Objections By Apartment Association Can't Override Consent Of Individual Flat Owners For Additional Development: Allahabad High Court
The Allahabad High Court has held that objections by Apartment Owner's Association cannot invalidate the consent given by individual flat owners for further development and purchase of additional FAR (floor area ratio) by the developer.
Justice Arun Kumar held,
“A representative body cannot, merely by passing a resolution, invalidate contractual declarations and consents furnished by hundreds of individual apartment owners who continue to stand by them. The Association cannot be permitted to substitute its opinion for the autonomous decisions of individual apartment purchasers. Even assuming the Association validly resolved to oppose the project, a collective resolution cannot retrospectively revoke individual declarations executed by hundreds of separate apartment owners. The Association cannot exercise a power of rescission on behalf of non-objecting owners.”
After obtaining lease for an area measuring 72,957.60 square metres, builder sought sanction of plan for Phase-I, which did not include the central portion of the land and certain areas were marked as “future blocks” and were reserved for future development. Subsequently, Phase-II development for disputed area was approved. Thereafter, the developer leased further land which increased the total FAR.
In 2017, a fresh brochure was issued to prospective buyers stating possibility of future construction/ development. While litigation was ongoing with certain allottees, Builder sought consent of the allottees for buying additional FAR. Out of 1,440 home buyers, 1,165 granted consent while 275 declined.
Initially the FAR was granted, however, due to stalled project, the builder applied for fresh issuance for FAR. NOIDA verified the list of objections and consents. Since, approximately 68% of all flat owners and 81% of participating allottees supported the grant of additional FAR, additional FAR was granted.
After revise map was sanctioned, the petitioner association filed revision before the State challenging the grant of additional FAR. The same was dismissed. This dismissal order was challenged before the High Court.
One of the issues before the Court was whether the permission for purchase of additional area granted by individual flat owners could be overridden by the objections raised by office bearers of the apartment owner's association, on which the Court held that it cannot be done.
On the argument of the petitioner that consent of flat owners was obtained through coercion, the Court held that even is consent is obtained by coercion, it would not be void ab initio, it can be voidable at best. It also noted that none of the parties who had consented field anything receding their consent. It held that withdrawal of consent cannot be presumed without evidence.
“Furthermore, allegations of fraud, systematic coercion, and historical duress are intensely disputed questions of fact. The burden of proving fraud lies squarely upon the party alleging it, as held in the case of Anil Rishi (Supra). Such matters cannot be decided based on summary pleadings within the extraordinary jurisdiction of Article 226 of the Constitution of India; they require full trial and the cross-examination of witnesses before a competent civil court, as held by the Hon'ble Supreme Court in the casess of Ram Sakal Singh (Supra) and Lakshmi Singh Chauhan (Supra).”
The Court observed that the allottees were aware about future development which could have been carried out by the developer. It held that once it entered with the knowledge that the disputed area was not marked for open common spaces, it could not raise objection to future development.
“Apartment purchasers acquire rights recognized by statute and contract, but they do not acquire a vested right that the density of a township shall remain frozen forever. What the law itself permits cannot be treated as an invasion of a vested right merely because population density subsequently increases. At best, the petitioner complains of greater sharing of existing facilities, not extinction or diminution of the facilities themselves.”
Observing that there was nothing to show that there was any violation of building plans, the Court held that no unanimous permission/ consent of all flat owners was required for development and obtaining additional AFR by the developer.
Accordingly, the Court dismissed the writ petition by the Great Value Sharanam Apartment Owners Association.
Case Title: Great Value Sharanam Apartment Owners Association v. State of U.P. and 8 others
Counsel for Petitioner(s) : Abhijeet Mukherji
Counsel for Respondent(s) : C.S.C., Kaushalendra Nath Singh, Rishu Mishra, Shivam Yadav