The re­cent Supreme Court judg­ment giv­ing a de­vel­oper own­er­ship rights over com­mu­nity and com­mer­cial fa­cil­i­ties is go­ing to make life dif­fi­cult for lakhs of apart­ment own­ers in Gur­gaon

HT Estates - - FRONT PAGE - Jee­van Prakash Sharma

BK Dhawan, a 75- year- old res­i­dent of Sil­ver Oaks, GGur­gaon, iis a didis­ap­pointed man to­day. He has lost a 20-year-old le­gal bat­tle against real es­tate de­vel­oper DLF for res­i­dents’ rights over com­mu­nity and com­mer­cial fa­cil­i­ties within the Sil­ver Oaks com­plex – a cam­paign which has all but con­sumed his fi­nances and en­er­gies.

The Supreme Court, in a much-awaited judg­ment, which may have far-reach­ing con­se­quences for the real es­tate sec­tor in Haryana, has held that apart­ment own­ers can’t claim un­di­vided in­ter­est in com­mu­nity and com­mer­cial fa­cil­i­ties asa these be­long to the de­vel­oper.

The judg­ment im­pacts lakhs ofo fam­i­lies liv­ing in hous­ing projects in Haryana where own­er­ship over com­mon ar­eas and fa­cil­i­ties has re­mained a bone of con­tention be­tween de­vel­op­ers and apart­ment own­ers. The lat­ter also ar­gue that by virtue of be­ing in a dom­i­nant po­si­tion, the de­vel­op­ers are likely to mis­use and twist the judg­ment to suit their own needs. “A de­vel­opero can lease or sell com­mu­nity and com­mer­cial fa­cil­i­ties such as club, nurs­ery schools, con­ve­niencec shops and com­mu­nity cen­tre in a group hous­ing project to any third party who will run these fa­cil­i­ties for mak­ing money and who will have no con­cern for the needs and re­quire­ments of the apart­ment own­ers. There is also no clar­ity on what the com­mu­nity and com­mer­cial fa­cil­i­ties in­clude,” says Dhawan, who bought his Sil­ver Oaks apart­ment in 1991 and got the pos­ses­sion in 1995 af­ter a two-year de­lay.

“In 1996, when we came tot know that the de­vel­oper planned to sell the com­mu­nity and com­mer­cial fa­cil­i­ties, we de­cidedd to go to court be­cause we be­lieve these fa­cil­i­ties are a part of the com­mon area and meant for the apart­ment own­ers. It’s the right of the apart­ment own­ers to lease out com­mu­nity and com­mer­cial fa­cil­i­ties and main­tain them by earn­ing money by leas­ing out the fa­cil­i­ties. The Pun­jab and Haryana High Court had given its ver­dict in our favour but the apex court has over­ruled that. It’s a big set­back for the flat buy­ers of Haryana, es­pe­cially in Gur­gaon ,” says Dhawan.

The Sil­ver Oaks Con­do­minium As­so­ci­a­tion (SOCA) and other res­i­dents who con­tested the builders’ own­er­ship claim over com­mu­nity and com­mer­cial fa­cil­i­ties ar­gued that the real es­tate reg­u­la­tion acts in Haryana – The Haryana De­vel­op­ment and Reg­u­la­tion of Ur­ban Ar­eas Act, 1975, and The Haryana Apart­ment Own­er­ship Act, 1983 – give apart­ment own­ers rights over com­mon ar­eas and fa­cil­i­ties, which in­clude ev­ery­thing from cor­ri­dors, lob­bies, stair­cases, lifts etc to com­mu­nity fa­cil­i­ties such as nurs­ery schools, shops, com­mu­nity cen­tres etc.

Ac­cord­ing to the SOCA mem­bers, once the project is com­plete the de­vel­oper is le­gally bound to file a dec­la­ra­tion be­fore the di­rec­tor, town and coun­try plan­ning, with de­tails of land, build­ings, apart­ment num­bers and ev­ery­thing that ex­ists within the hous­ing com­plex.

Ex­cept for the dwelling units over which apart­ment own­ers have ex­clu­sive rights, any­thing which ex­ists in the com­plex is part of the com­mon area and fa­cil­i­ties in which flat buy­ers have un­di­vided in­ter­est. They also ar­gue that ac­cord­ing to the Apart­ment Act, the de­vel­oper should hand over the own­er­ship, ad­min­is­tra­tion and man­age­ment of these fa­cil­i­ties to the as­so­ci­a­tion of home­buy­ers.

“In our plea we cited le­gal pro­vi­sions as well as prac­ti­cal prob­lems we would face if the de­vel­op­ers were given rights over com­mu­nity f acil­i­ties. We told the Hon’ble court that the de­vel­oper got the li­cense to sell only res­i­den­tial units and, there­fore, could not sell shops and schools as that would be in­ter­preted as sale of com­mer­cial en­ti­ties. Se­condly, t h e H a r ya n a Ap a r t m e n t Own­er­ship Act talks about com­mon prof­its – the bal­ance of all in­come, rents, prof­its and rev­enues from the com­mon ar­eas and fa­cil­i­ties re­main­ing af­ter the de­duc­tion of the com­mon ex­penses. So what will be the source of the RWA’s in­come if the schools, clubs, shops and other fa­cil­i­ties are owned by the de­vel­oper? We tried to con­vince the court that these pro­vi­sions sug­gest that the in­tent of the leg­is­la­ture is to give apart­ment own­ers rights over com­mu­nity and com­mer­cial fa­cil­i­ties,” says Amit Jain, di­rec­tor gen­eral, Fed­er­a­tion of Apart­ment Own­ers As­so­ci­a­tion in Gur­gaon.

Ex­am­in­ing Sec­tion 3( 3) (a)(iv) of the Haryana De­vel­op­ment and Reg­u­la­tion of Ur­ban Ar­eas Act, 1975, the SC says that the own­er­ship of the col­o­nizer can­not be trans­ferred or di­vested, un­less the col­o­nizer vol­un­teers to trans­fer the same free of cost to the gov­ern­ment.

The apex court f ur­ther ex­am­ines Sec­tion 3(f)(7) of the Haryana Apart­ment Own­er­ship Act, 1983 and says, “No duty is

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