MRTP Act Section 11(3) | Alternate Plot Allotment Does Not Vest Title Without Scheme Modification: Bombay HC

The Bombay High Court has delivered a significant judgment clarifying the legal position on alternate plot allotments under the Maharashtra Regional and Town Planning (MRTP) Act, 1966. The Court held that ownership of an alternate plot allotted in lieu of acquired land does not automatically vest in a subsequent purchaser unless the town planning scheme is modified to reflect the change in ownership. This ruling underscores the importance of procedural compliance in property transactions involving statutory schemes.

Background & Facts

The Dispute

The appellant, Allarakha Ismail, an 81-year-old resident of Mumbai, filed a suit challenging the deemed conveyance dated 23rd November, 2021 executed in favor of Vardhan Apartment CHS Ltd. (Respondent No. 1). The appellant sought a negative declaration that Respondents Nos. 1 to 7 have no right, title, or interest in the suit property, along with recovery of possession and injunction against further development. The suit property, described as Final Plot No. 190, was allotted under a town planning scheme in lieu of CTS No. 1582 (1 and 2) and CTS No. 1583, which were acquired for road widening.

Key Facts

• 16.12.1964: The appellant was granted a 99-year lease for CTS No. 1582 (1 and 2) (Old Plot Nos. 261 and 262).
• 30.09.1985: The appellant purchased CTS No. 1582 (1 and 2) from the original owner, Bhagatsingh Solanki, for Rs. 20,000. The conveyance deed made no mention of Final Plot No. 190 or the acquisition proceedings.
• 1972-1980: Acquisition proceedings for CTS No. 1582 (1 and 2) and CTS No. 1583 commenced. Bhagatsingh Solanki participated in the proceedings and consented to the acquisition.
• 26.04.1976: Final Plot No. 190 was allotted to Bhagatsingh Solanki in lieu of the acquired plots.
• 01.09.1980: The Arbitrator recorded the death of Bhagatsingh Solanki.
• 1981-1982: Development permissions were obtained for Final Plot No. 190, and construction commenced.
• 22.09.1988: Occupation certificate was issued for the building constructed on Final Plot No. 190.
• 10.02.1986: The appellant wrote to the Arbitrator claiming ownership of Final Plot No. 190 but took no further legal action until 2024.
• 23.11.2021: Deemed conveyance was executed in favor of Respondent No. 1.
• 2023: The appellant challenged the deemed conveyance through Writ Petition No. 635 of 2023, which was dismissed on grounds of delay, with liberty to file a substantive suit.
• 2024: The appellant filed L.C. Suit No. 1331 of 2024 and Notice of Motion Nos. 2156 and 2157 of 2024 seeking injunctions against further development and third-party rights.
• 09.05.2025: The Trial Court dismissed the interim applications, leading to the present appeal.

Procedural History

• 12.06.2019: The appellant filed OA No. 789/2019 before the Central Administrative Tribunal, which was dismissed.
• 2023: Writ Petition No. 635 of 2023 was dismissed on 11.08.2023 due to delay.
• 2024: L.C. Suit No. 1331 of 2024 was filed, along with interim applications for injunction.
• 23.08.2024: The Trial Court rejected the ad-interim relief.
• 05.02.2025: The High Court set aside the Trial Court’s order and directed a final decision on the interim applications.
• 09.05.2025: The Trial Court dismissed the interim applications, leading to the present Appeal from Order No. 448 of 2025.

The Parties' Positions

Appellant:

• Claimed ownership of Final Plot No. 190 through the conveyance deed dated 30.09.1985, which transferred CTS No. 1582 (1 and 2).
• Argued that the allotment of Final Plot No. 190 should have been in his name, not Bhagatsingh Solanki’s.
• Contended that Respondent No. 1 obtained registration by misrepresenting the plot as CTS No. 1602 instead of CTS No. 1582.
• Relied on Index-II and the redistribution and valuation statement to prove ownership.

Respondents:

• Argued that the conveyance deed of 1985 is doubtful as Bhagatsingh Solanki had died in 1980, and the deed made no mention of the acquisition proceedings or Final Plot No. 190.
• Contended that Final Plot No. 190 was allotted in lieu of both CTS No. 1582 (1 and 2) and CTS No. 1583, the latter of which was not included in the appellant’s conveyance.
• Highlighted the delay of nearly 40 years in asserting ownership rights despite knowledge of the construction on Final Plot No. 190 since 1986.
• Submitted that the building was constructed pursuant to valid permissions and cannot be termed illegal.

Relief Sought

The appellant sought:

1. A declaration that Respondents Nos. 1 to 7 have no right, title, or interest in Final Plot No. 190.
2. Recovery of possession of the suit property.
3. Injunction restraining Respondents Nos. 1 to 3 from carrying out further development or creating third-party rights.

The Legal Issue

The central question was whether the appellant, who purchased CTS No. 1582 (1 and 2) in 1985, could claim ownership of Final Plot No. 190 allotted in lieu of the acquired plots under the MRTP Act, without modifying the town planning scheme to reflect the change in ownership.

Arguments Presented

For the Appellant

• Relied on the registered conveyance deed dated 30.09.1985 and Index-II to establish ownership of CTS No. 1582 (1 and 2).
• Argued that Final Plot No. 190 was allotted in lieu of CTS No. 1582 (1 and 2), which was purchased by the appellant.
• Contended that Respondent No. 1 misrepresented the plot as CTS No. 1602 to obtain registration.
• Highlighted the prima facie observations of the High Court in Writ Petition No. 635 of 2023 favoring the appellant’s ownership claim.

For the Respondents

• Argued that the conveyance deed of 1985 is doubtful as Bhagatsingh Solanki had died in 1980, and the deed made no mention of the acquisition proceedings or Final Plot No. 190.
• Contended that Final Plot No. 190 was allotted in lieu of both CTS No. 1582 (1 and 2) and CTS No. 1583, the latter of which was not included in the appellant’s conveyance.
• Emphasized the delay of nearly 40 years in asserting ownership rights despite knowledge of the construction on Final Plot No. 190 since 1986.
• Submitted that the building was constructed pursuant to valid permissions and cannot be termed illegal.

The Court's Analysis

The Court conducted a detailed examination of the redistribution and valuation statement, the minutes of meetings before the Arbitrator, and the chronology of events leading to the allotment of Final Plot No. 190. Key observations included:

1. Allotment of Final Plot No. 190:

   • The redistribution and valuation statement showed that Final Plot No. 190 was allotted in lieu of CTS No. 1582 (1 and 2) and CTS No. 1583.
   • The appellant’s conveyance deed of 1985 made no mention of CTS No. 1583 or Final Plot No. 190, casting doubt on the claim of exclusive ownership.

2. Doubt Over Conveyance Deed:

   • The minutes of the Arbitrator recorded the death of Bhagatsingh Solanki in 1980, raising doubts about the authenticity of the conveyance deed executed in 1985.
   • The deed was silent about the acquisition proceedings and the allotment of Final Plot No. 190, which the Court found prima facie suspicious.

3. Procedural Compliance Under MRTP Act:

   • The Court noted that under Chapter V of the MRTP Act, once a final scheme is sanctioned under Section 86(3), it assumes statutory force.
   • The appellant failed to seek modification of the town planning scheme to reflect his ownership, which was a prerequisite for claiming rights over Final Plot No. 190.

4. Delay and Balance of Convenience:

   • The appellant was aware of the construction on Final Plot No. 190 since 1986 but took no legal action until 2024.
   • The balance of convenience favored the respondents, as the building was constructed pursuant to valid permissions and was awaiting an occupation certificate.

"The conveyance deed of 1985 is prima facie doubtful for the reason that the minutes of meeting before the Arbitrator in the town planning scheme process records the statement of son of Bhagatsingh Solanki that Bhagatsingh has expired in the year 1980. The Deed of Conveyance has been executed by Bhagat Singh Shakarbhai Solanki and before the Arbitrator, notification of 23rd April, 1953 is produced to show that name of Bhagasingh Solanki was changed to Bharatkumar Shankerbhai Kalasparshi. The Final Plot No. 190 was allotted in the name of Bharatkumar Shankerbhai Kalasparshi. There is no reason why the conveyance of 1985 would be executed in the name of Bhagat Singh Sahankerbhai Solanki when the name was changed on 23rd April, 1953."

The Verdict

The Appeal from Order was dismissed. The Court held that:

1. The appellant failed to establish a prima facie case for ownership of Final Plot No. 190.
2. The balance of convenience favored the respondents, as the building was constructed pursuant to valid permissions and was awaiting occupation.
3. The delay of nearly 40 years in asserting ownership rights militated against granting interim relief.
4. The appellant’s challenge to the deemed conveyance was misconceived, as no interim relief was sought to stay its implementation.

What This Means For Similar Cases

Modification of Town Planning Scheme is Mandatory for Title Claims

• Property owners claiming rights over alternate plots allotted under the MRTP Act must modify the town planning scheme to reflect their ownership.
• Failure to do so will bar claims of title, even if the original plot was purchased subsequently.

Delay Defeats Equity

• Courts will not favor parties who delay asserting their rights despite knowledge of encroachment or development.
• In this case, the appellant’s 40-year delay was fatal to his claim for interim relief.

Conveyance Deeds Must Reflect Statutory Proceedings

• Conveyance deeds must explicitly mention acquisition proceedings and alternate plot allotments to avoid prima facie doubts about their authenticity.
• Silence on critical statutory processes can render the deed suspect, especially if the original owner is deceased at the time of execution.