Mahabir Pershad & Others vs Arunachal Apartment Owners ...
2008 Latest Caselaw 1883 Del

*     IN THE HIGH COURT OF DELHI AT NEW DELHI

                                               Pronounced on :23.10.2008

+            IAs 11151 & 11152/2008 in CS (OS) 563/2008

MAHABIR PERSHAD & OTHERS                                      ..... Plaintiffs

                   Through : Mr. Gaurav Bharathi, Advocate

                                 versus


ARUNACHAL APARTMENT OWNERS ASS'N (REGD) & ORS                 ..... Defendants

                   Through : Mr. Tapesh Tyagi, Mr. Vineet Maheshwari
                   Advocates for Def. 2.


CORAM:
HON'BLE MR. JUSTICE S. RAVINDRA BHAT


1.    Whether the Reporters of local papers
      may be allowed to see the judgment?

2.    To be referred to Reporter or not?

3.    Whether the judgment should be
      reported in the Digest?


S.RAVINDRA BHAT, J.

*

1. The plaintiff seeks permanent and mandatory injunctive reliefs against

the first defendant, is office bearers, employees, successors, etc from

interfering with its ownership rights and peaceful use and occupation of the

IA NOS 11151 & 11152/2008 IN CS(OS) 563/2008 Page 1 terrace portion of 37% share of the building known as ARUNACHAL , located

at 19, Barakhamba Road, New Delhi, (hereafter called "suit property") and

directing them to remove advertisement and signboards put up and

displayed by them within the parapet walls of the terrace of the said suit

property. They also seek an order directing the defendants to disclose terms

of the agreement whereby the first defendant authorized the use of the

parapet walls of the suit property, by the Second defendant, and thereafter

pass a decree to the extent of 37% of the disclosed value of such

consideration. The present common order proposes to dispose of IA

3752/2008 and IA 11151/2008. The first is the plaintiffs' application for ad-

interim injunction. This court had granted an ex-parte order, on the first

hearing of the suit, in that application. The second application is by the first

defendant, under Order 39, Rule 4, for vacation of the said ex-parte order.

2. The facts necessary to decide the two applications are briefly indicated

as follows. The plaintiff claims ownership of the suit property, to an extent of

6000 square yards, in terms of an agreement with Kailashnath and

Associates (the third defendant, which built upon the plot), through a letter/

agreement of 7-3-1973. The plaintiffs were entitled to 30% share of the suit

property, in terms of the letter, and entitled to allotment of flats, to that

extent. They contend that by a subsequent letter/ MOU their share was

increased to 37%; that of the third defendant was correspondingly revised to

IA NOS 11151 & 11152/2008 IN CS(OS) 563/2008 Page 2 63%. The plaintiffs also aver that besides recording this, through an

agreement dated 19-6-1981, it was also agreed that open areas, including

unreserved car parking, terrace etc would belong to joint owners, in the

same ratio as their ownership of the building. Copies of the letters of 1973,

and 19-6-1981, have been placed on the record. Pursuant to the

agreements, the third defendant built the suit property, and the joint owners

sold flats which fell to their shares.

3. According to the plaintiffs, the flat buyers' agreement contain express

stipulations which reserve the right to exclusive ownership, and use of

parapet walls, as well as terrace of the suit property building. This is

asserted, by relying on clauses 12 and 13 of the flat buyers' agreements, the

copy of a format of which is placed on the record. Clause 12 reads as follows:

" Save and except in respect of the particular office/showroom/basement space/garage etc hereby agreed to be acquired the Buyer(s) shall have no claim or right of any nature or kind over or in respect of any open space parking places, lobbies, staircases, lifts, terraces, etc. which will remain the property of the sellers."

The material part of Clause 13, which too, is relied on, reads as follows:

" ... However, even after the formation of a Co-operative Housing Society, or a Limited Company, or an Association of Persons, the basement and the terrace of the building including the parapet shall always be the property of the Sellers and the Agreement with the buyers and all other purchasers of office/showroom/basement spaces/ garages etc. in the said building shall be subject to the aforesaid rights of the Sellers who shall be entitled to use the said terrace including the parapet wall for all purposes including the display of advertisement and signboards or open air restaurant, cinema, or any other use..."

IA NOS 11151 & 11152/2008 IN CS(OS) 563/2008 Page 3

4. The defendant No. 1 is a society formed of the owners/ buyers of the

flats in the suit property ARUNACHAL. The plaintiffs contend that in a past

instance, the said defendant had attempted to obstruct and interfere with its

rights, by removing flower pots placed by the plaintiffs near the basement.

This had led to the plaintiffs filing a suit. It is alleged that on 23 November,

2007, some members of the first defendant society attempted, on the

strength of a circular, issued by the said defendant, on 12-11-2007, to access

the terrace, which was thwarted by the plaintiffs. It is also alleged that the

office bearers of the first defendant, illegally broke open the lock placed on

the terrace by the plaintiffs, on 18-2-2008, in the pretext of maintenance of

the VSAT dish and other materials, which led to filing of a police complaint.

The plaintiffs allege another like incident, on 27-2-2008.

5. Learned senior counsel submitted that the court should reject the

defendants' application for vacation of the interim order, and confirm it.

According to counsel, the clear terms of the three agreements executed

between the plaintiffs and third defendant, as well as the flat buyers'

agreement establish that the first defendant, and none of its members or

other occupiers have any manner of right, title or interest in relation to the

terrace and parapet walls of the suit property. It was urged that the

commercial exploitation of the parapet walls, by permitting hoardings and

IA NOS 11151 & 11152/2008 IN CS(OS) 563/2008 Page 4 advertisements, commissioned by the first defendant was clearly illegal.

Learned counsel relied on the terms of the agreements, with the third

defendant, as well as clauses 12 and 13 of the format flat buyers

agreements, placed on the record. Counsel relied on the decision reported as

Sagar Apartments Flat Owners Society (Regd.) & Ors. V. M/S. Sequoia

Construction (P) Ltd. & Ors. 51 (1993) DLT 308 to say that by virtue of

Section 24 of the Delhi Apartment Ownership Act, 1986, the pre-existing

rights secured through the two agreements dated 7-3-1973 and 19-6-1981

were preserved, and the plaintiffs' exclusive possession of the terrace to the

extent of 37% had to be protected.

6. The first defendant avers, in their reply and application for vacating the

interim order, and their counsel contends, that the plaintiffs ought not to be

given equitable relief, since they have practiced deceit and not divulged

material facts. According to the first defendant, the plaintiffs' attempt to get

an ad-interim order in the previous suit, was unsuccessful; it relied on a copy

of the order of the trial court, made in that case. Besides, it was urged that

apart from relying on the three letters, which were inter-se materials

between the plaintiffs and the third defendant, there was nothing to disclose

that the plaintiffs ever had exclusive possession, or of 37% of the terrace, or

of the walls, as contended by them. It was urged that in terms of the Delhi

Apartment Ownership Act, 1986, particularly, Section 3(j), roof and such

IA NOS 11151 & 11152/2008 IN CS(OS) 563/2008 Page 5 rights as were in question in the present case were "common areas". The

first defendant also contends that in the present day scenario, where safety

and security concerns of residents and occupants of high rise buildings are to

be addressed, there can be no exclusive rights in respect of terrace portions,

and in the eventuality of fire or other mishaps, the occupants would be

imperiled. Therefore, the first defendant urges that the court should not

grant the injunction sought for.

7. It would be useful, at this stage, to notice relevant provisions of the

Delhi Aparment Ownership Act, 1986. They are extracted below:

"Section 3(b) „Allottee‟ in relation to an apartment, means the person to whom such document has been allotted, sold or otherwise transfer by the promoter;

Section 3(e) „Apartment owner‟ means the person or persons owning an apartment and in undivided interest in the common areas and facilities appurtenant to such apartment in the percentage specified in the deeds of apartments;

Section 3(j) "Common Areas and facilities", in relation to a multi-storeyed building means;

(i) the land on which such building is located and all easements, rights and appurtenances belonging to the land and the building;

(ii) the foundations, columns, girders, beams, main walls, roofs, halls, corridors, lobbies, stairs, stairways, fire escapes and entrances and exits of the building;

(iii) The basement, cellars, yards, gardens, parking areas, shopping centres, schools and storage spaces;

(iv) The premises for the lodging of janitors or persons employed for the management of the property;

IA NOS 11151 & 11152/2008 IN CS(OS) 563/2008                             Page 6
       (v)       installations of central services, such as, power, light, gas, hot

and cold water, heating, refrigeration, air conditioning, incinerating and sewerage;

(vi) The elevators, tanks, pumps, motors, fans, compressors, ducts and in generally all apparatus and installations existing for common use;

(vii) Such other community and commercial facilities as may be prescribed; and

(viii) all other parts of the property necessary or convenient to its existence, maintenance and safety, or normally in common use. Section 3(n) „Deed of apartment" means the deed of apartment referred to in Section 13;

Section 3(w) "Promoter" means the authority, person or cooperative society, as the case may be, by which or by whom, any multi-storeyed building has been constructed;

4. (1) Every person to whom any apartment is allotted, sold or otherwise transferred by the promoter, on or after the commencement of this Act, shall, save as otherwise provided in Section 6, and subject to the other provisions of this Act, be entitled to the exclusive ownership and possession of the apartment so allotted, sold or otherwise transferred to him.

(2). Every person to whom any apartment was allotted, sold or otherwise transferred by the promoter before the commencement of this Act shall, save as otherwise provided under Section 6 and subject to the other provisions of this Act, be entitled, on and from such commencement, to be exclusive ownership and possession of the apartment so allotted, sold or otherwise transferred to him. (3) Every person who becomes entitled to the exclusive ownership and possession of an apartment under Sub-section (1) or Sub- section (2) shall be entitled to such percentage of undivided interest in the common areas and facilities as may be specified in the Deed of Apartment and such percentage shall be computed by taking, as a basis, the value of the apartment in relation to the value of the property.

(4). (a) The percentage of the undivided interest of each apartment owner in the common areas and facilities shall have a permanent character, and shall not be altered without the written consent of all the apartment owners.

IA NOS 11151 & 11152/2008 IN CS(OS) 563/2008 Page 7

(b) The percentage of the undivided interest in the common areas and facilities shall not be separated from the apartment to which it appertains and shall be deemed to be conveyed or encumbered with the apartment, even though such interest is not expressly mentioned in the conveyance or other instrument.

5. The common areas and facilities shall remain undivided and no apartment owner or any other person shall bring any action for partition or division of any part thereof, and any convenient to the contrary shall be void.

6. Each apartment owner may use the common areas and facilities in accordance with the purposes for which they are intended without hindering or encroaching upon the lawful rights of the other apartment owners.

7. The necessary work relating to maintenance, repair and replacement of the common areas and facilities and the making of any additions or improvements thereto, shall be carried out only in accordance with the provisions of this Act and the bye- laws.

8. The Association of Apartment Owners shall have the irrevocable right, to be exercised by the Board of Manager to have access to each apartment from time-to-time during reasonable hours for the maintenance, repairs or replacement of any of the common areas or facilities therein, or accessible there from, or for making emergency repairs therein necessary to prevent damage to the common areas and facilities or to any other apartment or apartments.

xxxxxxx xxxxxxx xxxxxxx xxxxxxx

13. (1) Whenever any allotment, sale or other transfer of any apartment is made, the promoter shall

(a) in the case of an allotment, sale of other transfer made after the commencement of this Act, within three months from the date of such allotment, sale or other transfer; or

(b) in the case of any allotment, sale of other transfer made before the commencement of this Act, within six months from the date of such commencement, execute a Deed of Apartment containing the following particulars namely:

      (i)      the name of the allottee.
      (ii)     description of the land on which the building and the common

areas and facilities are located; and whether the land is free-hold or lease-hold, and if lease-hold, the period of such lease.

IA NOS 11151 & 11152/2008 IN CS(OS) 563/2008 Page 8

(iii) a set of floor plans of the multi-storeyed building showing the lay-out and location, number of apartments and being a verified statement of an architect certifying that it is an accurate copy of the portions of the plans of the building as filed with, and approved by, the local authority within the jurisdiction of which the building is located.

(iv) description of the multi-storeyed building, stating the number of storeyes and basements, the number of apartments in that building and the principal materials of which it is constructed.

(v) the apartment number, or statement of the location of the apartment, its approximate JJarea, number and dimension of room, and immediate common area to which it has access, and any other date necessary for its proper identification.

(vi) description of the common areas and facilities and the percentage of undivided interest appertaining to the apartment in the common areas and facilities.

(vii) description of the limited common areas and facilities, if any, stating to which apartments their use is reserved.

(viii) value of the property and of each apartment and a statement that the apartment and such percentage of undivided interest are not encumbered in any manner whatsoever on the date of execution of the Deed of Apartment.

(ix) statement of the purposes for which the building and each of the apartments are intended and restricted as to use, x x x Section 24 (1) The provisions of this Act shall have effect notwithstanding anything inconsistent therewith contained in any other law for the time being in force or in any contract, undertaking or other instrument and all apartment owners, tenants of owners, employees of owners and tenants, or any other person who may, in any manner, use the property or any part thereof to which this Act applies, shall be subject to the provisions of this Act and the bye-laws and the rule made there-under:

Provided that nothing contained in this sub-section shall affect the right, title or interest acquired by any allottee or other person in common areas and facilities from any promoter on or before the 28th day of February, 1986.

(2) All agreement, divisions and determinations lawfully made by the Association of Apartment Owners in accordance with the provisions of this Act and the bye-laws shall be deemed to be binding on all apartment owners."

IA NOS 11151 & 11152/2008 IN CS(OS) 563/2008 Page 9

8. In R.L. Bhardwaj V. Shivalik Co-Operative Group Housing Society

Limited & Ors 56 (1994) DLT 600, this court held, while considering an

argument pertaining to applicability of Section 24 of the Apartment Act, of

1986, held as follows:

"Reading of Section 3(j) of the Act makes it clear that roof falls under the definition of "common areas and facilities", therefore also the plaintiff is not entitled to the interim relief. Besides the legal submission, on merits the contention of Mr. Singhla that the architect had given classification before allotment of the flat that terrace/roof was not a common area. Reference in this regard can be had to the letters dated 3rd June, 1988 and 6th November, 1989. But I am afraid this does not prima facie amount to concluded contract. The agreement including schedule Annexure-B are not signed on behalf of the Society. In the absence of any agreement protection under Sections 3(g) and 24 of the Act cannot be claimed by plaintiff. Section 3(j)(ii) of the Act provides that „roofs‟ of the building to be a common area and common expenses were charged from each of the individual flat owner. Carpet area of the LIG flat is 68.85 sq. mt. and roof area is 49.2 sq. mt, therefore, from each of the flat owner of LIG a sum of Rs. 900 was charged besides the price of the flat. Reference can be made to Section 4 of the Act which indicates how much charges are to be collected for the common area i.e. of the undivided interest of each apartment owner. Sub-section (5) of Section 4 of the Act provides that common areas and facilities shall remain undivided and no apartment owner or any other person encroach upon the same. However, exception has been carved out under Sections 3(g) and 24 of the Act which stipulates exclusion of other‟s right by agreement and this must take place before the allotment and that agreement must have been entered into prior to 28th February, 1986.

7. As already observed, the copy of the agreement and the Schedule placed on record do not bear signature on behalf of the Society. The minutes of the General Body Meeting in which reference of this agreement was made is yet to be proved. Hence in the absence of the agreements having been executed before the allotee of the individual flats as stipulated under the Act, prima facie it cannot be said that plaintiff has exclusive right of use and enjoyment of the terrace/roof of flat No. 44. Nor the balance of convenience is in his favour.."

IA NOS 11151 & 11152/2008 IN CS(OS) 563/2008 Page 10

9. In Sagar Apartments Flat Owners Society (Regd.) & Ors. V. M/S.

Sequoia Construction (P) Ltd. & Ors. 51 (1993) DLT 308 the court held as

follows:

"51. The Act applies to multi-storyed buildings constructed prior to its coming into force. The building in the present case admittedly came into existence prior to this Act coming into force. The intention of the Legislature is clear that the benefits of the Statute should be conferred also o n the purchasers of apartments in multi-storeyed buildings constructed prior to the enforcement of the Statute. The building was originally admittedly completed in the year 1979 and completion certificate was obtained on 26th July, 1979. Had the Act been in force at that time, the Deeds of Apartment would have had to be executed and the sanctioned plan of the year 1979 would have formed part thereof. This further means that the rights of the apartment purchasers in the building, particularly, in its common areas and facilities would have got crystalised at that stage. The Act, however, came into force in the year 1988. Therefore, any additional construction, which is raised after the enforcement of the Act has to be subject to the Act and the rights of the parties created under the Act have to be taken into consideration and if so required preserved. Any view to the contrary would mean that the building will be constantly in a state of flux and the rights of the apartment purchasers would always remain in a state of fluidity. For the buildings which came into existence prior to enforcement of the Act, six months time is granted under the Act for the execution of the Deeds of Apartment. This is intended to ensure that the rights of the parties created under the Statute get crystalised soon after the enforcement of the Statute. When the Statute has been enforced, the purchasers of the apartments must get some protection against the builder. The Court has to ensure that the legislative intent is fulfilled rather than allow it to be flouted. Therefore, the building ought to be preserved and further construction ought to be stopped.

52. There is possibly no answer to the point that defendant No. 1 has waited for almost ten years after the sanction of the plans for additional construction in 1983 to start the construction. The only reason advanced on behalf of defendant No. 1 to justify permission to construct is constant increase in cost of construction. In view of the various important issues raised in the case, this reason is not enough

IA NOS 11151 & 11152/2008 IN CS(OS) 563/2008 Page 11 to pursuade me to permit further construction at this stage. Secondly, if the cost of construction increases, the value of the property increases in a higher ratio.

53. For all these reasons, I am of the view that the ex part ad interim injunction restraining defendant No. 1 from raising any further construction including demolition /addition/alteration in the front block of the building called „Sagar Apartments‟ at 6, Tilak Marg, New Delhi-- 110001 ought to be confirmed. The ex-parte interim order dated 16th December, 1992 is, therefore, confirmed."

10. The factual narrative in the present case indicates that the plaintiffs

were allotted 30% share of the flats in the suit property; this was later

increased to 37%. The three MOUs/ letters, copies of which are on the

record, do not indicate that the plaintiffs were given "exclusive" share of

such proportion of terrace or parapet wall rights. The plaintiffs source their

claim to such rights from format flat buyer agreements. These documents do

not contain any particulars, are unsigned, and the plaintiffs are unable to

establish whether they were signed on their behalf, when the flats in

question were sold by them to buyers or allottees. In the absence of such

particulars, it would be perilous to assume, as the plaintiffs invite the court

to, that they "acquired" such "exclusive" though proportionate rights to the

terrace and parapet walls. The materials placed on record are insufficient for

the court to assume that the plaintiffs are entitled to the benefit of the

proviso to Section 24 of the Apartment Act.

IA NOS 11151 & 11152/2008 IN CS(OS) 563/2008 Page 12

11. The above discussion is, however not dispositive of the applications.

The plainitffs' inability to disclose at this interim stage, their exclusive rights,

however cannot mean they have no rights. The defendants have allowed

commercial use of the parapet walls, which appear to be let out for

placement of hoardings and advertisements. At this stage, though the court

has determined that the plaintiffs are not entitled to claim ad-interim

injunctive relief, yet, the plaintiffs commercial rights to share in revenue is to

be examined; the defendants have not shown how they possess such

exclusive rights. In the circumstances, the equities in the case demand that

the first defendant discloses material particulars about the advertisement

agreements it has entered into, with occupiers of the buildings as well as

third parties, though a suitable affidavit. Such affidavit shall disclose all

relevant particulars, including number of advertisements, the parties, copies

of agreements, revenue earned since January, 2008, etc. The first defendant

shall also disclose the amounts collected by it, from occupiers and other

parties, for charges collected by it towards VSAT and other similar services,

for the period commencing from January, 2008. This affidavit shall be filed by

the first defendant within four weeks from today.

IA NOS 11151 & 11152/2008 IN CS(OS) 563/2008 Page 13

12. The applications IA 3752/2008 and IA 11151/2008 are disposed off in

the above terms; the interim order made previously, in IA 3752/2008 is

accordingly vacated.

OCTOBER 23, 2008                               S.RAVINDRA BHAT, JUDGE




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