Supreme Court Orders Bombay HC To Expeditiously Decide MOFA vs. MMRDA Act Tussle in Universal Garden Case; Interim Relief Denied to Flat Owners - 2025-05-08

Supreme Court Directs Speedy Trial in Jogeshwari Property Tussle, Declines Interim Stay on New Wing

Bench comprising Justices J.B. Pardiwala and R. Mahadevan emphasizes need for Bombay High Court to resolve complex MOFA vs. MMRDA Act issues concerning 'Universal Garden' within six months of framing issues.

New Delhi, April 29, 2025 – The Supreme Court today directed the Bombay High Court to expedite the trial in a long-standing property dispute involving flat owners of 'Universal Garden A-Wing' in Jogeshwari, Mumbai, and developer Pagarani Universal Infrastructure Private Limited over the construction of an additional 'Wing B'. While declining to grant interim relief to the petitioners seeking to halt further flat transfers in the new wing, the apex court underscored the urgency of resolving the "complex legal issues" at the heart of the case.

The Special Leave Petition, filed by Shahed Kamal & Ors., challenged a Bombay High Court order dated March 17, 2022, which had upheld a single judge's refusal to grant an injunction against the construction and sale of flats in 'Wing B'. The connected Writ Petition (C) No. 334/2023 was also disposed of.

Background: A Dispute Over Development Rights and Transparency

The dispute centers on a parcel of land in Jogeshwari (West), Mumbai, developed as "Universal Garden A-Wing." Flat purchasers in Wing A, who received possession in 2014, contested the developer's subsequent plans to construct 'Wing B' on the same plot, arguing it was done without their consent as allegedly required under the Maharashtra Ownership of Flats (Regulation of the Promotion of Construction Sale Management and Transfer) Act, 1963 ( MOFA ).

Key events leading to the Supreme Court include:

* 2011-14: Flats in 'Universal Garden A-Wing' sold under MOFA .

* 2014: Occupation Certificate for Wing A issued; possession handed over.

* 2015: Maharashtra government increased FSI (Floor Space Index).

* 2017: Developer allegedly submitted a declaration under the Maharashtra Apartment Ownership (MAO) Act, withdrawing a portion of land for Wing B, a document petitioners claim was suppressed. MMRDA granted a supplemental lease deed for additional FSI for Wing B.

* 2018: Petitioners filed a suit in Bombay High Court challenging the new construction.

The petitioners have also raised concerns about the developer allegedly suppressing crucial documents, including a declaration under the MAO Act, which the Supreme Court noted would be a matter for the trial court to examine.

High Court's Stance: MOFA Inapplicable to MMRDA Lands

The Bombay High Court, in its impugned order, had primarily held that MOFA does not apply to lands or buildings owned by or vested in the Mumbai Metropolitan Region Development Authority (MMRDA), which is the lessor of the land. The High Court reasoned that Section 31 read with Schedule II, Clause II of the MMRDA Act, 1974, excluded MOFA 's applicability. Consequently, the High Court found no requirement for the developer to obtain the consent of existing flat purchasers before commencing construction of the additional building, provided MMRDA's permission was secured.

Arguments and Pleas Before the Supreme Court

Before the Supreme Court, Dr. Menaka Guruswamy , Senior Advocate for the petitioners, vehemently argued for an injunction to restrain the developer from further transferring flats in Wing B, even though construction was complete and approximately 40% of flats (116 out of 185 units, as per the developer's counsel Mr. P.S. Patwalia ) had already been sold.

The developer, represented by Senior Advocates Mr. P.S. Patwalia and Mr. Prasenjit Keswani , and MMRDA, represented by Solicitor General Mr. Tushar Mehta , opposed the plea for interim relief.

Supreme Court's Observations and Directives

The Supreme Court, while acknowledging the "fine legal issues involved," decided to dispose of the petition without delving into the merits of the High Court's order, focusing instead on ensuring a timely resolution of the underlying suit.

The bench observed: > "We are of the view that at this point of time, no relief can be granted to the petitioners, more particularly, when the learned Single Judge as well as the Division Bench of the High Court have declined to grant any relief."

Key directives issued by the Court include:

Expedited Trial: The suit, currently re-numbered as Civil Suit No.3533/2024 and pending in the Bombay City Civil Court, is to be transferred back to the Bombay High Court on its original jurisdiction within two weeks, with the consent of the parties.

Timeline for Disposal: The Bombay High Court is directed to "proceed at the earliest with the framing of issues and see to it that the suit is disposed of with final judgment within a period of six months from the date the issues are framed."

MMRDA's Written Statement: A final opportunity of six weeks was granted to MMRDA (defendant No.8) to file its written statement, failing which the trial court shall close that stage.

Amendment of Plaint: Petitioners are at liberty to amend their plaint in accordance with law.

Third-Party Rights: Crucially, the Court clarified: > "It is needless to clarify that any third-party rights already created so far as the Wing ‘B’ is concerned and the one that may be created in future would be subject to the final outcome of the suit that the High Court may decide."

Merits Left Open: The Supreme Court explicitly stated: > "We clarify that we have only examined the matter from the point of view of interim relief prayed for by the plaintiffs is concerned. We have not gone into any other larger issues. The same shall be decided by the High Court in accordance with law. The suit shall be decided on its own merits without being influenced in any manner by any of the observations made in the interlocutory orders passed by the High Court including our order."

Complex Legal Questions for Adjudication

The trial court (now the Bombay High Court) will grapple with several complex legal questions, including: * The precise scope and applicability of MOFA versus the MMRDA Act concerning lands leased by MMRDA. * The rights of existing flat purchasers when a developer utilizes additional FSI for new constructions on the same plot. * The legal effect of the developer's declaration under the MAO Act and the allegations of its suppression. * The validity of the supplemental lease deed and permissions granted for Wing B.

Path Forward: Focus on Timely Resolution

The Supreme Court's order places a strong emphasis on the expeditious adjudication of the suit by the Bombay High Court. Both parties have been urged to cooperate for a fast disposal. The outcome of the suit will have significant implications for the flat owners of Universal Garden A-Wing, the purchasers in Wing B, and the developer, particularly concerning the rights over the land and common amenities.