Developer Cannot Postpone Conveyance Until Completion Of Entire Layout Development: Bombay High Court

Conveyance of land in favour of a co-operative housing society cannot be postponed until completion of an entire layout development, the Bombay High Court has reiterated while setting aside an order that rejected a society's deemed conveyance application as premature.

Justice Sandeep V. Marne observed, “This Court has already held that conveyance cannot be postponed till completion of entire layout development and that land can be conveyed in favour of the Petitioner-Society even before completion of the layout development.”

The ruling came in a petition filed by Upvan Woodlands Co-operative Housing Society Ltd., which challenged an order dated May 20, 2025 passed by the Competent Authority rejecting its application for deemed conveyance.

The dispute arose from a larger property comprising five plots bearing Plot Nos. 145 to 149 at Village Chinchavali and Dindoshi, Taluka Borivali.

Upvan Developers undertook development of the layout and constructed the residential building "Upvan Woodlands" on land admeasuring 2,799.90 square meters. The building received an Occupation Certificate on May 6, 2017. Flat purchasers subsequently formed Upvan Woodlands Co-operative Housing Society, which was registered on July 11, 2018.

After its formation, the society sought conveyance of the land. The developer relied on Clause 12 of the agreements for sale, which stipulated that conveyance would be executed only after completion of the entire project and development of the layout.

On September 1, 2023, the developer forwarded a draft conveyance deed proposing conveyance of the 2,799.90 square metre parcel. At the same time, it maintained that the society's demand was premature because the layout development had not been completed.

The society thereafter applied for deemed conveyance. Opposing the application, the developer contended that conveyance could be executed only after completion of development of the layout in all respects.

The Competent Authority accepted that contention and rejected the application.

The Competent Authority accepted that contention and rejected the application, holding that the society's building had benefited from the layout's global FSI and that the agreed timeline for conveyance had not yet arrived.

It also found that the society had failed to establish non-compliance with Section 11 of the Maharashtra Ownership Flats (Regulation of the Promotion of Construction, Sale, Management and Transfer) Act, 1963.

Before the High Court, the society argued that the Competent Authority had misread earlier Bombay High Court rulings and wrongly treated the contractual stipulation on conveyance as prevailing over the statutory framework.

Accepting those submissions, Justice Marne held that the Competent Authority had incorrectly relied on Clause 12 of the agreement for sale to postpone conveyance.

The Court observed, “Thus, Clause 12 in the Agreement for Sale cannot take precedence over the period specified in Rule 9 of the MOFA Rules. The promoter therefore cannot avoid conveyance on the ground that the timeline stipulated in contractual clause is yet to arrive even though the period specified in Rule 9 of MOFA Rules has already elapsed.”

The court also disagreed with the finding that the developer's September 1, 2023 letter reflected a bona fide willingness to convey the land. While a draft conveyance deed had been shared, the letter expressly described the society's demand as premature and stated that conveyance would be executed only after completion of the entire layout development.

Rejecting the Competent Authority's reliance on that letter, the Court held,

“Therefore, letter dated 1 September 2023 cannot be treated as willingness on the part of Respondent No.1 to execute deed of conveyance nor action of Respondent No.1 in addressing letter dated 1 September 2023 can be treated as an action in good faith as is assumed by the Competent Authority.”

Justice Marne further found that the Competent Authority had erred in concluding that grant of conveyance at that stage would enrich the society because its building had benefited from the global FSI of the larger layout.

The court noted that the society had restricted its claim to 2,799.90 square meters even though an architect's certificate calculated a larger share of 4,373.50 square metres.

The court also rejected the developer's apprehension that conveyance of that parcel would affect its ability to continue development on the remaining land. It held that conveyance of a portion of land in a layout in favour of a society does not by itself affect a developer's rights in respect of the balance land.

Noting that there was no dispute between the parties regarding the extent of land to be conveyed, the Court found that remanding the matter would serve no purpose.

The petition was accordingly allowed. The court quashed the Competent Authority's order and directed issuance of a deemed conveyance certificate in favour of the society in respect of land admeasuring 2,799.90 square meters.

Upvan Woodlands Co-operative Housing Society Limited: Advocates Tanaya Patankar, Devang Shah, Aditya Kanchan (instructed by Lakshyavedhi Legal).

Upvan Developers: Advocates Karl Tamboly, Samit Shukla, Delnavaz Patel, Sayali Diwadkar (instructed by Trilegal).

Govindram Brothers Pvt. Ltd.: Advocate Nimesh Bhatt.

Competent Authority & District Deputy Registrar, Co-operative Societies, Mumbai City and State of Maharashtra: Assistant Government Pleader P.G. Sawant.