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Govt. of Maharashtra Revenue & Forest Department Govt. Circular No. petition- 2013/1425/260/1
Mantralaya, Mumbai:--400032.
Date: 9th May, 2014.

 

As per Public Interest Litigation (PIL) bearing No. 54/2011 Chandrakant Manekar V/S Govt. of Maharashtra & Others which was filed before Bombay High Court in respect of Development Agreement of immovable property between owner and Developer, sometimes owner by way of consideration retains for himself certain Galas/Premises. On such constructed area retained by owner and on such document which will be executed between owner and Developer, the issue was for assessment of stamp duty to be payable on such document.

Honorable High Court in respect of PIL No.54/2011 has passed an Order Dated 19th March, 2014 in respect of Galas/Premises retained by the owner on the issue of assessment of stamp duty on that premises and directed Government to issue Circular clarifying the above matter and to follow order dated 29/01/2004 (Prabha Laxman Ghate V/S State of Maharashtra & others) in Writ Petition No.146/1997 passed by this Bombay High Court.

In the matter of Prabha Laxman Ghate V/s Govt. of Maharashtra matter (Writ Petition No. 146/1997)

In the said writ petition, the petitioners (original owner of land) had executed Development Agreement dated 10/4/1989 and as per the said Development Agreement, the Developer had to develop and out of total six premises, two premises had to be retained by original owner.

This Development Agreement was produced before Stamp Collector, Pune for fixation of stamp duty on the said Development Agreement. The Stamp Collector came to the conclusion that those two premises which were to be retained by the owner as per Development Agreement had the effect of an Assignment of Property and therefore he demanded Stamp Duty. Smt. Prabha Laxman Ghate, the petitioner filed a petition challenging this order passed by said Stamp Collector, Pune. Bombay High Court on 29/1/2004 issue order quashing order of Stamp Collector, Pune and clarified two issues:-

1) As per Bombay Stamp Act, 1958 dated 16/5/1997 on Development Agreement Article 5-G-, the assessment of stamp duty is calculated with effect from 7/2/1990. In the case of Smt. Prabha Laxman Ghate matter, the Development agreement was executed on 10th April, 1989. As per Bombay Stamp Act, 1958 (Now Maharashtra Stamp Act ) amended Article 5-G-A Provisions came to be implemented after 7/2/1990 and hence, the said provisions are not applicable to present Development Agreement.

2) In Smt Prabha Laxman Ghate matter, as per Development Agreement two premises had to be retained by the landowner in lieu of development rights of the owner and therefore there is no assignment in true meaning for the benefit of the owner and therefore there is no assessment of stamp duty on those retained premises for the reason of law of assignment.

Taking into account the above background clarification is issued as follows:--

1) As per the Honorable Bombay High Court Judgment in Writ Petition No. 146/1997 Prabha Laxman Ghate V/S Sub-Registrar and Stamp Collector, Pune, the Bombay High Court issued the order dated 29/04/2004 Maharashtra Stamp Act, 1958 Article 5 ( G-A ) that is prior to 7/2/1990 there will be no stamp duty on executed Development Agreement and therefore with effect from 7/2/1990, All Development Agreements executed on or after that date as per provisions of Maharashtra Stamp Act, 1958 Article 5 (G-A) stamp duty will be payable.

2) In all other matters like Prabha Laxman Ghate matter, in those situations when there is executed Development Agreement between original owner of property and the Developer, owner who retains for himself constructed area on that no assessment of stamp duty shall be done. As per that agreement when there is an assignment of constructed area to original owner, an incidental document has to be executed, and since there is no assignment of any property on executing an incidental document, on such type of documents assessment of stamp duty shall be as per the provisions of section 4 of Maharashtra Stamp Act.

Issued in the name of and order of Governor of Maharashtra.

Sd/-
Rajesh Narvekar
Deputy Secretary

C.C To:

1) Sub Registrar & Stamp Controller, Pune
2) Stamp Controller, Main stamp office, Fort, Mumbai
3) All Sub Registrars and Stamp Dy. Controllers.
4) Assistant Govt. pleader, Bombay High Court, Appellate Branch, (Writ Cell), Mumbai:-32
5) Office of Revenue 7 Forest Dept, Mantralaya, Mumbai:-32.

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BUILDER MUST PAY ALL TAXES UNTIL ENTIRE PROPERTY IS CONVEYED TO SOCIETY

In a recent case of non-procurement of Occupancy Certificate by the Builder and furnish the same to the Society, the Consumer Forum asked one of the Builders of Mumbai to pay water charges, municipal taxes and other charges as applicable until the time the entire property is conveyed to the housing society.

This was after one of the housing societies in one of the busiest western suburbs, complained about having formed its own housing society, pay excess water charges and property tax, as the Builder did not get an Occupancy Certificate from Civic Authorities. The Forum held the Builder guilty of ‚ÄėDeficiency in Service‚Äô for the same.

The bench ruled that since the property has not been conveyed and so it would be the duty of the Build¬er to pay property taxes. The bench referred to Section 6 of the Maharashtra Ownership Flats Act. 1963 (MOFA) which states that the Builder must clear the dues such as municipal taxes, property tax and water charges and any other charges until they transfer the entire property to flat purchasers or the co-operative housing society. The Builder was also charged for not forming a co-operative society as per the provisions under MOFA.

The Forum's order comes after the society approached them in 2004 asking for relief as they were forced to pay excess water bills and property taxes as the Builder had not acquired the Occupancy Certificate.

Calling these the Builder’s statutory duties, the Forum asked them to refund:

1. Rs. 40 lakhs taken for forming the society from 38 members.

2. Rs. 6.05 lakhs paid by members as excess water bills and property taxes.

3. Rs. 3 lakhs for not provid¬ing promised amenities such as a garden, chil¬dren's play equipment and safety equipment in elevators

In its defence, the Builder said the buyers were aware of the lack of Occupancy Certificate and the Builder was unable to get it as the landlord was not willing to part with a portion of the plot. The Forum said the Builder did neither take efforts to resolve the issue with the landlord nor acted in accordance with the provisions of MOFA.

Under the provisions of The Maharashtra Ownership Flats (Regulation of the Promotion, Construction, Sale, Management and Transfer) Act, 1963 (‚ÄúMOFA‚ÄĚ) and Rules made there under, the Developer is required to form a Society within 4 months from the date on which minimum number of persons required to form a society have purchased flats. Further, the Developer is required to convey or cause to convey the land (or Leasehold Right) in favour of the Society along with the building within 4 months from the date of its incorporation.

If the Developer fails to convey the land (and/or transfer the leasehold rights) and building by executing the Deed of Conveyance and/or Deed of Assignment as the case may be and in that event, the society and/or any other body of the purchasers have got the following remedies:-

(a) To approach the Civil Court for obtaining Conveyance;

(b) To approach the ‚ÄúConsumer Forum‚ÄĚ for obtaining Conveyance;

(c) To adopt appropriate Criminal/Legal proceedings under the provisions of MOFA to punish the Developer (if found guilty) in accordance with the law and the proceedings can put pressure on the Developer to execute Conveyance in favour of the society.

Comments from Author: Thousands of co-operative housing societies in Mumbai are paying the water charges and other taxes at the commercial rate to BMC as many errant Builders have not conveyed the title of land to these societies in the hope of availing more Floor Space Index (FSI) that may become available in future or the benefits accrued to them in case the housing society is going for redevelopment.

Why the Forum did not rule that the judgment so delivered in this particular case, should also be made applicable to all those delinquent and felonious Builders in Mumbai who have blatantly violated the provisions of MOFA by not conveying the respective properties in favour of housing societies within a stipulated period of 4 months and that all such dishonest Developers must be forced to pay water charges, municipal taxes and other charges as applicable until the time the entire property is conveyed to the housing society???

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ILLEGAL MANAGING COMMITTEE CANNOT HOLD FRESH ELECTIONS

IN THE HIGH COURT OF JUDICATURE AT
BOMBAY CIVIL APPELLATE JURISDICTION
WRIT PETITION NO.1671 OF 2009

Mr. Shashikant Jesrani & Ors...Petitioners
Vs.
Assistant Registrar & Ors...Respondents
Mr.Satyajeet Mirajkar i/b.Gabriel Pillai for the Petitioners
Mr.S.N.Patil, A.G.P. for the Respondents

CORAM: - V.C.DAGA, Justice.
DATE: 27TH JANUARY, 2009
P.C

1. Heard learned Counsel for Petitioner. This Petition is directed against the order dated 13th January, 2009 passed by the Divisional Joint Registrar, Co-operative Societies, Mumbai Division, Mumbai.

2. The factual matrix canvassed during the course of hearing, is as under:

3. On 8th August, 2005, the Managing Committee of The Society entered into the office for a term of five years.

4. As per Section 73(1) (AB) of the Maharashtra Co-operative Societies Act, 1960, the members of the Managing Committee were bound to execute Indemnity Bond in Form M-20 by 23 August, 2005 (i.e. Within 15 days from the date of assuming office).

5. The members of the Managing Committee failed to execute bonds. Consequently, by operation of law, the Managing Committee automatically vacated their office on 24th August, 2005. Thereafter, there was no validly elected Managing Committee in the office of the Society.

6. It appears that out of 7 members, 6 members who constituted Managing Committee in the month of August, 2005 continued to look after the affairs of the Society till 2008 though unauthorisedly. It further appears that sensing action from the Cooperative Department; these 6 members adopted resolution dated 10th September, 2008 and appointed Advocate Mr. Borade as an Election Officer to conduct Election, who appears to have conducted Election in the month of October, 2008. The present Petitioners are claiming to be the validly elected members of the Managing Committee in the election held in October, 2008.

7. The fault was found by the Co-operative Department with regard to the contention of the Petitioners with regard to the validity of the election held in the month of October, 2008, since old Managing Committee could not have held election for want of authority. Consequently, the Assistant Registrar in exercise of power under Section 73(1) (AB) read with Section 78 of the Maharashtra Co-operative Societies Act, 1960 appointed an Administrator. Challenge to this order failed. The said order has also been confirmed in Appeal by the Divisional Joint Registrar, which is impugned in this Petition filed under Article 227 of the Constitution of India.

8. Having heard learned Counsel for Petitioner, it is clear that the members of the Managing Committee were elected on 8th August, 2005, had automatically vacated their office on 24th August, 2005, in view of the lapse committed by them leading failure to execute bond under Section 78(1) (AB) of the Maharashtra Cooperative Societies Act,1960. Thereafter, there was no legal Managing Committee in the office. Therefore, the resolution dated 10th September, 2008 adopted by the Managing Committee, who was illegally holding office could not have adopted resolution to hold fresh election. The action is bad & illegal.

9. If the aforesaid resolution was the foundation for holding election giving birth to the existing Managing Committee, then it suffers from the illegality. The Election conducted by the Society in the month of October, 2008 being bad and illegal, the Respondent Co-operative Department was perfectly justified in appointing an Administrator under Section 78 of the Maharashtra Cooperative Societies Act, 1960.

10. In this view of the matter, the Petition is devoid of any substance and liable to be dismissed in limine.

11. In the result, Petition is dismissed. No order as to costs.

(V.C.DAGA, Justice)

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MAJORITY CANNOT PASS ARBITRARY AND UNREASONABLE RESOLUTIONS IN GENERAL BODY - HC

IN THE HIGH COURT OF BOMBAY
WRIT PETITION NO.1948 OF 1997
30-7-2002

(JUSTICE R.J. KOCHAR)

Venus Co-op. Housing Society and Anr
Vs.
Dr. J.Y. Detwani & Ors

Appearances:

Mr. G.R. Rege with Ms. Shakuntala Mudbidri i/b. Little & Company for Petitioners

Mr. Y.S. Jahagirdar with Mr. Sanjay Udeshi for Respondent No.21

Mr. D.A. Nalawade with Mr. S.G. Bane for Respondent No.2

Maharashtra Co-operative Societies Act, 1960 _ Section 72 _ Co-operative Housing Society _ Maintenance charges _ Basis of computation of _ High Court Original Side Rules, 1980 _ Rule 641 _ Failure to serve rule nisi _ Constitution of India, 1950 _ Article 226 _ Writ jurisdiction.

1) Service of rule nisi along with a copy of the petition _ twelve respondents not served properly and legally _ one of the respondents had expired but still petition was filed against him _ Cause of action against the society was common and indivisible _ Petition stands abated against all.

2) Petitioner society having flats of different sizes _ Resolution passed for charging the maintenance charges on the basis of area of the flat _ Mandatory for general body meeting to have considered whether the large flat holders were drawing more benefits or facilities by virtue of the big size of the flats _ Services are enjoyed by all the members equally _ No rational basis for the society to charge for services on the basis of size of the flats _ Courts below rightly held the said resolutions as invalid and inoperative.

3) Resolution passed by General Body _ Though general body is supreme for the administration of the society it cannot pass arbitrary and unreasonable resolutions merely because it has a large majority in favour of one of the issues on the agenda. (See Para: 12).

Held: a) "The declaration was indivisible and was not severable and, therefore, I accept the submissions of Shri Jahagirdar that even if one respondent is not to be served in that contingency as also the petition would have abated. Here in this case twelve respondents have not been served. The packets of service were not in accordance with the rules prescribed and therefore, it cannot be said to be a good service of rule nisi in accordance with the rules. Further one of the respondents i.e. respondent No.2 had expired but still the petition was filed against him and for that reason also the writ petition stands abated against all."

b) "I agree with the submissions of Shri Jahagirdar that it cannot be said that the big flat holders are getting higher or more services to make them liable to pay more on the basis of the area of the flat. Aforesaid services are enjoyed by all the members equally and therefore, there was no reason for the society to have made the large flat holders to pay more on the basis of the area of the flat. There is absolutely no rational or any reason to require the large flat owners to pay more for the aforesaid service charges."

c) "The supremacy of the general body cannot be disputed but even the supreme general body has to be reasonable and has to pass rational resolution considering all the facts and circumstances of the matter. The general body cannot pass arbitrary and unreasonable resolutions merely because it is supreme and it has a large majority in favour of one of the issues on the agenda." (Para: 12).

d) "It is clarified here that the payment of municipal taxes is on the basis of the area of the flat and there is no dispute over that issue. Whatever bill is sent by municipal authorities is accordingly paid by all the flat owners whether small or big."

e) "The reliance by the society on its old obsolete Byelaw No.24(c) is misplaced as the source of the authority to levy the maintenance charges. It is an admitted position that the said Byelaws were framed under the old Act of 1925 which has stood repealed by the present Maharashtra Cooperative Societies Act, 1960. If the old Act itself stood repealed in the year 1960, I fail to understand how the Byelaws framed under that Act can be said to be the source of the power for the Managing Committee or for the society to levy any maintenance charges under that Byelaw which is no more in existence. In any case, we cannot read Byelaw 24(c) in isolation. There are other sub-laws of Byelaw No.24 viz., (a) and (b). In my opinion, the aforesaid Byelaws have become obsolete and outdated as repealed and the same are deemed to have been substituted by the model bye-laws. The concept of rent is no more available for a cooperative society. The reliance placed on this archaic bye-law is totally misplaced." (Para: 10).

Result: Petition dismissed.

Case Law Referred:
State of Punjab vs. Nathu Ram A.I.R. 1962 SC 89 (Para 4)

JUDGMENT

The Resolution dated 30th November, 1980 is still hanging to await the decision in respect of its legality and validity. On that date the special general meeting of the petitioner cooperative housing society passed the said resolution to be effective from 1st December, 1980 to switch over from the system of flat-wise monthly maintenance charge to the system of charging maintenance as per the area of the flat as specified in the said resolution. The petitioner society has flats of different sizes i.e. 284 flats of two bed room, kitchen and hall and about 39 flats are of larger size viz., 4 bed rooms, kitchen and hall. The said resolution gave rise to a controversy between the smaller flat holders who are in large majority and larger flat holders who are in minority. The purpose of passing of such resolution was said to be to make up the losses sustained by the society on account of various reasons including defaults in making payment of the maintenance charges by some of the members of the society. The minority of the large flat holders challenged the said resolution and refused to make payment of maintenance charges as per the area of the flat. They were, however, ready and willing to abide by the earlier resolution of flat wise payment. It appears that the Managing Committee passed its resolution revising the general maintenance charges for all the flats on the basis of area of the flats. The aforesaid resolution of the Managing Committee was finally ratified by the subsequent general body meeting held on 31st May, 1981. By a circular dated 1st March, 1981, the Managing Committee, however, informed the members the rise in the maintenances charges as computed on the area of the flats.

2. The disputants who are the respondents in the present petition filed a dispute under section 91 of the Maharashtra Co-operative Societies Act, 1960 before the Co-operative Court, giving challenge to the circular dated 1st March, 1981 of the Managing Committee and also to the resolution dated 30th November, 1980 passed by the special general meeting of the society. The Co-operative Court by its order dated 29 February, 1996 declared that the disputants were entitled to pay general maintenance charges to the society for the flats held by them not on area wise basis but as on flat wise basis. It also declared the resolution dated 30th November, 1980 passed at the special general meeting as invalid and not at all binding on the disputants. It also declared that the resolution of the Managing Committee dated 10th February, 1981 as invalid and not binding on the disputants. The Co-operative Court consequently restrained the petitioners and their servants and agents from implementing the resolution dated 30th November, 1980 and from recovering general maintenance charges at the rate of more than the rate that was prevalent prior to 30th November, 1980. The Co-operative Court allowed the dispute as aforesaid with costs. The Co-operative Court made an award accordingly on 29th February, 1996. The petitioner society was aggrieved by the said decision of the Cooperative Court and therefore, it filed an appeal before the Maharashtra State Cooperative Appellate Tribunal, to challenge the said decision. The learned member of the appellate tribunal by its judgment and order dated 26th February, 1997 confirmed the said decision. The appellate tribunal also held that the society had delayed in adopting the model bye-laws and finally it adopted the same in the year 1996. Under the said model Byelaws a minute provision is made in respect of the recovery of maintenance and service charges and other charges payable by the members. It also observed that the society had acted in a high handed manner against the bigger flat holders whereby the minorities of bigger flat holders were discriminated against by the smaller flat owners and, therefore, they had an absolute right to come before the court of law, which has power and jurisdiction to interfere with the impugned resolution which was rightly held by the Cooperative Court as invalid. In the opinion of the appellate tribunal, if the members were given equal amenities, they should be charged equal maintenance charges as per the model Byelaws and directed the society to refund the excess amount collected from the bigger flat holders with interest. The petitioners have approached this court under Article 226 of the Constitution of India to challenge the said decision of the appellate court.

3. According to Shri Rege, the learned Counsel appearing for the petitioner society, the general body of the society being the supreme for the administration of the society had absolute power and right to decide the question of maintenance payable by the members. In the meeting held on 30th November, 1980, it was resolved that the maintenance charges should be levied in accordance with the area of a flat and not in accordance with the flat. The Managing Committee had by its circular dated 10th February, 1981 performed ministerial job of fixing the rates and the said decision of the Managing Committee was finally ratified and approved in the general body meeting held on 31st May, 1981. Shri Rege, further pointed out that the dispute was filed before the court on 24th May, 1981 before the general body approved and ratified the decision on 31st May, 1981. He has, therefore, emphasized the fact that the disputants have not challenged the said resolution dated 31-5-1981 passed by the General Body. Shri Rege further relied upon the Byelaw No.24(C) of the Byelaws governing the working of the society to fix the rent/rate and according to him under the said the law the Managing Committee is empowered to fix the rates. He relied upon section 72 of the Maharashtra Cooperative Societies Act to submit that the general body was the supreme and final authority in the working of every co-operative society. Shri Rege, therefore, pointed out that the second resolution passed by the general body on 31-5-1981 was not challenged and the question whether the resolution dated 30th November, 1980 was arbitrary or unreasonable, cannot be gone into by the Cooperative Court as the general body being the final and supreme authority had taken that decision, not only once but twice. He also justified the enhancement of the maintenance charges area-wise as according to him, the owners of the bigger flats were getting better and more amenities and facilities than those available to the small flat owners. Shri Rege pointed out that the appeal court has not at all dealt with the points urged before him and has merely concluded the issue in last two paragraphs. Shri Rege further submitted that many members from the larger flats have made payment on the area wise basis and that it was only the present disputants who are challenging the said resolution.

4. Shri Jahagirdar, the learned Counsel for the disputants/ respondents has raised a very serious substantive objection to the hearing of the present petition on the ground that the respondent Nos.1, 15, 16, 18, 19, 22, 23, 26, 27 and 29 have not been served with rule nisi. Shri Jahagirdar pointed out from the report of the Sheriff that they were either not found or premises were found locked or had gone out or had left, as indicated in the remarks on the packets Shri Jahagirdar submitted that after the appeal court's order dated 20th March, 2002 to serve the respondent as reflected in the affidavit of service, out of twelve respondents three were served and seven packets were returned with the postal remark "not claimed" and one packet with the postal remark "left" while in the case of respondent No.25 (Punjabi), the packet has not come back. Shri Jahagirdar vehemently submitted that the cause of action against the society was common and indivisible for a declaration that the resolution passed by the petitioner society was illegal and invalid and such declaration was granted and, therefore, according to the learned Counsel, even if one respondent is not served, the writ petition must abate in these circumstances.

5. The learned counsel has cited the judgment of the Supreme Court in the case of State of Punjab vs. Nathu Ram reported in A.I.R. 1962 SC 89 in support of the said contention urged by him. Shri Jahagirdar has very seriously urged that the petitioners have taken the court for granted and for a ride. Shri Jahagirdar has drawn my attention to the order dated 3rd August, 2001 passed by this Court (Dr. Chandrachud, J) wherein he issued an ultimatum that on the expiry of the period of three weeks from 3rd August, 2001, the writ petition shall stand dismissed in the event no steps were taken and parties were not served with the nisi. Shri Jahagirdar emphasized the fact that the writ petition was of 1997 and at the time of admission of the said petition on 16th December, 1997, the petitioner had obtained interim relief in terms of prayer clause (b) i.e. stay of the order passed by the appellate tribunal. Since then, the petitioners have failed to serve the rule nisi on the majority of the respondents. When this fact was brought to the notice of this court this Court gave the aforesaid ultimatum as the petition was called out time and again and was adjourned since rule nisi was not served on all the contesting respondents. The learned Judge has noted several dates of adjournment only on that ground as no steps were taken by the petitioners to serve the rule nisi on the concerned respondents. Shri Jahagirdar further submitted that by his order dated 12th September, 2001, again this Court (P.V. Kakade, J.) had held that the petition had already and automatically stood dismissed by virtue of the self-operative order dated 3rd August, 2001 passed by Chandrachud, J. due to inaction on the part of the petitioners and that no further indulgence was granted. The learned Judge, therefore, passed the order that the petition stood disposed of as dismissed by virtue of the order dated 3rd August, 2001.

6. Shri Jahagirdar further submitted that since the petitioners were aggrieved by the aforesaid orders they filed an appeal before the appeal court. The appeal court took a lenient view and restored the writ petition to file and granted time to the petitioners up to 30th April, 2002 to serve the respondents. The appeal court had also given an ultimatum and ordered that in case the petitioners (appellants) fail to serve the respondents, the writ petition will stand dismissed. Shri Jahagirdar, therefore, submitted that the respondents were not served even by the deadline fixed by the appeal court i.e. 30th April, 2002 and, therefore, by virtue of the said order the writ petition already stood dismissed and, therefore Shri Jahagirdar submits that this court should not hear the petition at all as it had already stood dismissed. Shri Nalawade, the learned Advocate for the respondent No.2 submits that the original respondent No.2 had expired even before the petition was filed. The petition was filed against the dead person and, therefore, the whole petition must fail say both Shri Jahagirdar and Shri Nalawade.

7. Shri Jahagirdar further submitted that under High Court Original Side Rule 641 rule nisi has to be served along with true copies of the petitions and all annexure. For ready reference the Rule 641 is reproduced herein below:

"The rule nisi granted as above, shall, along with a copy of the petition and of the order, if any, made under the last preceding rule, be served on the respondent in the manner prescribed for service of a writ of summons upon a defendant in a suit." (Emphasis is given by me).

8. Shri Jahagirdar pointed out from the packets that they did not contain the copies of the petition and the order. The learned Counsel, therefore, requested me to open the packets which were returned un-served by the office of the Sheriff to find out whether the said packets contained the contents as mandatorily prescribed in the said rule. Accordingly, I opened one of the several packets to find out whether the said packet contained the content as prescribed in the said rule. To my surprise the said packet did not contain a copy of the writ petition and the annexure of the writ petition. The said packet had only a copy of the rule nisi and nothing more. Shri Jahagirdar, therefore, seriously attacked the petitioners for being cavalier and very negligent in the matter of service of rule nisi in accordance with the rules. Shri Rege the learned Counsel for the petitioner society had to accept the fact of basic defect and deficiency in the service of the Rule nisi on the respondents. I agree with the serious grievance made by Shri Jahagirdar that the petitioners have failed to comply with the mandatory conditions prescribed in the said rule to serve the rule nisi on the respondents. In the affidavit of service filed by Shri Rege on behalf of the petitioners, though it is mentioned that twelve respondents were issued rule nisi, in fact it appears that there are only eleven respondents who were tried to be served with rule nisi. Three have already been served and their acknowledgements are found along with the affidavit of service. There are eight packets with the affidavit of service. One packet is not yet received. It is, therefore, clear that at least eight packets which were returned by the postal authorities to the office of the sheriff did not contain the contents as prescribed in rule 641 and, therefore, it cannot be said that it was a good service in accordance with the rules. The matter, therefore, boils down to this position that at least eight respondents have not been properly served rule nisi in accordance with the rules. To the aforesaid eight, we will have to add even the other four respondents as even they were sent the similar packets which did not contain the contents in accordance with the said rule. It is, therefore, clear that twelve respondents have not been properly and legally served with the rule nisi under Rule 641 at all. The petitioners have, therefore, failed to serve rule nisi in accordance with law and even in accordance with the appeal court's ultimatum and, therefore, the petition must fail on that ground alone. I cannot travel beyond the orders passed by either Justice Chandrachud or Justice Kakade and never beyond the appeal court, which also mandate that the petition shall stand dismissed if the respondents were not served by 30th April, 2002. In the aforesaid circumstances, the writ petition must abate and has already abated and the same, therefore, deserves to be dismissed for the reasons aforesaid.

9. The declaration was indivisible and was not severable and, therefore, I accept the submissions of Shri Jahagirdar that even if one respondent is not to be served in that contingency also the petition would have abated. Here in this case twelve respondents have not been served. The packets of service were not in accordance with the rules prescribed and therefore, it cannot be said to be a good service of rule nisi in accordance with the rules. Further one of the respondents i.e. respondent No.2 had expired but still the petition was filed against him and for that reason also the writ petition stands abated against all.

10. In spite of the longest rope given by the learned Single Judge and the appeal court, the petitioners have proved that they did not deserve the sympathetic and lenient view taken by the appeal court to give them one more opportunity. The petition, therefore, having abated pursuant to the order passed by the appeal court and the petition having stood dismissed as aforesaid, it was not necessary for me to enter into merits of the case. I have, however, entered into the merits of the case to put an end to this petition at this stage itself even on merits.

11. According to Shri Jahagirdar, the society had, as members small flat holders who comprise 86.4% of the total membership. They were and are in brute majority in the society and they are always oppressing the minority of the large flat holders. Shri Jahagirdar pointed out that even in the past on the strength of the brute majority the small flat owners had increased the rates of maintenance which the large flat owners accepted to maintain the spirit of cooperation and cordial relations. Shri Jahagirdar pointed out that on this occasion, the large flat holders thought it proper to put an end to this oppressive decision of the majority small flat owners. Shri Jahagirdar pointed out that an amount of Rs.16 lakhs was due to the small flat holders who were defaulters. He pointed out that to make up the said loss they were oppressing and coercing the large flat holders by enhancing the maintenance charges. The majority flat holders, therefore, resorted to the device of charging the maintenance charges on the basis of area of the flat. Shri Jahagirdar pointed out that the said decision was totally unreasonable, arbitrary and oppressive as the amenities, facilities and services rendered to all of them were the same and it was not that the large or big flat holders were getting more or higher or greater benefits so that they should be coerced to pay more. Shri Jahagirdar submitted that the general maintenance comprises of the following common factors such as salary of staff, expenses for the security of the society, lift maintenance, common electricity charges, internal road lighting, common passage maintenance, charges for lifting water from the tank and expenses for postage.

12. I agree with the submissions of Shri Jahagirdar that it cannot be said that the big flat holders are getting higher or more services to make them liable to pay more on the basis of the area of the flat. Aforesaid services are enjoyed by all the members equally and therefore, there was no reason for the society to have made the large flat holders to pay more on the basis of the area of the flat. There is absolutely no rational or any reason to require the large flat owners to pay more for the aforesaid service charges. The supremacy of the general body cannot be disputed but even the supreme general body has to be reasonable and has to pass rational resolution considering all the facts and circumstances of the matter. The general body cannot pass arbitrary and unreasonable resolutions merely because it is supreme and it has a large majority in favour of one of the issues on the agenda. In the present case, the resolution dated 30th November, 1980 passed by the general body is totally unreasonable and arbitrary regardless of the amenities; facilities availed of by the members. It is clarified here that the payment of municipal taxes is on the basis of the area of the flat and there is no dispute over that issue. Whatever bill is sent by municipal authorities is accordingly paid by all the flat owners’ small or big. It was, however, mandatory for the general body meeting to have considered whether the large flat holders were drawing more benefits or facilities by virtue of the big size of the flats. It is not the case of the society that by virtue of the large size of the flat, the flat holder gets more or higher security or more common road or common passage light than that of the small flat holders. There is absolutely no rational basis for the society to charge for the aforesaid services on the basis of the size of the flats.

13. The present model Byelaws which came in force and which ought to have been accepted by the petitioner society as long back as in the year 1986, but for the reasons best known to the society, it had accepted the same only in the year 1996. The present model Byelaws have neatly stipulated and provided for as to how the maintenance charges are payable by the members. The reliance by the society on its old obsolete Byelaw No.24(c) is misplaced as the source of the authority to levy the maintenance charges. It is an admitted position that the said Byelaws were framed under the old Act of 1925 which has stood repealed by the present Maharashtra Co-operative Societies Act, 1960. If the old Act itself stood repealed in the year 1960, I fail to understand how the Byelaws framed under that Act can be said to be the source of the power for the Managing Committee or for the society to levy any maintenance charges under that Byelaw which is no more in existence. In any case, we cannot read Byelaw 24(c) in isolation. There are other sub-laws of Byelaw No.24 viz., (a) and (b). In my opinion, the aforesaid bye-laws have become obsolete and outdated as repealed and the same are deemed to have been substituted by the model bye-laws. The concept of rent is no more available for a cooperative society. The reliance placed on these archaic bye-laws is totally misplaced. The source of power to levy maintenance charges in accordance with the said Byelaw 24(c) had dried up long back in the year 1960 and is dead as on today.

14. In my opinion, the resolution dated 30th November, 1980 is totally arbitrary, unreasonable and without any rationale and without any source of power. Both the courts, therefore, have rightly held the said resolution and the subsequent resolution dated 10th February, 1981 as invalid and inoperative. The declaration granted by both the courts cannot be interfered with as there is absolutely no illegality or infirmity in the said concurrent decisions of the courts below. There is, therefore, absolutely no merit in the petition which deserves to be dismissed and the same is dismissed with no orders as to costs. It is needless to mention that the orders passed by the courts below are confirmed and would be in force in every respect.

All concerned including the petitioner society to act on a copy of this order duly authenticated by the Associate.

(JUSTICE R.J. KOCHAR)

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SC DOWN ON DEVELOPERS OVER OPEN SPACE, RECRETIONAL AREA, PODIUM IN REDEVELOPMENT

Supreme Court is heavily down on Developers to maintain open space, passageway of 6 meters, recreational area and podium rules in redevelopment as per various clauses as specified in DCR.

The recent judgment of Supreme Court in the matter of Municipal Corporation of Greater Mumbai and Others as Appellants Versus Kohinoor CTNL Infrastructure Company Private Limited and another as Respondents has ruled to maintain adequate space around buildings at the ground level both as recreational areas and to allow fire engines smooth passage. The ruling has sent most Developers in lurch. The Real Estate Industry in Mumbai, which is already stumbling under recession, has virtually come to a grinding halt.

The Apex Court has whipped the strictures in case of redevelopment projects under consideration that the minimum recreation area under the Development Control Rules (DCR) 23 should not be reduced. The recreation area if any provided on podium as per DCR 38 (34) should be in addition to that provided as per DCR 23.

Rule 23 of the Development Control Regulation of 1991 mandates 15-25% open space at ground level depending on the plot size for every building. By an amendment in January 2012, the Authorities had permitted recreation space on a podium. The Apex Court said that any green space on a podium had to be in addition to the space mandated at ground level. For redevelopment, the minimum open space norm stays at 8% for small plots. Podiums are allowed only in plots covering more than 1,500 sq. meters.   

The decision would apply to all those constructions where plans are not approved or where the Commencement Certificate (CC) has not been issued till date and further directed that the Chief Fire Officer (CFO) must certify the accessibility for each redevelopment proposal.

Developers, architects and even the civic body represented to the Supreme Court the rising demand for parking space in residential towers supposedly creating the lots either in basements or on podiums, which in turn required ramp space, thus reducing area meant for the gardens.

The Apex Court pointed that the Greater Mumbai has just 1.91 sq. meters of open space per person. It falls way short of the 3 sq. meters prescribed by the National Building Code 2005 and the 11 sq. meters recommended by the Union govt.

For redevelopment of plots up to a size of 600 sq. meters, an open space of 6 meters on at least one side of the ground level that is accessible from the road side will have to be maintained for the maneuverability of a fire engine, unless the building abuts two roads of 6 meters or more on two sides or another access of 6 meters to the building is available apart from the road abutting the building.

The Developers are stressed that for the redevelopment projects in city and suburbs mostly having small plots, it would not be feasible unless the 6-metre passageway on one side of a building for fire engines rule is relaxed and that the ruling’s adverse impact will be felt most in the B and C wards where pre-1960 buildings abound in narrow lanes which have lined up with applications for reconstruction. Several other issues, such as Heritage, Doppler, Prisons, Naval Restrictions and Coastal Regulation Zones have already crippled the realty industry.

The result is that in the last three weeks not a single new proposal for construction of buildings has been received by the BMC. In fact, all the plans are now returned by the BMC which were submitted by the Developers before the order of Supreme Court, since they would have to comply with the new rule. The CFO, Fire Brigade and the Building Proposals and Development Plan Departments have been instructed to strictly follow the Apex Court Guidelines so that no contempt of court is committed.

Due to this stricture, the actual size of plots proposed for redevelopment has shrunk and has upset the computation with regard to the viability of a project as also the height of buildings has to be increase to accommodate all the tenants as also the saleable area of Developers in redevelopment projects.

It is feared that if the height of the proposed building goes up more than 70 metres then the High-Rise Committee Rules will be invariably applicable such as to keep two staircases with a width of two metres, refuge floors will have to be provided after each set of eight floors which were earlier free of FSI and now since added to FSI, premium has to be paid for the same.

 

EXCERPTS FROM SC JUDGMENT:

@ It was noticed that as per the approved plan, the recreational space available at the ground level was reduced to only 7.7% of the area of the plot, as against the required minimum of 15% (where the area of the plot was between 1001 sq. meters to 2500 sq. meters as per the DCR 23).

@ Recreational/Amenity Open Spaces in Residential Layouts: As per DCR 23,in any layout or sub-division of vacant land in a residential and commercial zone, open spaces shall be provided as under:

(i) Area from 1001 sq. meters to 2500 sq. meters: 15 per cent
(ii) Areas from 2501 sq. meters to 10000 sq. meters: 20 per cent
(iii) Area above 10000 sq. meters: 25 per cent

These open spaces shall be exclusive of areas of accesses, internal roads, designations or reservations, development plan roads and areas for road-widening and shall as far as possible be provided in one place. Where, however, the area of the layout or sub-division is more than 5000 sq. meters, open spaces may be provided in more than one place, but at least one such place shall be not less than 1000 sq. meters in size. Such recreational spaces will not be necessary in the case of land used for educational institutions with attached independent playgrounds. Admissibility of FSI shall be as indicated in Regulation 35.

@ The minimum recreational space as laid down under Development Control Regulation (DCR) 23 cannot be reduced on the basis of DCR 38 (34). The recreational space, if any, provided on the podium as per DCR 38(34) (iv), shall be in addition to that provided as per DCR 23.

@ The provisions regarding height of building: Under DCR No.31 (1), the height of the building has to be in proportion to the width of the road which is adjoining a building, but the proviso to that DCR makes another exception to this rule with respect to construction schemes under DCRs Nos.33 (7), (8) and (9). DCR 33 (7) is regarding reconstruction or redevelopment of cessed buildings in the island city, by co-operative housing societies, or of old buildings belonging to the Municipal Corporation or the police department and it grants FSI of 3 plus incentive FSI whichever is more. DCR 33 (8) is regarding construction for housing the dis-housed, by the Municipal Corporation. DCR 33 (9) is regarding reconstruction or redevelopment of cessed buildings or urban renewal schemes on extensive areas where the FSI is 4. These constructions also add to the population and the vehicles in that very area. A question therefore arose as to whether these exemptions are justified, valid and legal?

@ The provisions regarding the podium: The provision regarding the podium is seen in DCR No. 38 (34). DCR 38 lays down the requirements concerning parts of buildings. DCR 38 (34) reads as follows:

(i) A podium may be permitted on plot admeasuring 1500 sq. meters or more.

(ii) The podium provided with ramp may be permitted in one or more level, total height not exceeding 24 meters above ground level. However, podium not provided with ramp but provided with two car lifts may be permitted in one or more level, total height not exceeding 9 meters above ground level.

(iii) The podium shall be used for the parking of vehicles.

(iv) The recreational space prescribed in DCR 23 may be provided either at ground level or on open to sky podium.

(v) Podium shall not be permitted in required front open space.

(vi) Such podium may be extended beyond the building line in consonance with provision of DCR 43 (1) on one side whereas on other side and rear side it shall be not less than 1.5 meters from the plot boundary.

(vii) Ramps may be provided in accordance with DCR 38(18).

(viii) Adequate area for Drivers rest rooms and sanitary block may be permitted on podiums by counting in FSI.

@ The second proviso to DCR 43 (1) (A) concerning fire protection requirements:  We hold that for the reconstruction proposals of plots up to the size of 600 sq. meters under DCR 33(7), open space of the width of 6 meters at least on one side at ground level within the plot, accessible from the road side will have to be maintained for the manoeuvrability of a fire engine, unless the building abuts two roads of 6 meters or more on two sides, or another access of 6 meters to the building is available, apart from the road abutting the building.

@ The decision as contained above, will apply to those constructions where plans are still not approved, or where the Commencement Certificate (CC) has not yet been issued. All authorities concerned are directed to ensure strict compliance accordingly.

@The Government of Maharashtra shall issue the necessary notification within four weeks of this order, re-constituting the ‚ÄėTechnical Committee for the High-Rise Buildings‚Äô.

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