O.S. Bajpai vs The Administrator (Lt. Governor ...
2010 Latest Caselaw 2805 Del

                             Reportable

*          IN THE HIGH COURT OF DELHI AT NEW DELHI

                      WP (C) No. 1959 of 2007

                                Judgment Reserved On: April 26, 2010
%                            Judgment Pronounced On: May 28, 2010

     O.S. BAJPAI                                            . . . Petitioner

                       through :            Petitioner-in-person with Mr. V.N.
                                            Jha, Advocate


                             VERSUS


     THE ADMINISTRATOR (LT. GOVERNOR OF DELHI) & Ors.
                                         . . .Respondents

                       through:             Mr. Sanjay Poddar, Advocate.
                                            Ms. Zubeda Begum, Advocate for
                                            the respondent No.1


CORAM :-
    HON'BLE MR. JUSTICE A.K. SIKRI
    HON'BLE MR. JUSTICE AJIT BHARIHOKE

     1.    Whether Reporters of Local newspapers may be allowed
           to see the Judgment?
     2.    To be referred to the Reporter or not?
     3.    Whether the Judgment should be reported in the Digest?

A.K. SIKRI, J.

1. The petitioner who has filed this petition is a Senior Advocate

practising in this Court. This petition is in the nature of public

interest litigation whereby the petitioner has drawn the attention

of this Court to the apathy and inaction on the part of the

respondents in not properly enforcing the Delhi Apartment

Ownership Act, 1986 (hereinafter referred to as „the Act‟). The

grievance is that thought the said Act was passed 20 years ago

(from the date when the petition was filed), the respondents are

feigning helplessness in enforcing the provisions of the said Act as

their stand is that the Act does not provide any remedial or penal

action which can be taken by the respondents, in the event the

provisions of the Act are being violated by the builders/promoters

who construct/maintain the multi-storeyed buildings. The

petitioner has knocked the doors of this Court after he took up the

matter with the builders as well as the Government for redressal

of his grievance, but failed in his attempt.

2. Before we come to the grip of the matter and take note of the

grievance of the petitioner in implementation of this Legislation, it

would be apposite to refer to the main provisions of the Act.

3. The Act was passed by the Legislator for providing ownership of

an individual in a multi-storeyed building and also to give him

undivided interest in the common areas and facilities appurtenant

to such apartment and also to make such apartment and interest

heritable and transferrable. The preamble to the Act reads as

under:

"An Act to provide for the ownership of an individual apartment in a multi-storeyed building and of an undivided interest in the common areas and facilities appurtenant to such apartment and to make such apartment and interest heritable and transferable and for matters connected therewith or incidental thereto.

Whereas with a view to securing that the ownership and control of the material resources of the community are so distributed as to subserve the common good, it is expedient to provide for the ownership of an individual apartment in multi-storeyed building and of an undivided interest in the common areas and facilities appurtenant to such apartment and interest heritable and transferable and to provide for matters connected therewith or incidental thereto."

4. The purpose which was sought to be achieved by passing this

enactment is elaborately stipulated „objects and reasons‟ to the

Delhi Apartment Ownership Bill, 1986, which makes the following

reading:

"The Delhi Apartment Ownership Bill, 1986 seeks to achieve the object of enabling the conferment of heritable and transferable right in an apartment including its proportionate and undivided interest inland and other common areas. The scarcity of land in Delhi because of very rapid urbanization has led to a vertical growth of buildings. Multi-storeyed residential buildings, integrated development of commercial, institutional and industrial areas and flatted factories have resulted in a marked increase in the number of multi- storeyed buildings in Delhi containing a number of apartments, sharing land and other common facilities. In the case of flats constructed by agencies like the Delhi Development Authority, while the super-structure is conveyed to the allotted, the land is conveyed to a registered agency and the allottees jointly which apart from separating the ownership of land and super-structures, interposes the registered agency in future transfers of properties. In the case of cooperative societies, difficulties are experienced in obtaining loans in the absence of a mortgageable title in an apartment constructed on indivisible land, the title to which rests in the society. The existing arrangements also involve the intervention of the Government and agencies like the Delhi Development Authority in the litigation or dispute regarding management of common areas which arise between the lessees and buyers of the apartments. The legislation therefore proposes to meet the persistent demand for statutory recognition of an apartment as a unit of property, capable of transfer and for statutory recognition of an apartment as a unit of property, capable of transfer and for a statutory organization clothed with adequate powers for management of common areas in multi-storeyed buildings."

5. The said Act extends to the whole of the Union Territory of Delhi

and applies to every apartment in a multi-storeyed building,

which was constructed, viz., for residential or commercial or such

other purposes as may be prescribed, by-

a) Any group housing cooperative society, or

b) Any other person or authority, before or after the

commencement of this Act and on a freehold land, or a

lease hold land, if the lease for such land is for a period

of thirty years or more.

6. According to Section 4(1) of the Act, every apartment owner is

entitled to exclusive ownership and possession of the apartment

so allotted, sold or otherwise transferred to him on or after

commencement of the Act. Under Section 4(2) of the Act, the

apartment owner is entitled to exclusive ownership and

possession of the apartment so allotted, sold or otherwise

transferred to him before the commencement of the Act. Section

4(3) of the Act provides that, a flat owner who becomes entitled

to the exclusive ownership and possession under sub-section (1)

or (2) of Section 4 shall be entitled to such percentage of

undivided interest in the common areas and facilities as may be

prescribed in the deed or the 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. As per sub-

section (4)(a) of Section 4, 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.

Further, sub-section (4)(b) of Section 4 mandates that 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.

7. Section 5 makes the apartment heritable and transferable.

Section 13 of the Act provides for the contents of the deed of

apartment. Section 14 deals with its registration and stipulates

that every deal of apartments and every endorsement relating to

the transfer of apartment shall be deemed to be a document,

which is compulsorily registerable under the Registration Act,

1908.

8. Section 15 is an important provision in the Act, which prescribes

that there would be an Association of an apartment owners for

the administration of the affairs in relations to the apartment and

the property appearing thereto and for the management of

common areas and facilities. Proviso to this Section specifically

puts an embargo to multiple associations by providing that there

shall be a single Association of apartment owners in each multi-

storeyed building. The Administrator is permitted to frame model

bye-laws for the functioning of such an Association and casts a

duty on the Association to frame bye-laws on the said model bye-

laws in its very first meeting. We would like to reproduce Section

15 in toto:

"15. Association of Apartment Owners and bye-laws relating thereto.- (1) There shall be an Association of Apartment Owners for the administration of the affairs in relation to the apartments and the property appertaining thereto and for the management of common areas and facilities.

Provided that where any area has been demarcated for the construction on multi-storeyed buildings, whether such area is called a block or pocket or by any other name, there shall be a single Association of Apartment Owners in such demarcated area.

(2) The Administrator may, by notification in the Official Gazette, frame model bye-laws in accordance with which the property referred to in sub section (I) shall be administered by the Association of Apartment Owners and every such Association shall, at its first meeting, make it bye-laws in accordance with the model bye-laws so framed, and in making its bye-laws the Association of Apartment Owners shall not make any departure from, variation of, addition to, or omission form, the model bye-laws aforesaid except with the prior approval of the Administrator and no such approval shall be given if, in the opinion of the Administrator, such departure, variation, addition or omission will have the effect of altering the basic structure of the model bye-laws framed by him.

(3) The model bye-laws framed under sub section (2) shall provide for the following, among other matters, namely :-

(a) The manner in which the Association of Apartment Owners is to be formed,

(b) The election, from among apartment owners, of a Board of Management by the members of the Association of Apartment Owners,

(c) The number of apartment owners constituting the Board, the composition of the Board and that one-third of members of the Board shall retire annually,

(d) The powers and duties of the Board,

(e) The honorarium, if any, of the members of the Board,

(f) The method of removal from office of the members of the Board

(g) The powers of the Board to engage the services of a Manager,

(h) Delegation of powers and duties of the Board to such Manager

(i) Method of calling meetings of the Association of Apartment Owners and the number of members of such Association which shall constitute a quorum for such meetings,

(j) Election of a President of the Association of Apartment Owners from among the apartment owners, who shall preside over the meetings of the Board and of the Association of Apartment Owners.

(k) Election of a Secretary to the Association of Apartment Owners from among the apartment owners, who shall be an ex efficio member of the Board and shall keep two separate minutes books, one for the Association of Apartment Owners and the other for the Board, pages of each of which shall be consecutively numbered and authenticated by the President of the Association of Apartment Owners, and shall record, in the respective minutes books, the resolutions adopted by the Association of Apartment Owners or the Board, as the case may be,

(l) Election of a Treasurer from among the apartment owners, who shall keep the financial records of the Association of Apartment Owners as also of the Board.

(m) Maintenance, repair and replacement of the common areas and facilities and payment therefor,

(n) Manner of collecting from the apartment owners or any other occupant of apartments, share of the common expenses

(o) Resignation and removal of persons employed for the maintenance, repair and replacement of the common areas and facilities,

(p) Restrictions with regard to the use and maintenance of the apartments and the use of the common areas and facilities, as may be necessary to prevent unreasonable interference in the use of each apartment and of the

common areas and facilities by the several apartment owners,

(q) Any matter which may be required by the Administrator to be provided for in the bye-laws for the proper or better administration of the property.

(r) Such other matters as are required to be, or may be, provided for in the bye-laws.

(4) The bye-laws framed under sub-section (2) may also contain provisions, not inconsistent with this Act,

(a) Enabling the Board to retain certain areas of the building for commercial purposes and to grant lease of the areas so retained, and to apply the proceeds of such lease for the reduction of the common expenses for maintaining the building, common areas and facilities, and if any surplus is left after meeting such expenses to distribute such surplus to the apartment owners as income.

(b) Relating to the audit of the accounts of he Association of Apartment Owners and of the Board, and of the administration of the property.

(c) Specifying the times at which and the manner in which annual general meetings and special general meetings of the Association of Apartment Owners shall be held and conducted.

(d) Specifying the time at which and the manner in which, the annual report relating to the activities of the Association of Apartment Owners shall be submitted.

(e) Specifying the manner in which the income derived and expenditure incurred by the Association of Apartment Owners shall be dealt with, or as the case may be, accounted for."

9. Sections 19 and 20 of the Act would also be relevant and

therefore, the same are reproduced below as well:

"19. Common profits, common expenses and other matters - (1) The common profits of the property shall be distributed among, and the common expenses shall be charged to, the apartment owners according to the percentage of the undivided interest of the apartment owners in the common areas and facilities.

(2) Where the apartment owner is not in the occupation of the apartment owned by hi, the common expenses payable by such apartment owner may be recovered from the person in the occupation of the apartment.

20. Apartment owner not to be exempt from liability for contribution by waiver of the use of the common areas and facilities. - No apartment owner may exempt himself from liability for his contribution towards the

common expenses by waiver of the use of enjoyment of any of the common areas and facilities, or by the abandonment of his apartment."

10. The petitioner has submitted that the builders of multi-storeyed

buildings are not adhering to the aforesaid provisions inasmuch

as;

a) Contrary to the mandate of Section 4 of the Act, in

actual practice, individual interest in common areas and

facilities is not conveyed to the apartment owners,

neither fictionally nor practically while executing the

Agreement for allotment/sale of the apartment.

b) In fact, these builders are not even executing Sale Deed

and getting it registered in accordance with the

Registration Act in spite of specific provisions contained

in Section 13 and 14 of the Act in this behalf.

c) No associations of apartment owners are formed and the

builders are, in fact, ensuring that such associations do

not come up. Instead, separate companies controlled

and owned by these builders are given the contract of

maintenance, which are charging exorbitant amounts as

maintenance of the flat owners. The charges are so

exorbitant that in spite of purchasing the apartment

after paying full consideration, they are made to cuff out

the amount, which is more than normal rental in those

areas. In this way, the apartment owners are virtually

relegated as „tenant‟ in their own premises.

d) In the absence of any association and contract for

maintenance given to their own henchmen, Section 19

of the Act is also violated as there are no common

profits and nothing is distributed amongst the apartment

owners, who is pocketed by the builders/maintenance

companies.

e) Likewise, Section 22 to 24 are violated by these

apartment owners.

11. In the counter affidavit filed by the respondent No. 1, it is stated

that the Act, after receiving the assent of the President of India,

came into force with effect from 01.12.1987. Rules along with

model bye-laws were notified by the Ministry of Urban

Development vide Notification dated 17.11.1987 published in the

Gazette of India, Extraordinary, Part-II. These were subsequently

amended by Notification dated 26.03.1991 published in Delhi

Gazette, Extraordinary, Part-IV. It is, thus, pleaded that Acts

stand implemented. At the same time, helplessness is shown by

stating that there is no panel provisions under the Act and Rules

for taking action against the persons violating the Acts and Rules.

Therefore, if any builders or maintenance agencies are violating

these provisions, the respondents are not in a position to take any

action. It is, however, stated that the following Competent

Authorities are appointed under Section 3 (m) of the Act vide

Notification dated 10.12.1987:

         "a) Vice Chairman, DDA                   In      respect           of
                                                   apartments on         DDA‟s
                                                   Land.

         b) Land & Development Office, GOI        In respect of apartments
                                                  constructed on lands of
                                                  Central Government and
                                                  belonging to the Land
                                                  and Development Office.

         c) Secretary, L&B Department,


             GNCTD                                   In respect of apartments
                                                    constructed on any other
                                                    land not covered by (a) &
                                                    (b) above.

12. The respondent No.1 has denied the allegations that it is not

implementing the Act. Without giving reply to each and every

Para, stock reply to the various averments of the petition is given

in the following manner:

"4. That the petitioner has leveled false and baseless allegations against the answering respondent in not implementing the Act. It is specifically denied that the respondent No.1 & 2 have any sort of connivance with the promoters/builders. It is submitted that under Section 13(2) of the Act it is the duty of the promoters to file in the office of the competent authority a certified copy of each deed of apartment as registered under Section 14. It is further submitted that whenever any succession takes place to any apartment or part thereof, it is the duty of the successor to make an application to the competent authority, within a period of six months from the date of succession for recording such succession on the certified copy of the deed of apartment in relation to the concerned apartment. Since, there is no such provision/section or proviso to any sections in this Act whereby the competent authority have been authorized to take action against the promoters/builders or successors who have violated the provisions of this Act. As such the competent Authorities are handicapped to take action against the violators.

5. That under Section 15(1) of the Act there shall be an association of apartment owners for administration of the affairs in relation to the apartments and the property appertaining thereto and for the management of common areas and facilities. Under section 15(2) of this Act, Association shall at its first meeting make its bye-laws in accordance with the model bye-laws so framed and by making bye-laws association shall not make any departure, variation, addition or omission except with the prior approval of the Administrator. It is again reiterated here that neither any procedure has been laid down nor there are any section/provisions or proviso to any section for taking action against the associations violating the provisions. Hence, the shortcomings in the Act itself is a biggest hurdle."

13. This Court vide orders dated 21.11.2007 had directed to convene

a meeting between the Secretary of the Ministry of Urban

Development and Chief Secretary, Government of NCT of Delhi to

resolve the issue raised by the petitioner and find a solution

thereto. This meeting was held on 01.02.2008 and minutes of the

meeting are placed on record. In this meeting, it is recorded that

a decision in-principle had already been taken to the effect that

instead of making extensive amendments to the existing Act, it

would be more appropriate to draft a comprehensive legislation,

which would cover all the identified issues relating to sale and

transfer to the builders and to the developers and also to protect

the interest of the apartment owners. Thus, minutes show that

the respondents realize that there is a need for new legislation,

which would completely overhaul the existing one. It is also

stated that Delhi Apartment Ownership Bill was drafted and

introduced in the 13th Lok Sabha. However, on the dissolution of

the said Lok Sabha, this bill lapsed, which was to be considered

afresh with the constitution of 14th Lok Sabha. A Draft Cabinet

Note had been prepared and was under-consideration before the

Competent Authority for approval. At the same time, minutes

also record that it would be possible to indicate any timeframe for

enactment of the new Act, since legislation rests with the

Parliament. On the same lines, counter affidavit was filed by the

respondent No.1 through Ministry of Urban Development, Govt. of

NCT, Delhi enclosing their minutes of meeting dated 01.02.2008.

14. The upshot of the aforesaid discussions leads us to the situation

where various infirmities pointed out by the petitioner in the

present enactment are acknowledged by the respondents as well.

They recognize that there is a complete absence of

remedial/penal provisions in the present enactment, which

enables the builders of these multi-storeyed buildings to commit

breach as minutes has no consequences flow from the said

breach. So much so, the respondent also recognize that in order

to provide adequate provisions and plug a loophole, it is not even

feasible to carry out a large number of amendments and the

proper remedy would be to pass new legislation incorporating all

such provisions. The Government had itself realized this

shortcomings in the existing legislation way back in the year 2001

when Delhi Apartment Bill was introduced in the Parliament.

However, with the dissolution of 13th Lok Sabha, said bill lapsed.

Thereafter, no exercise is done to either introduce any bill on the

same line or in a modified form subsequently. Even in the

meeting held between the Ministry of Urban Development and

Government of NCT of Delhi as recent as on 01.02.2008, that the

need for new legislation is acknowledged. It is also stated that "a

Draft Cabinet Note has been prepared and is under-consideration

of the Competent Authority for approval", but hand are washed

off by further stating in the said meeting that "since enactment of

a new legislation rests with the Parliament, it was felt that it may

not be possible to indicate any timeframe for enactment of the

new Act". What happened to the Draft Cabinet Note, which was

under-consideration of the Competent Authority is not brought on

record thereafter. It appears that the matter is swept under the

carpet and the file is gathering underserved dust. It shows the

apathy and non-action on the part of the Government in taking

appropriate action by bringing another bill in the Lok Sabha even

when need for the same is felt, for the reasons best known to the

concerned authorities. No doubt, it is not the province of this

Court, even in exercise of its extra-ordinary jurisdiction under

Article 226 of the Constitution of India to direct passing of a

particular legislation. Again, no doubt, that is the prerogative of

the Parliament.

However, at the same time, good governance demands that when

the Government itself realizes the shortcomings in the present

legislation and feels the immediate and emergent necessity to

bring out new legislation with all suitable provisions, inaction on

the part of the Government by sitting over the matter and not

processing the matter further is not an act of good governance.

Citizens of this country would have aspirations from the

Government of the day to act promptly in this direction by taking

suitable measures. When that is not done, expectations of

citizens are belied.

15. Though we cannot give positive directions to the respondents to

bring out a suitable legislation, influenced by the aforesaid

consideration, we can exhort the respondents to proceed further

in the direction. They have already moved on their own. Draft

Cabinet Note, which was prepared and submitted to the

Competent Authority for approval should be considered by the

competent authority without further delay and if found feasible

afresh Delhi Apartment Ownership Bill be introduced in the

Parliament so that the Parliament in its collective wisdom is above

to take a decision on passing suitable legislation on those lines.

We hope and are confident that the issue would not remain

dormant any longer an the Competent Authority spring into action

at the earliest.

16. The matter should not be put to rest at that. Till the time new

legislation comes up (if at all it happens), some means are to be

found for effective implementation of the present legislation, as

far as possible. After all, when a particular legislation is passed

by the Parliament with benevolent object and contained in its

„object and reason‟ as well as preamble and provisions are also

made giving certain rights to the apartment owners, if the

builders of multi-storeyed apartments do not adhere to these

provisions, some mechanism is to be found to ensure that

apartment owners are in fact bestowed the rights granted in the

aforesaid legislation.

17. Role of Courts, in such scenario is amply described by the

Supreme Court in the case of Ahmedabad Municipal Corpn.

Anr. Vs. Nilaybhai R. Thakore & Anr. [(1999) 8 SCC 139 in the

following words:

"14. Before proceeding to interpret Rule 7 in the manner which we think is the correct interpretation, we have to bear in mind that it is not the jurisdiction of the court to enter into the arena of the legislative prerogative of enacting laws. However, keeping in mind the fact that the Rule in question is only a subordinate legislation and by declaring the Rule ultra vires, as has been done by the High Court, we would be only causing considerable damage to the cause for which the Municipality had enacted this Rule. We, therefore, think it appropriate to rely upon the famous and oft-quoted principle relied by Lord Denning in the case of Seaford Court Estates Ltd. v. Asher [1994] 2 All ER 155 wherein he held : "When a defect appears a judge cannot simply fold his hand and blame the draftsman. He must set to work on the constructive task of finding the intention of Parliament and then he must supplement the written words so as to give 'force and life' to the intention of the Legislature. A judge should ask himself the question how, if the makers of the Act had themselves come across this ruck in the texture of it, they would have straightened it out ? He must then do as they would have done. A judge must not alter the material of which the Act is woven, but he can and should iron out the creases". This statement of law made by Lord Denning has been consistently followed by this Court starting in the case of M. Pentiah and Ors. v. Muddala Veeramallappa and Ors. : [1961]2SCR295 and followed as recently as in the case of S. Gopal Reddy v. Slate of Andhra Pradesh : 1996CriLJ3237 . Thus, following the above Rule of interpretation and with a view to iron out the creases in the impugned Rule which offends Article 14, we interpret Rule 7 as follows : "Local student means a student who has passed H.S.C./New S.S.C. examination and the qualifying examination from any of the High Schools or Colleges situated within the Ahmedabad Municipal Corporation limits and includes a permanent resident student of Ahmedabad Municipality who acquires the above qualifications from any of the High School or

College situated within Ahmedabad Urban Development Area."

18. Governed by the aforesaid consideration and the role of the Court,

which it is supposed to perform in such circumstance, we have

considered the matter. The petitioner had also given certain

suggestions for proper and effective implementation of the Act in

the present form. After due deliberation thereupon, we feel that

the following steps can be taken by the respondent seven within

the existing law, which may go a long way to curb the menace:

a) Appointment of Competent Authority:

i) That the competent authorities may be

appointed/nominated area-wise or building wise, so

that these authorities are able to effectively discharge

their functions. This should be done in accordance

with the definition of competent authority as given in

Section 2(k) of the Act.

ii) The competent authority may authorize for this

purpose as many officers of the rank of the Deputy

Commissioner or Joint Commissioner as may be

necessary for the purpose.

The aforesaid action be taken within 30 days of this

order.

Registration of Deed of Apartment:

i) The promoter/builder shall in all cases where the

transfer has taken place under the sale deed/lease

deed/transfer by endorsement, prior to the date of

the order, which may be passed by this Court,

execute the deed of apartment in the proformae as

may be approved and issued by the competent

authority keeping in view the provisions of Section

13(1) of the Act. This should be done within two

months from the date of constituting the competent

authorities.

ii) For future, the deed of apartment may be registered

within one month of its execution by the owner and

the promoter/builder.

iii) That in the case of existing owners, the deed of

apartment shall be prepared by the existing owners

and the promoters/builders in the proformae as

mentioned in para (i) above enclosing their original

Title deed (sale deed/lease deed/transfer by

endorsement) and the same will be presented before

the sub-registrar for registration. It will be the

responsibility of the promoter/builder to do so as

provided in Section 13(2) of the Act and also to

deliver a certified copy of the registered deed to the

owner of the apartment after it is registered.

iv) In the case of leaseholder land, the deed of apartment

be entered into between three parties, i.e., promoter,

apartment owner and Land Development Officer (L &

DO) on behalf of the President of India as confirming

party.

v) In the case of freehold land; the deed of apartment

should be entered into between the promoter/builder

and the apartment owner.

vi) The competent authority constituted in the aforesaid

manner shall give notice to the promoters/builders of

all the multi-storeyed apartments in Delhi directing

them to execute sale deed/lease deed/transfer by

endorsement in favour of the buyers for which time

bound period would be prescribed. The competent

authority shall prepare necessary proformae for this

purpose and issue directions to execute the deed of

apartments in the said proformae, keeping in view the

provisions of Section 13(1) of the Act.

vii) General instructions shall also be issued for future,

viz., the deed of apartment would be registered

within one month of its execution by the

promoters/builders and the owner.

viii)The terms of deed of apartment shall, inter alia,

include conveyance of exclusive ownership and

possession of (a) apartment owned by the respective

owner; (b) title to such percentage of undivided

interest in the common areas and facilities including

land as may be specified in each deed of apartment

computed on the basis of proportionate value of the

apartment to the total value thereof. The terms of

the deed should also make the right and interest in

the property described as clause (v) above

inheritable and transferable.

ix) Since it is the obligation of the promoters/builders on

the one hand and owner on the other hand to

execute and register such a deed of apartment, in

the event of failure to execute, this non-action can be

treated as evading payment of necessary stamp duty

and registration charges, necessary penalty can be

imposed by the Registrar under the Indian Stamp

Act, the Registration Act and action for recovery of

necessary charges can also be initiated.

x) If it is proved that failure and inaction on the part of

promoters/builders in executing and registering sale

deed of an apartment, the buyer be treated as the

owner of the apartment for the purpose of getting

benefits under the Act.

b) Apartment Owners Association:

The competent authority shall send specific notice to all

multi-storeyed apartments informing the owners of

apartments that it is their right to form owners‟

association in accordance with the bye-laws as per the

Explanation B of Chapter 1 of the said bye-laws under

Section 15 (2) of the Act. The officials from the office of

the competent authority shall be deputed to visit all

these multi-storeyed buildings, who would ensure

formation of owners‟ association. They would be

authorized to call for the meeting of the owners and

supervise the formation of the association, so as to

ensure smooth formation of the association. This

exercise in respect of multi-storeyed buildings shall be

completed within six months and the existing

maintenance companies shall transfer the management

of the multi-storeyed buildings to such associations.

c) Transfer of Management, Books of Account, etc.

Once the apartment owners‟ association is formed, it

shall takeover the management from the

promoter/builder. All the books of account, bank

account and other documents shall be handed over by

the promoter/builder to the apartment owners‟

association so formed and all functions relating to the

management of the building, common area, collection of

maintenance charges, expenditure to be incurred on

maintenance, employment of manpower, legal

compliance, etc. will be performed by the association.

Re: Approaching Court/Consumer Fora

19. We clarify that the remedies to such flaws which are provided

under the Consumer Protection Act, shall always remain open.

20. This writ petition stands disposed of in the aforesaid terms.

However, the matter be listed for direction on 20th December,

2010 when the respondents shall file the Status Report of the

action taken in compliance with the aforesaid directions.

(A.K. SIKRI) JUDGE

(AJIT BHARIHOKE) JUDGE MAY 28, 2010 pmc