1 IN THE HIGH COURT OF JUDICATURE AT BOMBAY CIVIL APPELLATE JURISDICTION APPEAL FROM ORDER NO.884 OF 2008 IN THE MUMBAI CITY CIVIL COURT AT BOMBAY NOTICE OF MOTION NO.95 OF 2007 IN S.C. SUIT NO.89 OF 2007 Jitendera Santilal Shah & Ors. ..Appellants (Org.Plaintiff) Vs. M/s.Zenal Construction Pvt. Ltd. ..Respondent Mr.Anil R. Mishra for the Appellants. Mr. V.Y. Sangalikar for Respondent no.1. CORAM : S. J. VAZIFDAR, J. DATE OF RESERVING THE JUDGMENT : 18TH DECEMBER, 2008 DATE OF PRONOUNCING THE JUDGMENT : 21ST JANUARY, 2009 ORAL JUDGMENT : This is the Plaintiff's appeal against the order of the learned Judge of the Mumbai City Civil Court, dismissing 2 their Notice of Motion. The Appellants are the Plaintiffs and the Respondent is the Defendant. 2. The Appellants filed the suit for a declaration that the Defendant is not entitled to amend the plans sanctioned on 5.12.2002 regarding the development of the suit property; for a declaration that the amended plans are not binding upon them; for an order directing the Defendant to provide the building occupation certificate in respect of the building in which their flats are situated and to execute a conveyance in favour of the Appellants society. The Appellants have also sought certain reliefs regarding construction and/or repair of certain facilities and disclosure of amounts collected from new flat purchasers and a cellular operator. By prayer (l) the Appellants have sought a permanent injunction restraining the Defendants from carrying out any construction work on the suit property contrary to the plan sanctioned on 5.12.2002 and/or putting any construction beyond Wings “A” and “B” of the suit property. By prayer (m) the Appellants have sought an order 3 restraining the Defendants from parking their vehicles in the compound of the suit property. The Appellants took out a Notice of Motion seeking interim reliefs in terms of the above reliefs. The learned Judge by the impugned order, dismissed the Notice of Motion. 3. An agreement dated 12.2.2001 was entered into between the Defendant as the developer and the owner of the property one Y.J. Dave. The owner assigned and alloted the development rights in respect of the suit property which consisted of land together with a building standing thereon known as “Ambika Bhavan”. 4. The twelve Appellants are members of the proposed society. They, alongwith twenty three others were tenants in respect of the premises in their occupation in a building which existed upon the suit property. Agreements were entered into between the Defendant and twenty tenants including the Appellants. The remaining tenants apparently settled with the Defendants and 4 thereupon left the suit property. Identical agreements were entered into between each of the Appellants and the Defendant. A sample of one such agreement dated 6.8.2001 entered into between Appellant no.3 and the Defendant was relied upon. The original owner was a confirming party to these agreements. 5. On 5.12.2006, the Bombay Municipal Corporation sanctioned the plans for the redevelopment of the suit plot. Apparently, the plan was sanctioned earlier on 17.8.2002 and was amended on 5.12.2002. In any event, that the construction was required to be carried out as per the plan sanctioned on 5.12.2002 is not in dispute. The commencement certificate was issued on 21.3.2003. As per the plan sanctioned on 5.12.2002, there were open spaces within the said plot on all sides of the building proposed to be constructed. As per this plan, the Defendant constructed twenty flats, ten shops and a basement and handed over possession thereof to the respective Appellants on 1.4.2005. 5 6. The Defendant subsequently amalgamated the suit plot with the adjoining plot and sought and obtained sanction from the concerned authorities modifying the plans. By an agreement dated 21.3.2003 the Defendant acquired from one Sadashiv Dave, development rights in respect of the adjoining plot. The agreement was not produced before me. There is no dispute however that the Defendant is entitled to develop the adjoining plot and I therefore proceed on that basis. The Defendant claims to have entered into independent agreements with the tenants of the adjoining plots as well and to have demolished the structure thereon. The Defendant thereafter amalgamated the suit property with the adjoining property and sought and obtained the sanction from the Bombay Municipal Corporation for the amended plans submitted by it. The Defendant has stated that after the original plan was amended on 5.12.2002 there was a further amendment sanctioned on 9.9.2004 and thereafter again on 2.5.2007 and that as per the sanctioned plan dated 6 2.5.2007 the Defendant is to construct two further wings on the adjoining property. What is important to note is that admittedly a part of this construction will be upon the suit property and will touch, physically attach itself to the Plaintiffs' building on one side substantially. 7. The agreement dated 6.8.2001 was registered by the Plaintiffs alone on 8.11.2005. The commencement certificate which is one of the annexures at the time of registration refers only to the original two wings and not the additional wing, as per the amended plan dated 2.5.2007. The photographs also indicate the same. It is also important to note that as a result of the modified plan the entire open space on one side of the suit property would be completely taken up by a part of the new construction. 8. Mr. Mishra, the learned counsel appearing on behalf of the Appellants submitted that in view of Section 7 of The Maharashtra Ownership Flats (Regulation of the promotion of construction, sale, management and transfer) Act, 1963, the 7 Respondent was not entitled to amalgamate the adjoining plot and the suit plots and on the basis thereof, to amend the plans earlier sanctioned on 5.12.2002. He further submitted that the same materially affects the Appellants flats and the structure viz. the building, in which they are situated. Sections 7 and 7A of The Maharashtra Ownership Flats (Regulation of the promotion of construction, sale, management and transfer) Act, 1963 (MOFA) read as under :- “7. (1) After the plans and specifications of the building, as approved by the local authority as aforesaid, are disclosed or furnished to the person who agrees to take one or more flats, the promoter shall not make- (i) any alteration in the structures described therein in respect of the flat or flats which are agreed to be taken, without the previous consent of that person; (ii) any other alterations or additions in the structure of the building without the previous consent of all the persons who have agreed to take the flats in such building. (2) Subject to sub-section (1), the building shall be constructed and completed in accordance with the plans and specifications aforesaid; and if any 8 defect in the building or material used, or if any unauthorised change in the construction of brought to the notice of the promoter within a period of [three years] from the date of handing over possession, it shall wherever possible to be rectified by the promoter without further charge to the persons who have agreed to take the flats, and in other cases such persons shall be entitled to receive reasonable compensation for such defect or change. Where there is a dispute as regards any defect in the building or material used, or any unauthorised change in the construction, [or as to whether it is reasonably possible for the promoter to rectify any such defect or change, or as regards the amount of reasonable compensation payable in respect of any such defect or change which cannot be or is not, rectified by the promoter,] the matter shall, on payment of such fee as may be prescribed, [and within a period of three years from the date of handing over possession, be referred for decision- (i) in an urban agglomeration as defined in clause (n) of section 2 of the Urban Land (Ceiling and Regulation) Act, 1976, to such competent authority authorised by the State Government under clause (d) of section 2 of that Act, and (ii) in any other area, to such Deputy Chief Engineer, or to such other Officer of the rank equivalent to that of Superintending Engineer in the 9 Maharashtra Service of Engineers, of a Board established under section 18 of the Maharashtra Housing and Area Development Act, 1976. as the State Government may by general or special order, specify in this behalf, such competent authority, Deputy Chief Engineer or, as the case may be, the other officer of a Board shall, after inquiry record his decision, which shall be final.] 7A. For the removal of doubt, it is hereby declared that clause (ii) of sub- section (1) of section 7 having been retrospectively substituted by clause (a) of section 6 of the Maharashtra Ownership Flats (Regulation of the promotion of construction, sale, management and transfer) (Amendment) Act, 1986 (hereinafter in this section referred to as “the Amendment Act”), it shall be deemed to be effective as if the said clause (ii) as so substituted had been in force at all material times; and the expression “or construct any additional structures” in clause (ii) of sub-section (1) of section 7 as it existed before the commencement of the Amendment Act and the expression “constructed and completed in accordance with the plans and specifications aforesaid” and “any unauthorised change in the construction “in sub-section (2) of section 7 shall, notwithstanding anything contained in this Act or in any agreement, or in any judgment, decree or order of any Court, 10 be deemed never to apply or to have applied in respect of the construction of any other additional building or structures constructed or to be constructed under a scheme or project of development in the layout after obtaining the approval of a local authority in accordance with the building rules or building bye-laws or Development Control Rules made under any law for the time being in force.]” 9. It is not necessary for me to deal with the larger question raised by Mr. Mishra viz. that the plan sanctioned on 5.12.2002 could not be amended without the consent of the Appellants as the additional construction as per the amended plans was not a part of the scheme or layout disclosed by the Defendant at the time of entering into the agreement with the Appellants. It would have been necessary to consider this submission had the new construction been physically separate from the existing construction. 10. For the purpose of this Appeal from Order, it is sufficient to consider the Appellants entitlement to interim reliefs on the basis of the fact that the proposed new/additional construction by the Defendant admittedly touches the building in which the Appellants flats are situated 11 as stated earlier. 11. In M/s. Jayantilal Investments v. Madhuvihar Co- operative Housing Society & Ors., (2007) 9 SCC 220, the Supreme Court observed in paragraph 16 that the question which needs to be decided is whether one building with several wings would fall under the amended Section 7(1)(ii). The question before me was thus expressly kept open. Paragraph 20 of the judgment reads as under :- “20. In the light of what is stated above, the question which needs to be examined in the present case is whether this case falls within the ambit of amended Section 7(1)(ii) or whether it falls within the ambit of Section 7-A of MOFA. As stated above, under Section 7(1) after the layout plans and specifications of the building, as approved by the competent authority, are disclosed to the flat takers, the promoter shall not make any other alterations or additions in the structure of the building without the prior consent of the flat takers. This is where the problem lies. In the impugned judgment, the High Court has failed to examine the question as to whether the project undertaken in 1985 by the appellant herein was in respect of construction of additional buildings or whether the project in the layout plan of 1985 consisted of one building with 7 wings. The promoter has kept the requisite percentage of land open as recreation ground/open space. Relocation of the tennis court cannot be faulted. The question which the High Court should have examined is: Whether the project in question consists of 7 independent 12 buildings or whether it is one building with 7 wings? The answer to the above question will decide the applicability or non-applicability of Section 7(1)( ii ) of MOFA, as amended. The answer to the above question will decide whether the time to execute the conveyance has arrived or not. This will also require explanation from the competent authority, namely, Executive Engineer, ‘R’ South Ward, Kandivali, Mumbai-400067 (Respondent 8 herein). In the dates and events submitted by the appellant promoter, there is a reference to the permission granted by ULC Authorities dated 16-11-1984 which states that the owner/developer shall construct a building with 7 wings. One needs to examine the application made by the promoter when he submitted the layout plan in 1985. If it is the building with 7 wings intended to be constructed in terms of the layout plan then the High Court is also required to consider the effect of the judgment in Ravindra Mutneja v. Bhavan Corpn. in which the learned Single Judge has held that if a building is put up as a wing of an existing building, it cannot be constructed without the prior permission of the flat takers. In that connection, the High Court shall also consider permission dated 16- 11-1984 under Section 21(1) of the ULC Act, application made to the competent authority when initial layout plan was sanctioned, applications for amendments to layout plans made from time to time and also agreements between promoter and flat takers.” (emphasis supplied) 12(A). It is important to consider the judgment of this Court in Ravindra Mutenja & Ors. v. Bhavan Corporation & Ors., 2003 (5) Bombay Cases Reporter, 695, which considered a similar situation. The learned Judge observed that from the photographs placed on record it was clear that the two 13 buildings were touching each other. The Respondents contended that despite the same, the buildings were independent of each other. They contended that the construction challenged therein constituted a new building. The trial Court there held prima-facie, that it was an extension of the Plaintiffs building. What is important to note is that ultimately, in paragraph 12, the learned Judge came to the conclusion that :- “Factually, on the facts of the case as on record the two buildings are touching each other.” Having come to this conclusion on facts, in paragraph 14, the learned Judge held :- “14....................................................... ............................................................ The law may be explained thus. An owner of the land or developer considering the provisions of the Maharashtra Regional and Town Planning Act, 1966 and development regulations framed thereunder, if a scheme or layout plan has been approved, whether the building is constructed or not then the owner developer inspite of MOFA can carry out development of such structure or building. It may be also possible to 14 hold that with a development permission under development regulations if obtained, the owner/developer can develop but as long as the permission was obtained and could be legally obtained if under the permission granted for construction the society had to be registered within a time frame and the land had to convey to the society under the agreement within a time frame and if not, within the time set out under Rule 9, after that time frame the owner/developer, is legally precluded from putting up of further construction without consent. At any rate if building is to be put up as a wing of an existing building considering section 7, it cannot be constructed without permission of the flat purchasers. There can, therefore, be no question of further development by the owner or developer. This is considered in the judgment in (Kalpita Enclave Co-op Housing Society Ltd. and others v. M/s.Kiran Builders Pvt. Ltd. And others), 1987(1) Bom. C.R. 355 : 1986 Mh. L. J. 110, as proposition seven. In (Vrindavan Borivali Co- operative Housing Society Ltd. v. Karmarkar Brothers and others), 1983 (2) Bom. C.R. 267 : 1982 Mh. L.J. 607, a learned Judge noted the statutory duty cast on the owner/developer and observed after considering the various sections of MOFA as under “......All these liabilities read with further 15 obligation under sections 10, 11 and 12 go to show that the promoter is under a statutory obligations who should complete the and pass a conveyance to the organization named thereunder.” (emphasis supplied) (B). The judgment applies to the facts of this case. The term “wing” is not defined in The Maharashtra Ownership Flats (Regulation of the promotion of construction, sale, management and transfer) Act, 1963. There is no universally accepted definition of “wing” in the field of construction. In any event, nothing to this effect was indicated. Independent, physically/structurally unconnected buildings within a complex are often referred to as different wings such as, for instance, “A” Wing, “B” Wing etc. However, even where buildings are structurally/physically connected portions thereof are similarly termed as “wings”. In these buildings, there often is no direct access from one wing to the other. This appears to be the case in the present matter as well. 16 Thus, the mere reference to “wings” in a judgment, would be of no assistance. It would be necessary to examine the nature of the “wings” in each case. In Ravindra Mutenja' s case, as observed therein, the wings/construction touched each other. They were not independent, structurally separate constructions. The same is the situation in the present case as well. I am bound by the judgment in Ravindra Mutenja's case. (C). In view of the judgment in Ravindra Muntenja's case, in the present case, it must be held that the buildings are not independent of each other and that therefore the proposed construction would be contrary to and in violation of Section 7 of the The Maharashtra Ownership Flats (Regulation of the promotion of construction, sale, management and transfer) Act, 1963. 13. Mr. Sangalikar relied upon the judgment in the case of Ralph D'Souza & Ors. v. Danny D' Souza & Ors., 2006(3) Mh. L.J., 497. The judgment is of no assistance to the Defendant. In that case, the impugned construction was found 17 to be abutting the Plaintiff's building. The term “abutting” does not necessarily mean that the constructions touch each other. The term “abutting” could also mean an adjoining property. In fact, the judgment read as a whole, indicates that the structures therein were independent of each other. This is indicated from the submission recorded in paragraph 5 of the judgment to the effect that the decision in Ravindra Mutenja's case would apply even with regard to the proposed construction of a new building which is independent of the structure occupied by the flat owners. Thus, the parties appear to have proceeded on the basis that the structures were independent of each other. The aspect regarding touching constructions referred to in Ravindra Mutenja's case was not dealt with in Ralph D' Souza' s case. 14. Mr. Mishra relied upon the judgment of a Division Bench of this Court in the case of White Towers Co-operative Housing Society Ltd. v. M/s. S. K. Builders & Ors., 2008(4) ALL MR, 838. A similar situation arose for the consideration of the Division Bench. I refer to this judgment not in respect of the 18 larger question which I am not deciding but to indicate that the restraint under Section 7 applies even where the original plot stands amalgamated with another plot. Paragraphs 3, 6, 7 and 8 of the judgment read as under :- “3. The main grievance of the appellants relate to the plot of land forming part of the plot wherein the society's building is situated and claims to have been amalgamated with adjoining plot and where the new layout thereof has been approved for the developments therein by the competent authorities sans the consent of the appellants in relation to the portion of their plot so amalgamated with the adjoining plot. 6. Bare perusal of the impugned order discloses that the same has been passed solely referring to para 17 of the decision in Jayantilal Investments' case by merely observing that if the contention based on paragraphs 19 and 21 of the said decision are taken into consideration, then the para 17 of the decision would stand diluted. With respect, we are unable to agree with the view taken by the learned single Judge. The Apex Court in Jayantilal Investments' case, has clearly observed in para 20, after taking into consideration the provisions of Clauses 3 and 4 of the Maharashtra Ownership Flats (Regulation of the Promotion of Construction etc) 19 Rules, 1964, that the said provisions are declared to be statutory and mandatory by the Legislature because the promoter is not only statutorily to give the particulars of land, amenities, facilities, etc., he is obliged to make full and true disclosure of the development potentially of the plot which is the subject matter of the agreement. The promoter is not only required to make disclosure concerning the inherent FSI, he is also required at the stage of layout plan to declare whether the plot in question in future is capable of being loaded with additional FSI/floating FSI/TDR. In other words, at the time of execution of the agreement with the flat takers, the promoter is obliged statutorily to place before the flat takers the entire project/scheme, be it a one building scheme or multiple number of buildings scheme. Having observed so in relation to the statutory provisions in Clauses 3 and 4 of the said Rules, the Apex Court has further rules that : “the above condition of true and full disclosure flows from the obligation of the promoter under MOFA vide Sections 3 and 4 and Form V which prescribes the form of agreement to the extent indicated above. This obligation remains unfettered because the concept of developability has to be harmoniously read with the concept of registration of society and conveyance of title.” 7. Obviously, the flat takers stand 20 assured that in case of any change to be made in the project, as was disclosed to the flat takers at the time of entering into agreement, the same has to be by following the proper procedure and without disturbance of the rights accrued to the flat purchasers in relation to the flats and all benefit attached to the flats including in relation to the land on which the building having such flat is situated. Taking into consideration the same, if a portion of the plot wherein the structure having the flat is situated is to be excluded and is to be amalgamated in the neighbouring plot, and the project in this regard is not disclosed to the flat takers at the time of the agreement being entered with the flat takers, it would be totally contrary to the decision of the Apex Court in Jayantilal Investments' case. This aspect has not been considered by the learned Judge while passing the impugned order. 8. Taking into consideration the law laid down by the Apex Court in Jayantial Investments' case, therefore, it cannot be said that the respondent No.5 would be entitled to carry out the construction as a matter of right in the portion of the land of the society's plot which is stated to have been amalgamated with the neighbouring plot. In fact, the learned single Judge, in para 9 of the impugned order, does make reference to this aspect. However, without considering the same, thereafter, proceeded to grant the relief of injunction. Being so, the impugned order to the 21 extent it excludes such portion of the society's plot from being subject to restraint, needs to be modified and the relief in the nature of Clause c(ii) granted by the impugned order needs to be modified to exclude such relief in relation to the society's