A Mumbai cooperative housing society has secured relief in a dispute spanning more than 24 years, with the National Consumer Disputes Redressal Commission directing the Maharashtra Housing and Area Development Authority (MHADA) to return approximately Rs 1.22 crore collected in connection with a land lease and construction costs.
In its October 8 order, the commission rejected an additional demand of Rs 4.68 crore, which largely comprised interest and other charges. It held that the authorities could not unilaterally revise the financial conditions established under the lease agreement.
The case was filed by Meera Cooperative Housing Society against MHADA and the Mumbai Housing and Area Development Board. The dispute concerned a plot in Oshiwara, where the society was required to build a municipal market and transfer it to the Brihanmumbai Municipal Corporation (BMC) without payment.
“Their conduct amounts to gross deficiency in service and an unfair trade practice,” the commission observed, referring to the authorities’ decision to revise construction costs and impose additional financial obligations after finalising the lease arrangement.
The society had approached the authorities in May 2000 seeking land for housing its members. Initial estimates placed the land premium at Rs 3,226 per square metre and the market construction cost at Rs 15,488 per square metre. However, allotment correspondence issued in June 2002 fixed the land premium at Rs 7,350 per square metre and provisionally calculated construction costs at Rs 13,000 per square metre. A 30-year lease was executed on June 29, 2002.
Subsequently, the authorities refused to adjust construction expenses against the land premium and raised additional demands. In 2004, the construction rate was revised to Rs 8,608 per square metre, resulting in a demand of Rs 1.09 crore. The society paid this amount in February 2016 under protest. A further demand exceeding Rs 4.68 crore followed in March 2017.
MHADA argued that the original construction rate was provisional and that a later policy resolution justified the revised calculations. The commission rejected this position, stating that subsequent policy changes could not retrospectively modify the agreed terms.
It also dismissed objections concerning consumer status, limitation and statutory notice.
The commission ordered a refund of Rs 1,09,50,015 and an additional Rs 12,79,084 wrongly charged towards ground rent. Both amounts will attract 6% annual simple interest from their respective payment dates. The authorities must pay within two months; otherwise, the interest rate will increase to 9% annually after that deadline.
Source: The Indian Express
