The court held that the sale of Transferable Development Rights does not require registration under the Registration Act as it is treated as movable property, and inadequacy of consideration alone cannot invalidate the sale.

JUDGMENT :-

SANDEEP V. MARNE, J.

A. THE CHALLENGE

1. This is an application for temporary injunction filed by the Plaintiff-Society seeking to restrain Defendant Nos.5 to 18 to act in furtherance with the Agreements executed in their favour for transfer of Transferable Development Rights (TDR) and from selling, transferring, assigning, parting with or alienating the TDR received by them from and out of Plaintiff’s Development Rights Certificate (DRC) dated 7 August 2023. Plaintiff has also sought injunction against Defendant No.19-Municipal Corporation of Greater Mumbai (MCGM) from recognizing the TDR transfer agreements relied upon by Defendant Nos.5 to 18 and from permitting them to utilize the TDR out of Plaintiff’s DRC dated 7 August 2023. Plaintiffs have also sought temporary monetary injunction against Defendant Nos.1 to 4 for deposit of sum of Rs.16.51 crores towards repayment of amounts paid to Defendant Nos.3 to 4 alongwith interest.

B. FACTS

2. Plaintiffs case can be summarized thus :-

2.1) Plaintiff is a co-operative housing society and an owner of piece and parcel of land admeasuring 26,983 sq.mtrs at Village-Borla, Taluka- Kurla, Mumbai Suburban District at Deonar, Mumbai – 400 088. In 1986, portion of Plaintiff-Society’s land admeasuring 7,284.10 sq.mtrs. was acquired by Defendant No.19-MCGM for the purpose of construction of road. Physical possession of the acquired land was handed over by the Plaintiff-Society to MCGM on 12 November 1986. The Society apparently did not contemporaneously receive compensation from MCGM in respect of the acquired land. Plaintiff- Society was entitled to apply for compensation in the form of TDR as per applicable Development Control Regulations in lieu of monetary compensation. According to the Plaintiff, Defendant No.2, who is its member, was liasoning with MCGM and had sufficient experience in aiding the Society in the process of securing the TDR and began the process of making applications to MCGM for grant of TDR. A Special General Body Meeting of the Society was held on 8 January 2023 appointing and authorizing Defendant No.1 (Chairman) and Defendant No.20 (Secretary) to submit TDR proposal to MCGM and to obtain DRC for the acquired land. Another Special General Body Meeting was held on 18 June 2023 in which Resolution was adopted, inter alia for appointment of Defendant No.3 (JP Nestor LLP) for providing comprehensive consultation services for acquisition of TDR and sale thereof. Resolution was also adopted for appointment of Defendant No.4 (N.V. Consultants) to provide comprehensive consultancy services for acquiring TDR till sale thereof. Defendant Nos.1 and 2 were entrusted with the task of taking necessary steps for entering into Agreements for appointment of DefendaNos.3 and 4 as consultants. On 13 July 2023, Society executed Mortgage Deed in favour of Defendant No.3 creating charge/levy on TDR of 6000 sq.mtrs receivable out of DRC. On 7 August 2023, MCGM issued DRC in favour of the Plaintiff-Society under which Society secured FSI credit of built-up area equivalent to 14,568.20 sq.mtrs. Between 14 August 2023 to 26 September 2023, unregistered Agreements for Sale of TDR and Agreements for utilization of FSI were executed between the Plaintiff- Society and Defendant Nos.5 to 18.

2.2) Plaintiff-Society alleges that Defendant No.2, under the guise of raising complaint against Defendant No.1, raised the issue of making payments to Defendant No.4 despite non-performance of any work by Defendant No.4. On account of raising of the said dispute, the members of the Society approached the Secretary (Defendant No.20) and sought clarifications. The Secretary called Special Man