The society's secretary lives in an unauthorised flat himself, wanted the basement owner to pay for the TDR that saved it, and then argued the basement deserved nothing
Justice Sandeep V. Marne confirmed the basement purchaser's membership but confined it to the 59.02 square metres sanctioned as storage, to be treated as residential for redevelopment, and refused a stay.
A plot at Pali Mala Road, Pali Naka, Bandra (West) was taken up for development in the 1990s. The Municipal Corporation issued an Intimation of Disapproval in August 1994 and sanctioned the building plans in October 1998. The sanctioned plan had a basement below ground level: within it, 59.02 square metres was sanctioned as storage space and the rest, apparently, for parking. The plans allowed construction up to the fifth floor.
The developer built to the seventh. The building has no Occupation Certificate. The basement was left incomplete, with no ramp and no staircase to reach it. Flats on the sixth and seventh floors were sold anyway, and the purchasers from ground to seventh floor formed and registered the petitioner society. Everything that follows is an argument about who, among the occupants of an irregular building, is entitled to be regularised.
Seventeen years of membership proceedings
The first respondent claims to have purchased premises of 250.83 square metres — about 2,700 square feet — in the basement, under an agreement for sale of 2 August 2004 with the developer, at that time unregistered.
Regularising the building needed additional built-up area, so it was decided to purchase external transferable development rights. The first respondent, wanting the basement regularised, says it purchased the TDR required for regularisation of the basement and of the sixth and seventh floors, and plans went to the Corporation. They were processed internally but never finally sanctioned, and the regularisation proposal remained unfructified.
The first respondent then paid stamp duty on the 2004 agreement and registered a deed of declaration in respect of it, and in February 2009 applied to the society for membership. The society did not decide the application, so an application was filed under Section 22(2) of the Maharashtra Co-operative Societies Act, 1960 seeking deemed membership. The Deputy Registrar allowed it in August 2009 and the society complied, issuing Share Certificate No. 21.
Nine years later the society filed a revision. The Divisional Joint Registrar dismissed it in July 2022. The society's writ petition against that succeeded in part: by order of 14 November 2025 this Court set aside both orders and remanded the matter to the Deputy Registrar, holding that the authorities had to examine whether the premises claimed have the character of a “flat” as defined in the statute.
In the remanded proceedings the society relied on the sanctioned plan to say the entire basement is parking or common area with no sanctioned access. By order of 7 May 2026 the Deputy Registrar again allowed the application, holding that on a plan dated 25 April 2008 the premises are sanctioned as a Data Processing Unit, which the first respondent uses as a godown, and directing the society to complete the membership proceedings. That order is what the society challenged here — by writ petition rather than by the revision available to it.
Why the writ was entertained at all
Mr Khandeparkar for the society met the alternative remedy objection on three grounds, and they are worth noting because they are the standard route past a statutory revision.
First, that the society should not be relegated to a revision because the authority had violated the remit of the remand laid down by this Court on 14 November 2025, so that invoking writ jurisdiction was justified by the authority travelling beyond the scope of remand and committing a jurisdictional error, relying on S.N. Choudhary v. Dongre Park Co-op. Society. Second, that the petition involves a pure question of law, so exhausting the alternative remedy is not mandatory, relying on Godrej Sara Lee Ltd. v. Excise and Taxation Officer-cum-Assessing Authority. Third, that since there are already precedents governing the field a revision is unnecessary, relying on Shireen Sami Gadiali v. Spenta CHSL.
What was confirmed, and what was cut down
The Court confirmed the grant of membership, but not on the scale the first respondent claimed. The order granting membership in respect of the basement premises was confirmed; the grant, however, was confined to premises admeasuring 59.02 square metres — the area the 1998 plan sanctioned as storage — and not the 250.83 square metres of the agreement for sale.
Those 59.02 square metres are to be considered as residential premises for the purpose of granting redevelopment benefits. The Court explained what that achieves: the alternative was to treat the entire basement as commercial IT user, whereas recognising the sanctioned area as residential ensures that the first respondent receives a residential flat in the new building, with the additional area sanctionable under redevelopment, at par with other members. That, the judgment says, balances the equities between the parties.
It is a carefully constructed middle course. The society does not have to admit a 2,700 square foot godown into a residential redevelopment. The purchaser does not lose everything because the developer built a basement nobody could reach.
What the society had said when it wanted the basement regularised
The reason the society's conduct became relevant is that it is on the record in its own earlier pleadings, and the judgment quotes them.
In a 2018 petition seeking deemed conveyance of the land and building, the society itself justified the capability of regularising the basement premises. It pleaded that the first respondent's architect had written to the Corporation in March 2008 recording that 400 square metres of TDR had already been submitted in October 2007 and a further 240 square metres purchased. And it pleaded, in terms the judgment underlines, that the society had given its own No Objection by letter of 3 April 2008 to the Executive Engineer “for loading T.D.R. and to get the existing 6th and 7th Floor and basement of the said Building regularized”.
It pleaded that a stability certificate had been obtained with no objection to the work up to seven floors from a structural aspect; that the building is capable of being regularised, the Municipal Commissioner having stayed demolition and held it capable of regularisation by loading TDR; and, in its grounds, that the regularisation could not take place because the development right certificate was found to have been already utilised in 2014 and 2016.
That petition was decided in November 2024, and the society did not withdraw those averments before it was. More recently, in 2022, the deponent of the present petition relied on various regularisation proposals in a suit of his own before the City Civil Court, and the documents he relied on referred to regularisation not just of the sixth and seventh floors but of the basement as well.
Estoppel, and the parity the society could not escape
Counsel for the society argued that its conduct is irrelevant to the first respondent's entitlement to membership. The Court was unable to accept that, and explained why with precision.
Ordinarily there can be no estoppel against law. But the law does not prohibit regularisation of a basement — the basement would already have been regularised if the requisite TDR had still been available, and on the society's own pleading the certificate had been used elsewhere. The society wanted the first respondent alone to spend on TDR, and the moment it was realised that the certificate had been consumed, it turned against him. Its conduct is therefore entirely relevant.
The parity point is sharper still. The society has granted membership to occupants of flats on the sixth and seventh floors, which are themselves unauthorised. The attempt to distinguish the basement occupant from them did not appeal to the Court: if the basement is not covered by FSI, so is the position of the sixth and seventh floor flats. A difference in the arrangement by which rights were acquired does not put those occupants on a higher pedestal. If membership is denied in respect of the basement, it will have to be denied to all the occupants of the sixth and seventh floors too.
And on that comparison the basement occupant is the better placed of the two, because part of the basement — the 59.02 square metres — was sanctioned as storage space in the 1998 plan, whereas nothing at all is sanctioned for the flats on the sixth and seventh floors. Going by the standard of non-consumption of FSI which the society urged, the Court observed, it is those flats that would need to be demolished and their occupants denied membership.
The limit on membership, and why it did not apply
Counsel for the society relied heavily on Section 154B-5 of the MCS Act, which provides that a housing society shall not admit to membership persons exceeding the number of flats or plots available for allotment. Strictly applied, no buyer of premises which are not a “flat” within the meaning of Section 154B-1(13) could become a member. The provision was inserted by the 2019 amendment precisely to stop developers selling common amenities in a building, and the Court cited Dheeraj Dreams Building No.1 CHS Ltd. v. Divisional Joint Registrar, where it was held that a society may refuse membership to a buyer where the developer sells a refuge area as a residential flat.
Two things took this case outside it. The applicability of Section 154B-5 is questionable here because it was incorporated on 9 March 2019, whereas the first respondent applied for and was initially granted membership in 2009. And under Section 154B-1(13) a godown can itself be treated as a flat so long as it is sanctioned by the planning authority. The 59.02 square metres is sanctioned as storage space, which the Court held is akin to a godown. Granting membership for it, the judgment adds, is not to encourage the sale of common amenities by developers.
A decision relied on about the grant of membership in respect of a garage was held inapposite, this case not involving a garage — and in any event the Court has in a given case directed the grant of membership even for a garage where it was found to be a self-contained part of the society's immovable property.
“Selectively reap the benefits”
The passage that gives the judgment its edge comes at the end, and it is directed at the deponent of the petition, the secretary of the society.
The Court recorded that it had not appreciated the actions of the society and particularly of its secretary in filing the petition. The deponent is himself an occupier of an unauthorised flat on the sixth floor of the building. He wants to selectively reap the benefits of the redevelopment process while denying a similar benefit to the first respondent. He wanted his own flat regularised by making the first respondent spend on the purchase of TDR. He relies selectively on the regularisation proposal to save his flat from demolition — a proposal which envisaged regularisation of the basement as well. And when it comes to the grant of the benefit of redevelopment, he changes his stance and seeks to create a distinction between himself and the first respondent.
Such conduct, the Court held, not only deserves serious deprecation but also the imposition of costs. In ordinary circumstances it would have proceeded to impose costs on him personally. It refrained, considering the facts and circumstances and because the deponent may have acted on an authorisation granted to him by the general body of the society — a distinction between the man and the office he was acting under.
The order, and the stay that was refused
The order passed by the Deputy Registrar on 7 May 2026 granting membership to the first respondent in respect of the basement premises was confirmed. The grant of membership was confined to premises admeasuring 59.02 square metres, to be considered as residential premises for the purpose of grant of redevelopment benefits. Subject to that clarification the writ petition was dismissed, with no order as to costs.
After the judgment was pronounced, counsel for the society sought a stay of eight weeks. The request was opposed, and considering the nature of the findings recorded in the judgment the Court rejected it. The judgment had been reserved on 23 September 2026.
Mr Mayur Khandeparkar with four others appeared for the society; Mr Ankit Lohia with five others for the first and second respondents; Ms Savina R. Crasto, Additional Government Pleader, for the State.
What the dispute ultimately turned on, then, was not the character of a basement but the consistency of a society. For eighteen years it argued that the basement could and should be regularised, and it changed position only when the development rights it expected somebody else to pay for turned out to have been consumed elsewhere.
The judgment was reserved on 23 September 2026 and runs to forty-one pages, most of them devoted to the documents by which the society had, over eighteen years, argued the opposite of what it argued here.
For the first respondent the practical result is a residential flat in the rebuilt building rather than a godown in a basement nobody could lawfully reach, and for the society it is a ruling that the standard it wanted applied to the basement would, applied evenly, cost it two whole floors.