The Bombay High Court has clarified that the Competent Authority under the Maharashtra Ownership Flats Act, 1963, cannot reject an application for deemed conveyance merely because of title disputes between the promoter and third parties or because the society seeks conveyance of more land than it is entitled to. The judgment reinforces the statutory obligation of promoters to transfer title to flat purchasers, irrespective of external ownership conflicts.
Background & Facts
The Dispute
The petitioner, Krushna Kunj Co-op. Housing Society Ltd., is a co-operative housing society formed by purchasers of flats and garages in a building constructed by M/s. Nayan Construction Co. Pvt. Ltd. (Respondent No. 1). The land on which the building stands was originally jointly owned. One joint owner’s legal heir appointed Nayan Construction as developer. The other joint owner sold the land to Respondent No. 2, who now claims full ownership and opposes the conveyance of any portion of the land to the society. Respondent No. 2 further alleges that the building construction is illegal because the development permission was granted subject to production of a probate of the will of the deceased joint owner, which was later dismissed.
Key Facts
The society was formed by flat purchasers who acquired units between 1988 and 1990.
Most flat purchase agreements were executed by M/s. Mak & Mak Builders, not Nayan Construction.
One agreement dated 11.07.1988 was executed between Nayan Construction Co. Pvt. Ltd. and society member Inderjeet Singh Bhatia.
The society applied for deemed conveyance of the entire land admeasuring 1331.1 sq.mtrs. under Section 11 of MOFA.
The building constructed for the society occupies only 155 sq.mtrs. of the total land.
The Competent Authority rejected the application on three grounds: (1) the society sought conveyance of land exceeding its entitlement; (2) no Agreement for Sale was executed by Respondent No. 1; and (3) existence of title disputes between Respondent No. 1 and Respondent No. 2.
The society filed the writ petition on 2015, challenging the order dated 10.06.2014.
Procedural History
11.07.1988: Agreement executed between Nayan Construction Co. Pvt. Ltd. and Inderjeet Singh Bhatia.
2013: Application No. 214 of 2013 filed before the Competent Authority for deemed conveyance.
10.06.2014: Competent Authority rejected the application.
2015: Writ Petition No. 5379 of 2015 filed before the Bombay High Court.
25.06.2026: Hearing concluded.
02.07.2026: Judgment pronounced.
The Parties' Positions
Petitioner-Society: Argued that under Section 11 of MOFA, the promoter is statutorily obligated to convey title to the society, regardless of whether the agreement contains an express clause for conveyance. The society is willing to accept conveyance of only the 155 sq.mtrs. on which the building stands.
Respondent No. 2: Contended that since the promoter (Nayan Construction) never acquired valid title to the land due to the dismissed probate petition, it cannot transfer title to the society. The society’s application is therefore invalid.
Relief Sought
The petitioner sought quashing of the Competent Authority’s order dated 10.06.2014 and a direction for immediate conveyance of the land on which the building stands, or alternatively, remand for fresh adjudication.
The Legal Issue
Whether the Competent Authority under Section 11 of the Maharashtra Ownership Flats Act, 1963, can reject an application for deemed conveyance on grounds of title disputes between the promoter and a third party, or because the society seeks conveyance of more land than its proportionate entitlement.
Arguments Presented
For the Petitioner
The petitioner relied on New Manoday CHSL v. Uday Madhavrao Jagtap to argue that Section 11 of MOFA imposes a statutory duty on the promoter to transfer title to the society, irrespective of the absence of an express clause in the Agreement for Sale. The existence of title disputes between the promoter and a third party is irrelevant to the Competent Authority’s jurisdiction under MOFA. The society’s prayer for conveyance of the entire 1331.1 sq.mtrs. was a procedural overreach, not a substantive defect, and the society has now clarified it seeks only the 155 sq.mtrs. on which the building stands.
For the Respondent
Respondent No. 2 contended that since the promoter never acquired valid title to the land due to the dismissal of the probate petition, it lacks the legal capacity to transfer any interest. The absence of any Agreement for Sale executed by Nayan Construction with the majority of flat purchasers further invalidates the application. The Competent Authority was therefore justified in rejecting the application.
The Court's Analysis
The Court held that the Competent Authority erred in conflating issues of title with the statutory mandate under Section 11 of MOFA. The Court emphasized that the statutory obligation to convey arises upon the formation of the society and the sale of flats, regardless of whether the promoter holds perfect title or whether third parties assert competing claims.
"Any disputes relating to title between the Promoter and any other person cannot be subject matter of enquiry under Section 11(3) and (4) of MOFA."
The Court noted that the Competent Authority’s finding that no Agreement for Sale was executed by Respondent No. 1 was perverse, as the agreement dated 11.07.1988 with Inderjeet Singh Bhatia was produced before it. The absence of a conveyance clause in that agreement is immaterial, as MOFA imposes a statutory duty irrespective of contractual stipulations.
The Court further observed that the Competent Authority’s rejection of the entire application because the society sought conveyance of 1331.1 sq.mtrs. - while the building occupies only 155 sq.mtrs. - was legally unsustainable. The proper course was to grant conveyance of the proportionate area, not to dismiss the application outright.
The Court also referenced the Government Resolution dated 22.06.2018, which provides a procedural framework for adjudicating such applications, particularly where multiple structures exist on a single plot. The Competent Authority must now apply this framework in fresh adjudication.
The Verdict
The writ petition was partly allowed. The order dated 10.06.2014 rejecting the application for deemed conveyance was set aside. Application No. 214 of 2013 was remanded to the Competent Authority for fresh adjudication. The petitioner is permitted to implead M/s. Mak & Mak Builders as a party. The parties may submit additional documents. The Competent Authority must decide the application on its merits within a reasonable time, and all contentions on the merits are expressly kept open.
What This Means For Similar Cases
Title Disputes Are Irrelevant to MOFA Conveyance
Practitioners must now argue that any title dispute between the promoter and a third party (e.g., original landowner, heir, or subsequent purchaser) is outside the scope of Section 11 proceedings.
Competent Authorities cannot use such disputes as grounds to deny conveyance - the statutory duty is absolute.
Even if the promoter’s title is defective, the society’s right to conveyance under MOFA remains intact.
Proportionate Conveyance Is Mandatory
Societies seeking conveyance of entire plots must be advised to specify the proportionate area corresponding to the built-up structure.
Rejection of the entire application due to an overbroad prayer is legally impermissible; the remedy is to grant partial conveyance.
The Government Resolution dated 22.06.2018 provides clear methodology for apportioning land in multi-building layouts.
Statutory Duty Overrides Contractual Gaps
The absence of a conveyance clause in flat purchase agreements is no longer a valid ground for rejection.
Form-V under MOFA Rules does not negate the statutory obligation under Section 11.
Any agreement executed by the promoter with even one flat purchaser triggers the duty to convey.
