No MOFA rights to flat buyers in buildings on MMRDA land: Bombay high court

MUMBAI: Purchase of flats in buildings on MMRDA land does not grant buyers to statutory entitlements under the Maharashtra Ownership Flats (Regulation of the Promotion of Construction, Sale, Management and Transfer) Act (MOFA), 1963, such as conveyance of land in the ownership sense or a right in the form of a sub-lease from the lessee of the Authority, the Bombay high court recently held.
The HC held that the MMRDA Act, 1974, expressly excludes the applicability of MOFA from lands belonging to or vested in the authority. The MMRDA has the right to consider and permit whether sub-lease, if any, is to be granted and on what terms, and the provisions of MOFA would not apply to it, ruled a bench of Justices Shahrukh Kathawalla and Milind Jadhav on March 17.
The verdict was in an appeal filed by 97 members of Universal Garden-I flat owners’ welfare association in Jogeshwari. The building was constructed by Pagarani Universal Infrastructure Pvt Ltd on MMRDA land and leased to the developer. The flat buyers had appealed against a November 25, 2020, order of a single judge dismissing their interim plea to restrain the developer from putting up additional construction on the plot or creating any third-party rights and to restrain MMRDA from approving any further construction.
The appeal was based on the interplay between two statutes—MOFA and MMRDA Act—said the HC.
The buyers, through their counsel Karl Tamboly, claimed conveyance of the property. They said in 2014, the flats were handed over to them but the developer failed to form a society or convey the plot in favour of the buyers as required under MOFA Section 11. In February 2018, MMRDA informed the residents that MOFA provisions are not applicable to the authority and allowed the developer to consume additional 1.5 FSI on the plot. This prompted the buyers to approach HC against the developer and MMRDA.
HC accepted MMRDA’s senior counsel Sharan Jagtiani’s submission that Section 31 of MMRDA Act excludes MOFA from MMRDA properties, exploitable and permissible FSI on it. “MOFA is not the sole repository of flat purchasers’ rights,” Jagtiani said.
Both Jagtiani and senior counsel J P Sen, for developer, argued that the “rights of the flat purchasers can still be enforced” through other laws and “there is no vacuum created by the exclusion of MOFA by MMRDA Act”. The HC agreed. It said with MMRDA’s nod, a society may be formed under the Maharashtra Cooperative Societies Act. MMRDA said this has been done for another society, without any claim to lease of land under MOFA.