REPORTABLE

IN THE SUPREME COURT OF INDIA

CIVIL  APPELLATE JURISDICTION

CIVIL APPEAL NO. 2544 OF 2010

Nahalchand Laloochand Pvt. Ltd.        …Appellant

Versus   Panchali Co-operative Housing Society Ltd.   …Respondent

WITH

CIVIL APPEAL NO. 2545 OF 2010 CIVIL APPEAL NO. 2546 OF 2010 CIVIL APPEAL NO. 2547 OF 2010 CIVIL APPEAL NO. 2548 OF 2010 CIVIL APPEAL NO. 2449 OF 2010 CIVIL APPEAL NO. 2456 OF 2010

JUDGEMENT

R.M. Lodha, J.

Of  these  seven  appeals  which  arise  from  the  

judgment  dated April  25,  2008 passed by the High Court  of

Judicature at  Bombay (Appellate Jurisdiction),  five are at  the  

instance of the original plaintiff  and the other two are by the  

parties,  who were  not  parties  to  the  proceedings  before  the  

High  Court  or  the  trial  court  but  they  are  aggrieved  by  the  

findings recorded by the High Court as they claim that these  

findings are affecting their rights.  

The facts:

2. Few important questions of law arise in this group of  

appeals. It will  be convenient to formulate the questions after  

we set out the material facts and the contentions of the parties.  

The narration of brief facts from S.C. Suit No. 1767 of 2004 will  

suffice  for  consideration  of  these  appeals.  Nahalchand  

Laloochand Private Limited is a Private Limited Company. As a  

promoter, it developd few properties in Anand Nagar, Dahisar  

(East),  Mumbai and entered into agreements for sale of flats  

with  flat  purchasers.  The  flat  purchasers  are  members  of  

Panchali  Co-operative  Housing  Society  Ltd.  (for  short,  ‘the  

Society’). The promoter filed a suit before the Bombay City Civil  

Court, Bombay for permanent injunction restraining the Society  

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(defendant) from encroaching upon, trespassing and/or in any  

manner disturbing, obstructing, interfering with its possession in  

respect of 25 parking spaces in the stilt portion of the building.  

The  promoter  set  up  the  case  in  the  plaint  that  under  the  

agreements for sale it has sold flats in its building and each flat  

purchaser has right in respect of the flat sold to him and to no  

other  portion.  It  was  averred  in  the  plaint  that  each  flat  

purchaser has executed a declaration/undertaking in its favour  

to  the  effect  that  stilt  parking  spaces/open  parking  spaces  

shown in the plan exclusively belong to the promoter and that  

the declarant has no objection to the sale of such spaces by it.  

The defendant (Society) traversed the claim and set up the plea  

that the promoter has no right to sell or dispose of spaces in the  

stilt  portion  and  that  the  undertakings  given  by  the  flat  

purchasers are not binding being contrary to law and based on  

such undertakings, the promoter has not acquired any right to  

sell stilt parking spaces.

3. The  parties  let  in  evidence  (oral  as  well  as  

documentary) in support of their respective case.

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4. On  April  4,  2007,  the  Presiding  Judge,  City  Civil  

Court, Greater Bombay dismissed the suit with costs.

5. The promoter preferred first appeal before the High  

Court which was dismissed on April 25, 2008.  

6. For  brevity,  we  shall  describe  Maharashtra  

Ownership Flats (Regulation of the Promotion of Construction,  

Sale,  Management  and  Transfer)  Act,  1963  as  ‘MOFA’,  

Maharashtra Ownership Flats (Regulations of the Promotion of  

Construction, Etc.) Rules, 1964 as ‘1964 Rules’, Development  

Control  Regulations  for  Greater  Bombay,  1991  as  ‘DCR’,  

Maharashtra Apartment Ownership Act, 1970 as ‘MAOA’, The  

Maharashtra  Regional    and  Town  Planning  Act,  1966  as  

‘MRTP Act’ and Transfer of Property Act as ‘T.P. Act’.  

The summary of findings recording by the High Court:

7. While  dismissing  the  appeal,  the  High  Court  

recorded the following findings :

• The carpet area of any of the 56 flats/tenements  in Panchali building is not less than 35 sq. mtrs.

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• The parking space either enclosed or unenclosed,  covered or open cannot be a ‘building’.  

• It  is  compulsory  requirement  to  provide  for  parking spaces under DCR.

• It  is  obligatory  on  the  part  of  the  promoter  to  follow  the  DCR.  The  agreement  signed  under  MOFA  between  the  developer  and  the  flat  purchaser must be in conformity with the model  form of  agreement  (Form V)  prescribed  by  the  State Government.

• The model agreement does not contemplate the  flat  purchasers  to  separately  purchase  the  stilt  parking spaces.

• The  rights  arising  from  the  agreement  signed  under the MOFA between the promoter and the  flat purchasers cannot be diluted by any contract  or  an  undertaking  to  the  contrary.  The  undertakings contrary to DCR will not be binding  either on the flat purchasers or the Society.

• The stilt parking space is a common parking area  available and the developer is obliged to provide  the same under the DCR when the carpet area of  the flat is 350 sq. meters It is not an additional  premises/area that he is authorized to sell either  to  flat  purchaser  or  any outsider.  It  is  part  and  parcel of the Society building and it cannot be a  separate premises available for sale. As soon as  the Corporation issues the occupation certificate  and the Society is registered, the building as well  as the stilt parking spaces, open spaces and all  common amenities  become  the  property  of  the  Society.

• The stilt parking spaces cannot be put on sale by  the developer as he ceases to have any title on  

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the same as soon as the occupation certificate is  issued  by  the  Corporation  and  it  becomes  the  property of the society on its registration.

• The  stilt  parking  spaces  cannot  be  termed  as  ‘open/covered  garages’  and  Clause  2  of  the  Model  Agreement—Form V provides for  sale of  covered/open garage in addition to the flat/shop.

• It  is  immaterial  if  the purchase agreement does  not include stilt car parking spaces in the common  area of amenities. The stilt car parking spaces is  part  of  the common amenities and it  cannot be  treated to be a separate premises/garage which  could  be  sold  by  the  developer  to  any  of  the  members of the society or an outsider.

• Under MOFA, the developer’s right is restricted to  the  extent  of  disposal  of  flats,  shops  and/or  garages, which means that any premises which is  included in the Flat Space Index (FSI) can be sold  by  the  developer/promoter.  The  stilt  parking  space  is  not  included  in  the  FSI  nor  it  is  assessable for the Corporation taxes.

The submissions:

8. Mr. Tanmaya Mehta, learned counsel appearing for  

the  promoter—Nahalchand  Laloochand  Private  Limited  

(appellant)  contended  that:   the  stilt  parking  space  being  

‘garage’, as an independent unit is covered by the definition of  

‘flat’  in  Section  2(a-1)  of  MOFA;  Section  2(a-1)  creates  an  

artificial  definition  of  ‘flat’  and  since  in  common  parlance  a  

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garage  would  not  be  considered  as  a  flat,  the  legislature  

clarified  and  explained  that  the  term  ‘flat’  means……  and  

‘includes a garage’; as long as  premises are  covered from the  

roof or which have a covered roof and  used for the parking of  

vehicles, that would qualify as ‘garage’ and since stilt parking  

spaces  are  covered  parking  spaces  and  form  part  of  the  

building, they fall within the definition of a ‘garage’; even if stilt  

parking spaces do not fall within the definition of ‘flat’, they are  

nevertheless sellable as independent units since  right to sell  

such spaces flows from the bundle  of  rights  associated with  

ownership of the property and Sections 10 and 11 of  MOFA  

read with Rule 9 of 1964 Rules are not exhaustive of the rights  

retained  by  the  promoter  upon  execution  of  conveyance.  

Moreover, if stilt parking spaces are treated as ‘common areas’  

then the proportionate price for the same would have to be paid  

by each flat purchaser, irrespective of whether he requires the  

parking space or not and there may  be situations where the  

number of parking spaces will  not be equal to the number of  

flats and, thus, a person who has paid  proportionate price for  

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the common parking space may find himself  without  parking  

space,  even  though  he  has  paid  for  the  same.  Lastly,  the  

learned  counsel  submitted  that  in  any  event  the  promoter  

undertakes  that  the  parking  spaces  shall  be  sold  only  to  

persons  purchasing  flats  within  the  subject  layout,  i.e.  the  

purchasers of flats in the seven buildings which form part of the  

layout and exist in close proximity.

9. Mr. Pravin K. Samdani, learned senior counsel for  

one of the appellants viz.,  Maharashtra Chamber of Housing  

Industry  adopted  a  little  different  line  of  argument.  He  

contended that the provisions of MOFA permit a promoter to  

sell garage/open/covered car parking space along with the flat.  

His submission is that MOFA does not define the word ‘garage’  

and  that  word  has  to  be  understood  and  interpreted  in  

accordance with the plain grammatical  meaning and not with  

reference to DCR which have been framed under MRTP Act  

having different legislative object. As to whether the stilt parking  

spaces  are  ‘common  areas’,  Mr.  Pravin  K.  Samdani   would  

submit  that  MOFA does not  list  out  the ‘common areas’  and  

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‘limited common areas’ while MAOA does define these terms  

and  parking  spaces  thereunder  are  ‘common  areas  and  

facilities’  unless otherwise provided in  the declaration  by the  

owner of the property.  Under MOFA, it is for the promoter and  

under MAOA,   the declarant  has to prescribe at the outset the  

‘common areas’  and ‘limited common areas’.   He referred to  

Sections  3(2)(h),  4(1)(a)(v),  10  and  11  of  the  MOFA  and  

submitted that   the promoter  must  at  the outset  indicate  the  

nature  of  organization  (condominium or  society  or  company)  

that  would  be  formed  at  the  time  of  sale  of  flats  and  on  

formation  of  such  organization,  the  promoter  joins  such  

organization with a right and power to dispose of remaining flats  

that would include the remaining unsold open/covered  parking  

space/garage  and  the  organization  is  transferred  unsold  

open/covered parking spaces only if all the flats have been sold  

by the promoter.  Learned senior counsel would submit that it is  

wholly  irrelevant  whether  stilt/podium/basement/covered  car  

park  attracts  FSI  or  not  but   the  only  relevant  criterion   is  

whether the promoter has listed it as a part of common area or  

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not and if he has not done so then it is sellable. If he has listed  

it,  then  every  flat  purchaser  is  proportionately  required  to  

contribute for the same.  

10. In the appeal filed by one Chirag M. Vora,  Mr. Sunil  

Gupta, learned senior counsel appeared. He argued that MOFA  

was  enacted and enforced in  the year  1963 as a regulatory  

piece of legislation and  barring the few aspects in respect of  

which  MOFA  makes  specific  inroads  into  the  rights  of  the  

promoter in the matter of construction, sale, management and  

transfer of flats, all other aspects of the right of the promoter  

who  enters  into  contract  with  the  flat  purchaser  remain  

unaffected and undisturbed. His submission is that MOFA gives  

a  wide  meaning  to  the  word  ‘flat’  so  that  buildings  of  all  

permutations  and  combinations  may  be  covered  within  the  

scope of that Act and keeping in mind both the plain language  

of  Section  2(a-1)  as  well  as  the  object  of  that  Act,  widest  

meaning to the word ‘flat’ deserves to be given so that the plain  

language is satisfied and also the object  of  the Act is better  

subserved. He adopted the line of interpretation put forth by Mr.  

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Tanmaya Mehta that ‘garage’ includes covered  parking spaces  

and even  open parking  spaces and  is  a  ‘flat’  in  itself  under  

Section  2(a-1).  Relying  upon  Barnett  &  Block v.  National  

Parcels  Insurance  Company  Ltd.1,  learned  senior  counsel  

submitted that the minimum requirement of garage is that there  

should be roof (even if there are no walls) and for the purpose  

of MOFA, not only a covered parking space like a stilt parking  

space  but  also  an  open  parking  space  is  tantamount  to  

‘garage’.  According to learned senior counsel the word ‘garage’  

is not to be read simply as another kind of user as contrasted  

with residence, office, showroom or shop or godown or industry  

or business rather it has to be read in contrast and juxtaposed  

against the expression ‘set of premises’;  it is the alternative to  

the ‘set of premises’ and not merely to the different users of the  

set of premises mentioned in Section 2 (a-1). Mr.  Sunil  Gupta,  

learned  senior  counsel  would  submit  that  each  stilt  parking  

space as well as each open parking space is a ‘flat’ in itself de  

hors  the  other  accommodations  amounting  to  ‘flat’  under  

Section 2(a-1) of MOFA. In support of his argument, he relied  1 [1942] 1 All E.R. 221

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upon  a  decision  of  this  Court  in  the  case  of  Municipal  

Corporation of Greater Bombay & Ors. v. Indian Oil Corporation  

Ltd.2.   In the alternative, he submitted  that if the stilt parking  

space or open parking space is not  held to be a ‘flat’  under  

Section 2    (a-1), still that space/area cannot be treated as part  

of  ‘common  areas  and  facilities’.   Firstly,  he  submitted  that  

common  areas  and  facilities  do  not  include  garage/parking  

spaces and such parking spaces remain ungoverned by MOFA.  

Sections 3 and 4 of MOFA concern with matters pertaining to  

‘common areas and facilities’  but  MOFA does not  define the  

meaning of  ‘common areas and facilities’.  Section 3(2)(m)(iii)  

leaves it  to the promoter to disclose to his flat purchaser the  

nature,  extent  and  description  of  the  common  areas  and  

facilities.  Section  4,  by  mentioning  a  prescribed  form  of  

agreement, rather opened the possibilities for the promoter to  

continue to exercise his traditional and pre-Act right to dispose  

of  such  parking  spaces  according  to  his  choice.  The  

stilt/covered/open parking spaces do not figure as part of the  

common areas and facilities in any project and remain within  2 1991 Suppl. (2) SCC 18

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the contractual, legal and fundamental rights of the promoter to  

dispose of the same in the manner in which he proposes and  

his customers accept.  Section 16 of MOFA does not override  

this  right  of  a  promoter.   Secondly,  learned  senior  counsel  

would submit that the provisions of MOFA must not be made to  

depend  on  the  provisions  of  some  other  enactment  just  

because the subject matter of the two legislations appears to be  

the same. In this regard, he referred to Maxwell Interpretation of  

Statutes,  12th Edition,  pages  69  to  70  and  G.P.  Singh  on  

Principles of Statutory Interpretations, 8th edition, pages 150 to  

160. He, thus, submitted that for the purposes of understanding  

the  meaning  of  ‘flat’  under  Section  2(a-1)  of  MOFA,  the  

provisions of MAOA may be looked at but there would be no  

justification  in  understanding  the  expression,  ‘flat’  defined  in  

MOFA with reference to MRTP Act, DCR, rules related to FSI  

and  the  provisions  concerning  property  tax  in  the  Bombay  

Municipal Corporation Act.

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11. On the other hand, Mr. Neeraj Kumar Jain, learned  

senior counsel and Mr. Umesh Shetty, learned counsel for the  

Societies stoutly supported the view of the High Court.  

The issues:

12. In  view  of  the  contentions  outlined  above,  the  

questions that  arise for  consideration are :  (i)  whether  stand  

alone ‘garage’ or in other words ‘garage’ as an independent unit  

by  itself  is  a  ‘flat’  within  the  meaning   of  Section  2(a-1)  of  

MOFA; (ii)  whether stilt parking space/open parking space of a  

building regulated by MOFA is a ‘garage’; (iii)  If the answer to  

aforesaid  questions  is  in  the  negative,  whether  stilt  parking  

space/open parking space in such building is part of ‘common  

areas and facilities’ and (iv) what are the rights of the promoter  

vis-à-vis society (of flat purchasers) in respect of open parking  

space/s / stilt parking space/s.  

13.  All  these questions have to be considered in the  

light of statutory provisions. At this stage we notice some of the  

provisions of MOFA.  As regards other statutory provisions, we  

shall  refer to them wherever necessary.

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Relevant provisions of MOFA:

14. The definition of ‘flat’ in Section 2(a-1) is most vital  

and during course of  arguments it  has been rightly said that  

meaning  of  the  word  ‘flat’  is  the  actual  fulcrum  of  MOFA.  

Section 2(a-1) reads thus:  

“S.2(a-1).- “Flat” means a separate and self-contained  set  of  premises  used  or  intended  to  be  used  for  residence, or office, show-room or shop or godown or  for carrying on any industry or business (and includes a  garage),  the  premises  forming  part  of  a  building  and  includes an apartment.

Explanation.—Notwithstanding  that  provision  is  made  for sanitary, washing, bathing or other conveniences as  common to two or more sets of premises, the premises  shall be deemed to be separate and self-contained.”   

15. ‘Promoter’  is defined in Section 2(c) as under :

“S.2(c).-  `Promoter’  means  a  person  and  includes  a  partnership  firm or  a  body or  association  of  persons,  whether registered or not who constructs or causes to  be constructed a block or building of flats, or apartments  for the purpose of selling some or all of them to other  persons, or to a company, co-operative society or other  association of persons, and includes his assignees; and  where the person who builds and the person who sells  are different persons, the term includes both;”

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16. The general liabilities of the promoter are set out in  

Section 3.  To the extent  it  is  relevant  to  the present  case it  

reads thus :

“S.3.-   (1) Notwithstanding anything in any other law,  a  promoter  who  intends  to  construct  or  constructs  a  block or building of flats, all or some of which are to be  taken  or  are  taken  on  ownership  basis,  shall  in  all  transactions  with  persons  intending  to  take  or  taking  one or more of such flats, be liable to give or produce,  or cause to be given or produced, the information and  the documents hereinafter in this section mentioned.

(2) A  promoter,  who  constructs  or  intends  to  construct such block or building of flats, shall—

(a) make full and true disclosure of the nature  of his title to the land on which the flats are constructed,  or  are  to  be  constructed;  such  title  to  the  land  as  aforesaid having been duly certified by an Attorney-at- law,  or  by  an  Advocate  of  not  less  than  three  years  standing, and having been duly entered in the Property  card or extract of Village Forms VI or VII and XII or any  other relevant revenue record;

(b) make  full  and  true  disclosure  of  all  encumbrances on such land,  including any right,  title,  interest or claim of any party in or over such land;

(c) to (h) …..

(i) not allow persons to enter into possession  until  a  completion  certificate  where  such certificate  is  required to be given under any law, is duly given by the  local authority (and no person shall take possession of a  flat until such completion certificate has been duly given  by the local authority);

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(j) to (l) …..

(m) when  the  flats  are  advertised  for  sale,  disclose  inter  alia in  the  advertisement  the  following  particulars, namely :-

(i) the extent of  the carpet area of the  flat  including  the  area  of  the  balconies  which  should be shown separately;

(ii) the  price  of  the  flat  including  the  proportionate  price  of  the  common  areas  and  facilities which should be shown separately, to be  paid by the purchaser of flat; and the intervals at  which the instalments thereof may be paid;

(iii) the nature, extent and description of  the common areas and facilities;   

(iv)      the nature, extent and description of  limited common areas and facilities, if any.

(n) sell flat on the basis of the carpet area only:

Provided  that,  the  promoter  may  separately  charge for the common areas and facilities in proportion  ‘to the carpet area of the flat’.

Explanation.—For the purposes of this clause, the  carpet  area  of  the  flat  shall  include  the  area  of  the  balcony of such flat.”

17. Section 4 of MOFA mandates that promoter before  

accepting  advance  payment  or  deposit  shall  enter  into  an  

agreement  with  the  prospective  flat  purchaser  and  such  

agreement shall be registered. It provides as follows:  

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 “S.4.-   (1)  Notwithstanding  anything  contained  in  any  other  law,  a  promoter  who  intends  to  construct  or  constructs  a  block  or  building  of  flats  all  or  some of  which are to be taken or are taken on ownership basis,  shall, before, he accepts any sum of money as advance  payment or deposit, which shall not be more than 20 per  cent of the sale price enter into a written agreement for  sale with each of such persons who are to take or have  taken such flats, and the agreement shall be registered  under the Registration Act, 1908” and such agreement  shall be in the prescribed form.

(1A) The agreement to be prescribed under sub- section  (1)  shall  contain  inter  alia  the  particulars  as  specified  in  clause (a);  and to  such agreement  there  shall be attached the copies of the documents specified  in clause (b)—

(a) particulars—

(i) if  the  building  is  to  be  constructed,  the  liability  of  the  promoter  to  construct  it  according  to  the  plans  and  specifications  approved  by  the  local  authority  where  such  approval  is required under any law for the time  being in force;

(ii) to (v) …..

(vi) the nature, extent and description of  limited common areas and facilities;   

(vii) the nature, extent and description of  limited common areas and facilities, if any;

(viii) percentage  of  undivided  interest  in  the common areas and facilities appertaining to  the flat agreed to be sold;

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(ix) statement of the use for which the   flat is intended and restriction on its use, if any;

(x) percentage of undivided interests in  the  limited  common areas  and facilities,  if  any,  appertaining to the flat agreed to be sold;

(b) …..    ”

18. Section 10 casts  duty upon the promoter to take  

steps for formation of co-operative society or company, as the  

case may be. The said provision reads as follows :

 “S.10.-  (1) As soon as a minimum number of persons  required to form a Co-operative society or a company  have  taken  flats,  the  promoter  shall  within  the  prescribed period submit an application to the Registrar  for registration of the organization of persons who take  the flats as a co-operative society or, as the case may  be,  as  a  company;  and  the  promoter  shall  join,  in  respect of the flats which have not been taken, in such  application for membership of a co-operative society or  as  the  case  may  be,  of  a  company.  Nothing  in  this  section shall affect the right of the promoter to dispose  of the remaining flats in accordance with the provisions  of this Act.

Provided  that,  if  the  promoter  fails  within  the  prescribed  period  to  submit  an  application  to  the  Registrar  for  registration  of  society  in  the  manner  provided in the Maharashtra Co-operative Societies Act,  1960, the Competent Authority may, upon receiving an  application from the persons who have taken flats from  the said promoter, direct the District Deputy Registrar,  Deputy  Registrar  or,  as  the  case  may  be,  Assistant  Registrar concerned, to register the society :

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Provided  further that,  no  such  direction  to  register any society under the preceding proviso shall  be  given  to  the  District  Deputy  Registrar,  Deputy  Registrar or, as the case may be, Assistant Registrar,  by  the  Competent  Authority  without  first  verifying  authenticity  of  the  applicants’  request  and  giving  the  concerned promoter a reasonable opportunity of being  heard.”    

19. There  is  also  obligation  cast  upon  promoter  to  

execute the documents of title and convey to the co-operative  

society  or  the  company  or  an  association  of  flat  

purchasers/apartment owners, right, title and interest in the land  

and  building by virtue of Section 11 which reads thus:  

 “S.11.- (1) A promoter shall take all necessary steps to  complete  his  title  and  convey  to  the  organization  of  persons, who take flats, which is registered either as a  co-operative society or as a company as aforesaid, or to  an association of  flat  takers or  apartment  owners  his  right,  title  and  interest  in  the  land  and  building,  and  execute all relevant documents therefore in accordance  with the agreement executed under section 4 and if no  period for  the execution of  the conveyance is agreed  upon,  he  shall  execute  the  conveyance  within  the  prescribed period and also deliver all documents of title  relating to the property which may be in his possession  or power.

2. It shall be the duty of the promoter to file with the  Competent  Authority,  within  the  prescribed  period,  a  copy of  the conveyance executed  by him under  sub- section (1).

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3. If the promoter fails to execute the conveyance in  favour of the co-operative society formed under Section  10  or,  as  the  case  may  be,  the  company  or  the  association of apartment owners,  as provided by sub- section (1), within the prescribed period, the members  of such co-operative society or, as the case may be, the  company or the association of apartment owners may,  make  an  application,  in  writing,  to  the  concerned  Competent Authority accompanied by the true copies of  the registered agreements for sale,  executed with the  promoter by each individual member of the society or  the company or the association, who have purchased  the flats and all other relevant documents (including the  occupation  certificate,  if  any),  for  issuing  a  certificate  that such society, or as the case may be, company or  association,  is  entitled  to  have  an  unilateral  deemed  conveyance,  executed  in  their  favour  and  to  have  it  registered.

(4) …..

(5) …..”   

20. Section  16  of  MOFA provides  that  the  provisions  

contained therein are in addition to the provisions of the T. P.  

Act  and  shall  take  effect  notwithstanding  anything  to  the  

contrary contained in the contract.

Re: question nos. (i) and (ii):

(A) What is `flat’?

21. For proper consideration of questions (i) and (ii) as  

afore-referred, it is  of considerable importance to ascertain the  

import and meaning of the term ‘flat’ defined in Section 2(a-1) of  

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MOFA.  Rather  the  answer  to  the   questions  presented  for  

consideration must squarely or substantially depend on what is  

a  ‘flat’.  Justice  G.P.  Singh  in  the  ‘Principles  of  Statutory  

Interpretation’  (12th edition,  2010)  says   that  the  object  of  a  

definition  of  a  term  is  to  avoid  the  necessity  of  frequent  

repetitions  in  describing  all  the  subject  matter  to  which  that  

word or expression so defined is intended to apply.  In other  

words,  the  definition  clause  is  inserted  for  the  purpose  of  

defining  particular  subject-matter  dealt  with  and  it  helps  in  

revealing  the  legislative  meaning.   However,   the  definitive  

clause may itself require interpretation because of ambiguity or  

lack of clarity in its language.  In the ‘Construction of Statutes’  

by Earl T. Crawford (1989 reprint) at page 362, the following  

statement is made: “…….the interpretation clause will control in  

the  absence  of  anything  else  in  the  act  opposing  the  

interpretation fixed by the clause. Nor should the interpretation  

clause  be  given  any  wider  meaning  than  is  absolutely  

necessary.  In  other  words,  it  should be subjected to  a strict  

construction.”

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22. The definition of term ‘flat’ in MOFA  at the time of  

its  enactment  was  this:  ‘flat’  means  a  separate  and  self-

contained  set  of  premises  used  or  intended  to  be  used  for  

residence,  or  office,  showroom  or  shop  or  godown  (and  

includes a garage), the premises forming part of a building.  By  

Maharashtra  Act  No.  15  of  1971,  the  definition   of  ‘flat’  got  

amended  and  the  words  ‘and  includes  an  apartment’  were  

inserted after the word `building’.   Thereafter by Maharashtra  

Act 36 of 1986, the words ‘or for carrying on any industry or  

business’ were inserted after the word ‘godown’ and before the  

bracketed portion `(and includes a garage)’.  

23. Before we analyze Section 2(a-1),  if  we ask what  

the  term ‘flat’  means,  apart  from the  statutory  definition,  the  

reply must be that though it has no uniform meaning but in its  

natural  and ordinary meaning, ‘flat’  is a self  contained set of  

premises structurally divided and separately owned for dwelling.  

Concise  Oxford  English  Dictionary  (10th edition,  revised)  

explains `flat’ —a set of rooms comprising an individual place of  

residence within a larger building.

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24. Webster  Comprehensive  Dictionary;  International  

edition (Vol. 1) explains  ‘flat’— 1.  a set of rooms on one floor,  

for the occupancy of a family; apartment. 2.  A  house  

containing such flats.

25. In Stroud’s Judicial Dictionary (5th edition, Vol. 2), a  

reference has been made to the observations of Somervell L.J,  

in  Murgatroyd v. Tresarden, 63 T.L.R. 62 and it is stated; the  

natural meaning of the word ‘flat’ is a separate self-contained  

dwelling.

26. In  Words and Phrases,  Permanent  Edition,  (West  

Publishing Company), Vol. 17, while dealing with the term `flat’  

generally, it is stated :

“The word ‘flat’ has no technical, legal meaning, so that  a court can pronounce absolutely one way or the other.  A building is a ‘flat’ or not, and, where the testimony is  conflicting, the question is one of fact”.

27. Advanced Law Lexicon by P. Ramanatha Aiyar (3rd  

edition, 2005) explains the term ‘flat’, in the following way – `in  

the ordinary use of  the term a flat  is  a self-contained set  of  

rooms, structurally divided and separately owned or let  from  

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the rest of a building, which for the most part consists of other  

flats separated in like manner’.

28. Reverting  back  to  the  definition  of  the  term  ‘flat’  

under  Section  2(a-1),  for  a  ‘flat’  within  the  meaning  of  this  

definition clause, the set of premises  has to be a separate and  

self-contained that forms part of the building which is used or  

intended to be used for residence or office, showroom or shop  

or  godown  or  for  carrying  on  industry  or  business.  

Separateness  of  one  premises  from  another  premises  

physically and also in use or intended use for one of the uses  

specified  in  the  definition  clause   containing  the  necessary  

facilities for self-contained accommodation is sine qua non for a  

unit being covered by the definition of  ‘flat’ occurring in Section  

2(a-1) which includes an ‘apartment’.   In other words, it must  

be  a  separate  unit  conforming  to  the  description  capable  of  

being  used  for  one  of  these  purposes—namely,  residence,  

office,  showroom, shop,  godown or  for  industrial  or  business  

purposes.  Alternative  uses  in  Section  2(a-1)  do  expand  the  

ordinary  meaning  of  the  term  ‘flat’  but  nevertheless  such  

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premises that form part of building must be separate and  self-

contained.  A set of premises is called self-contained if it has  

the  following  basic  amenities  available:  (a)  sanitary;  

(b) washing, bathing and (c) other conveniences (cooking etc.)  

for  the  use  of  its  occupant/s  although  as  provided  in  the  

explanation appended to Section 2(a-1) such provision may be  

common  to  two  or  more  sets  of  premises.   The  nature  of  

construction and user are important features of this definition  

clause. A unit or accommodation to fit in the definition of ‘flat’  

must meet twin-test namely: (i) self contained test and (ii) user  

test.  The other predominant characteristic is that it must form  

part of a building. Crucially, for the relevant premises to be ‘flat’:

• It must be a separate and self contained premises;

• It must form part of building;

• It must be used or intended to be used for any of  

the  uses  namely—residence,  office,  showroom,  

shop,  godown  or  for  carrying  on  any  industry  or  

business.

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29. In the discussion made above, we have not referred  

to the bracketed portion namely - ‘(and includes a garage)’ so  

far.   What is the meaning and significance of this bracketed  

portion? On technical linguistic basis, the bracketed phrase can  

only attach to the word preceding it.  That may not be happy  

construction nor such construction by reading bracketed portion  

‘(and includes a  garage)’  with  the  preceding  word ‘business’  

appropriately reflects the meaning of the phrase.  The scope of  

the  bracketed  phrase  has  to  be  seen  in  the  context  of  the  

definition given to the word ‘flat’ which is true indication of intent  

of the legislature.  It was suggested by learned senior counsel  

and counsel for the promoters that the phrase ‘and includes a  

garage’ must be read with the ‘set of premises’ and not with the  

user.  This  does  not  appear  to  be  a  correct  reading  of  the  

expression.  We are not persuaded to accept such construction.  

We  think  that  statutory  definition  of  ‘flat’  must  be  construed  

keeping in  view the intent of the legislature and the context of  

the statute and, seen thus, the  phrase, ‘and includes a garage’  

in  the  bracket  does  not  bring  in  ‘garage’  by  itself  within  the  

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meaning of word ‘flat’.  If stand alone `garage’ (or a garage by  

itself) were intended by the legislature to be a ‘flat’ within the  

meaning of Section 2(a-1), that  could have been conveniently  

conveyed by use of the expression ‘or garage’ after the word  

‘business’  in  the  same  breath  as  preceding  uses.   The  

bracketed phrase is rather indicative of the legislative intention  

to  include  a  ‘garage’  as  appurtenant  or  attachment  to  a  flat  

which  satisfies the ingredients of Section 2(a-1).  To this extent  

Mr. Pravin K. Samdani is right in his submission.  It is clear to  

us that stand alone ‘garage’ or in other words ‘garage’ as an  

independent unit by itself is not a ‘flat’  within the meaning of  

Section 2(a-1) and we answer question (i) in the negative.  The  

judgment  of  Bombay  High  Court  in  Dr.  K.R.  Agarwal  Vs.   

Balkrishna3  to the extent the expression ‘or garage’ has been  

read after the word ‘godown’ in para 5 (clause 2) of the report  

does  not  state  the  correct  legal  position  in  what  we  have  

already said above.  

(B) Whether stilt parking space is a garage?

3 AIR 1972 Bombay 343

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30. The next question is, whether stilt parking space in  

a building regulated by MOFA is a ‘garage’.  The term ‘garage’  

has not been defined in MOFA and, therefore, we need to first  

find out what is the extent and scope of that term in Section  

2(a-1).   The general  term ‘garage’  is appropriated in English  

from the French language and means ‘keeping under cover’ or  

‘a  place  for  keeping’  of  wagons  as  well  as  automobiles.  

Concise  Oxford   English  Dictionary  (10th edition,  revised)  

explains ‘garage’— 1 a building for housing a motor vehicle or  

vehicles.  2 an establishment which sells fuel or which repairs  

and sells motor vehicles.

31. Webster  Comprehensive  Dictionary,  International  

edition (Vol. 1) explains the word ‘garage’—a building in which  

motor vehicles are stored and cared for.

32. Words  and  Phrases,  Permanent  Edition,  (West  

Publishing Company), Vol. 17, states that ‘garage’ generally is  

a station in which motorcars can be sheltered,  stored, repaired,  

cleaned, and made ready for use; it  is also place for private  

storage for motorcars; stable for motor cars.  

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33. The  DCR  define  two  expressions  ‘garage-private’  

and  ‘garage-public’  in  Regulations   2(47)  and  2(48)  

respectively.  According to these Regulations,  ‘garage-private’  

means a building or a portion thereof designed and used for the  

parking  of  vehicles  and  ‘garage-public’  means  a  building  or  

portion  thereof  designed  other  than  as  a  private  garage,  

operated for gain, designed and/or used for repairing, serving,  

hiring,  selling  or  storing  or  parking  motor-driven  or  other  

vehicles.  In  our  view,  we  must  give  to  the  word  ‘garage’  

occurring in Section 2(a-1) a meaning that general public or for  

that matter a flat purchaser of ordinary prudence would give to  

that word or understand by that word.   Learned senior counsel  

Mr.  Sunil  Gupta  referred  to  Barnett  and  Block1 wherein  

Atkinson, J. stated as follows:  

“Now  what  is  a garage?  No evidence was given to  suggest or prove that the word “garage” in the trade had  got any special meaning, and it was agreed to take four  dictionary definitions set out in the agreed statement of  facts.   The  four  definitions  were  these.   From  the  SHORTER OXFORD DICTIONARY: “A building for the  storage or refitting of motor vehicles.”  From the NEW  CENTURY DICTIONARY :  “A building for   sheltering,  cleaning or repairing motor vehicles.  To put or keep in  a garage.”  From the NEW STANDARD DICTIONARY:  “A building for stabling or storing of motor vehicles of all  

3

kinds.”   From NUTTAL’S STANDARD DICTIONARY :  “A  storehouse  for  motor  vehicles.”   Those  are  four  definitions from leading dictionaries all containing at any  rate one word  in  common, and that  is  “building.”   As  there  is  no   evidence  as  to  how  the  general  public  understand  the  word  “garage,”    I  suppose  one  is  entitled to use one’s own knowledge.  I am inclined to  think  that  ordinary  man  in  the  street  does  regard  a  garage as connoting some sort of a building; how far he  would  go I  do not  know.   I  do not  know whether  he  would think that there should be a wall all round it, or  whether it would be sufficient if there were three sides  walled in and a roof.  I have one in  mind where there is  a row of sheds without any protection in front, which are  commonly spoken of as “garages,”  but I am going to  apply  here  the  test  suggested  by  counsel  for  the  insured.    He said “A garage is a place where one can  get reasonable protection and shelter for a car.”   Can I  say  that  you  are  getting  reasonable  protection  and  shelter for a car, if  there is nothing to protect the car  from above – if there is no roof of any sort?  I think the  ordinary  man,  as  counsel  for  the insurers  suggested,  who took a house with a garage, if he came and found  merely an open shed without any roof, would think he  had been swindled, however high the walls might be.  I  cannot think that one is entitled to say that it is adequate  or reasonable protection or shelter if there is no roof; but  this is worse than that, though I agree that the walls are  very good here.  Wherever you put a car in this yard, in  addition to there being no shelter from above, there will  be no shelter on two sides.  That seems to me to be  really conclusive.”

He,  thus, submitted that even a place with merely a roof may  

well be a ‘garage’.  By placing reliance on condition No. 2 in  

Form V of 1964 Rules, learned senior counsel submitted that  

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for  the  purposes  of  MOFA,  even  an  open  parking  space  is  

tantamount to a ‘garage’.   

34. The  relevant  portion  of  condition  No.  2,  Form  V  

appended  to 1964 Rules reads as under:  

“2.    The  Flat  Purchaser  hereby  agrees  to  purchase  from the Promoter and the Promoter hereby agrees to  sell  to  the Flat  Purchaser one flat  No.  ………. of  the  Type ……….   of carpet area admeasuring ………. sq.  meters (which is inclusive of the area of balconies) on  ………. floor as shown in the Floor plan thereof hereto  annexed  and marked Annexures  D/Shop No.  ……….  /covered/open  Garage  No.  ……….   in  the  ……….  Building  (hereinafter  referred  to  as  “the  Flat”)  for  the  price of Rs. ……….  including  Rs. ……….  being the  proportionate price of the common areas and facilities  appurtenant  to  the  premises,  the  nature  extent  and  description of  the common/limited common areas and  facilities/limited common areas and facilities which   are  more  particularly  described  in  the  Second  Schedule  hereunder written. The Flat Purchasers hereby agrees  to  pay to  that  Promoter  balance amount  of  purchase  price  of  Rs.  ……….  (Rupees  ……….  ……………)  having  been  paid  to  the  Promoter  on  or  before  the  execution  of his agreement in the following manner.”

35. We do not perceive any force in the argument that  

open  parking  space  tantamounts  to  a  ‘garage’  within  the  

meaning of Section 2(a-1) read with condition No. 2 Form V of  

1964 Rules.   Can a person buying a flat for residence or one of  

the uses mentioned in Section 2(a-1) really think that open to  

3

the sky or open space for parking motor vehicles is a garage?  

We do not think so.  The word ‘garage’ may not have uniform  

connotation  but  definitely  every  space  for  parking  motor  

vehicles  is  not  a  garage.  A  roofless  erection  could  not  be  

described  a  garage.  What  is  contemplated  by  a  ‘garage’  in  

Section 2(a-1) is a place having a roof and walls on three sides.  

It does not include an unenclosed or uncovered parking space.  

It  is  true  that  in  condition  No.  2,  Form  V  the  words  

‘covered/open garage’  have been used but,  in  our  view,  the  

word ‘open’ used in the Model Form V cannot override the true  

meaning of term ‘garage’ in Section 2(a-1).  As a matter of fact,  

none  of  the  provisions   of  MOFA  regards  ‘open  garage’  

connoting ‘flat’ or an appurtenant/attachment to a flat.  We do  

not  think  undue  importance  should  be  given  to  word  ‘open’  

which has loosely been used in condition No. 2, Form V. The  

true meaning of the term ‘garage’ in Section 2(a-1), we think, is  

not affected by a Model Form V appended to the 1964 Rules.  

36.    The question  then is  as  to  whether  the stilted  

portion or stilt area of a building is a garage under MOFA.  A  

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stilt area is a space above the ground and below the first floor  

having columns that support the first floor and the building.  It  

may be usable as a parking space but we do not think that for  

the  purposes  of  MOFA,  such  portion  could  be  treated  as  

garage. It was argued that the test accepted by Atkinson, J. in  

Barnett & Block1–that a garage is a place where one can get  

reasonable protection and shelter for a car—is satisfied by stilt  

car parking space and such space is a garage.  We are unable  

to  agree.   The test  accepted  by Atkinson,  J.  in  Barnett  and  

Block1 also does not support this argument.   Even as per that  

test a place having roof but offering no shelter or protection on  

two  sides  cannot  be  a  garage.   It  is  worth  repeating  what  

Atkinson,J. said, `….I am inclined to think that the ordinary man  

in the street does regard a garage as connoting some sort of  

building; how far he would go I do not know.  I do not know  

whether he would think that there should be a wall all round it,  

or whether it would be sufficient if there were three sides walled  

in and a roof.  I have one in mind where there is row of sheds  

without any protection in front, which are commonly spoken of  

3

as  “garages”.’   Atkinson,J.  applied  the  test  of  `reasonable  

protection and shelter for car’ as was suggested by the counsel  

for the insurer while construing the term `garage’ in a policy of  

insurance.  For the purposes of MOFA, and particularly Section  

2(a-1),   the term ‘garage’   must  be considered as would be  

understood  by  a  flat  purchaser  and  such  person  would  

contemplate garage which has a roof and wall on three sides.  

Our answer to question No. (ii) is, therefore, no.  

Re: question no. (iii) – Whether stilt  parking spaces are   part of `common areas and facilities’?

37. The High Court  has held that the stilt  car parking  

spaces are part of the common amenities.  Is the High Court  

right  in  its  view?   MOFA  does  not  define  nor  it  explains  

‘common areas and facilities’ though the said phrase is used at  

various  places  in  that  Act.   Mr.  Pravin  K.  Samdani,  learned  

senior counsel for Maharashtra Chamber of Housing Industry  

submitted  that  following  could  be  termed  as  part  of  the  

‘common areas’:

• 15% Recreation Ground (RG)  Area;

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• Recreational facilities and/or club house on above RG Areas;

• Society Office; • Security guards cabin; • Common passage/lobbies; • Stair case; • Lift; • Terraces over the  roof of the building; • Landings on each floor; • Columns and beams of the building • Playgrounds, if any.

According  to  him,  the  following  could  be  part  of  ‘Limited  

Common Areas’:

• Separate lift  attached to a particular flat and/or   certain number of flats;

• Terrace attached to a flat; • Servants toilet on each floor, meant for the user  

of the flats on that particular floor;

The aforesaid list as suggested by the learned senior counsel,  

in our opinion,  is not exhaustive. It may not be out of place to  

refer  to  Section 3(f)  of  MAOA which defines ‘common areas  

and facilities’ as follows:

“3(f) “common areas and facilities”, unless  otherwise  provided  in  the  Declaration  or  lawful  amendments, thereto means—

(1) the land on which the building is located;

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(2) the foundations,  columns, girders,  beams,  supports,  main  walls,  roofs,  halls,  corridors,  lobbies,  stairs, stair-ways, fire-escapes and entrances and exits  of t he buildings;

(3) the  basements,  cellars,  yards,  gardens,  parking areas and storage spaces;

(4) the premises for the lodging of janitors or  persons employed for the management of the property;

(5) installations  of  central  services,  such  as  power,  light,  gas,  hot  and  cold  water,  heating,  refrigeration, air conditioning and incinerating;

(6) the elevators, tanks, pumps, motors, fans,  compressors,  ducts  and  in  general  all  apparatus  and  installations existing for common use;

(7) such  community  and  commercial  facilities  as may be provided for in the Declaration; and

(8) all other parts of the property necessary or  convenient to its existence, maintenance and safety, or  normally in common use;”  

It is true that interpretation clause or legislative definition in a  

particular statute is meant for the purposes of that statute only  

and such legislative definition should not control other statutes  

but the parts of the property stated in clauses (2), (3) and (6)  of  

Section  3(f)  as  part  of  ‘common areas  and  facilities’  for  the  

purposes of  MAOA are  what  is  generally  understood by  the  

expression ‘common areas and facilities’.  This is fortified by the  

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fact  that  the  areas  which  according  to  the  learned  senior  

counsel  could  be  termed  as  ‘common  areas’  in  a  building  

regulated by MOFA are substantially included in aforenoticed  

clauses of Section 3(f) of MAOA.  Looking to the scheme and  

object of MOFA, and there being no indication to the contrary,  

we find no justifiable reason to exclude parking areas (open to  

the sky or  stilted portion) from the purview of ‘common areas  

and facilities’ under MOFA.  

38. It was argued that under MOFA it is for the promoter  

to prescribe and define at the outset the ‘common areas’ and  

unless it is so done by the promoter, the parking area cannot be  

termed as part  of  ‘common areas’.   We are  quite  unable  to  

accept  this  submission.  Can  a  promoter  take  common  

passage/lobbies or say stair case or RG area out of purview of  

`common areas and facilities’ by not prescribing or defining the  

same in the `common areas’?  If the answer to this question is  

in negative, which it has to be, this argument must fail.  It was  

also submitted that by treating open/stilt parking space as part  

of  ‘common  areas’,  every  flat  purchaser  will  have  to  bear  

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proportionate  cost  for  the  same  although  he  may  not  be  

interested in such parking space at all. We do not think such  

consideration is relevant for the consideration of term ‘common  

areas and facilities’  in MOFA. It  is not necessary that all  flat  

purchasers must  actually use ‘common areas and facilities’ in  

its  entirety.  The  relevant  test  is  whether  such  part  of  the  

building is normally in common use. Then it was submitted that  

if  a  parking  space  is  sold  to  a  flat  purchaser,  it  is  to  the  

exclusion of other flat purchasers and, therefore, logically also it  

cannot be part of ‘common areas’. This submission is founded  

on assumption that parking space (open/covered) is a ‘garage’  

and sellable along with the flat.  We have, however, held in our  

discussion above that open to the sky parking area or stilted  

portion  usable  as  parking  space  is  not  ‘garage’  within  the  

meaning  of  Section  2(a-1)  and,  therefore,  not  sellable  

independently as a flat or along with a flat.  As a matter of fact,  

insofar  as  the  promoter  is  concerned,  he  is  not  put  to  any  

prejudice financially by treating open parking space/stilt parking  

space as part of ‘common areas’ since he is entitled to charge  

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price  for  the  common  areas  and  facilities  from  each  flat  

purchaser in  proportion to the carpet area of the flat.  MOFA  

mandates  the  promoter  to  describe   ‘common  areas   and  

facilities’ in the advertisement as well as the ‘agreement’ with  

the flat purchaser and the promoter is also required to indicate  

the  price  of  the  flat  including  the  proportionate  price  of  the  

‘common  areas  and  facilities’.   If  a  promoter  does  not  fully  

disclose the common areas and facilities he does so at his own  

peril.    Stilt  parking  spaces  would  not  cease  to  be  part  of  

common areas and facilities merely because the promoter has  

not  described  the  same  as  such  in  the  advertisement  and  

agreement  with  the  flat  purchaser.   Although  there  is  some  

merit in the contention of the appellant that High Court erred in  

placing reliance on the two aspects—namely, that the area of  

stilt parking space is not included in the FSI and such area is  

not  assessable  to  the  corporation  taxes  -   in  reaching  the  

conclusion that stilt parking space is part of ‘common areas’ but  

in our view even if these two aspects are excluded, in what we  

have discussed above stilt parking space/open parking space  

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of  a  building  regulated  by  MOFA  is  nothing  but  a  part  of  

‘common areas’ and, accordingly, we answer question no.  (iii)  

in the affirmative.

Re: question no. (iv) – what are the rights of a promoter   vis-à-vis society in respect of stilt parking spaces?

39. We have now come to the last question namely—

what  are  the  rights  of  a  promoter  vis-à-vis  society  (of  flat  

purchasers) in respect of stilt  parking space/s.  It  was argued  

that  the  right  of  the  promoter  to  dispose  of  the  stilt  parking  

space is a matter  falling within the domain of the promoter’s  

contractual,  legal and fundamental right and such right is not  

affected. This argument is founded on the premise, firstly, that  

stilt  parking  space  is  a  ‘flat’  by  itself  within  the  meaning  of  

Section  2(a-1)  and  in  the  alternative  that  it  is  not  part  of  

‘common areas’.  But  we have already held that  ‘stilt  parking  

space’ is not  covered by the term ‘garage’ much less a ‘flat’  

and that it is part of ‘common areas’. As a necessary corollary  

to the answers given by us to question nos. (i) to (iii), it must be  

held that stilt parking space/s being part of ‘common areas’ of  

the building developed by the promoter, the only right that the  

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promoter has, is to charge the cost thereof in proportion to the  

carpet  area  of  the  flat  from  each  flat  purchaser.  Such  stilt  

parking  space  being  neither  ‘flat’  under  Section  2(a-1)  nor  

‘garage’ within the meaning of that provision is not sellable at  

all.

40. MOFA was enacted by the Maharashtra Legislature  

as  it  was  found  that  builders/developers/promoters  were  

indulging in malpractices in the sale and transfer of flats and the  

flat purchasers were being exploited. The effect of MOFA may  

be  summarized  as  follows.   First,  every  promoter  who  

constructs or intends to construct block or building of flats in the  

area  to  which  MOFA  applies  has  to  strictly  adhere  to  the  

provisions contained therein, i.e., inter alia, he has to make  full  

and true disclosure of  the nature of   his  title  to  the land on  

which the flats are constructed and also  make disclosure   in  

respect  of  the  extent  of  the  carpet  area  of  the  flat  and  the  

nature,  extent  and  description  of  the  common  areas  and  

facilities when the flats are advertised for sale. Secondly, the  

particulars which are set out in Section 4(1A) (a) (i) to (x) have  

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to  be incorporated  in  the  agreement  with  the  flat  purchaser.  

Thirdly,  the  promoter  has  to  apply  to  the  Registrar  for  

registration  of  the  organization  (co-operative  society  or  

company  or  condominium)  as  soon  as  minimum  number  of  

persons required to form such organization have taken flats. As  

regards unsold flats, the promoter has to join such organization  

although  his right to dispose of unsold flats remains unaffected.  

Fourthly,  and more importantly,   the promoter has to take all  

necessary  steps  to  complete  his  title  and  convey  to  the  

organization  his right, title and interest in the land and building  

and execute all relevant documents accordingly. It was argued  

by Mr. Tanmaya Mehta, learned counsel for the promoter that  

in view of the provisions of MOFA, Section 6 of T.P. Act and  

Article 300A of the Constitution, the   right of the promoter to  

transfer parking spaces is not at all restricted. Relying upon the  

decisions of this Court in  ICICI Bank Ltd. v.  SIDCO Leathers  

Ltd.  &  Ors..4,  Karnataka  State  Financial  Corporation  v. N.  

Narasimahaiah & Ors.5 and Bhikhubhai Vithlabhai Patel & Ors.,   

4 (2006) 10 SCC 452 5 (2008) 5 SCC 176

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v. State of  Gujarat  & Anr.6,  he submitted that  the provisions  

contained in MOFA must be construed strictly and there is no  

provision either express or by  necessary implication in MOFA  

restricting the sale of stilt or open parking spaces.  Mr. Sunil  

Gupta also argued that promoter continues to have contractual,  

legal and fundamental right to dispose of the stilt/open parking  

space in the manner in which he proposes and his consumers  

accept.   We  think  this  argument  does  not  bear  detailed  

examination.  Suffice it to say that if the argument of learned  

senior  counsel  and  counsel  for  promoter  is  accepted,  the  

mischief  with which MOFA is obviously intended to deal with  

would remain unabated and flat purchasers would continue to  

be  exploited  indirectly  by  the  promoters.   In  our  opinion,  

MOFA does restrict the rights of the promoter in the block or  

building constructed for  flats or to be constructed for  flats to  

which that Act applies. The promoter has no right to sell any  

portion of such building which is not ‘flat’ within the meaning of  

Section  2(a-1)  and  the  entire  land  and  building  has  to  be  

conveyed to the organisation; the only right remains with the  6 (2008) 4 SCC 144

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promoter  is  to  sell  unsold  flats.     It  is,  thus,  clear  that  the  

promoter has no right to sell ‘stilt parking spaces’ as these are  

neither ‘flat’ nor appurtenant or attachment to a ‘flat’.

41. In view of the above, it is not at all necessary to deal  

with the factual submissions advanced by Mr. Tanmaya  Mehta.  

Having regard to the answer to question no. (iv), the finding of  

the High Court that undertakings are neither binding on the flat  

purchasers nor the society also warrants no interference.    

42.  These appeals, accordingly,  fail and are dismissed  

with no order as to costs.

………….……………..J                 (R. M. Lodha)

…..…….……………..J                  (A. K. Patnaik)

New Delhi. August  31, 2010.

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