War over common areas : Case Studies

[yogesh]

Hindustan Times HT Estates 9-Feb-13

Developers have time and again been prevented by courts from assuming absolute power in declaring areas in common use as ‘common areas’. Here’s a look at some landmark cases that have sought to protect the homebuyer.

The concept of apartments has evolved over time in view of shortage of land in urban areas and has led to vertical growth of buildings. Multistoreyed residential buildings, integrated development of commercial, institutional and industrial areas and flatted factories have resulted in a marked increase in the number of such structures that consist of a number of apartments that share the land and common facilities. Town planning laws require development of apartments in accordance with a plan. Apartment laws, apart from making apartments heritable and transferable, provide safeguards for the apartment owners for their shared use of common areas.

Purchasers of apartments are also attracted by the services available in a complex and are directly or indirectly made to pay for such services. The legislature has always intended that the developer does not assume absolute power of declaring or not declaring areas, normally in common use, to be common areas. The courts in India have in several landmark cases, including (i) Nahalchand Laloochand Private Ltd versus Panchali Cooperative Housing Society Limited (ii) Brig (Retd) Kamal Sood versus DLF Universal Ltd (iii) Jayantilal Investments versus Madhuvihar Cooperative Housing Society and Others (iv) Capt (Retd) Manmohan Lowe versus State of Haryana & Ors and (v) OS Bajpai versus the administrator (Lt Governor of Delhi) & Ors checked the arbitrary use of power by developers.

While the Delhi Apartment Ownership Act, 1986, was passed 25 years ago, the provisions of the Act could not be effectively implemented as the Delhi Apartment Ownership Act, 1986 does not provide forremedial or penal action that can be taken by the authorities against the promoters/builders who violate the provisions of the Act. The Hon’ble Delhi High Court in OS Bajpai versus the administrator (Lt Governor of Delhi) & Ors exhorted the authorities to consider passing afresh the Delhi Apartment Ownership Bill incorporating such provisions to curb such menace and passed directions for effective implementation of the existing Delhi Apartment Ownership Act, 1986.

Similarly, the builders in Haryana and Uttar Pradesh have been violating the provisions of the Haryana Apartment Ownership Act, 1983 and the Uttar Pradesh Apartment (Promotion of Construction, Ownership And Maintenance) Act, 2010 to claim ownership of common areas. The Hon’ble Punjab and Haryana High Court in the Capt (Retd) Manmohan Lowe versus State of Haryana & Ors set a precedent by holding that the apartment owners could be entitled to undivided interest in common areas and facilities under Section 6 of the Haryana Apartment Ownership Act, 1983 and thus are vitally affected if common areas in which apartment owners are entitled to undivided interest are not declared as such. The court also allowed the apartment owners to file their objections before the competent authorities and made it obligatory for the latter to decide on the objections of the apartment owners to the declaration filed by the developer with regard to the extent of common areas.