Bombay HC – CIDCO Cannot Levy Transfer Charges on Pre-1990 Lease
Judgment dated 29.6.2026 of the High Court of Bombay in Writ Petition No.3540 of 2018 of Navi Mumbai Cooperative Housing Federation and others Vs. City and Industrial Development of Maharashtra Ltd and others
Navi Mumbai Co-operative Housing Federation Limited, a Federation of Co-operative Housing Societies, Navi Mumbai with 2528 cooperative housing societies of
Navi Mumbai along with Manmandir Co-operative Housing Society and Surya Co operative Housing Society, the two members of the Federation have approached this Court, praying for issuance of writ of mandamus, restraining the City and Industrial Development Corporation of Maharashtra Ltd, (CIDCO) from demanding transfer charges in respect of the members of the petitioner no.1 Federation along with those who are members of petitioner nos.2 and 3, who are listed at Exhibit A and B, where the allotment letter/agreement to lease and the lease deed pre date the amendment to the New Bombay Disposal of Lands Regulations, 1975. (hereinafter referred to as ‘the Regulations’) A declaration is also sought to the effect that the Explanation (iii) to Regulation 3(vii) of the New Bombay Disposal of Lands Regulation, 1975 inserted vide notification dated 8/2/1990, be restricted to the exclusion of the Co operative Housing Societies formed and registered prior to its introduction by way of amendment and therefore, not applicable to the members of such societies. For all practical purposes, the demand letter dated 26/10/2016 for payment of transfer charges amounting to Rs.24,58,100/- issued by the respondent no.2 to the petitioner no.1 and similar demand letters issued to other similarly placed societies of petitioner no.1 Federation are sought to be be quashed and set aside.
However, it is submitted that vide notification issued by the State of Maharashtra on 8/2/1990, when the New Bombay Disposal of Lands Regulation 1975 came to be amended by inserting the explanation (iii) to Regulation no.3(vii), which contemplated that ‘Transfer of Demised Land’ shall include the transfer of share(s) by shareholders or members of the Society, the amount was claimed from the members of the Housing Society.
As far as petitioner no.2 Society is concerned, it is pointed out that the lease executed prior to 8/2/1990, did not include any restrictive conditions and covenant with regard to the transfer of shares by the individual members. However, by letter dated 26/10/2016, the respondent no.2 Estate Officer made reference to the transfer charges against 27 transfer and called upon the petitioner no.2 Manmandir Co-operative Housing Society to make arrangement for payment of the same.
A reading of the Amendment Regulations 2008, would make it clear that it, for the first time, introduced a provision incorporating conditions relating to disposal of Apartments, and specific clause 15 and 16 therein included grant of lease and restrictions against transfer, and this included the condition of permission to be sought by the Apartment owner from the Managing Director of CIDCO, and on payment of transfer charges at the rate, as may be determined from time to time.
As a result, the impugned demand letter dated 26/10/2016 addressed to petitioner no.2 Society, and such Tilak demand being raised against members of petitioner no.3 are quashed and set aside. We make it clear that this relief shall only restrict to the demand notice for payment of charges demanded from petitioner nos.2 and 3 Society, as the agreement to lease and lease deed predate the amendment to the amendment to the regulations of 1975, which came into effect from 08/02/1990.