Bombay HC – Once Section 11 of MOFA is applied, the society must receive the promoter’s actual estate – Leasehold or Ownership under the Development Agreement
On 20.6.1963, the respondent no.5 Ratan Coop Housing Society was registered. The said society had sub-divided the larger property of 41,279.95 sq.mts in 31 smaller plots.
On 28.4.1980, the allottees of plot No.A/22 had executed Development Agreement in favour of the petitioner. Clause 10 provided that the lease for the land was to be obtained from Rattan Society. The petitioner had constructed building of ground plus upper floors and entered into agreements for sale.
In February 2021, the respondent no.2 filed application for unilateral deemed conveyance of the said plot. It was granted.
The statutory test under Section 11 remains constant. The society is entitled to receive the entire right, title and interest held by the promoter. Once that principle is applied, outcomes may differ from case to case because the promoter’s interest itself may differ. In one case it may be leasehold. In another, it may be ownership. The law does not insist on uniform results. It insists on correct transfer of the promoter’s actual estate.
The legislative history shows that the law was brought in to address widespread abuse in the housing sector. Before the enactment of MOFA, flat purchasers often paid full consideration yet remained without clear title to the land. Societies were not formed in time. Conveyance of the property was delayed indefinitely. Promoters retained control over land even after selling all flats, leaving purchasers dependent and legally insecure. The Act was designed to correct this imbalance. It shifts the focus from the promoter’s convenience to the purchaser’s protection. The entire scheme of the statute must therefore be read as consumer protective legislation meant to ensure that purchasers ultimately receive collective ownership through their society.
Judgment dated 24.2.2026 of the High Court of Bombay in Writ Petition No.1673 of 2022 of Paramanand Builders LLP Vs. Competent Authority & District Deputy Registrar and others with connected matters
