The Bombay High Court has upheld the deemed conveyance granted in favour of a housing society in Mumbai’s Vile Parle area, ruling that developers cannot delay transferring land and building ownership to flat purchasers with the intention of benefiting from future Floor Space Index (FSI) potential.
Justice Sandeep Marne, on July 17, dismissed a petition filed by Ariisto Realtors Pvt Ltd challenging a 2025 order passed by the Competent Authority, which had approved unilateral deemed conveyance in favour of Ariisto Cloud Cooperative Housing Society.
The society, comprising residents of the Ariisto Cloud building, was registered in June 2016 after the developer completed a nine-storey structure featuring 12 residential flats, one commercial unit and two shops. The residents had approached the authority for deemed conveyance after the developer failed to execute the transfer of the land and building in the society’s favour.
The developer had argued that the Competent Authority had improperly considered a second deemed conveyance application after rejecting the earlier one. It also claimed that it had contractual rights to utilise additional FSI available under the Development Control and Promotion Regulations (DCPR), 2034.
Rejecting the developer’s arguments, the court observed that the authority had not conducted a review of its earlier decision, as the previous order had allowed the society to submit a fresh application after completion of construction. Since the building was completed, the society was entitled to seek conveyance.
Highlighting the purpose of the Maharashtra Ownership Flats Act (MOFA), Justice Marne said, “A promoter cannot indefinitely delay conveyance of land on the pretext of exploiting the further additional FSI arising out of the new FSI regime.”
The court further stated that once a housing society is registered, the promoter has a legal obligation to complete the conveyance process within four months and cannot use private agreements as a reason to postpone the transfer.
Criticising the developer’s approach, the court said, “Petitioner has already exploited the development potential in the land… Its greed to make more profits is however not satisfied.”
“This Court would not be a party to such devious acts of the Petitioner of monetising something which belongs to society. If additional FSI flows out of DCPR 2034, the same would belong to Respondent No. 2-Society and not to the Petitioner,” the judge added.
The court concluded that its extraordinary jurisdiction could not be used to support attempts by developers to indefinitely exploit future development potential at the expense of housing societies.
Source: The Free Press Journal
