fa-1642.12 & fa-31.16.

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bdp
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
CIVIL APPELLATE JURISDICTION

FIRST APPEAL NO. 1642 OF 2012

1. Dr. Dilip B. Raja

2. Smt. Lilavati B. Raja

both adults Indian inhabitants, Residing at
Flat No.701/C, Shree Arihant Apartment,
31, D. B. Marg, Mumbai Central,
Mumbai – 400 008. ... Appellants

Versus

1. Shree Arihant Apartment Co-op. Housing

Society, Duly registered under the
provisions of Maharashtra Co-op.
Society’s Act, having registration No.
BOM/WD/HSG/TC/5868/94, having its
office at ‘C’ Wing, Shree Arihant
Apartment, 31, Dr. Bhadkamkar Marg,
Mumbai Central, Mumbai – 400 008.

2. Narpatraj Besarmal Mehta,

adult, Indian inhabitant, residing at,
Adinath Apartment, B-Wing, 281, Tardeo
Road, Mumbai – 400 007.

3. Hemchand Santokchand Bafna,

adult, Indian inhabitant, residing at,
Sukhsagar Apt, 33, D.B. Marg, Mumbai-8

4. Pukharaj Chunnilal Bafna,

adult, Indian inhabitant carrying on
business as a sole proprietor in the first
name of M/s. Paras Enterprises, having its
office at Veena Chambers, 3rd Floor, 21,
Dalal Street, Fort, Mumbai – 400 023. ... Respondents
 fa-1642.12 & fa-31.16.doc

ALONG WITH
FIRST APPEAL NO. 31 OF 2016

1. Dr. Dilip B. Raja

2. Smt. Lilavati B. Raja
both adults Indian inhabitants, Residing at
Flat No.701/C,,Shree Arihant Apartment,
31, D. B. Marg, Mumbai Central,
Mumbai – 400 008. ... Appellants
Versus
1. Shree Arihant Apartment Co-op. Housing
Society, Duly registered under the
provisions of Maharashtra Co-op.
Society’s Act, having registration No.
BOM/WD/HSG/TC/5868/94, having its
office at ‘C’ Wing, Shree Arihant
Apartment, 31, Dr. Bhadkamkar Marg,
Mumbai Central, Mumbai – 400 008.

2. The Municipal Corporation of Greater

Mumbai, a Statutory Body having its
office at Mahapalika Marg, Fort,
Mumbai – 400 001.

3. The Municipal Commissioner, the

Municipal Corporation of Greater
Mumbai, Mahapalika Marg, Fort,
Mumbai – 400 001.

4. The Executive Engineer, (Building

Proposal) City-I, The Municipal
Corporation of Greater Mumbai, Office -
Building, M 3rd Floor, 10, Shaik
Hafidudin Mag, Byculla, Mumbai – 400
008.
5. The Assistant Municipal Commissioner,
The Municipal Corporation of Greater
Mumbai, having its office at D Ward,
Municipal Office, Jobanputra Compound,
Nana Chowk, Mumbai – 400 007.

6. Narpatraj Besarmal Mehta,

adult, Indian inhabitant, residing at,
Adinath Apartment, B-Wing, 281, Tardeo
Road, Mumbai – 400 007.

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 fa-1642.12 & fa-31.16.doc

7. Hemchand Santokchand Bafna,

adult, Indian inhabitant, residing at,
Sukhsagar Apt, 33, D.B. Marg, Mumbai-8

8. Pukharaj Chunnilal Bafna,

adult, Indian inhabitant carrying on
business as a sole proprietor in the first
name of M/s. Paras Enterprises, having its
office at Veena Chambers, 3rd Floor, 21,
Dalal Street, Fort, Mumbai – 400 023.

... Respondents

…....
Mr. Venkatesh Dhond, Senior Advocate along with Mr. Rohan Kadam i/by
Mr. Sandeep R. Waghmare, Advocates for the Appellants in both First
Appeals.

Mr. Khan Javed Akhtar, Advocate for the Respondent No.1 in both First
Appeals.

Ms. Sheetal Mane Tadke, Advocate for Respondent Nos. 2 to 4 in

FA/31/2016.
….…

CORAM : R.D. DHANUKA, J.

RESERVED ON : 6th MARCH, 2020
PRONOUNCED ON : 19th MAY, 2020

JUDGMENT :

. By First Appeal No. 1642 of 2012 filed by the appellants (original

defendant nos. 1 and 2), the appellants have impugned the judgment and

award dated 12th September, 2012 passed by the learned Judge, City Civil

Court, Mumbai in S.C. Suit No.1642 of 2009 thereby decreeing the suit filed

by the respondent no.1 and declaring the agreement dated 28 th December,

1993 as bad in law, null and void and stood cancelled to the extent of the

‘sale of portion of terrace’ and directing the appellants to handover the

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possession of the alleged common terrace is concerned.

2. First Appeal No. 31 of 2006 is filed by the appellants (original

defendants nos. 5 and 6) inter-alia impugning the judgment and order dated

28th October, 2015 passed by the learned Judge City Civil Court, Mumbai in

L.C. Suit No. 1543 of 2009 thereby partly decreeing the suit filed by the

respondent no.1 (original plaintiff) by cancelling and setting aside the

regularization order passed by the respondent nos. 2 to 5 (Municipal

Corporation of Greater Mumbai and others) in respect of the suit structure

and directing the respondent nos. 2 to 5 to take appropriate action against the

appellants by following due process of law in respect of the alleged

unauthorized structure raised on terrace of the suit building. The appellants

in both these appeal are common. The respondent no.1 (original plaintiff) in

both these appeals and some of the other respondents in both these appeals

are common. By consent of parties, both these appeal were heard together

and are being disposed of by a common order. Some of the relevant facts for

the purpose of deciding both these appeals are as under:-

3. Respondent Nos. 3 to 5 in First Appeal No. 1642 of 2012 had carried

out construction on a plot of land bearing City Survey No.2/248 of Tardeo

Division and admeasuring 1958.20 sq. yards equivalent to 1687.35 sq. mtrs.

or thereabouts and situate at 31, Dr. Bhadkamkar Marg. The respondent

nos.2 to 5 executed various agreements in support of various flats sold by

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them in favour of various flat purchasers. By a letter of allotment dated 30th

June, 1992, the respondent nos. 2 to 5 had allotted flat being flat no. 701-A

on the 7th floor and part of the terrace above the 7 th floor in the building

known as Arihant Appartment ‘C’ Building to Suresh M. Jain and S.P.

Choudhary for the total consideration of Rs.8,00,000/-. By an agreement

dated 28th December, 1993, between the respondent nos. 2 and 3 and the

appellants, the respondent nos. 2 and 3 agreed to sell the said flat no. 701,

701-A on the 7th floor and part of the terrace, above the 7 th floor which was

allotted to Suresh M. Jain and S.P. Choudhary for total consideration of

Rs.9,00,000/-. The said Suresh M. Jain and S.P. Choudhary were confirming

parties to the said agreement for sale.

4. In recital VIII, it was provided that the disputes and differences arose

between the owner and the promoters with regard to their respective rights

which were referred to arbitration. The learned arbitrator made an award on

11th April, 1992. The owner became entitled to flat nos. 101 and 102 on the

1st floor, flat no. 701 on the 7 th floor and terrace above the 7 th floor. The

promoters become entitled to remaining premises of the building under

construction. In clause 11 of the said agreement, it was provided that

promoters had confirmed and agreed that the purchasers shall be exclusively

entitled to a portion on terrace shown in green colour in the plant annexed to

the said agreement and shall be exclusively entitled to use, occupy, possess

and enjoy the said portion of the said terrace in such manner as the

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purchasers may deem fit.

5. It was further provided that the purchasers shall be entitled to put a

separate staircase to have direct access to the said terrace through their flat

no.701 and the promoters and/or the purchasers of the other premises in the

said building shall not be entitled to raise any objection of any nature

whatsoever in that respect.

6. In clause 11(d) of the said agreement it was provided that the

promoters i.e. respondent nos. 2 and 3 herein represented and confirmed that

there was about 145 sq. ft. balance and unutilized FSI out of the permissible

FSI as per the rules and regulations in respect of the said property which FSI

of 145 sq. ft. could not be consumed and utilized by the promoters as the

same was not possible as per the Development Control Rules and

Regulations of Bombay Municipal Corporation applicable at that time. It

was provided that the purchasers shall be entitled to put temporary or

permanent construction or irrigation or shelters or enclosure on the said

terrace, if the same was permitted by the Municipal Corporation by

utilization and consumption of the balance unutilized FSI of about 145 sq. ft.

and/or if permitted free of FSI or even otherwise. It was further provided

that the owners, promoters and confirming parties however shall have no

responsibility or liability for such works if any that may be carried out by the

purchasers. The promoters will not use the said FSI of 145 sq. ft. anywhere.

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The owner and the promoters shall not permit any one else to utilize the said

balance FSI of 145 sq. ft.

7. In clause 11(f) of the said agreement it was provided that the

promoters and/or the purchasers of the other premises shall not interfere with

the right, title and interest of the purchasers in respect of the said portion of

the said terrace thereby allotted. In clause 12 of the said agreement it was

provided that the purchasers shall not have claim save and except in respect

of the particular premises inclusive of terrace area, common area, facilities

and limited common areas and facilities, thereby agreed to be acquired and

all other open space/unallotted parking space/flats/rooms/

offices/shops/garages/lobbies/staircases/terraces etc. will remain the property

of and/or any part thereof is transferred to the said organization as mentioned

in the said agreement but subject to the rights of the promoters under the

said agreement.

8. In Seventh Schedule of the said agreement, the list of the portions of

the properties not allowed to be utilized were terraces except allotted to

particular premises and various other portions of the properties specifically

mentioned therein. The said agreement was duly registered with the

Registrar of Assurance. The appellants paid the entire consideration to the

respondent nos. 2 and 3 under the said agreement for sale.

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9. On 21st December, 1992, the respondent nos. 2 and 3 entered into

another agreement in favour of Mr. Jitendra Lalchand Shah one of the office

bearer of the respondent no.1 society in respect of the flat no. 702 on the

same floor adjoining to the suit flat which was sold to the appellants for

consideration of Rs.7,00,000/-. Clause 13 of the said agreement provided

that the owner and/or his assignee and transferee shall be entitled to allow

exclusive use of any areas of the said terrace to any party to their choice. The

purchaser and/or the purchasers of the other premises in the said building

shall not be entitled to raise any objection of whatsoever kind or nature and

shall not be entitled to use of such terrace or open space sold and/or allotted

by the owner and/or promoters to the purchaser of such terrace unless the

purchaser himself is such purchaser or the purchaser of such terrace shall be

exclusively entitled to use the terrace of open space sold and/or allotted to

him. It was further provided that the owner/promoter shall be entitled to

transfer, assign, dispose off and/or sell in any manner they deem fit or proper

the said terrace, open space etc. to anybody on such price, terms and

conditions as the promoters deems fit. The purchasers along with other

purchasers will not raise any objection of whatsoever nature or kind.

10. In clause 13(c) of the said agreement, it was provided that the owner/

promoters shall be entitled to sell or otherwise dispose off the right to the

terrace or terraces of the said building for the purpose of construction or

advertisement/hoardings or any other use permissible by law, so long as the

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means of access is available to the proposed society for approaching the

water tanks and the lift room.

11. Clause 24 of the said agreement provided that the purchaser also

agreed and undertakes not to use or permit to be used the terrace on the top

floor of the said property which shall exclusively belong to the promoters

and/or purchasers of the flats on the 7 th floor as per writing between the

promoters and the concerned parties.

12. Clause 34 of the said agreement provided that the purchasers agrees

that the terrace above the 7th floor shall belong exclusively to Pukhraj

Chunilal Bafna who shall be entitled to use, occupy, possess and enjoy the

said terrace exclusively and the purchasers agreed and undertake not to

obstruct or raise any objection in that regard. The said Pukhraj Chunilal

Bafna shall be entitled to sell, transfer, assign the said terrace to any person

or party. The said Pukhraj Chunilal Bafna shall also be entitled to let, sub-let

or in any manner deal with the said terrace and the purchasers thereby

irrevocably concerned with to the same.

13. Clause 45 of the said agreement provided that the promoters or the

persons nominated by the promoters or the person to whom the rights and

benefits conferred under the subsequent clauses were assigned and shall

have absolute right to make additions, alterations, raise any storeys or put up

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additional structure as may be permitted by the Municipal Corporation and

the Competent Authorities. Such additions, alterations, structures and storeys

will be the sole property of the promoters and/or its nominees or assignees as

the case may be and will be entitled to dispose of the same in any way they

choose and the purchasers gave consent to the same. The terrace/s of the

building/s till the same is/are allotted to any purchaser and/or agreed to be

sold as well as the parapet walls shall be the sole property of the promoters

or its nominees or assignees.

14. The said clause further provided that the agreement with the

purchaser and all other purchasers of other premises in the said building

shall be subject to those rights of the promoters or its nominees or assignees

who shall be entitled to use the said terrace/s therein as well as the said

property and other purchasers shall not be entitled to any abatement in the

price of all the premises therein. The promoters shall be deemed to be the

owner of the such premises which have not been allotted and/or acquired

and/or agreed to be sold at the time when the said property is transferred as

mentioned in the said agreement. Seventh Schedule in the said agreement

also provided for various portions of the property which were not allowed to

be used by the said flat purchaser i.e. Mr. Jitendra Lalchand Shah who

became office bearer of the respondent no.1 subsequently including terraces

except ‘a terraces allotted to particular premises’.

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15. Pursuant to the agreement entered into between the appellants and the

respondent nos. 2 and 3, the appellants constructed three side walls below

the overhead water tank by utilizing the said FSI of 145 sq. ft. available on

the plot. The said construction was carried out by the appellants prior to the

formation of the respondent no.1 society. The respondent no.1 society was

formed on 26th April, 1994 and was registered. The appellants accordingly

started claiming to be owner of the said small room on the terrace of the

building since then even prior to the formation of the society. On 6th May,

1994, the Municipal Corporation of Greater Mumbai issued a completion

certificate pursuant to the application dated 6th February, 1993 submitted by

an Architect appointed by the respondent nos. 2 and 3 in respect of the said

building.

16. On 17th February, 1993, the Municipal Corporation issued occupation

certificate for occupying the entire building i.e. ground + 7 upper floors,

subject to various conditions. After about 12 years, on 30 th January, 2005, the

respondent no.1 society addressed a letter to the appellants alleging breaches

on the part of the appellants for carrying out construction of the room on the

7th floor. The appellants by their advocate’s letter dated 10 th February, 2005

responded to the said letter and denied the allegations made therein. The

appellants informed the respondent no.1 that there was a transaction in

respect of flat nos. 701 and 701-A including part of terrace & FSI of 145

sq.ft. between the appellants and the respondent nos.2 and 3. The appellants

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have been the owner and were in the enjoyment of the said area since last 11

years to the knowledge of all the concerned members of the society. The

society also had collected the maintenance charges from the appellants

including the maintenance of that area of the terrace since beginning. The

appellants placed various facts on record and called upon the respondent

no.1 society to withdraw the said notice.

17. The appellants thereafter filed an application seeking direction under

Section 79(2) of the Maharashtra Co-operative Societies Act, 1960 against

the respondent no.1 before the learned Deputy Registrar, Co-operative

Society, D Ward, Mumbai, on 21st April, 2005. The Deputy Registrar of Co-

operative Society passed an order under Section 79(2) of the Maharashtra

Co-operative Societies Act, 1960 directing the managing committee of the

respondent no.1 to issue the said certificate in the name of the appellants in

respect of flat nos. 701 and 701-A. The Deputy Registrar also directed the

respondent no.1 not to raise any dispute about terrace premises of the flat

nos.701 and 701-A of the appellants, since the builder had granted

possession and ownership of terrace as per Sale Deed in their favour. The

Deputy Registrar directed that if the appellants wanted to sell their flats in

future, the permission was being granted through the Office of the Deputy

Registrar and the respondent no.1 should not raise any hurdle and

obstruction in that respect. The Deputy Registrar made it clear that if the

respondent no.1 would not take any action on or before 15 th May, 2004,

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further action under Section 79(2) of the Maharashtra Co-operative Societies

Act, 1960 would be taken against the society.

18. Being aggrieved by the said order dated 21 st April, 2005, the

respondent no.1 filed a Writ Petition bearing No. 1718 of 2008 in this Court

against the Divisional Joint Registrar and the appellants. By an order dated

20th August, 2008 passed by this Court, this Court noticed that the said

certificate was also issued by the society in favour of the appellants. The

appellants agreed for deletion of the direction issued by the Deputy Registrar

holding that the respondent no.1 society shall not raise any dispute about

terrace premises of flat nos. 701 and 701-A sold to the appellants. This Court

set aside the directions issued by the Deputy Registrar that if the appellants

would sell all their flats in future, permission was granted through the said

order and the respondent no.1 should not raise any hurdle and obstruction in

that respect. In paragraph 7 of the said order, this Court granted liberty to the

parties to raise a dispute as and when occasion arises in accordance with the

law before appropriate forum.

19. The respondent no.1 society thereafter filed a suit in the month of

July, 2009 against the appellant inter-alia praying for declaration that the

agreement dated 28th December, 1993 executed between the appellants and

the respondent nos. 2 and 3 was illegal, bad in law, null and void and cannot

be enforced and stood cancelled to the extent of sale of portion of common

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terrace of the building known as Arihant Apartment, ‘C’ Wing. The

respondent no.1 also prayed for an order and direction against the appellants

to handover the agreement dated 28 th December, 1993 in respect of the sale

of portion of common terrace of the building known as Arihant Apartment,

‘C’ Wing. The respondent no.1 also prayed for a mandatory order and

injunction against the appellants to handover the possession of the portion of

the common terrace of the society admeasuring 800 sq. ft. approximately to

the extent of dividing wall to the respondent no.1. The said suit was resisted

by the appellants by filing a written statement on various grounds. The

appellants also raised a plea of limitation in the written statement. The

respondent nos. 2, 3 and 5 did not file any written statement.

20. Learned Trial Judge framed four issues for determination. The

appellant no.1 entered the witness box. The respondent no.1 examined

Mr.Jitendra Lalchand Shah, one of the office bearer of the respondent no.1

as a witness. Both these witnesses were cross-examined by the other side.

The Trial Court passed a judgment and order dated 12 th September, 2012

holding that the said suit filed by the respondent no.1 was not barred by law

of limitation. The Trial Court declared the agreement dated 28 th December,

1993 between the appellants and the respondent nos. 2 and 3 as illegal, bad

in law, null and void and stood cancelled to the extent of sale of portion of

common terrace in the suit building and directed the appellants to handover

the possession of the common terrace in the suit building to the respondent

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no.1 Being aggrieved by the said judgment and award passed by the Trial

Court, the appellants filed this First Appeal No. 1642 of 2012 in this Court.

The said First Appeal came to be admitted.

Facts in First Appeal No. 31 of 2016 :-

21. It was the case of the respondent no.1 that the appellants had

encroached open portion of the terrace of the building by constructing a

dividing wall and a room below overhead water tank in the year 2003. The

respondent no.1 made a complain to the Municipal Corporation of Greater

Mumbai against such alleged encroachment by the appellants. The

Municipal Corporation issued a notice under Section 351 of the Mumbai

Municipal Corporation Act, 1888 on 10th March, 2003, in respect of such

alleged unauthorized construction to the appellants. Sometime in the year

2004, the appellants applied for regularization of the work carried out by the

appellant on the 7th floor of the building i.e. regularization of room at terrace

of building ‘C’ on the 7th floor of the building. On 13th September, 2004, the

Municipal Corporation of Greater Mumbai allowed the said application for

regularization subject to various conditions.

22. The respondent no.1 filed a Writ Petition bearing No. 2588 of 2005 in

this Court impugning the order of this Court dated 13 th September, 2004. By

an order dated 16th October, 2006, this Court disposed off the said writ

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petition. This Court held that the issue raised in that petition was before the

competent forum. If the respondent no.1 society succeeds before the

competent forum, it would be open to them to move the Municipal

Corporation based on that judgment and it would be on the Municipal

Corporation thereafter to act according to law. In so far as the issue about the

dividing wall on the terrace is concerned, this Court granted liberty to the

society to file a representation to the Municipal Corporation. This Court

directed the Municipal Corporation to pass an appropriate order according to

law after hearing the society and the appellants.

23. On 27th January, 2009, the respondent no.1 society issued a notice to

the Municipal Corporation and called upon it to initiate appropriate action

against the appellants in response to the said statutory notice. The appellants

by their letter dated 19th February, 2009 to the Municipal Corporation raised

various issues. Sometime in the month of July, 2009, the respondent no.1

filed a suit bearing L.C. Suit No. 1543 of 2009 before the City Civil Court at

Bombay against the appellants and the Municipal Corporation inter-alia

praying for appropriate orders for cancelling the regularization granted by

the Municipal Corporation to the appellant in respect of the room

constructed below the overhead water tank and for mandatory order

directing the Municipal Corporation to demolish the said room below the

overhead water tank. The respondent no.1 also applied for an order and

direction before the Municipal Corporation to take appropriate action against

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the appellants for carrying out alleged illegal construction on the portion of

alleged common terrace of the respondent no.1 society. The said suit was

resisted by the Municipal Corporation and also by the appellants by filing

separate written statements.

24. Learned Trial Judge framed four issues for determination. The

appellant no.1 entered the witness box on behalf of the appellants.

Mr.Jitendra Lalchand Shah, the Honorary Chairman of the respondent no.1

society entered the witness box on behalf of the respondent no.1. The

Municipal Corporation examined Mr. Jeevan D. Rathod, Assistant Engineer

(B&F) who filed his affidavit in lieu of examination-in-chief dated 16 th

December, 2013. All these witnesses were cross-examined. The Trial Court

passed a decree and order on 28 th October, 2015 thereby decreeing the said

suit partly and has set aside the order of regularization passed by the

Municipal Corporation. The Trial Court also directed the Municipal

Corporation to take appropriate action against the appellant no.1 by filing

due process of law in respect of alleged unauthorized structure raised on the

terrace of the suit building and rejected the prayers in the plaint made by the

respondent no.1. Being aggrieved by the said judgment and order, the

appellants (original defendant nos. 5 and 6) filed this First Appeal No. 31 of

2016. The respondent no.1 society did not file any First Appeal or cross-

objection.

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Submissions on behalf of the appellants in First Appeal No. 1642 of 2012

and First Appeal No. 31 of 2016 :-

25. Mr. Venkatesh Dhond, learned senior counsel appearing for the

appellants invited my attention to various averments made in the plaint filed

by the respondent no.1 in both the suits filed by the respondent no.1,

averments made by the appellants in the written statements filed in both the

suits, averments made by the Municipal Corporation in Suit bearing L.C.

No. 1543 of 2009, various documents annexed to a compilation of

documents including agreement entered into between the appellants and the

original owner of the suit property, agreement between the original owner

and the Honorary Chairman of the respondent no.1 society, various portions

of the oral evidence laid by the witnesses examined by the parties and

various findings rendered by the Trial Court in both the suits filed by the

respondent no.1.

26. It is submitted by the learned senior counsel that the respondent nos.

2 and 3 in First Appeal No. 1642 of 2012 who were the original owners of

the suit property had entered into agreement with the appellants. The

respondent nos. 2 and 3 had sold not only the flats but also 145 sq. ft. FSI

which could not be utilized by the respondent nos. 2 and 3 by carrying out

further construction in the building constructed by them. The appellants

were allowed to carry out construction by utilizing the said 145 sq. ft. FSI by
carrying out construction of room on the part of terrace sold by the respondent nos.

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2 and 3 in favour of the appellants.

27. It is submitted by the learned senior counsel that in the agreement for

sell entered into between the respondent nos.2 and 3 with the Chairman of

the respondent no.1 society Mr. Jitendra Lalchand Shah and several other

flat purchasers, there was a reference to the terrace of the ‘C’ wing of the

building constructed by the respondent nos. 2 and 3. It was specifically

mentioned in the said agreement that the respondent nos. 2 and 3 were the

owners of the terrace on the 7 th floor and were entitled to sell such terrace to

the flat purchasers and that no other person except the purchasers of such

terrace will have any right, title and interest of any nature whatsoever on the

said terrace on the 7th floor. He submits that the said Mr.Jitendra Lalchand

Shah was fully aware of the agreement between the appellants and the

respondent nos. 2 and 3 in respect of the flats and also the terrace. The said

Mr. Jitendra Lalchand Shah was also staying on the same floor and used to

visit the flats purchased by the appellants along with terrace. He had also

attended the birthday parties of the daughter of the appellants in the said flat

along with terrace.

28. It is submitted by the learned senior counsel that the said Mr. Jitendra

Lalchand Shah was interested in buying the said flats along with the terrace

at a thrown away price. The appellants had categorically refused to sell that

flat to the said Mr. Jitendra Lalchand Shah at thrown away price. The said

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Mr. Jitendra Lalchand Shah accordingly adopted a vindictive approach

against the appellants and filed frivolous complaints to the Municipal

Corporation, to the authorities under the provisions of Maharashtra Co-

operative Societies Act, 1960 and instigated the society to file frivolous suits

against his client.

29. It is submitted by the learned senior counsel that the respondent no.1

society had been collecting separate amount towards maintenance in respect

of the said terrace since inception. He submits that the said terrace which

was sold to the appellants by the respondent nos. 2 and 3 was not a common

terrace on the ‘C’ Wing of the building constructed by the respondent nos.2

and 3. None of the members of the respondent no.1 society or the respondent

no.1 society itself had any right, title or interest of any nature whatsoever on

the said portion of the terrace. The appellants had paid consideration in

respect of the said terrace portion and also for purchasing 145 sq. ft. FSI

from the respondent nos. 2 and 3.

30. It is submitted by the learned senior counsel that though it was to the

knowledge of the respondent no.1 society about the agreement entered

between the appellants and the respondent nos. 2 and 3 in respect of the said

open terrace on the 7th floor which was not a common terrace as far back as

on 28th December, 1993, after expiry of the limitation period, the respondent

no.1 filed a suit against the appellants for a declaration that the agreement

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dated 28th December, 1993 between the appellants and the respondent nos. 2

and 3 cannot be enforced, was illegal, bad in law, null and void and stands

cancelled to the extent of sale of portion of common terrace and handing

over possession of the alleged common terrace. Learned senior counsel

strongly placed reliance on Article 58 of Schedule I to the Limitation Act,

1963 and would submit that each and every prayers of the said suit bearing

No. 1642 of 2009 were barred by law of limitation.

31] Learned senior counsel invited my attention to the averments made in

paragraph 19 of the plaint filed by the respondent no.1 alleging that the suit

was within the period of limitation by relying upon the order dated 20 th

August, 2008 passed by this Court in Writ Petition No. 1718 of 2008

granting liberty to the respondent no.1 to initiate appropriate proceedings as

and when occasion arises. Learned senior counsel invited my attention to the

said order dated 20th August, 2008 passed by this Court and would submit

that by the said order this Court had set aside the direction issued by the

authority which was in the nature of anticipatory relief and granted liberty to

the parties to raise a dispute as and when occasion arises in accordance with

law before an appropriate forum. Cause of action for filing the said Civil

Suit No. L.C. Suit No. 1543 of 2009 had not commenced on the date of the

said order dated 20th August, 2008 but had already commenced when the

agreement was entered into between the appellants and the respondent nos. 2

and 3 in respect of the said open portion of terrace along with sale of 145 sq.

21
 fa-1642.12 & fa-31.16.doc

ft. FSI.

32] It is submitted that the respondent no.1 society through its Honorary

Chairman and all other members of the respondent no.1 society were fully

aware that the respondent nos. 2 and 3 had reserved their right to sell the

open portion on the terrace to any of the flat purchasers and making it clear

that the other flat purchasers will not claim any right, title or interest in the

said open terrace on the 7th floor. The period of limitation for filing a suit in

respect of the prayers sought in the said L.C. Suit had already expired much

before the said order dated 20th August, 2008 came to be passed by this

Court in Writ Petition No. 1718 of 2008.

33. Learned senior counsel invited my attention to the finding rendered

by the Trial Court in paragraph 21 and submits that the trial court has

erroneously held that the suit is essentially for enforcement of statutory

obligation under the Maharashtra Ownership Flats (Regulation of the

Promotion of Construction, Sale, Management and Transfer) Act, 1963

(hereinafter referred to as ‘MOFA Act, 1963’ for short) and secondly the

agreement to the extent of sale of terrace was not just avoidable but was void

ab initio being in contravention with law and public policy. The Trial Court

also held that the relief of possession, does not prescribe any limitation

unless adverse possession is shown by the defendants which was not the

case in the present suit.

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34. Learned senior counsel invited my attention to the averments made by

the respondent no.1 in paragraphs 8, 12 and 13 of the plaint in L.C. Suit No.

1642 of 2009 filed by the respondent no.1. The respondent no.1 society was

registered on 26th April, 1994. The respondent no.1 itself had made a

reference to agreement dated 28th December, 1993 executed between the

appellants and the respondent nos. 2 and 3. In paragraph 6 of the plaint it

was averred that the respondent no.1 society came to know about the

agreement entered into between the appellants and the respondent nos. 2 and

3 about sale of the open terrace along with FSI admeasuring 145 sq. ft. only

on receipt of the copy of the agreement along with letter of the advocate for

the appellant dated 10th February, 2005.

35. In paragraph 12, it was alleged by the respondent no.1 that the

appellants had illegally constructed a room below the overhead water tank

on the common terrace in the year 2003 i.e. after the issuance of the

occupation certificate dated 17th February, 1993. The appellant had

constructed the dividing wall on the common terrace of the building of the

respondent no.1 society on the basis of the agreement dated 28 th December,

1993 in the year 2003. It is submitted that even if the date of the advocate’s

notice dated 10th February, 2005 was considered as a knowledge of the

respondent no.1 society, the suit filed in the month of July 2009 is ex-facie

barred by law of limitation. The suit was affirmed by the said Mr. Jitendra

Lalchand Shah who was neighbour of the appellants and was interested in

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buying the said flat nos. 701 and 701-A along with terrace.

36. Learned senior counsel for the appellants submits that the said

Mr.Jitendra Lalchand Shah who was the Honorary Chairman of the

respondent no.1 society or the office bearer at the relevant time was fully

aware about the agreement entered into between the appellants and the

respondent nos. 2 and 3 and also of the construction carried out by the

appellants in the year 2003-2004. The leaned senior counsel invited my

attention to the averments made by the appellants in this regard in

paragraphs 9 and 10 of the written statement filed by the appellants in the

said L.C. Suit. At no point of time, the respondent no.1 had raised any

objection against the appellant from carrying out construction on the terrace

below water tank by constructing three side walls pursuant to the agreement

entered into between the appellants and the respondent nos.2 and 3.

37. Learned senior counsel invited my attention to the photograph

forming part of the compilation in support of his submission that that the

said Mr. Jitendra Lalchand Shah who had attended birthday party of the

daughter of the appellant in the year 1996 much prior to the date of three

years of the respondent no.1 filing the said suit. The respondent no.1 society

had not disputed the agreement entered into between the respondent nos. 2

and 3 that Mr. Jitendra Lalchand Shah in respect of another flat on the same

floor and clearly mentioning that the terrace on the 7th floor exclusively

24
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belong to the respondent nos. 2 and 3 and would be sold to one of the flat

purchaser and that the other flat purchasers have no right, title and interest in

support of such terrace. Flat No.702 was sold to the said Honorary Chariman

Mr. Jitendra Lalchand Shah by the respondent nos. 2 and 3 in the year 1992

much prior to the date of sale of the flat nos. 701 and 701-A with open

terrace.

38. Learned senior counsel invited my attention to the Sixth and Seventh

Schedule of the said agreement for sale entered into between the respondent

nos. 2 and 3 with the Chairman of the respondent no.1 society referring to

the rights of the respondent nos. 2 and 3 in the open terrace. He invited my

attention to the affidavit of evidence filed by Mr. Jitendra Lalchand Shah

before the Trial Court and more particularly deposition in paragraphs 7, 13

and 14 and also to his cross-examination. He submits that the said

Mr.Jitendra Lalchand Shah admitted in his cross-examination that he had

taken possession of flat no.702 in the year 1994. He also admitted that the

agreement in respect of the said flat no. 702 was executed between the

respondent nos. 2 and 3 and himself in the year 1993. He had gone through

the said agreement while purchasing the flat no.702 and did not take any

objection while entering into the said agreement in respect of any part of the

said agreement.

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39. Learned senior counsel submitted that the said Mr. Jitendra Lalchand

Shah also admitted that he knew the appellants since the year 1994 and used

to visit the house of the appellants and had seen the entire flat in the year

1994. It is submitted that the said witness had admitted that he used to go to

terrace about 10 to 12 times in a month. When the construction of the room

on the 7th floor on the open terrace was going on, the said Mr. Jitendra

Lalchand Shah did not take any objection. Dr. Nikhil Shah had taken

objection in the Annual General Meeting of the society. The room in

question was constructed prior to the year 2003.

40. Learned senior counsel submits that the said witness also admitted

that the terrace was divided in two parts and out of that two parts one part

was in possession of the appellants and the other part was in possession of

the respondent no.1 society. The said witness also admitted that the

appellants were paying maintenance charges of the said terrace room to the

respondent no.1 society since 1994. The society was registered in the year

1994. Managing Committee of the respondent no.1 society was looking after

the affairs of the society from the year 1994 to 2002. He also admitted that

since the year 1994 the members of the society had no objection for

accepting the maintenance charges from the appellants in respect of the

terrace and room in question. The said witness also admitted that he was

aware of the fact that the Municipal Corporation had regularized the

construction of room in question. There was a room beneath the staircase on

26
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the ground floor. The approval of plan from Municipal Corporation was

taken by the society in the year 2005. The said witness admitted that since

1994, he was member of the Managing Committee of the respondent no.1

society and since then had been attending the meetings of the Managing

Committee of the respondent no.1 society.

41. Learned senior counsel invited my attention to the affidavit in lieu of

examination-in-chief filed by the appellant no.1 in the said L.C. Suit in 1642

of 2009 and more particularly deposition in paragraphs 2 to 6 and 8 to 10

and his cross-examination. The respondent no.1 was thus estopped by this

acquiescence. He submits that the findings rendered by the Trial Court on

the issue of limitation is ex-facie perverse and contrary to the evidence led

by the parties. The Trial Court did not consider the pleadings and evidence

filed by the parties. In view of the respondent no.1 society having filed false

case and pleadings in spite of knowing the true and correct facts, the

Honorary Chairman of the respondent no.1 society shall be punished for

perjury.

42. Learned counsel for the respondent no.1 society on the other hand

submits that the suit was filed by his client for declaration that the agreement

entered into between the appellants and the respondent nos. 2 and 3 was void

ab-initio. He submits that the respondent no.1 society was formed on 26 th

April, 1994. Even if the respondent no.1 society had collected any

27
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maintenance charges from the appellants for occupying the terrace, such

charges were illegally recovered and will not regularize the unauthorized

construction carried by the appellants on the terrace which property belong

to the respondent no.1 society.

43. Learned counsel for the respondent no.1 strongly placed reliance on

the order dated 20th August, 2008 passed by this Court in the Writ Petition

filed by the respondent no.1 and would submit that by the said order, this

Court had granted liberty to the parties to raise a dispute as and when

occasion arises. The suit was filed by the respondent no.1 within three years

from the date of the said order dated 20th August, 2008. He submits that the

Trial Court has thus rightly held that the agreement entered into between the

appellants and the respondent nos. 2 and 3 in respect of the terrace was void

ab-initio and accordingly directed the appellants to handover the said terrace

portion to the respondent no.1 society.

44. Mr. Dhond, learned senior counsel for the appellants in rejoinder

would submit that the said Writ Petition filed by the respondent no.1 was

arising out of the order passed by the Deputy Registrar under Section 179(2)

of the Maharashtra Co-operative Societies Act, 1960. The liberty granted by

this Court in the order passed in the said Writ Petition was to be exercised in

accordance with law. The said order passed by this Court would not revive a

time barred suit and would not create a fresh cause of action in favour of the

28
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respondent no.1 society. He submits that by the said order passed by this

Court the bar of limitation was not waived.

Submission of the parties in First Appeal No. 31 of 2016 :-

45. Mr. Dhond, learned senior counsel for the appellants submits that the

appellants had constructed three side walls below the water tank between

28th December, 1993 and 1st January, 1994. The respondent no.1 society was

registered only on 26th April, 1994. There was no question of obtaining any

prior permission from the society at that stage. No Conveyance Deed has

been executed by the developer in favour of the society in respect entire

property even till date. The respondent nos. 2 and 3 had already sold 145

sq.ft. FSI to the appellants with permission to carry out construction of a

room on the said terrace. The appellants had applied for regularization of the

said room by an application dated 4th November, 2004. The Municipal

Corporation allowed the said application filed by the appellants for

regularization of the said structure on 13th September, 2004.

46. The respondent no.1 society had filed a Writ Petition bearing No.

2588 of 2005 in this Court inter-alia challenging the order of regularization

passed by the Municipal Corporation. The respondent no.1 also had filed a

complaint before the Municipal Corporation. The Writ Petition filed by the

respondent no.1 came to be dismissed. The Review Petition bearing No.

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1543 of 2009 also came to be dismissed. The respondent no.1 thereafter filed

a Civil Suit bearing No. 1543 of 2009 before the City Civil Court inter-alia

impugning the order of regularization passed by the Municipal Corporation

in respect of the said room constructed below overhead water tank.

47. Learned senior counsel invited my attention to the prayers in the said

suit. He submits that his client had constructed three walls below the water

tank by utilizing balance FSI. He strongly placed reliance on various

paragraphs from the written statement filed by the Municipal Corporation

clearly stating that the application for regularization made by the appellants

was allowed by the Municipal Corporation. There was no violation of the

FSI. He also invited my attention to the various paragraphs on the written

statement filed by the appellants and the oral evidence led by the parties

including evidence led by the Municipal Corporation.

48. It is submitted by the learned senior counsel that the Municipal

Corporation is competent authority to regularize any structure and it is

exclusively within the powers and domain of the Municipal Corporation to

pass an order of regularization in accordance with law. The Municipal

Corporation has regularized the said structure. The Trial Court could not

have set aside the regularization order of the said structure. The respondent

nos.2 and 3 had sold specific portion of terrace to the appellants along with

flat Nos.701 and 701A which terrace was not a common terrace. A copy of

30
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the plan was annexed to the agreement entered into between the appellants

and the respondent nos. 2 and 3 showing a portion of the terrace sold to the

appellants by the respondent nos. 2 and 3. The said structure was put up by

the appellants without prior permission of the Municipal Corporation. There

was no embargo against the respondent nos. 2 and 3 for carrying out

construction by a room by utilizing balance FSI on the 7 th floor of the said

building or on any other portion of the buildings.

49. Mr. Khan, learned counsel for the respondent no.1 on the other hand

invited my attention to the averments made in paragraph 4 of the plaint and

would submit that the Municipal Corporation in its letter dated 17 th February,

1993 had not mentioned anything in respect of the terrace room on the 7 th

floor. The completion certificate issued by the Municipal Corporation on 6th

May, 1994 was also not in respect of the said terrace room constructed by

the appellants. He invited my attention to the notice issued by the Municipal

Corporation to the appellants under Section 351 of the Mumbai Municipal

Corporation Act, 1888. He submits that in the written statement filed by the

Municipal Corporation, there was no specific denial in respect of the

building completion plan referred by the respondent no.1 society in the

plaint.

50. It is submitted by the learned counsel that it was specifically

mentioned in the agreement entered into between the respondent nos.2 and 3

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and the appellants that the said agreement was subject to the provisions of

MOFA Act, 1963. The learned counsel placed reliance on the Sixth Schedule

of the said agreement and would submit that the water tank was common

area available to all the members of the society. He also invited my attention

to the Seventh Schedule which provides that the terraces except allotment

thereof in particular premises. He submits that the respondent nos. 2 and 3

could neither sell the compulsory open space to the appellants nor the

appellants could construct any structure in such compulsory open space

which was for the benefit of all the members of the respondent no.1 society.

The respondent nos. 2 and 3 admittedly had not given any NOC to the

appellants to carry out construction of any room in the compulsory open

space.

51. Learned counsel for the respondent no.1 placed reliance on the

judgment of this Court in case of Madhuvihar Co-op. Hsg. Soc. Ltd. and

Ors. v/s. Jayantilal Investments and Ors., 2006(3) Bom.C.R. 36 and in

particular paragraphs 26, 29 and 47 on the issue of limitation raised by the

appellants in Suit No. 1642 of 2009 and would submit that the claims made

by the respondent no.1 in the said suit were not barred by law of limitation.

52. Learned counsel for the respondent no.1 placed reliance on the

Section 7 of the MOFA Act, 1963 and would submit that in the occupation

certificate granted by the Municipal Corporation in respect of the said

32
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building more particularly ‘C’ Wing, no room was shown to have been

constructed by the appellants on the 7th floor and more particularly in the

compulsory open space. No changes thus could be done by the appellants or

by the developers without prior specific consent from the other flat

purchasers after sale of various flats in the said building in their favour.

53. Learned counsel for the respondent no.1 placed reliance on the

following judgments :-

i. Judgment of this Court in case of Abdul Rashid Khan v/s.

Brihanmumbai Mahanagar Palika and Ors., 2009(1) ALL MR 38
and in particular paragraph 11.

ii. Judgment of this Court in case of Ramagauri Keshvlal Virani v/s.

Walkeshwar Triveni Co-operative Housing Society Ltd. and Ors.,
2000(2) Bom.C.R. 687 and in particular paragraphs 7, 10, 11 and 14.

iii. An unreported Judgment of this Court delivered on 8 th October,

2018 in case of Smt. Neelam Omprakash Singh and Ors. v/s.
Awadhnarayan Laxmi Singh and Ors. in Writ Petition No. 8805 of
2017 and in particular paragraphs 2, 13 and 14.

iv. Judgment of this Court in case of Esha Ekta Apartments Co-

operative Housing Society Ltd. and Ors. v/s. Municipal
Corporation of Mumbai and Ors., 2013(5) 30 and in particular note
(a).

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v. Judgment of Supreme Court in case of Nahalchand Laloochand

Pvt. Ltd. v/s. Panchali Co-operative Housing Society Ltd., 2010(6)
ALL MR 430 and in particular note (c).

vi. An unreported Judgment of this Court delivered on 17 th December,

2011 in case of Rachanaa-I Co-op. Hsg. Society Ltd. v/s. Rachnaa
– Engineers and Developers and Ors. in Appeal From Order No.
357 of 2010 and in particular paragraphs 3, 6 and 12.

vii. An unreported Judgment of this Court delivered on 7th April, 2016 in

case of M/s. Dosti Corporation v/s. Sea Flama Co-operative
Housing Society and Ors. in Appeal From Order No. 117 of 2016
and in particular paragraphs 59 and 74 to 77.

54. Mr. Dhond, learned senior counsel for the appellants in rejoinder

submits that in clause 11 of the agreement between the appellants and the

respondent nos. 2 and 3, specific portion of the terrace was sold to the

appellants which was clearly identified including the use thereof.

Respondent Nos. 2 and 3 had also sold FSI admeasuring 145 sq. ft. to the

appellants for carrying out construction of a room on the part of the terrace.

He relied upon the completion certificate issued by the Municipal

Corporation on 6th May, 1994. The appellants had purchased the two flats

with terrace on the 7th floor and also 145 sq. ft. FSI after such completion

certificate was issued by the Municipal Corporation.

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55. It is submitted that it is not the case of the appellants that the said 145

sq. ft. FSI was sold by the respondent nos. 2 and 3 to the appellants or that

the said room was constructed by the appellants before the issuance of

completion certificate by the Municipal Corporation in favour of the

appellants. The appellants had constructed the said three side walls below

the water tank by utilizing 145 square feet FSI subsequently and had applied

for regularization thereof to the Municipal Corporation. He submits that

there is no dispute that the water tank on the 8th floor was the property of the

respondent no.1 society.

56. In so far as the judgment of this Court in case of Madhuvihar Co-op.

Hsg. Soc. Ltd. and Ors. (supra) relied upon by the learned counsel for the

respondent no.1 is concerned, it is submitted by the learned senior counsel

that the said judgment was subsequently set aside by the Division Bench of

this Court. In so far as the judgment of this Court in case of Abdul Rashid

Khan (supra) relied upon by the learned counsel for the respondent no.1 is

concerned, learned senior counsel distinguished the said judgment on the

ground that there was no case of regularization in that matter. Illegal

construction was carried out by the member. However, in this case the

application for regularization has been rightly sanctioned by the Municipal

Corporation.

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57. In so far as the judgment of this Court in case of Ramagauri Keshvlal

Virani (supra) relied upon by the learned counsel for the respondent no.1 is

concerned, it is submitted by the learned senior counsel that the said

judgment would not apply to the facts of this case. In this case, the

respondent no.1 society was not even registered when the said agreement

entered into between the appellants and the respondent nos.2 and 3 for sale

of the two flats, portion of the open terrace and 145 sq. ft. FSI was entered

into. In so far as the judgment of this Court in case of Smt. Neelam

Omprakash Singh and Ors. (supra) relied upon by the learned counsel for

the respondent no.1 is concerned, it is submitted by the learned senior

counsel that in the said matter the issue was whether the chamber summons

for seeking agreement to the plaint was rightly allowed by the Trial Court or

not. The said judgment does not apply to the facts of this case at all.

58. In so far as the judgment of this Court in case of Esha Ekta

Apartments Co-operative Housing Society Ltd. and Ors. (supra) relied

upon by the learned counsel for the respondent no.1 is concerned, learned

senior counsel distinguished the said judgment on the ground that in that

matter there was no order of regularization of the unauthorized construction,

whereas in this case the Municipal Corporation rightly regularized the

construction of three sides walls constructed by the appellants below the

water tank. In so far as the judgment of Supreme Court in case of

Nahalchand Laloochand Pvt. Ltd. (supra) relied upon by the learned

36
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counsel for the respondent no.1 is concerned, it is submitted by the learned

senior counsel that the facts before the Supreme Court in the said judgment

were totally different and are clearly distinguishable in the facts of this case.

59. In so far as the judgment of this Court in case of M/s. Dosti

Corporation (supra) relied upon by the learned counsel for the respondent

no.1 is concerned, the said judgment is distinguished by the learned senior

counsel on the ground that the developer in the said matter had constructed

new buildings after formation of the society without taking specific consent

from the flat purchasers in the other buildings. The facts before this Court

were totally different in that matter and are clearly distinguishable. In that

matter the entire FSI was already consumed by the developer, whereas in

this matter 145 sq. ft. FSI was still available with the developer when the

said agreement was entered into between the appellants and the respondent

nos. 2 and 3.

60. In so far as the judgment of this Court in case of Madhuvihar Co-op.

Hsg. Soc. Ltd. and Ors. (supra) relied upon by the learned counsel for

respondent no.1 is concerned, learned senior counsel submits that there is no

dispute about the proposition of law laid down by this Court in the said

judgment. In this case, the developer had brought to the notice of all the flat

purchasers in their respective agreement that there was a separate

terrace and no other flat purchasers would be entitled to make any claim

37
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or will have right, title or interest except the purchasers who would be sold

the said terrace. The other flat purchasers were also aware of balance FSI

available to the developers for carrying out construction. He submit that if

the developer could have constructed a room by utilizing the said 145 sq. ft.

FSI, no flat purchasers could have raised any objection. The developers have

sold the said FSI to the appellants. The appellants rightly constructed three

sides walls by utilizing the said FSI on which none of the flat purchasers had

any right, title or interest of any nature whatsoever. No such objection thus

could be raised by the members of the respondent no.1 society or even by

the society itself.

61. Mr. Khan, learned counsel for the respondent no.1 society submits

that no construction could be carried out under the water tank by the

appellants.

62. Ms. Sheetal Mane Tadke, learned counsel for the respondent nos. 2 to

4 in First Appeal No. 31 of 2016 adopts the stand already taken by her

clients i.e. Municipal Corporation in the written statement filed before the

Trial Court in the Suit No. 1642 of 2009 and evidence led by her clients

before the Trial Court. She submits that the Municipal Corporation had

rightly regularized the structure constructed by the appellants on the 7 th floor

below the water tank and thus no interference with the said judgment and

order passed by the Trial Court is warranted.

38
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REASONS AND CONCLUSIONS :-

63. I shall first deal with the First Appeal No.1642 of 2012. It is an

admitted position that the respondent nos.2 to 4 in this first appeal had

carried out construction on the plot of land at Tardeo Division and

executed various agreements for sale of flats in favour of various flat

purchasers. It is not in dispute that by a letter of allotment dated 30 th June

1992, the respondent nos. 2 to 4 had allotted flat bearing nos.701, 701-A on

the 7th floor and also the part of the terrace in the building known as

‘Arihant Apartment’, ‘C’ Wing to Suresh M. Jain and S.P. Chaudhari for the

total consideration of Rs.8 lakhs. By another agreement dated 28 th

December 1993, the respondent nos.2 to 4 agreed to sell the said flats and

the part of the terrace to the appellants. The said Mr.Suresh M. Jain and

Mr.S.P. Chaudhari were the confirming parties to the said agreement. In

clause 11 of the said agreement, it was clearly provided that the promoters

had confirmed and agreed that the purchasers shall be exclusively entitled to

a portion of the terrace shown in the green colour in the plan annexed to the

said agreement and shall be exclusively entitled to use, occupy, possess and

enjoy the said portion of the terrace in the manner, the purchasers may deem

fit in addition to the said flat nos.701 and 701-A.

64. It was further provided in the said clause that the purchasers shall be

entitled to put separate stairs to have direct access to the said terrace through

their flat no.701 and the promoters and/or the purchasers of the other

39
 fa-1642.12 & fa-31.16.doc

premises in the said building shall not be entitled to raise any objections of

any nature whatsoever in that respect.

65. In clause 11(d) of the said agreement, it was clearly provided that

the promoters had represented and confirmed that there was about 145 sq.ft.

balance and unutilized FSI out of the permissible FSI as per the rules and

regulations in respect of the said property. It was provided that the

purchasers shall be entitled to put temporary or permanent construction or

erection or shelter or enclosure on the said terrace, if the same was permitted

by the Bombay Municipal Corporation by utilization and consumption of

balance unutilized FSI about 145 sq.ft. and/or if permitted free of FSI or

even otherwise. It was further agreed that the promoters as well as the

confirming parties shall have no responsibility or liability for such work, if

any, that may be carried out by the purchasers. The promoters will not use

the said FSI of 145 sq.ft. anywhere else. The owners and the promoters shall

not permit anyone else to utilize the said balance FSI of 145 sq.ft.

66. It is not in dispute that under clause 11 (f) of the said agreement, it

was clearly provided that the said promoters and/or the purchasers of the

other premises shall not interfere with the right, title and interest of the

purchasers in respect of the portion of the said terrace thereby allotted to the

appellants. In clause 12 of the said agreement, it was clearly provided that

the purchasers shall have no claim save and except in respect of the

40
 fa-1642.12 & fa-31.16.doc

particular premises inclusive of terrace area, common area, facilities and

limited common areas and facilities, thereby agreed to be acquired and all

other open space/unallottted parking space/flats/rules/offices/shops/ garages/

lobbies/staircases/terraces etc. will remain the property of and/or any part

thereof is transferred to the said organization as mentioned in the said

agreement but subject to the right of the promoters under the said agreement.

In the Seventh Schedule of the said agreement, the list of the portions of the

properties not allowed to be utilized were terraces except allotted to the

particular premises and various other portions of the properties specifically

mentioned therein. Admittedly the said agreement was duly registered with

the Registrar of Sub-Assurances.

67. It is also not in dispute that on 21 st December 1992, the respondent

nos.2 to 4 had entered into another agreement in favour of Mr.Jitendra

Lalchand Shah, who was one of the office bearers of the respondent no.1

society in respect of the flat no.702 on the same floor adjoining to suit flat

and the said terrace which was sold to the appellants for consideration of

Rs.7 lakhs. The respondent no.1 did not dispute that the clause 13 of the

said agreement entered into between the promoters and the said Mr.Jitendra

Lalchand Shah, it was clearly provided that the owner and/or his assignee

and transferee shall be entitled to allow exclusive use of any areas of the said

terrace to any party of their choice. The purchasers and/or the purchasers of

the other premises in the said building shall not be entitled to raise any

41
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objection of whatsoever kind and nature and shall not be entitled to use such

terrace or open space sold and/or allotted by the owner and/or promoters to

the purchasers of such terrace unless the purchasers himself is such

purchasers or the purchasers of such terrace shall be exclusively entitled to

use the terrace of the open space sold and/or allotted to him.

68. It was further provided that the owners/promoters shall be entitled to

transfer/assign/dispose of and/or sell in any manner they deem fit or proper

the said terrace/open space etc. to anybody or such price, terms and

conditions as the promoters deem fit. The purchasers along with other

purchasers shall not raise any objection of whatsoever nature or kind. In

clause 13(c) of the said agreement, it was clearly provided that the

owners/promoters shall be entitled to sell or otherwise dispose of the right to

the terrace or the terraces of the said building for the purpose of construction

or advertisement/hoardings or any other use permissible by law, so long as

the means of access was available to the proposed society for approaching

the water tanks and the lift rooms.

69. Clause 24 of the said agreement further provided that the purchasers

also agreed to undertake not to use or permit to use the terrace on the top

floor of the said property which shall exclusively belong to the promoters

and/or the purchasers of the flats on the 7th floor as per writing between the

promoters and the concerned parties. Under Clause 34 of the said agreement

42
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entered into between the promoters and the said office bearer of the

respondent no.1 society, it was clearly provided that the purchasers agreed

that the terrace shall exclusively belong to Pukhraj C. Bafna, respondent

no.5 who shall be entitled to use, occupy, possess and enjoy the said terrace

exclusively and the purchasers agreed and undertook not to obstruct or

raise any objection in that regard. The said Pukhraj C. Bafna shall be

entitled to sell, transfer or assign the said terrace any person or party. The

said Pukhraj C. Bafna shall also be entitled to let, sublet or any manner to

deal with the said terrace and the purchasers thereby irrevocably consented

to the same.

70. Clause 45 of the said agreement clearly provided that the promoters

or the person nominated by the promoters or the person to whom the

rights and benefits conferred under the subsequent clauses were signed

and shall have absolute right to make additions, alterations, raise any

storeys or put up additional structure as may be permitted by the Municipal

Corporation and the competent authorities. Such additions, alterations,

structures and storeys will be the sole property of the promoters and/or its

nominees or assignees as the case may be. They will be entitled to dispose

of the same in any manner they choose and the purchasers gave consent to

the same. The terrace/s of the building/s till the same is/are allotted to any

purchaser and/or agreed to be sold as well as the parapet walls shall be

the sole property of the promoters or its nominees or assignees.

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71. It was further provided that the agreement with the purchasers and

all other purchasers of other premises in the said building shall be subject

to those rights of the promoters or its nominees or assignees who shall be

entitled to use the said terrace/s therein as well as the said property and

other purchasers shall not be entitled to any abatement in the price of all

the premises therein. The promoters shall be deemed to be the owner of

such premises which have not been allotted and/or acquired and/or agreed

to be sold at the time when the said property is transferred as mentioned in

the said agreement. Seventh Schedule in the said agreement also provided

for various portions of property which were not allotted to be used by the

said flat purchasers including Mr.Jitendra Lalchand Shah who became

office bearer of the respondent no.1 society subsequently including the

terraces except “a terrace allotted to particular premises.” Similar

agreement was entered into by the promoters with several flat buyers in the

said building.

72. Pursuant to the agreement entered into between the appellants and

the promoters, the appellants constructed three side walls below the

overhead water tank on the terrace by utilizing the said FSI 145 sq.ft.

available on the plot. The said construction was carried out by the

appellants prior to the formation of the respondent no.1 society.

Admittedly the respondent no.1 society was formed only on 26 th April

1994 and was registered. The appellants were in use of / started claiming

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to be owner of the said small room on the terrace of the building since then

along with those two flats bearing nos.701 and 701-A. On 6 th May 1994,

the Municipal Corporation of Greater Mumbai had issued a completion

certificate pursuant to the application dated 6th February 1993 submitted

by an Architect appointed by the promoters. On 17th February 1993,

Municipal Corporation issued an Occupation Certificate for occupying the

entire building i.e. ground plus 7th floor subject to various conditions.

73. For the first time, only in the year 2005 i.e. by letter dated 30 th

January 2005, the respondent no.1 society addressed a letter to the

appellants alleging breaches on the part of the appellants by carrying out

construction of a room on the 7th floor. The appellants admittedly by their

advocate’s letter dated 10th February 2005 denied the allegations made

therein. The appellants thereafter filed an application under Section 79(2)

of the Maharashtra Co-operation Societies Act, 1960 against the respondent

no.1 before the learned Deputy Registrar, Co-operative Societies, ‘D’ Ward

inter alia praying for seeking various directions under the said provisions.

74. It is not in dispute that on 21st April 2005, the Deputy Registrar of

Co-operative Society passed an order under Section 79(2) of the said Act

directing the Managing Committee of the respondent no.1 to issue a share

certificate in the names of the appellants in respect of the said flat nos.701

and 701-A. In the said order, the learned Deputy Registrar also directed

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the respondent no.1 not to raise any dispute about terrace premises of flat

nos.701 and 701-A of the appellants since the builder had granted

possession and ownership of the terrace as per sale deed in their favour.

The Deputy Registrar also directed that if the appellants wanted to sell

their flats in future, permission was being granted through the office of

the Deputy Registrar and the respondent no.1. The Deputy Registrar made

it clear that if the respondent no.1 would not take any action on or before

15th May 2004, further action under Section 79(2) of the said Act would

be taken against the respondent no.1 society.

75. The respondent no.1 thereafter filed a writ petition bearing

No.1718 of 2008 impugning the said order dated 21st April 2005 before

this Court. By an order dated 20th August 2008 passed by this Court, this

Court recorded that the appellants agreed for deletion of the direction

issued by the Deputy Registrar holding that the respondent no.1 society

shall not raise any dispute about terrace premises of flat nos.701 and 701-

A sold to the appellants. This Court accordingly set aside the direction

issued by the Deputy Registrar that if the appellants would sell their flats

in future, permission was granted through the said order and the respondent

no.1 should not raise any hurdle and obstruction in that respect. This

Court granted liberty to the parties to raise a dispute as and when cause of

action arises in accordance with law before appropriate forum.

76. It is not in dispute that only in the month of July 2009, the

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respondent no.1 society filed a suit before Bombay City Civil Court

against the appellants and the promoters inter alia praying for declaration

that the agreement dated 20th December 1993 executed between the

appellants and the promoters was illegal, bad in law, null and void and

cannot be enforced and stood cancelled to the extent of sale of portion of

common terrace of the building known as ‘Arihant Apartment’, ‘C’ Wing.

The respondent no.1 also prayed for an order and direction against the

appellants to hand over the agreement dated 28 th December 1993 in

respect of the sale of portion of common terrace of the building known as

‘Arihant Apartment,’ ‘C’ Wing. The respondent no.1 also prayed for

mandatory order and injunction against the appellants to hand over the

possession of the portion of common terrace of the society admeasuring

800 sq.ft. approximately to the extension of dividing wall to the

respondent no.1. The said suit was resisted by the appellants by filing

written statement. The promoters did not appear before the trial Court in

the said suit. The trial Court framed four issues for determination. The

appellant no.1 entered the witness box. The respondent no.1 examined

Mr.Jitendra Lalchand Shah, one of the office bearers of the respondent

no.1 as a witness. Both the witnesses were cross-examined by the other

side. The trial Court decreed the said suit by judgment and order dated

12th September 2012.

77. A perusal of the plaint in the suit filed by the respondent no.1 before

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the City Civil Court indicates that it is an admitted position that the

respondent no.1 society was registered on 26 th April 1994. In paragraph 3

of the plaint, it is averred by the respondent no.1 that the building of the

society consists of ground plus 7th floor and 8th floor is common terrace of

the building (which includes the terrace of the appellants) as per sanctioned

plan and occupation certification dated 17th February 2003 issued by the

Municipal Corporation. It is averred in the said paragraph that there was

common terrace on 8th floor of the said building whereupon only the

overhead water tanks, lift machine room and stair case room were

constructed/existed. The common terrace is being used by the society for

mobile antena for the years together. The suit had been filed for assertion of

its alleged rights over part of the terrace.

78. In paragraph 5 of the plaint, it has been alleged that the appellants

had illegally encroached upon the portion of common terrace of the

building in violation of provisions of MOFA and Development Control

Regulations, Greater Mumbai, 1991 and the Model Agreement. In

paragraph 7 of the plaint, it is alleged that on perusal of the agreement

dated 28th December 1992, it was noticed that builder had in the said

agreement clarified that as per DC Regulation, it was not possible to the

developer to consume balance FSI and as such permitted the defendant

nos.1 and 2 (appellants) to put construction on the common terrace subject

to the same being permitted by the Municipal Corporation. It is alleged that

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FSI of 145 sq.ft. could not be utilized/consumed by the promoters as the

same was not permissible as per DC Regulations.

79. In paragraph 8 of the plaint, it is alleged that bills showing levy of

charges in respect of portion of common terrace had been originally issued

in respect of flat no.701-A, included by the promoters for terrace prior to

the management of building being transferred to the respondent no.1-

Society. Upon formation of the society, the respondent no.4 was the Chief

Promoter and on the management being taken by the society, the

appellant no.1 became the Chairman of the society. In paragraph 9, the

respondent no.1 relied upon letter dated 10 th February 2005 addressed by

the appellants to the Deputy Registrar, ‘D’ Ward, Malhotra House, Mumbai

under Section 79(2) of the Maharashtra Co-operative Societies Act, 1960

seeking certain directions against the respondent no.1 society.

80. The respondent no.1 also placed reliance on the order dated 20 th

August 2008 passed by this Court in Writ Petition bearing No.1718 of 2008

directing that as and when occasion arises, parties can adopt appropriate

proceedings. In paragraph 12, it is alleged that the appellants have

illegally constructed a room below overhead water tank on the common

terrace of the society building in the year 2003 i.e. after issuance of

occupation certificate dated 17th February 1993 by the Municipal

Corporation of Greater Mumbai. In paragraph 19 of the plaint, it is

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alleged that in the order dated 20th August 2008, this Court in Writ Petition

No.1718 of 2008 had granted liberty to initiate appropriate proceedings

as and when occasion arises and as such the present suit is within time and

the same is not barred by law of limitation.

81. In paragraph 21, it is alleged by the respondent no.1 that the

respondent no.1 was filing the said suit through Mr.Jitendra L. Shah the

Honorary Chairman of the respondent no.1 society duly authorized by the

resolution passed by the managing committee in that behalf and that the

said Mr.Jitendra L. Shah is aware of the facts of the present case. The

respondent no.1 accordingly prayed for various reliefs in the said suit and

more particularly for a declaration that the agreement entered into between

the promoters and the appellants was bad-in-law, null and void and cannot

be enforced and stood cancelled to the extent of sale of portion of common

terrace and also seeking order and direction to hand over the portion of the

said plot to the respondent no.1 society. The said suit was resisted by the

appellants by filing written statement.

82. In the examination-in-chief of the appellant no.1 who entered the

witness box on behalf of the appellants, he deposed as to how the appellants

had purchased the Flat Nos.701, 701-A and part of the terrace. He also

brought on record that the said room below the water tank was

constructed in the year 1993. Members of the society were aware of the

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construction and about his agreement with the developer with respect to

sale of FSI for consideration. He also produced photographs of birthday

celebration of his daughter in the year 1995. The said photographs were

taken by him by his camera and developed at his instance in the year

1995. His daughter was seen in the said photographs. At that time, she

was about 7 years old. In that event, wife of the Chairman of the

respondent no.1 society and his children were seen as they were invited

for his daughter’s birthday. The said photos showed the terrace room and

terrace portion in exclusive use and possession of the appellants at the

time of the said birthday celebration in the year 1995 along with wife and

children of Chairman Mr.Jitendra L. Shah.

83. It was deposed that the respondent no.1 was fully aware of existence

of terrace room and the terrace in the possession of the appellants before

formation of the society. In paragraph 6 of the said affidavit of evidence,

the appellant no.1 also deposed that he had contemplated to dispose of the

said flats along with room on the terrace in the year 2002-03 as his medical

practice was more in suburb. Mr.Jitendra L. Shah who is present

Chairman approached the appellant no.1 and offered to purchase the said

flat premises and the said room from him. He deposed that the said

Mr.Jitendra L. Shah demanded that the appellant no.1 should sell the said

flat premises to him at thrown away price of about Rs.50 lakhs and if the

same was not done as per the demand of the said Mr.Jitendra L. Shah, he

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will not be permitted to ever sell the flat premises. He also threatened that

he would use the promoter as an instrument and so also the respondent

no.1 society to involve the flat premises in litigation and to blackmail the

appellant no.1 into selling the flat premises at a price much below the

market price as demanded by him.

84. In paragraph 7 of the affidavit in lieu of examination-in-chief, the

appellant no.1 pointed out that in the said Writ Petition bearing No.2588 of

2005, the respondent no.1 had alleged that the said room and the dividing

wall which were constructed by the appellants was illegal and contrary to

the terms of the agreement entered into between the appellants and the

developer. In paragraph 8, it was deposed that none of the flat purchasers

ever objected to the construction of the said room and the user,

occupation, possession and enjoyment of the said room, terrace portion

along with wall dividing the terrace portion which was used by the

appellants uninterruptedly from 1993.

85. The appellant no.1 also relied upon the maintenance bill issued in

favour of the appellants prior to the formation of the society including the

maintenance charges for the use of terrace. The appellant no.1 also relied

upon the subsequent bills issued by the society after formation of society.

He also relied upon the approved plan in respect of terrace room showing

that the terrace was in two parts. He produced certified copy of the plan

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with letter dated 4th November 2002 issued by the Municipal Corporation.

He also relied upon the order passed by the Municipal Corporation

regularizing the said construction carried out by the appellants below the

water tank which order was passed on 30th April 2005.

86. In paragraph 15 of the affidavit in lieu of examination-in-chief, the

appellant no.1 also deposed that the society has been collecting

compensation/maintenance charges also in respect of delineated portion of

terraces owned by the appellants and enhanced the amount from time to

time. The appellant no.1 was cross-examined by the learned advocate for

the respondent no.1. The examination-in-chief of the appellant no.1 was

not shattered in the cross-examination conducted by the learned advocate

for the respondent no.1. In the writ petition filed by the respondent no.1

society in this Court in the year 2005 impugning the order passed by the

learned Deputy Registrar under Section 79(2) of the Maharashtra Co-

operative Societies Act, in paragraph 4.5, it was alleged by the respondent

no.1 that in or about February 2003, the appellants had commenced illegal

construction activities upon the portion of terrace on 8 th floor of the

building admeasuring about 1000 sq.ft. built up area. It was further

alleged that the appellants had carried out illegal and unauthorized

construction of sub-dividing wall on the said common overhead water tank

on the said common terrace on 8th floor of the said building. The office

bearer of the respondent no.1 had objected to the same, however, the same

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did not deter the appellants.

87. The respondent no.1 examined Mr.Jitendra L.Shah who is the

Honorary Chairman of the respondent no.1 society as the only witness

before the City Civil Court. In the resolution passed by the society, it was

mentioned that the said Mr.Jitendra L. Shah was familiar with the facts of

this case. In paragraph 5 of the affidavit in lieu of examination-in-chief, he

admitted that the respondent no.1 society was registered on 26 th April

1994. The building of the respondent no.1 society consists of ground plus

7th floor and 8th floor of common terrace of the building. He referred to the

agreement dated 28th December 1993 executed between the developer

and the appellants in paragraph 7 of the said affidavit of evidence. In

paragraph 9 of the said affidavit, it is deposed by him that bills which had

been originally issued in respect of the Flat No.701-A, the promoters had

included the charges for terrace prior to the management of the building

being transferred to the respondent no.1 society. He also referred to the

Directives issued by the Deputy Registrar by an order dated 21 st April 2005

and the order passed by this Court on 20 th August 2008 in the writ petition

filed by the society.

88. In his cross-examination, the said Mr.Jitendra L. Shah, the Honorary

Chairman of the respondent no.1 society, admitted that he had taken

possession of the flat no.702 in the year 1994 on the same floor on which

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the suit premises were situated. The agreement in respect of the said flat

purchased by the said witness was executed between him and the developer

in the year 1993. He admitted that while purchasing the flat no.702, he

had gone through the agreement and did not take any objection while

entering into the agreement between him and the developer. He admitted

the he knew the appellants since 1994. He used to visit the house of the

appellants. He had seen the entire flat of the appellants in the year 1994.

He became the Chairman of the respondent no.1 society after the year

2005. He admitted that he had gone to the flat of the appellants near about

one and half years ago for giving wedding card of his daughter to the

appellants. There is no internal staircase to go to the suit flat of the

appellants. He used to go to the terrace for about 10 to 12 times for a

month.

89. The said witness admitted that the appellants had constructed a

room on the terrace of the building. When the construction of the said room

was going on, at that time, he personally did not take objection. He

however, volunteered that Dr.Nikhil Shah and Narayan Bhai had taken

objection. The said objection was taken in the Annual General Meeting of

the society. The room in question was constructed prior to the year 2003.

He denied the suggestion that a room in question was constructed in the

year 1994. In his cross-examination, he admitted that the terrace is

divided in two parts and out of two parts, one part is in possession of the

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appellants and another part is in possession of the society. One service

antenna is on the lift room and another service antenna is on the terrace.

These antennas are existing since the year 2000.

90. In paragraph 4 of the cross-examination, the said witness of the

society admitted that the appellants were paying maintenance charges in

respect of the terrace and room in question to the society from the year

1994. The said witness however, volunteered that since the year 2003,

society was not accepting maintenance charges from the appellants. The

society was registered in the year 1994. He admitted that elections of the

managing committee were held during the period 1994 to 2003. The

managing committee of the society was looking after the affairs of the

society from the year 1994 to 2003. He admitted that since the year

1994, the members of the society did not take objection for accepting the

maintenance charges from the appellants in respect of the terrace and the

room in question.

91. In paragraph 5 of his cross-examination, he admitted that he was

aware of the fact that Municipal Corporation of Greater Mumbai has

regularized the construction of the room in question. He also admitted that

there was a room beneath the staircase. He however, deposed that he did

not know whether the plan in respect of the said room got sanctioned from

the Municipal Corporation by the plaintiff-society in the year 2004. He

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admitted subsequently that the approval of the plan from the Mumbai

Municipal Corporation was taken by the society in the year 2005. He

admitted that the suit room belonging to the appellants had been shown in

the said plan.

92. The said witness also admitted in his cross-examination that since

the year 1994, he was a member of the managing committee of the

respondent no.1 society and had been attending the meetings of the

managing committee of the society. He also admitted that the society did

not raise any objection against the developer from putting an antenna on

the terrace of the said building.

93. A perusal of the evidence on record clearly indicates that when the

suit agreement was entered into between the developer and the appellants,

the respondent no.1 society was not even formed. It is also an admitted

position that till date, no conveyance deed has been executed between the

developer in favour of the respondent no.1 society in respect of the plot and

the building.

94. A perusal of the agreement entered into between the developer and

the appellants in respect of Flat Nos.701, 701-A and 145 sq.ft. FSI clearly

indicates that the said developer in the said agreement claimed to be the

owner of the said flats as well as unutilized 145 sq.ft. FSI by carrying out

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construction, if permitted by the Municipal Corporation. It was also made

clear that none of the flat purchasers or the developers would have right,

title or interest or would claim any interest in the said unutilized 145 sq.ft.

FSI. Simultaneously in the agreement entered into between the developer

with the said Mr.Jitendra L. Shah and the other members of the society, it

was clearly provided that they will not have right, title or interest of any

nature whatsoever on the terrace which would be sold by the developer in

favour of some other purchasers. It was clearly provided in those agreements

that it would be the purchasers of the said portion who would be entitled to

claim right, title and interest in the said portion of the terrace and not

other flat purchasers in the said building.

95. The said Mr.Jitendra L. Shah in his cross-examination admitted that

he had read the agreement entered into between him and the developer. He

did not raise any objection about the clauses in the said agreement. He also

knew the appellants since 1974 and had visited the house of the appellants

on several occasions. His wife and daughter had also attended the birthday

celebration of the daughter of the appellants in the year 1995. The

respondent no.1 did not dispute the photographs relied upon by the

appellants produced in the evidence led by the appellant no.1 showing the

terrace on the 7th floor in those photographs in possession of the appellants.

96. There is thus no substance in the submission of the learned counsel for

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the respondent no.1 that the said structure was constructed by the

appellants in the year 2003. The respondent no.1 in his evidence also

admitted that he himself used to visit the terrace of the society several times

in a year. He also admitted that the society had been collecting separate

amount towards maintenance of the terrace portion and the said room in

possession of the appellants for last several years and at least till 2003

even according to the respondent no.1.

97. A perusal of the record further indicates that on the ground floor, one

of the occupants of the flat had constructed a structure below the staircase.

The developer had applied for regularization of that structure. The society

never raised any objection in respect of that structure. The plan issued by

the Municipal Corporation in the year 2004 clearly indicated the existence

of the construction carried out by the appellants on the terrace by utilizing

145 sq.ft. FSI and also the said structure constructed by the member of the

society occupying the flat on the ground floor below the staircase. The

respondent no.1 did not dispute this fact in the evidence.

98. The society or its members did not raise any objection in respect of

the said agreement from 1993 till 2005. It was a specific case of the

appellants in the written statement that when the appellants wanted to sell

the said flats to shift to some other premises, the honorary Chairman of

the society of the respondent no.1 Mr.Jitendra L. Shah wanted to purchase

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the said premises at thrown away price. Since the appellants did not agree

to sell the said premises including the terrace to Mr.Jitendra L. Shah,

Honorary Chairman of the respondent no.1, appears to have threatened the

appellants to drag them in the litigation. During the course of the

arguments, learned counsel for the society could not dispute this part of the

evidence or the submission advanced by Mr.Dhond, learned senior counsel

for the appellants.

99. In the examination-in-chief of the respondent no.1 led through

Mr.Jitendra L.Shah, it was deposed that he personally did not raise any

objection when the said construction was carried out by the appellants.

However, two other members of the society had raised an objection which

objection was recorded in the minutes of meeting of the society. Cause of

action thus had already commenced when the agreements were entered

into between the developer and the appellants as far back as in the year

1993. The respondent no.1 who examined Mr.Jitendra L.Shah himself

had purchased the flat on the same floor in the year 1992 and claimed to be

fully familiar with the facts of this case as is apparent from the resolution

passed by the respondent no.1 society allowing him to file a suit and to

verify and affirm the plaint followed by entering into the witness box on

behalf of the respondent no.1 society to prove the case of the society before

the City Civil Court.

100. A perusal of the impugned judgment and order passed by the trial

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Court indicates that the trial Court has recorded a finding that the society

had proved that the agreement dated 28 th December 1993 between the

developer and the appellants is illegal, bad-in-law and null and void to the

extent of sale of portion of common terrace of the building ‘Arihant

Apartment,’ ‘C’ Wing. Trial Court has held that open terrace of the roof of

common area is not available for sale or allotment to the individual

member. Trial Court also recorded a finding that the common terrace was

on the 8th floor of the building. Trial Court did not consider the oral and

the documentary evidence led by the appellants about the date of purchase

of the said 145 sq.ft. FSI, knowledge of the respondent no.1 society to the

said construction carried out by the appellants, use, occupation and

possession thereof since 1993-94, the respondent no.1 society collecting

separate maintenance charges from the appellants in respect of the said

portion of the terrace and the room in possession of the appellants.

101. The trial court did not consider the admitted fact that the respondent

no.1 society was not even formed when the said agreement entered into

between the appellants and the developers and also an admitted fact that the

respondent no.1 who had examined the said Mr.Jitendra L. Shah had

clearly admitted that he knew the appellants since 1994 and was visited

his house as well as the terrace of the building quite often. Learned Judge

also did not consider the fact that the birthday celebration of the daughter of

the appellants was held in the said premises including the terrace which

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was attended by the family members of the Honorary Chairman of the

respondent no.1 society. The photographs produced by the appellants

clearly indicated that the said terrace was in possession, use and occupation

of the appellants prior to 1997. The impugned judgment and order is

passed in total ignorance of the evidence led by the parties and without

recording any sufficient reasons.

102. In my view, the trial Court has totally mixed up the fact that there

were two portions of terrace. Even according to the respondent no.1

society, in its plaint, it was clearly alleged that there was common terrace

on the 8th floor of the building ‘C’ Wing in ‘Arihant Apartment.’ Part of the

terrace was already in possession of the society admittedly. The society

had separately put an antenna on the portion of the terrace in possession of

the respondent no.1 society. The trial Court was under an impression that

the common terrace of the building of the society was sold to the appellants

by an agreement entered into between the developer and the appellants. In

my view, the impugned judgment and order is in ignorance of the admitted

pleadings and the evidence on record and shows perversity. The findings to

that effect and the conclusions drawn by the learned trial Judge thus

deserves to be set aside on this ground itself.

103. In so far as the issue of limitation is concerned, though it was an

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admitted position that the members of the society were aware of the

construction carried out by the appellants and more particularly the

Honorary Chairman of the society who entered the witness box being

neighbor of the appellants, cause of action had already arisen initially when

the agreement was entered into between the developer and the appellants or

at least on formation of the respondent no.1 as far back as in the year 1994.

The witness examined by the respondent no.1 society clearly admitted about

his knowledge and entered the witness box on the premise that he was fully

familiar with the facts of the case.

104. In so far as the reliance placed by the respondent no.1 on the order

passed by this Court in the writ petition filed by the society is concerned, a

perusal of the said order indicates that the said order was passed in writ

petition filed by the appellants in the year 2005 impugning the order passed

by the learned Deputy Registrar issuing direction under Section 79(2) of

the Maharashtra Co-operative Societies Act, 1960. Even in the said writ

petition, it was the case of the respondent no.1 that the appellants had

carried out unauthorized construction in the year 2003. The respondent

no.1 however, admittedly filed a suit for declaration only in the month of

July, 2009. In so far as the order passed by this Court on 20 th August 2008

is concerned, by the said order, this Court had made it clear that the parties

would have liberty to initiate appropriate proceedings as and when

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occasion arises.

105. In my view, the suit for declaration that the suit agreement in so far

as portion of terrace is concerned, since was executed in the year 1993

was ex facie barred by law of limitation on the date of filing the said suit

by the respondent no.1 before the City Civil Court and also on the date

when this Court passed the said order on 20 th August 2008 in the said

Writ Petition No.1718 of 2008. Granting liberty to initiate the appropriate

proceedings would not commence fresh cause of limitation since the suit

had already become time barred on the date of said order. Reliance placed

on the said order by the learned counsel for the respondent no.1 and by the

trial court is thus totally misplaced.

106. A perusal of the impugned judgment and order indicates that the

learned trial Judge has rendered an erroneous finding that since the suit for

enforcement of statutory obligation under MOFA and since the agreement

to the extent of sale of terrace is not just voidable but void-ab-initio, such

agreement in contravention of law and public policy could not have been

entered into between the parties. It was also erroneously held that for the

relief of possession, law does not prescribe any limitation unless adverse

possession is shown. In my view, even if the declaration is sought that the

agreement is null and void, bad-in-law and illegal, a specific period of

limitation is prescribed for seeking such relief in Article 58 of the

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Limitation Act. The finding of the trial Court that no limitation is

prescribed for possession unless adverse possession is shown or that the suit

is filed for enforcement of the statutory obligation under MOFA thus

limitation is saved is ex facie perverse and thus deserves to be set aside.

The suit filed by the respondent No.1 was ex facie barred by limitation.

107. Insofar as judgment of this court delivered by a learned Single Judge

in case of Madhuvihar Co-operative Housing Society Limited and Others

(supra) by the learned counsel for the respondent no.1 is concerned,

Mr.Dhond, learned senior counsel for the appellants invited my attention to a

judgment delivered by the Division Bench of this court on 7th October,2010

in First Appeal No.786 of 2004 and First Appeal No.989 of 2004 and would

submit that the said judgment delivered by a learned Single Judge of this

court reported in 2006 (3) Bom.C.R. 36 has been set aside by the Division

Bench and the matter has been remanded back to the learned Single Judge.

A learned Single Judge of this court thereafter has taken a different view in

the matter than the view taken by the learned Single Judge in the said

judgment reported in 2006(3) Bom.C.R. page 36. Reliance placed by the

learned counsel for the respondent no.1 on the judgment of learned Single

Judge reported in (2006) 3 Bom.C.R. page 36 is misplaced.

108. Insofar as the judgment in case of Ramagauri Keshavlal Virani

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(supra) relied upon by the learned counsel for the respondent no.1 and

referred to and relied upon by the learned trial judge in the impugned

judgment and order is clearly distinguishable on the ground that the

respondent no.1 society in this case was not even registered when the said

agreement was entered into between the appellant and the developer for sale

of the flats bearing no.701 and 701A along with open terrace and 145 sq.feet

FSI. In that the society was already formed. The flat purchaser who was a

party to the said proceedings had purchased the flat much later after

formation of the society. An agreement was entered into by the builder after

formation of the society for sale of the terrace. In my view, the learned trial

judge has erroneously followed the said judgment which is not applicable to

the facts of this case at all.

109. Insofar as judgment of this court in case of Smt.Neelam Omprakash

Singh (supra) by the learned counsel for the respondent no.1 is concerned, a

perusal of the said judgment indicates that the issue before this court in the

said judgment was whether an application by way of chamber summons for

seeking amendment to the plaint was rightly allowed by the trial court or

not. The said judgment is not even remotedly applicable to the facts of this

case. Reliance thus placed by the learned counsel for the respondent no.1 on

the said judgment is totally misplaced.

110. Insofar as the judgment of Supreme Court in case of Nahalchand

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Laloochand Private Limited (supra) relied upon by the learned counsel or

the respondent no.1 is concerned, the facts before the Hon’ble Supreme

Court in the said judgment were totally different. In this case, if the

developers themselves would have carried out the further construction by

utilizing the said unutilized 145 sq.feet FSI, no objection could have been

raised by any of the flat purchasers. The said agreement between the

appellants and the developers was executed prior to the formation of the

society. The society thus even otherwise could not have raised any objection

prior to its formation in respect of the said agreement in respect of the open

terrace with 145 sq.feet unutilized FSI.

111. In my view, the impugned judgment and order passed by the learned

trial court is contrary to the pleadings, evidence and the principles of law

laid down by the Supreme Court and this court referred to in the aforesaid

paragraphs of the judgment and thus deserves to be set aside.

Discussion and Conclusion in First Appeal No. 31 of 2016

112. This appeal is arising out of the judgment and order passed by the

City Civil Court thereby decreeing the suit filed by the respondent no.1

society partly and setting aside the order of regularization passed by the

Municipal Corporation in respect of the suit structure. By the said judgment

and order, the Municipal Corporation is directed to take appropriate action

against the appellants by following due process of law in respect of the

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unauthorized structure allegedly raised on the terrace of the suit. The trial

court rejected rest of the prayers made by the respondent no.1 in the suit.

113. A perusal of the plaint filed by the respondent no.1 indicates that it

was the case of the respondent no.1 (original plaintiff) that the appellants

had illegally encroached upon the portion of the common terrace of the

building by constructing a dividing wall and a room below overhead water

tank in the year 2003 in violation of the provisions of MOFA and

Development Control Regulations for Greater Mumbai, 1991. The

respondent no.1 had filed a complaint with the Municipal Corporation

alleging the violation of provisions of the MOFA and Development Control

Regulations for Greater Mumbai by the appellants. Pursuant to the said

complaint made by the respondent no.1, Municipal Corporation issued a

notice upon the appellants dated 10 th March, 2003. The respondent no.1 also

had filed a written complaint with the Municipal Corporation against the

appellants on 18th June, 2003. It was the case of the respondent no.1 in the

plaint that the appellants had illegally constructed a room below overhead

water tank on the common terrace of the society building. It was falsely

alleged that the society was duly registered at the relevant time. According

to the respondent no.1, even in the building completion plan, the room below

the overhead water tank was not shown and the same was shown on open

space.

114. It was the case of the respondent no.1 in the plaint that the Municipal

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Corporation has regularized the said unauthorized structure without

considering the objections raised by the respondent no.1. In paragraph 10 of

the plaint, it was averred that the ownership of the building vested in the

society since 26th April, 1994 and as such the society is the deemed and

beneficial owner of the entire building. It is the case of the respondent no.1

that when no occupation certificate was issued by the Municipal

Corporation, the said structure constructed by the appellants on the terrace of

the society was not constructed. Learned counsel appearing for the

respondent no.1 across the bar urged that the permission of the respondent

no.1 society was not obtained nor the permission of the Corporation was

obtained before carrying out the said construction by the appellants.

115. In the said suit, the Municipal Corporation was also impleaded as one

of the defendant. The suit was resisted not only by the appellants but also by

the Municipal Corporation by filing written statement. Insofar as the written

statement of the Municipal Corporation is concerned, it was averred by the

Municipal Corporation that as per available record with the Municipal

Corporation, it was observed that there was already an approved plan for the

building consisting of ground plus seven upper floors on the plot bearing

City Survey No.2/248 of Tardeo Division at the junction of Dr.D.B.Marg.

The plans were approved with two FSI in C Wing of the building. The

occupation certificate was issued on 17th February, 1993. Building

completion certificate was accepted on 6th May, 1994.

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116. In paragraphs (b) of the written statement, it was averred by the

Municipal Corporation that the appellants as per the terms and conditions of

the sale agreement dated 28th December,1993 constructed a room by

utilizing the FSI as sold to him. At that point of time, no permission for the

said construction of the said room was sought from the Municipal

Corporation by the appellants though the FSI was available. It is stated in

the written statement that the said construction appears to have been carried

out by the appellants immediately after the agreement in 1993. The

respondent no.1 society however for the first time complained about the said

room to the Assistant Commissioner, D Ward who issued a notice under

section 351 of the Mumbai Municipal Corporation Act on 10 th March, 2003

directing the appellants to show cause for the alleged unauthorized work

stated therein i.e. covering of open space below the elevated storage tank

situated on terrace of the said building.

117. In the said written statement, it is averred by the Municipal

Corporation that the appellants through their architect had submitted a

proposal for regularization of the said work along with the copy of the

registered agreement with the developers dated 28th December, 1993

allowing and giving rights to the appellants to construct a room on the

terrace upto the balance FSI potential of 145 sq.feet. The said architect also

submitted a title search report stating that the aforesaid property was not

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conveyed in the name of the respondent no.1 society. It was averred by the

Municipal Corporation that the said proposal submitted by the architect of

the appellant was scrutinized and approved by the competent authority on

10th January, 2004 under the provisions of law and on merits of the case.

118. It was averred that the permissible built up area available was 18.57

sq.meters (199.81 sq.feet) and the plans for the consumption of built area

were approved for 13.47 sq.meters (145 sq.feet) for the regularization of the

said room on the terrace. There was thus no violation of FSI on account of

regularization. The Municipal Corporation annexed a copy of the report and

the approval granted by the competent authority on the application submitted

by the architect of the appellants. In the said written statement, it was also

averred that as regards to the wall, which is sub-diving the terrace, the said

wall was reflected in the agreement between the appellants and the

developers and also reflected the said wall in the plan which was approved

by the Municipal Corporation.

119. The Corporation admitted that the appellants have carried out the

work below the overhead water tank with height of the room as 8 feet (2/44

meters). As per provisions of Development Control Regulation 38(2) (II),

Table 19, Serial No.1(c), the height of 2.44 meters (8 sq.feet) is permissible

subject to the condition that the said room is provided with A.C.

arrangement. The appellants have already installed the air conditioner in the

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same room and thus the provision of Development Control Regulation has

been adhered to by the appellants. The Municipal Corporation also referred

to the search report submitted by the appellants through their architect to

show that the said property had not been conveyed in the name of the society

till the date of the said application for regularization made by the appellants

was considered by the Corporation.

120. In paragraph (4) (i) of the written statement, the Municipal

Corporation averred that subsequent to the regularization of the structure of

the appellants, another proposal for regularization of inclusion of the passage

area in shop no.3 on the ground floor was received by the Municipal

Corporation. The said approval report showed that the premises of the

appellant viz. terrace along with room and the dividing wall was reflected in

the proposal plan as well as the sanction plan of the said premises of the

ground floor. The said proposal was submitted by the developer Mr.Pukhraj

Bafna who was the owner of the said property. The respondent no.1 society

was aware that it was within their knowledge that the said structure and wall

was approved and accepted by the Municipal Corporation since 4th

November, 2004. The regularization of amalgamation of shops inclusive of

the passage area had been done on 30th April, 2005. The Municipal

Corporation averred in the said written statement that as there was no

violation of FSI available of the said building, construction carried out by

the appellant was regularized. The said order of regularization is legal and

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proper.

121. In the written statement filed by the appellant, the appellant placed

various facts on record about the provisions of the agreement entered into

between the developer and the appellants, application for regularization

made by the appellants through their architect and the order passed by the

Municipal Corporation. The appellants also annexed various receipts issued

by the respondent no.1 society showing the payment of maintenance

recovered from the appellants for the said terrace for last several years. It is

the case of the appellants that since the said construction was carried out by

the appellants pursuant to the said agreement entered into between the

appellants and the developer, appellants had not obtained any prior

permission from the Municipal Corporation. The respondent no.1 society

was not even formed when the appellants had carried out the said

construction. A question of any prior consent from the respondent no.1

society which did not even exist at that point of time, did not arise.

122. On behalf of the respondent no.1, Mr.Jitendra Shah entered the

witness box as the sole witness. In paragraph 12 of his affidavit in lieu of

examination in chief he deposed that the ownership of the building is vested

in the society since 26th April, 1994 and as such, the society is deemed and

beneficial owner of the entire building. The residual FSI in the plot or

layout not consumed, will be available to the promoter till the registration of

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the society and on registration of the society, the same shall be available to

the society and not the builder/promoter. The said witness was cross

examined by the Municipal Corporation as well as by the appellants’

advocate.

123. In his cross examination, the said witness on behalf of the society

deposed that at that point of time, he was not the chairman of the society as

the Government had appointed an administrator in the month of October

2011. Though the society was registered, there was no conveyance deed in

favour of the society. He deposed that in the year 1993-94 he was not the

chairman of the society. He was also not the chairman in the year 2003. He

admitted that in the year 2003, the society had filed a complaint with the

Municipal Corporation alleging unauthorized construction made by the

appellants. He admitted that the Municipal Corporation had regularized the

said construction carried out by the appellants. He however pleaded

ignorance that he did not know whether any construction was made by the

inhabitants of the ground floor was regularized or not.

124. In the cross examination of the said witness examined by the society

by the appellants’ advocate, the said witness admitted that he was one of the

flat purchasers in the building. There were about 32 flats in the said

building. He was the office bearer of the society during the period of 1992

to 2005 and was member of the executive body since 1997. When he had

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purchased the flat, he had entered into an agreement with the builder.

125. On behalf of the Municipal Corporation, Mr.J.D.Rathod working as

Assistant Engineer in Building and Factory Department filed an affidavit in

lieu of examination in chief. In his affidavit of evidence, he deposed that the

appellants as per the terms and conditions of the sale agreement dated 28 th

December, 1993 had constructed a room by utilizing the FSI sold to him by

the developer. At that point of time, no permission for the said construction

was sought from the Municipal Corporation though the FSI was available.

The society for the first time made a complaint about the said room to the

Assistant Commissioner, D Ward who issued a notice on 10 th March, 2003

under section 351 of the Mumbai Municipal Corporation Act. He referred to

the application made by the architect of the appellant for regularization of

the said work along with the copy of the registered agreement allowing the

appellant to utilize 145 sq.feet FSI potential.

126. In paragraph 5 of the affidavit, it is deposed that the proposal was

scrutinized and approved by the competent authority on 10 th January, 2004

under the provisions of law and/or merits of the case. It was observed that

the permissible built up area available was 18.57 sq.meter (199.81 sq.feet)

and plans for the consumption of built up area were approved for 13.47

sq.meters (145 sq.feet) for the regularization of the said room. There was no

violation of FSI on account of regularization. In the said affidavit, the said

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witness also referred to the provisions of DC Regulation providing the

permissible height of the structure which can be constructed below the

overhead water tank subject to the condition that the said room is provided

with AC arrangement.

127. In his affidavit, the said witness also referred to a proposal made by

Mr.Chheda occupying the shop no.4 which was approved by the Municipal

Corporation for regularization wherein the NOC of the society was not

insisted nor the society had objected to the regularization of storage below

staircase on 30th April, 2005. The said proposal submitted by Mr.Chheda

also reflected the said room below water tank constructed by the appellants.

The said proposal was submitted by Mr.Pukhraj Bafna, who was owner of

the said building. The respondent no.1 society was thus fully aware and it

was within its knowledge that the said structure and the wall was approved

and accepted by the Municipal Corporation on 4 th November, 2004. The

said witness examined by the Municipal Corporation was cross examined by

the society’s advocate. The said witness had visited the suit flat. There was

hardly any cross examination of the said witness by the society’s advocate.

Various depositions made by the witness examined by the Municipal

Corporation thus remained uncontroverted.

128. The appellant no.1 also entered the witness box by filing an affidavit

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of evidence. In the said affidavit of evidence, he placed on record the

provisions of the agreement entered into between him and the developer. He

also pointed out as to when the appellants had carried out the said

construction on the terrace below the water tank and about the knowledge of

the society about such construction. He also relied upon the recovery of

maintenance by the society from the appellant in respect of the said structure

on the terrace. There was hardly any cross examination of the appellant no.1

by the society’s advocate. Be that as it may, the deposition of the appellant

was not shattered in the cross examination by the society’s advocate.

129. In so far as submission of the learned counsel for the respondent no.1

that the letter dated 17th February, 1993 issued by the Municipal Corporation

or the completion certificate dated 6th May, 1994 was not in respect of the

terrace room constructed by the appellants is concerned, it is not the case of

the appellants that the said construction was carried out by the appellants

prior to 17th February, 1993. Even according to the appellants the said

construction was carried by the appellants only after occupation certificate

was issued by the Municipal Corporation.

130. In so far as submission of the learned counsel for the respondent no.1

that the appellants had not obtained any prior permission from the

respondent no.1 society before carrying out the said construction on the

terrace of the said building is concerned, the learned counsel for the

respondent no.1 did not dispute that the society itself was formed only on

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26th April 1994. The appellants have produced proofs to show that the

appellant had already carried out the said construction even before formation

of the respondent no.1 society. The Municipal Corporation also has

confirmed this fact by filing written statement and by leading evidence on

this issue. The question of taking any prior consent of the society at that

point of time thus did not arise since the said society itself was not in

existence on the date of carrying out such construction.

131. In so far as submission of the learned counsel for the respondent no.1

that the provisions of the agreement entered into between the developers and

the appellants that the said agreement was subject to provisions of MOFA

Act and that the said unutilized 145 sq. ft. FSI could be used only after

obtaining permission from the society is concerned, since the society itself

was not in existence, the question of the appellants taking prior consent of

the society did not arise. In the pleadings filed before the City Civil Court, it

was a specific case of a respondent no.1 society that the society became the

owner of the entire building only upon registration of the respondent no.1

society in the year 1994.

132. In so far as submission of the learned counsel for the respondent no.1

that the respondent no.1 did not take any prior consent of the Municipal

Corporation before carrying out such construction is concerned, it is not the

case of the appellants that the appellants had taken any such prior permission

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from the Municipal Corporation before carrying out any such construction.

The appellants therefore had applied for regularization of the said structure

constructed by the appellants under the provisions of the Development

Control Regulations and other related provisions. There is thus no merit in

this submission of the learned counsel for the respondent no.1.

133. The Municipal Corporation has not only pleaded in the written

statement but has also proved in the oral evidence that the said 145 sq. ft.

FSI remained to be utilized by the developers in the said building according

to the plan sanctioned by the Municipal Corporation and was available. In

fact larger FSI was available then the FSI utilized by the appellants. The

Municipal Corporation has also proved by leading evidence that the

Corporation had considered the records and has followed the provisions of

law and more particularly the Development Control Regulations before

regularizing the said construction carried out by the appellants on a portion

of the terrace of the building. The Municipal Corporation has also pointed

out that below the water tank three sides wall could be put up provided an air

Conditioner was installed in the said part of the structure.

134. The Corporation has confirmed in its evidence that the appellants

have already installed an Air Conditioner in that part of the structure. After

considering this part of the evidence led by the appellants and the Municipal

Corporation, I do not find any infirmity in the sanction granted by the

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Municipal Corporation regularizing the construction put up by the appellants

below the water tank by utilizing the 145 sq. ft. FSI which was lying

unutilized as confirmed by the Municipal Corporation. I shall now deal with

the findings rendered by the Trial Court in the impugned judgment and

order.

135. The entire judgment and the order proceeds on the premise that the

appellants had not obtained prior permission of the society before carrying

out the construction. The respondent no.1 has not disputed the fact that even

according to the respondent no.1 the society was formed only on 26 th April,

1994. In paragraph 10 of the plant it is categorically stated by the respondent

no.1 that the ownership of the building vested in the society only 26 th April,

1994 and as such, the society is deemed and beneficial owner of the entire

building. In my view since the society itself was formed and registered after

completion of the construction of three side walls by the appellants below

the water tank utilizing 145 sq. ft. balance FSI, the question of taking any

prior permission of the society by the appellants did not arise.

136. In so far as the finding of the Trial Court that the developers at the

first instance could not have sold the said balance FSI of 145 sq. ft. to the

appellants is concerned, in my view the said finding is totally erroneous and

contrary to the provisions of Development Control Regulations. It was not

the case of the respondent no.1 society that though such FSI was unutilized

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and was lying surplus with the developers, the developers could not have

sold such FSI to the appellants. There was no such plea raised by the

respondent no.1 in the plant. The developers ofcourse had made it clear in

the agreement entered into with the appellants that the appellants would be

entitled to utilize the said FSI of 145 sq. ft. if permitted by the Municipal

Corporation.

137. Since, the appellants had carried out the said construction without

obtaining prior consent of the Municipal Corporation, an application for

regularization was made by the appellants through an architect. The finding

of the learned Trial Judge that builder had not sold any specific portion of

terrace is also totally erroneous and is contrary to the agreement entered into

between the developers and the appellants.

138. A plan was annexed to the agreement entered into between the

appellants and the developers showing the location at which such

construction could be carried out by the appellants by utilizing the said 145

sq. ft. balance FSI. Even after regularization of the said structure the

sanction plan was produced on record before the Trial Court showing the

exact location of the said structure carried out by the appellants. Be that as it

may, the respondent no.1 was fully aware that three sides wall were put up

below the water tank to the knowledge of the society since the date of

construction of the said structure.

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139. In so far as the finding of the learned Trial Judge that the Municipal

Corporation has not followed the requisite procedure while regularizing

proposal made by the appellants is concerned, in my view this finding of the

learned Trial Judge is contrary to the provisions of the Development Control

Regulations referred by the Municipal Corporation and more particularly

Regulation 38(2)(ii), table 19, serial no.1(c) of the Development Control

Regulations. It is also clarified and confirmed by the Municipal Corporation

that such construction below the water tank is permissible, if such room is

provided with Air Conditioner arrangement. It is not in dispute that the

appellants had already provided Air Condition arrangement in the said room.

140. In the agreement entered into between the developers and the other

flat purchasers before formation of the society it was made clear that the

developers alone were the owners of the said 145 sq. ft. balance unutilized

FSI and would sell such FSI to any flat purchaser. It was made clear that

only such flat purchaser will be entitled to utilize such FSI for carrying out

construction in the said building and no other purchasers will have any right,

title or interest of any nature whatsoever in the said portion. It is thus clear

that the question of the society claiming any right, title or interest on the said

unutilized FSI before formation of the society did not arise. Part of the

terrace on the 8th floor in any case is already in possession of the society.

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141. In so far as the judgment of this Court in case of Esha Ekta

Apartments Co-operative Housing Society Ltd. (supra) relied upon by the

learned counsel for the respondent no.1 is concerned, in my view Mr.Dhond,

learned senior counsel for the appellants rightly distinguished the said

judgment on the ground that in that matter there was no application for

regularization of the unauthorized construction whereas in this case an

application for regularization was made by the appellants and after

considering the provisions of law and verifying the fact that 145 sq. ft. FSI

remained unutilized, the Municipal Corporation rightly regularized the said

construction of three sides walls constructed by the appellants below the

water tank on part of the terrace. The said judgment thus would not assist the

case of the respondent no.1 and is clearly distinguishable in the facts of this case.

142. In so far as the judgment of this Court in case of M/s. Dosti

Corporation (supra) relied upon by the learned counsel for the respondent

no.1 is concerned, in that matter the developer had constructed new

buildings after formation of the society without taking specific consent from

the flat purchasers under Section 7 of MOFA. The facts before this Court in

the said matter were totally different and are clearly distinguishable in the

facts of this case. In this case, the appellants have proved that the said part of

the construction by putting up three side walls below the water tank was

constructed prior to the date of formation of the respondent no.1 society. It is

an admitted position that even otherwise the deed of conveyance has not

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been executed till date in favour of the respondent no.1 society by the

developers.

143. Be that as it may, this Court has also set aside the judgment and order

passed by the City Civil Court which is subject matter of First Appeal No.

1642 of 2012. This Court having taken such view in the said appeal, this

Court is not inclined to accept any submission made on behalf of the

respondent no.1 that the developers could not have permitted the appellants

to carry out any construction by utilizing the said 145 sq. ft. FSI area. In my

view, the impugned judgment and order is totally erroneous and contrary to

the provisions of law and ignoring the oral and documentary evidence by the

appellants and the Municipal Corporation.

144. The respondent no.1 society did not take any objection when the

proposal for regularization was put up by the developers in respect of

another premises on the ground floor i.e. construction carried out below the

staircase by one of the shop owner. The said proposal for regularization was

also made by the developers showing the existing position of the

construction carried out on the terrace. The society was thus fully aware of

the said construction long back. No objection was raised by the society in

respect of the application for regularization made by the developer in respect

of the construction carried out by the shop owner on the ground floor below

the staircase. Be that as it may, in this case there was already a surplus FSI

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of 145 sq. ft. available with the developers which was rightly utilized by the

appellants. In my view, both the judgments and orders passed by the City

Civil Court allowing the suits filed by the respondent no.1 thus deserve to be

set aside.

145. I therefore pass the following order :-

a. Judgment and order dated 12th September, 2012 passed by the

learned Trial Judge in Short Cause Suit No. 1642 of 2009 is set
aside. Short Cause Suit No. 1642 of 2009 filed by the
respondent no.1 is dismissed.

b. Judgment and order dated 28th October, 2015 passed by the

learned Trial Judge in Short Cause Suit No. 1543 of 2009 is set
aside. Short Cause Suit No. 1543 of 2009 filed by the
respondent no.1 is dismissed.

c. First Appeal No.1642 of 2012 and 31 of 2016 filed by the

appellants are allowed.

d. There shall be no order as to costs.

e. Office is directed to transmit the records and proceedings of the

trial Court received by the office, if any, to the concerned trial
Court expeditiously.

146. This judgment will be digitally signed by the Private Secretary

of this Court. Sheristedar of this Court is permitted to forward the
appellants and the respondents copy of this order by e-mail. All concerned
to act on digitally signed copy of this order.

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(R.D. DHANUKA, J.)

147. Mr.Dhond, learned senior counsel for the appellants, on
instructions, seeks liberty to withdraw the amount deposited by his
clients in this Court pursuant to the interim order passed by this Court.

148. Mr.Khan, learned counsel for the respondent no.1 seeks time
to consider the judgment delivered by this Court today.

149. Office is directed to permit the appellants to withdraw the

amount deposited pursuant to the interim order passed by this Court after
expiry of six weeks from today.

(R.D. DHANUKA, J.)

Digitally signed
by Prachi P.
Prachi P. Nandiwadekar
Nandiwadekar Date:
2020.05.19
17:50:08 +0530

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