The Bombay High Court has clarified that restrictive covenants affecting land remain enforceable across successive transfers if preserved in the chain of title, regardless of whether each subsequent deed repeats the covenant verbatim. The judgment underscores that equitable interests in land, once annexed to the property, pass automatically with ownership, and courts must scrutinize the integrity of title documents over mere procedural delays or changing neighbourhoods.
Background & Facts
The Dispute
The dispute centres on a restrictive covenant limiting building height to 30 feet on a property at Altamount Road, Mumbai. The Plaintiff, New Deluxe Co-operative Housing Society Ltd., seeks to redevelop its 60-year-old building beyond this height. The Defendant, Pemino Co-operative Housing Society Ltd., opposes the redevelopment, claiming enforceable rights under covenants dating back to 1943 and 1944.
Procedural History
- 1943: Registered Indenture between PD Dubash/BP Dubash and Gazdars imposed a 30-foot height restriction on a plot identified as "Plot of Cottages".
- 1944: Registered Indenture conveyed 3,016 square yards to Govindram Brothers Limited, expressly subject to the 1943 covenant.
- 1963: Plaintiff acquired 1,900 square yards from Seksaria Industries under an Indenture that expressly incorporated "all stipulations, agreements, covenants and restrictions" from the 1944 Indenture.
- 1945: Defendant’s predecessors acquired land with express benefit of the 1943 covenant.
- 1972: Defendant’s title deed referenced benefits from its 1945 predecessor’s deed, which itself incorporated the 1943 covenant.
- 2024: Plaintiff issued public notices inviting objections to redevelopment; Defendant responded with legal notice and public notice asserting the covenant.
- 2025: Plaintiff filed Suit No. 21 of 2025 seeking declaration that the covenant is void and interim injunction to permit redevelopment beyond 30 feet.
Relief Sought
Plaintiff sought interim injunction restraining Defendant from obstructing redevelopment, including approval of plans with the Municipal Corporation and appointment of a developer. Defendant sought dismissal of the application on grounds of suppression, approbation and reprobation, and lack of locus.
The Legal Issue
The central question was whether a restrictive covenant, originally imposed in 1943 and incorporated into the Plaintiff’s 1963 title deed, remains enforceable against the Plaintiff by a subsequent owner who never received an express assignment of the benefit, and whether the Plaintiff’s conduct in initially denying the covenant’s existence disentitles it to interim relief.
Arguments Presented
For the Petitioner
The Plaintiff argued that the covenant was vague due to absence of the 1943 map, lacked privity with Defendant, and was not expressly assigned in the 1972 deed. It contended that the covenant was personal to the original parties and could not bind successors without clear transfer. It relied on Administrator of the Specified Undertaking of the Unit Trust of India v. Garware Polyester Ltd. for strict construction of negative covenants and Motilal J. Boal v. Corporation of City of Bangalore to argue that mere intention to transfer is insufficient. It further invoked the doctrine of obsolescence due to surrounding high-rise development and claimed the cause of action arose only in 2024.
For the Respondent
The Defendant argued that the covenant was intended to run with the land, as evidenced by express incorporation in successive deeds. It cited Bomi Munchershaw Mistry v. Kesharwani Co-operative Housing Society and English precedents (Rogers v. Hosegood, Princy & Another v. Jose) to establish that benefit of a covenant passes with land without express assignment. It emphasized that the 1972 deed referenced the benefit of prior covenants, and that Plaintiff’s own 1963 deed bound it to the restriction. It invoked the doctrine of approbation and reprobation, arguing Plaintiff could not accept title under the 1963 deed while denying its binding conditions.
The Court's Analysis
The Court examined the chain of title documents and found that the restrictive covenant was not merely a personal agreement but an equitable interest annexed to the land. The 1944 Indenture, which conveyed the Plaintiff’s predecessor, expressly incorporated the 1943 covenant. The 1963 Indenture, by which the Plaintiff acquired title, explicitly stated that the conveyance was subject to "all stipulations, agreements, covenants and restrictions" contained in the 1944 Indenture. This created a prima facie binding obligation on the Plaintiff.
"...the benefit of the covenant is annexed to the land and passes on a subsequent conveyance of the land or any part thereof without express mention, even though the purchaser is not aware of the existence of the covenant."
The Court relied on Princy & Another v. Jose to hold that where a covenant binds the land at inception, it passes with the land to successors without requiring a separate assignment. The 1972 deed, though not repeating the covenant, referenced the benefit of the 1945 deed, which itself incorporated the 1943 covenant. This chain of reference was sufficient to preserve the covenant’s enforceability.
The Court rejected the argument that privity of contract was necessary. It held that covenants running with the land operate in equity, not contract, and their enforceability depends on intention, nature, and transmission through title documents. The absence of the 1943 map was deemed a factual dispute for trial, not a ground to deny interim relief.
Crucially, the Court found the Plaintiff’s conduct fatally flawed. It initially denied the existence of any covenant in its plaint, only to admit it after Defendant produced the 1963 deed. The Court invoked the doctrine of approbation and reprobation, citing Rajasthan State Industrial Development and Investment Corporation v. Diamond and Gem Development Corporation Limited: a party cannot accept the benefit of a transaction while rejecting its burdens. The Plaintiff’s attempt to recharacterize its position after being confronted with its own documents was deemed dishonest and disentitled it to equitable relief.
The Court also declined to apply the doctrine of obsolescence at the interim stage, noting that change in neighbourhood alone does not extinguish a covenant. The issue required full trial with evidence on whether the covenant still served a legitimate purpose.
The Verdict
The Plaintiff lost. The Court held that restrictive covenants running with the land remain enforceable if preserved in the chain of title, even without express assignment in every subsequent deed. The Plaintiff’s conduct of suppressing material facts and adopting inconsistent positions disqualified it from interim relief. The application for injunction was dismissed.
What This Means For Similar Cases
Chain of Title Supersedes Oral or Post-Hoc Claims
- Practitioners must trace title documents back to the original covenant to establish enforceability, not rely on subsequent conduct or lack of notice.
- A covenant incorporated by reference in a deed is as binding as if reproduced verbatim.
- Failure to produce or acknowledge relevant title documents may result in dismissal of claims on grounds of suppression.
Approbation and Reprobation Bars Equitable Relief
- A party cannot accept title under a deed containing restrictive covenants and later challenge those covenants in litigation.
- Courts will deny interim relief where a litigant’s conduct demonstrates bad faith or tactical reversal of position.
- Always disclose all title documents at the outset - suppression is fatal to equitable claims.
Interim Relief Cannot Prejudice Final Rights
- Courts will not grant interim injunctions that effectively decide the final outcome, such as permitting construction beyond a covenant’s limit.
- Even if the covenant’s validity is disputed, interim orders must preserve the status quo pending trial.
- Redevelopment may proceed within covenant limits; exceeding them requires final adjudication.
