TDR Usage No Bar To Proportionate Land Conveyance For Societies: Bombay High Court

The Bombay High Court affirmed that the mere utilization of Transferable Development Rights (TDR) in a layout development does not automatically restrict a society's entitlement to only the plinth and appurtenant area. The court clarified that the principle of land division proportionate to the built-up area remains applicable when TDR is distributed across buildings rather than being selectively loaded to create FSI imbalances.

Justice Sandeep V. Marne presided over the challenge brought by a developer against an order of the District Deputy Registrar, Co-operative Societies, Thane. The developer had contested the grant of a unilateral deemed conveyance of 929.84 sq.mtrs to a society comprising row houses, arguing that the usage of TDR in the larger project limited the society's claim under a government resolution.

Proportionate Land Division Over Mechanical Application of TDR Rules

The Court observed that the legislative intent behind special provisions for TDR-linked projects was to prevent unequal land distribution, not to benefit developers or deprive flat purchasers of their due land. The bench noted that where TDR is utilized for all buildings in a layout, the principle of proportionate land division should naturally follow. The Court, in its reasoning, observed: "The procedure of conveying land less than proportionate land should be followed only in rare cases where it becomes impossible to divide and convey land proportionate to the BUA utilised in each building or where application of such principle gives undue advantage to one of the societies in the layout at the cost of other societies."

TDR Usage as a 'Transitional Solution', Not an Absolute Prohibition

Addressing the developer's reliance on a Government Resolution (GR) dated 22 June 2018, the Court noted that Clause 2(C)(vi)(2) is a transitional arrangement to surmount difficulties in land division. It cannot be read as an absolute prohibition for proportionate land division in every case involving TDR. The Court remarked, "Para-2(C)(vi)(2) of the GR merely makes a transitional arrangement to surmount the difficulty faced in proportionate land division due to use of TDR. This is the true purport of the procedure... under no circumstances, non-conveyance of proportionate land should work to the advantage of the developer."

The Court has following directions:

"The Order of the Competent Authority appears, to my mind, to be unexceptionable. Writ Petition is devoid of merits. It is accordingly dismissed with no order as to costs."

Background:

The dispute originated from a large integrated project named ‘Neelkanth Greens’ in Thane. The Petitioner-Developer opposed a deemed conveyance granted to a society of 12 row houses. The Petitioner argued that because TDR admeasuring 24,950.45 sq.mtrs was utilized in the layout, the society was only entitled to the plinth and immediate appurtenant area as per the 2018 GR.

The Court referred to Lok Housing and Construction Limited vs. State of Maharashtra and Others, ACME Enterprises & Anr. vs. Deputy Registrar, Co-operative Societies & Ors, and Upvan Woodlands CHSL Vs. Upvan Developers to reiterate that a society in a completed building need not wait for the entire layout's completion to seek conveyance. Interpreting Section 11(3) of the Maharashtra Ownership Flats (Regulation Of The Promotion Of Construction, Sale, Management And Transfer) Act, 1963, the Court found that the developer was attempting to take disadvantage of the TDR rules to retain ownership of land for future FSI benefits. The bench further relied on Rashesh Cooperative Housing Society Limited Vs. State of Maharashtra And ors. and Garment Craft vs. Prakash Chand Goel to discuss the scope of 'appurtenant area' and the limits of the High Court's supervisory jurisdiction under Article 227 of the Constitution of India, 1950, ultimately finding no reason to interfere with the Competent Authority's decision to grant proportionate land.

Case Details:
Case No.: WRIT PETITION NO. 3530 OF 2026
Case Title: Neelkanth Mansions & Infrastructure Private Limited Versus The District Deputy Registrar, Co-operative Societies, Thane & Ors.
Appearances:
For the Petitioner(s): Mr. Sharad Bansal with Mr. Mdehavin Bhatt, Mr. Ranjyot Singh Panesar and Ms. Manashvi Shah i/b. MV Law Partners
For the Respondent(s): Ms. Mamta S. Srivastava, AGP for State; Mr. Mosin Naik, for Respondent No. 2

Source: 2026 CaseBase(BOM) 254