Separate conveyance must for each housing society on one plot

Separate conveyance must for each housing society on a plot

Jehangir B Gai | TNN | Mar 22, 2010, 05.17 AM IST

Builder held liable to execute separate conveyance for each society building

BACKDROP: It is common to come across builders failing to execute conveyance to retain their hold over the land. This is not permissible, as per a recent ruling of the Consumer Forum for Mumbai Suburban District, in the case of Mamta-D Co-operative Housing Society v/s Gundecha Builders.

Case Study: Gundecha Builder had constructed four buildings at Prabhadevi. These were named Mamta-A, B, C and D Co-operative Housing Society. Of these, Mamta-D CHS raised a grievance against the builder, stating that its members had purchased flats by paying the entire consideration and taking possession in December 1984, and thereafter the society was formed and registered in December 1989, yet the conveyance was not executed as required by law. The society also wrote to the builder and demanded that he construct independent boundary walls for their building and execute conveyance. Since the builder failed to pay heed, in May 2001, the society filed a consumer complaint against the builder.

The builder contested the complaint. He claimed that that since the four buildings were constructed on one plot of land, it was not possible to get the mutation done in the land records for sub-division of the plots. Consequently, it would not be possible to execute separate conveyance for Mamta-D Society. He claimed that when the construction work on the plot is completed, he would execute the conveyance for all the buildings, and the society should bear with the delay. The builder stated that the complaint was devoid of any merit and should be dismissed. The society claimed that the builder’s stand was incorrect because the four buildings were not joined, each had a separate entrance and it was possible to construct independent boundary walls around each building.

After hearing advocates Uday Wavikar and Mr Wankhade for the society and advocate Bhandari for the builder, the forum observed that the builder was bound by the terms and conditions of the agreement and was also required to abide by the provisions of the Maharashtra Ownership Flats Act (MOFA). The law casts a duty on a builder to execute conveyance within four months of formation of the society. As this has not been done, the builder is guilty of violating the law and there is a deficiency in the service rendered by him.

The Forum noted that in the present case, when the complaint was argued out in the year 2010, the builder had not yet executed conveyance even though more than 20 years had elapsed from the date of formation of the society. The forum also observed that builders try to delay or withhold conveyance to take advantage of any subsequent increase in FSI, which is not legally permissible. Conveyance has to be executed within four months of formation of the society, and in case any additional FSI is available, its benefit accrues to the society which is the real owner of the land.

G L Chavan, delivering the judgment on behalf of the Bench comprising himself and President Suman Mahajan, upheld the complaint. By an order dated February 26, 2010, the builder was directed to construct an independent boundary wall for the society and also execute conveyance. Six months’ time was given for compliance of this order. In case of non-compliance within this period, the builder was liable to pay a compensation of Rs 50 to the society for each day’s delay. In addition, Rs 5,000 was awarded as costs.

Impact: The compensation of Rs 50 per day for each day of default and delay in executing conveyance should send a strong signal to other builders to desist from adopting similar unfair practices.

The latest update:

Gundecha Builders filed appeal against this order. The following is the latest status: