MOFA| Proportionate Land Division Permissible Despite TDR Use If Allocation Extends Across Entire Layout: Bombay High Court
The Bench noted that where transfer of development rights is uniformly distributed across all structures, restrictions to mere plinth and appurtenant area conveyances do not apply.
Justice Sandeep V. Marne, Bombay High Court
The Bombay High Court has held that the principle of land division proportionate to the utilized built-up area (BUA) remains fully applicable even in real estate layout developments involving Transfer of Development Rights (TDR), provided the TDR is distributed across multiple buildings rather than selectively loaded onto a single structure.
The Court noted that a Government Resolution directing conveyance of only the plinth and appurtenant area in TDR cases serves merely as a temporary, transitional solution to avoid structural imbalances, and cannot be mechanically weaponized by developers to retain residual land ownership for exploiting future additional floor space index (FSI).
Delivering clarity on a widely contested question regarding unilateral deemed conveyances under the Maharashtra Ownership Flats Act (MOFA), the Court clarified that an absolute restriction to only the building footprint or plinth area is limited to rare, incongruous scenarios where a localized loading of incentive FSI or TDR distorts the land equity of other societies within the same layout.
Justice Sandeep V. Marne observed, “…Where TDR is distributed across many buildings the principle of conveyance of land proportionate to the BUA utilised in each building must necessarily be followed… I do not see any difficulty why the principle of land division proportionate to built-up area utilised in each building cannot be followed…Thus, though the case involves utilization of TDR, such TDR is not selectively loaded in a particular building resulting in FSI imbalance for computation of land entitlement of each building. In that view of the matter, I do not see any difficulty in following the principle of land division proportionate to utilised built-up area envisaged in para-2(C)(vi)(1) of the G.R. dated 22 June 2018”.
“To sum up, the procedure of conveying land less than proportionate land should be followed only in rare cases where it becomes impossible to divide and convey land proportionate to the BUA utilised in each building or where application of such principle gives undue advantage to one of the societies in the layout at the cost of other societies”, the Bench noted further.
Advocate Sharad Bansal appeared for the petitioner and Mamta S. Srivastava, AGP appeared for the respondent.
The question that the Court had to adjudicate upon was:
-whether it is mandatory to convey only the plinth and appurtenant area to the organization of flat purchasers when TDR is utilised in construction of buildings in the layout or whether the Neeta Sawant principle of land division proportionate to built-up area utilised in construction of buildings in the layout can also be followed in a given case where use of TDR is not restricted to a particular building and TDR is distributed across all buildings in the layout.
The matter originated from an integrated residential project named 'Neelkanth Greens' spanning 56,654 square meters in Thane, where the developer constructed multi-storeyed buildings alongside a specific cluster of 12 row houses. Although the row houses received their occupancy certificate back in July 2007, the developer consistently failed to execute the legal conveyance of the underlying land, prompting the flat owners' cooperative society to approach the statutory authority for relief.
Thereafter, pursuant to the society's application under Section 11(3) of MOFA, the Competent Authority issued a certificate of unilateral deemed conveyance for 929.84 square meters, representing the society's proportionate share of the net plot and common recreational grounds.
Aggrieved by this allocation, the developer challenged the order through a writ petition, strictly contending that because a substantial volume of TDR (24,950.45 sq. mtrs) had been loaded into the layout's development, the authorities were legally barred by the state's 2018 Government Resolution from conveying anything beyond the literal plinth and appurtenant area.
The Court noting the legislative intent behind the regulatory framework, observed that the restriction to plinth-only conveyance was never meant to enrich developers or leave large chunks of layout land permanently unconveyed.
“…The legislative intent behind incorporation of para-2(C)(vi)(2) of the GR is not to provide any benefit to the developer or to deprive the societies of their due land entitlement. Otherwise, in every layout the developer would deliberately use some TDR to prevent conveyance of proportionate land and go on milking additional FSI arising out of new Building Regulations in the unconveyed land by putting up additional construction in the layout. Para-2(C)(vi)(2) of the GR merely makes a transitional arrangement to surmount the difficulty faced in proportionate land division due to use of TDR. This is the true purport of the procedure prescribed in para-2(C)(vi)(2) of the GR dated 22 June 2018”, it noted.
“…In a case where TDR is used only for construction of some of the buildings in the layout, an endeavour can be made by the Competent Authority to examine whether BUA corresponding to only base FSI for all buildings can be taken into consideration for proportionate land division. For example, in illustration discussed in para 14 above, it can be examined if only base BUA of 5000 sq.mtrs. can be considered for proportionate land division by ignoring the TDR or incentive FSI. If such solution is possible, the Competent Authority must adopt it rather than mechanically conveying only the plinth and appurtenant area to each building in the layout”, the Bench noted further.
Dismissing the writ petition, the Court sustained the unilateral deemed conveyance certificate, verifying that the cooperative society received only its lawful entitlement. It affirmed that it would not exercise its extraordinary correctional jurisdiction to disrupt a equitable final outcome, ordering that the society be put in complete possession of its proportionate share of the net plot and common infrastructure without any further delays.
Cause Title: Neelkanth Mansions & Infrastructure Private Limited v. The District Deputy Registrar, Co-operative Societies, Thane & Ors. (Writ Petition No. 3530 of 2026)
Appearances:
Petitioner: Sharad Bansal, Mdehavin Bhatt, Ranjyot Singh Panesar, and Manashvi Shah, Advocates instructed by MV Law Partners.
Respondents: Mamta S. Srivastava, AGP, Mosin Naik, Advocate.