which reads as follows:

“12.  Contents of deed of apartment. – (1) The  deed  of  apartment  shall  include  the  following  particulars, namely :-

(a) a  description  of  the  land  as  provided  in  Section 11 or the postal address of the property,  including in either case the number, page and  date of executing the declaration, the date and  serial  number  of  its  registration  under  the  Indian Registration Act, 1908 and the date and  other  reference,  if  any,  of  its  filing  with  the  competent authority;

(b) the  apartment  number  of  the  apartment  in  the declaration and any other  data necessary  for its proper identification;

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(c) statement of the use for which the apartment  is intended and restrictions on its use, if any;

(d) the  percentage  of  undivided  interest  appertaining to the apartment in the common  areas and facilities; and  

(e) any further details which may be desirable to  set forth consistent with the declaration and this  Act.

(2) A true copy of every deed of apartment shall  be filed in the office of the competent authority.”

34. Section 13 of the Act states that the declaration and all  

amendments thereto and the deed of apartment in respect of  

each apartment and the floor plan of the building referred to  

in  sub-section  (2)  shall  be  registered  under  the  Indian  

Registration Act.    

35. If  we  scan  through  the  above  mentioned  provisions,  

what  is  discernible  is  that  each apartment  owner  shall  be  

entitled to an undivided interest in the common areas and  

facilities in the percentage expressed in the declaration and  

such percentage shall be computed by taking as a basis the  

value  of  the  apartment  in  relation  to  the  value  of  the  

property.   Common  areas  and  facilities  shall  also  remain

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undivided and the apartment owner or any other person can  

use the common areas and facilities in accordance with the  

purpose  for  which  they  are  intended  without  entering  or  

encroaching  upon  the  rights  of  other  apartment  owners.  

Apartment owners are entitled to an undivided interest in the  

common areas and facilities in the percentage expressed in  

the declaration, within the meaning of Section 3(f) (1) to (6)  

and (8) and it is also open to the colonizer to provide, at its  

own cost, the community and commercial facilities referred  

to in clause 7 of Section 3(f) read with Section 3(3)(f)(iv) of  

the Development Act by including them in the declaration.  

Colonizer  cannot  also,  under  certain  circumstances,  confer  

any  undivided  interest  to  an  exclusive  set  of  apartment  

owners to the detriment of similar apartment owners,  who  

have apartments in other phases of a larger colony or city.  

Apartment  owners  are,  therefore,  not  entitled  to  an  

undivided interest or possession over those community and  

commercial facilities, referred to in Section 3(3)(a)(iv) of the  

Development  Act,  unless  specifically  provided  by  the  

colonizer in the statutory declaration.

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Ownership Vs. User:

36. We have clearly indicated that the ownership right over  

the  land  earmarked  for  schools,  hospitals,  community  

centers and other community buildings referred to in Section  

3(3)(a)(iv)  of  the  Development  Act  vests  on the  colonizer.  

That ownership can be divested, as already indicated, by the  

colonizer through a declaration under Sections 11 to 13 read  

with Section 3(f) of the Apartment Act.  The colonizer has to  

provide those facilities  in  discharge of  its  legal  obligations  

under the Development Act and the Act itself has recognized  

its or his legal ownership over the area set apart for those  

facilities under Section 3(3)(a)(iv) of the Act.  All the same,  

the right to enjoy those facilities referred to in Section 3(3)(a)

(iv)  of  the  Development  Act,  whether  shown  in  the  

declaration  or  not,  under  the  Apartment  Act,  cannot  be  

restricted  or  curtailed  and the apartment  owners  have no  

other right, except the right of “user”.   Community centers,  

nursery  schools,  shops  etc.,  therefore,  being  part  of  the  

approved  layout  plans  by  the  DTCP,  can  be  used  by  the

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apartment owners and, being part of the larger colony, are  

intended for  independent use of  all  the apartment owners  

having  direct  exit  to  common  areas,  to  the  public  street,  

road, etc.  All those facts would indicate, so far as apartment  

owners are concerned, they have only a right of user, so far  

as  the  facilities  provided  under  Section  3(3)(a)(iv)  of  the  

Development Act are concerned.

37. Learned counsel for respondents sought to argue that  

the Silver Oaks Apartments is a ‘gated’ colony and, therefore,  

the  developments  which  have  taken  place  inside  the  

boundary walls of that colony are to be treated as parts of  

internal development works and, therefore, these are parts of  

common  areas.   In  this  very  direction,  it  was  further  

submitted  that  these  are  the  necessary  and  essential  

facilities which have to be provided to the flat owners by the  

developers, for the common use of the flat owners.  Though,  

this argument appears to be attractive, it has no merit when  

we  examine  the  nature  of  structures  developed  by  the  

developer  i.e.  the  appellant  to  which  it  is  claiming  its

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exclusive right.   These structures are two nursery schools,  

three  shops  and  one  community  centre,  which  cannot  be  

treated as “common areas and facilities” within the definition  

of Section 3(f) of the Act.  As already pointed out above, they  

are  parts  of  planning  for  larger  area,  which  plans  were  

submitted by the appellant.  It is not meant for the exclusive  

use of the flat owners of Silver Oaks Apartments.  Position  

would have been different had these been integral parts of  

the facilities, in the sense that these facilities are essential  

for the enjoyment of the flats.   

38. Common  passages,  staircases,  lifts  etc.  are  the  

examples of such common areas and facilities.  Likewise, stilt  

parking area may be treated as part of common areas and  

facilities, in certain circumstances.  Here these structures are  

the part of the larger area of about 130 acres in respect of  

which  7  licenses  were  obtained  for  development  of  the  

colony.  Silver Oaks Apartments, which comprises of 14.75  

acres, is only a part thereof. The nursery schools, shops and  

community  centre  are  meant  for  the  development  of  the

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entire colony and are not confined only to these apartments,  

as already noted in detail above.  Further, as per our detailed  

discussion hereinabove, it is clear that the developer is given  

right to transfer these “community buildings and community  

centers”.  Likewise, even schools cannot be termed as part of  

“integral  development”  use  whereof  would  be  confined to  

residents of these apartments.   Even the shops which are  

inside the boundary walls have their opening from outside to  

enable the shopkeepers to cater to the customers not only  

from these apartments, but outsiders as well.  Therefore, on  

these  facts,  we  are  not  impressed  by  the  argument  

predicated on “gated colony”.  

Cost not on Apartment owners:

39. We  have  found  that  the  Colonizer  is  legally  obliged  

under Section 3(3)(a)(iv) of the Act to construct at his own  

cost  the  community  and  commercial  facilities  stipulated  

therein  and an  agreement  has  to  be  entered into  by  the  

Colonizer  with  the  DTCP  under  the  Development  Act  by  

which the Colonizer is prohibited by law from recovering the

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cost of providing those facilities from the apartment owners.  

The  operative  portion  of  the  agreement  executed  by  the  

colonizer reads as follows:

“j) That only convenient shopping sufficient for  requirement  of  the  Group  Housing  will  be  allowed which shall be approximate one shop  per  one  thousand  persons,  covering  a  maximum area of 200 sq. ft. per shop.

k) That  adequate  educational,  health,  recreational  and  cultural  amenities  to  the  norms  and  standards  provided  in  the  respective  Development  plan  of  the  area  shall be provided.

The owner shall at his own cost construct the  primary-cum-nursery  school,  community  building/dispensary  and  first  aid  centre  on  the land set apart for this purpose, or if  so  desired  by  the  Govt.  shall  transfer  to  the  Govt. at any time free of cost land thus set  apart  for  primary  cum  nursery  school,  community  building/dispensary  and first  aid  centre,  in  which case the Govt.  shall  be at  liberty to transfer such land to any person or  instruction including a local authority on such  terms and conditions as it may lay down.

o) That the owner shall abide by the provisions  of  the  Haryana  Apartment  and  Ownership  Act, 1983.

p) That  the  responsibility  of  the  ownership  of  the  common areas  and facilities  as  well  as  their  management  and  maintenance  shall  continue to vest with the colonizer till  such

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time the  responsibility  is  transferred  to  the  owners  of  the  dwelling  units  under  the  Haryana  Apartment  and  Ownership  Act,  1983.”

40. Section 3(3)(a)(iv)  of  the  Development  Act  read with  

the  above-mentioned  clauses  in  the  agreement  would  

indicate that ownership of the portion of the land set apart  

for the common areas and facilities referred to therein vest  

with the Colonizer so also the obligation “at his own cost” to  

provide  those  facilities  in  the  land  set  apart  for  the  said  

purpose.   The Colonizer cannot recover cost of land or the  

amounts spent by him for providing those facilities from the  

apartment owners.  It is for the said reason that clause 7 of  

Section 3(f) of the Apartment Act has not made it obligatory,  

on the part of the Colonizer to include the “community and  

commercial”  facilities  in  the  declaration.   If  the  colonizer  

includes the same within the declaration, then Section 6 of  

the Apartment Act will kick in, consequently, the apartment  

owners would be entitled to the undivided interest in respect  

of the community and commercial facilities provided therein  

without  bearing  the  cost  incurred  by  the  colonizer  in

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purchasing  the land and the cost  of  construction.   In  our  

view, the colonizer could not have included the community  

and commercial facilities referred to in Section 3(3)(a)(iv) of  

the Development Act,  because the same is meant for  the  

benefit of the entire colony, not merely the flat/apartment  

owners in one part of the colony since they form part of the  

lay out plans duly approved, which takes in plotted area and  

the group housing societies area as well.

41. We  have  also  gone  through  the  Apartment  Buyer’s  

agreement/conveyance deed.  The exact extent of area sold  

by  the  colonizer  to  an  apartment  owner  is  mentioned  

therein.  The operative portion of the same reads as follows:

“1. That the Company hereby agrees to sell and  the Apartment Allottee hereby agrees to acquire  the said premises as detailed below at the rate  mentioned  against  it  and  upon  the  terms  and  conditions set out hereunder as mutually agreed  by and between the parties thereto.

Particulars      Apartment    Super Area  Rate (s)  per

i.e. Bldg. No.   No.     (Appx)       sq meter

    121    82        98.28 sq. mtr.   Rs.6189/-

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3(a) That the Apartment Allottee agress that the  Super  Area  for  the  purpose  of  calculating  the sale price in respect of the said premises  shall  be  inclusive  of  the  area  under  the  periphery  walls,  area  under  columns  and  walls  within  the  Apartment,  half  of  the  area  of  the  walls  common  with  other  apartments adjoining the said apartment and  also  proportionate share of the common  area  in  the building i.e.  stairs,  ramps,  walk ways, lobbies, lift wells, shafts and  the like…….”

42. Considerable  reliance  was  placed  by  the  apartment  

owners  on  the  Judgment  of  this  Court  in  Naharchand  

Laloochand  Private  Limited (supra).  First  of  all,  the  

Judgment  is  not  at  all  dealing  with  the  community  and  

commercial  facilities  in  a  group  housing  society  with  

reference  to  the  provisions  of  Section  3(3)(a)(iv)  of  

Development  Act.   The  above-mentioned  Judgment  was  

delivered in  the context  of  the Maharashtra  Ownership  of  

Flats  Act,  1963  (MOFA)  and  the  Development  Control  

Regulation  (DCR)  framed  under  the  Maharashtra  Regional  

Town  Planning  Act,  1966.   In  that  case  this  Court  was  

required to examine as to  whether  a stilt  parking can be  

considered  to  be  a  garage  under  the  definition  of  “flat”

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under MOFA.  As per the format provided under MOFA only a  

“flat” or “dwelling unit” or “shop” or “garage” can be sold by  

a developer.   Stilt  parking could not be separately sold in  

terms of the provisions of the MOFA, a statutory format of  

the  agreement  and  the  provisions  of  the  DCR.   Such  a  

restriction is not there either under the 1975 Regulation Act  

or the Apartment Act and there is no occasion to consider  

whether stilt parking can be sold along with the apartment.  

In  any  view,  the  present  case  is  not  concerned  with  the  

question  of  stilt  parking.   We  are  in  this  case,  pointedly  

concerned with the facilities provided under Section 3(3)(a)

(iv)  of  Development  Act,  consequently,  the  reasoning  of  

Naharchand  Laloochand  Private  Limited (supra)  are  

inapplicable to the facts of this case, if examined in the light  

of the Regulation Act and the Apartment Act.

Competent Authority:

43. We  are  also  of  the  view  that  the  High  Court  has  

committed  an  error  in  directing  the  DTCP  to  decide  the

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objections  of  the  apartment  owners  with  regard  to  the  

declaration made by the colonizer.  The Competent Authority  

is defined under Section 3(i) of the Apartment Act.  Section  

11(2) provides for  filing of declaration in the office of the  

Competent  Authority.   Section  24A  of  the  Act  prescribes  

penalties and prosecution for failure to file a declaration and  

Section 24B permits the prosecution only with the sanction  

of the Competent Authority.  In a given case if the developer  

does not provide common areas or facilities like corridors,  

lobbies, staircases, lifts and fire escape etc. the Competent  

Authority  can  look  into  the  objections  of  the  apartment  

owners  but  when  statute  has  given  a  discretion  to  the  

colonizer to provide or not to provide as per Section 3(f)(7)  

of the Apartment Act the facilities referred to in Section 3(3)

(a)(iv) of Development Act, in our view no objection could be  

raised by the apartment owners and they cannot claim any  

undivided interest  over  those facilities  except  the right  of  

user.  In the instant case the apartment owners have raised  

no grievance that they are being prevented from using the  

community and commercial facilities referred to in Section

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3(3)(a)(iv)  of  Regulation  Act,  but  they  cannot  claim  an  

undivided interest or right of management over them.

44. We  may  also  refer  to  the  contention  raised  by  the  

apartment  owners  that  the  Judgment  in  DLF  Qutab  

Enclave (supra)  is  not  applicable  in  view of  the  Haryana  

Development and Regulation of Urban Areas (Management)  

Act, 2003 which came into force on 03.04.2003.  We have  

gone  through  the  amended  definition  of  “external  

development  works”.   By  virtue  of  the  amendment,  the  

scope  of  the  said  expression  has  been  widened  and  the  

State Government has given a wider discretion in expending  

the  amount  collected  from  the  colonizer  as  external  

development charges.  The Amendment Act does not seek to  

transfer an obligation of actually carrying out the external  

development  work  upon the  colonizer.   The Statement  of  

Objects  and Reasons of  the Bill  of  2003 which led to  the  

amendment indicates that though the various decisions of  

the High Court have gone in favour of the Department, the  

amendment  was  necessitated  to  make  certain  provisions

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more comprehensive.  In other words, the amendment has  

no  effect  on  the  Judgment  of  this  Court  in  DLF  Qutab  

Enclave (supra).

45. We are of the view that the High Court has not properly  

appreciated or applied the various statutory provisions of the  

Regulation Act and the Rules framed thereunder, the terms  

of  licences  issued,  agreements  executed  between  the  

colonizer and the DTCP vis-à-vis the various provisions of the  

Apartment  Act,  the  statutory  declaration  made  by  the  

colonizer and the Sale Deeds executed between the parties.  

In  such  circumstances,  we  are  inclined  to  set  aside  the  

judgment of the High Court and dismiss the writ petition filed  

before  the  High  Court.   The  appeal  is,  therefore  allowed.  

However, there will be no order as to costs.  Applications for  

intervention are allowed.

Contempt Petition (Civil) No.      of  2013(D.No.29500/12)

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46. The interim orders passed by this Court are merged in  

the aforesaid judgment.   In such circumstances, no further  

orders are necessary in the Contempt Petition and the same  

is disposed of accordingly.

……..……………………..J.   (K.S. Radhakrishnan)

……………………………J.  (A.K. Sikri)

New Delhi, December 10, 2013.