Tribunal's Attempt To Correct Error By Entertaining Fresh Application For Deemed Conveyance Of Land Constitutes Jurisdictional Error: Bombay HC

Setting aside the said order, a Single Judge Bench of Justice Sandeep V. Marne held,

“The dispute is mainly about the area of land to be conveyed. Ordinarily this area dispute could well have been left to be adjudicated before Civil Court at the instance of Petitioners. However, erroneous exercise of jurisdiction by the Competent Authority has left no choice for this Court but to set aside its order. Some discipline needs to be exercised by the Competent Authorities. They are not clothed with power of review. They cannot correct their own mistakes, nor can they sit in appeal over their own decisions.”

“In the present case, the Competent Authority had shut its doors for the society while passing order dated 5 August 2021 by not granting any liberty to it to file fresh application. It however sat in appeal over its own decision and felt that it had erroneously rejected second application for deemed conveyance and that the judgment of this Court in New Manoday CHS empowered it to grant conveyance notwithstanding pendency of suits between different developers. Attempt to correct its own error by entertaining fresh application for deemed conveyance is a serious jurisdictional error, which leaves no option for this Court but to set aside the impugned order…” the Single Judge added.

Facts:

The High Court was dealing with petitions challenging the order dated 14 November, 2024, passed by the District Deputy Registrar, Co-operative Societies, Mumbai City (4) and Competent Authority (impugned order) issuing certificate of Deemed Conveyance of land measuring 2120.25 sq.mtrs. in favour of Torana Co-operative Housing Society (Respondent 3). The first writ petition (Writ Petition No.19417 of 2024) was filed by the original promoter, M/s. Akanksha Constructions (WP 1) who claimed the right of larger portion of land through agreements for sale dated 14 December 1979 and 9 January 1981 executed by original landowners, whereas, the second writ petition (Writ Petition (Stamp) No.38 of 2025) was filed by M/s. Nutan Realtors (WP 2), who claimed ownership in respect of land conveyed to Respondent No.3-society vide indenture of conveyance dated 1 March 2012.

WP 1, which claimed right of land through Agreements for Sale, had constructed a building with Wings 'A' and 'B' on the land which later formed part of the Final Plot under the Town Planning Scheme. However, due to TPS implementation, construction was done on 1669.61 sq.mts, and no occupancy certificate was obtained for the same. Meanwhile, in 1992, the flat purchasers formed the Respondent 3 society and after TPS finalisation, the land was designated as Final Plot No.696 measuring 2120.25 sq.mts. Consequently, a dispute arose regarding whether the entire Final Plot No.696 was used for Respondent 3's building.

Additionally, Divya Developments (Respondent 7), claiming rights over the adjoining Final Plots 697-699, entered into an MoU in 2011 with Respondent 3 to secure an occupancy certificate by amalgamating the said flats and obtained the occupancy certificate in 2012 and later constructed another building whose purchasers formed Divya Parshva CHS.

In 2012, the original landowners executed a conveyance of Final Plot 696 to Nutan Realtors (WP 2) granting development rights. Thereafter, WP 2 claimed ownership. Respondent 3, after filing a total of three applications before the Competent Authority (the first two were rejected however the third was accepted), was granted deemed conveyance vide the impugned order. Aggrieved, WP 1 and WP 2 filed the writ petitions.

It was the case of WP 1 that the third application was barred by res-judicata as no liberty was granted after the second rejection. Thus, the impugned order erred by considering the third application, which was previously rejected, violating res judicata principles. Additionally, WP 1 conceded that Respondent 3 was only entitled to 1397.67 sq.mts of actual construction and sanctioned plans and the conveyance of the entire 2120.25 sq.mts was illegal.

In the same alignment, WP 2 claimed that it possessed the right to develop the layout in respect of amalgamated lands forming part of Final Plot Nos. 696-699 by exploiting the entire available FSI potential in respect of such layout.

Contrary to these submissions, Respondent 3 had argued that the society's application was not barred by principles of res judicata as the principle of the res judicata becomes applicable only when the issue has been raised and adjudicated. Since there was no decision on the merits of the previous application, the same could not come in the way of the petitioner filing a fresh application for deemed conveyance. Additionally, it was further contended that that sanctioned plan for construction of building of Respondent 3 would indicate that the society is in fact entitled to land proportionate to 2242.83 sq.mts.

Court's Findings and Observations:

The issue tabled before the Court was whether the Competent Authority could sit in Appeal over its own decision by entertaining a third application for deemed conveyance of the land.

In this regard, the Court held,

“…in the present case, the objection of res-judicata goes to the very root of jurisdiction of the Competent Authority to decide third application filed by Torna CHS. If there a jurisdictional error in passing the order of deemed conveyance, the order would suffer from manifest error of law and would be susceptible to challenge in writ jurisdiction of this Court.”

Holding that the order granting deemed conveyance of land and building in favour of an association formed by homebuyers constituted an erroneous overstepping of jurisdiction by the Competent Authority, the Court consequently set it aside.

With respect to the remedy left for Respondent 3 in respect of its statutory right of conveyance of land, the Court held,

“As observed above, the society ought to have challenged the Order dared 5 August 2021, if it believed that the same is erroneous rather than filing a fresh application for deemed conveyance. Torna CHS had filed suit seeking conveyance of land, which has been withdrawn on account of filing of third application for deemed conveyance. Therefore, if liberty is not granted to Torna CHS to challenge the order dated 5 August 2021, it would be rendered remediless in respect of its right of having the land conveyed in its favour. Therefore, while setting aside the impugned order dated 14 November 2024, the society deserves to be granted liberty to challenge the order dated 5 August 2021. Society's second application for deemed conveyance is not adjudicated on merits and the decision of the competent authority refusing to adjudicate the same on merits must be permitted to be challenged by the Society. There is a statutory right in favour of Torna CHS to apply for deemed conveyance of the land and the building. The Competent Authority has however held in the second rejection order dated 5 August 2021 that it cannot adjudicate Society's application on merits in the light of pendency of litigation between various parties. Whether the said decision of the Competent Authority is valid or nor must necessarily be permitted to be tested by the Society. In my view therefore liberty needs to be granted to Torna CHS to challenge the order dated 5 August 2021.”

The petitions were accordingly allowed.

Case Details:

Case Number: WRIT PETITION NO. 19417 OF 2024 with INTERIM APPLICATION NO. 1171 OF 2025

Case Title: M/s. Aakansha Construction Company v. The State Of Maharashtra

Date: 05.05.2025

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