Authority: Supreme Court of India, Civil Appellate Jurisdiction

Order Date: 23 July 2026

Case Overview

  • Appellants: Mrs. Mahabanoo Contractor and Anr.; Respondents: M/s. Kalikund Developers and Ors.
  • The dispute stems from a Permanent Alternate Accommodation Agreement (PAAA) dated 17‑Oct‑2019, which promised the appellants three flats in the redeveloped building.
  • The building was cessed under the Maharashtra Housing and Area Development Act, 1976 (MHAD Act) with a No‑Objection Certificate (NOC) from MHADA.
  • MHADA issued two orders on 28‑May‑2025 and 27‑Jun‑2025 directing the developer to execute the PAAA and hand over possession; a Show‑Cause Notice (SCN) followed on 10‑Jul‑2025 under Section 91A of the MHAD Act.
  • The High Court of Bombay, in a Division Bench, set aside the MHADA orders, deeming the PAAA a private arrangement and restraining further coercive steps.
  • The developer later filed Civil Suit No. 4579 of 2026 on 06‑Feb‑2026, challenging the appellants’ claim to the entire 3336.92 sq ft area and contesting the validity of the PAAA.
  • Counsel for the appellants (Mr. Shyam Divan) argued that the appellants are legal heirs of the original occupant, Ms. Gool Peshotan Unwalla, and are entitled to the accommodation under the statutory definition of “occupier” in the MHAD Act and Rule 33(7) of the Development Control Regulations.
  • Counsel for the developer (Mr. Vinay Navare) contended that the PAAA was concocted, that the appellant had no right after the original tenant’s death, and that the area allotted exceeded the original tenancy.
  • MHADA’s position, presented by Mr. Chirag M. Shroff, emphasized that the statutory scheme mandates accommodation of all certified occupants before the developer can obtain an Occupation Certificate.
  • Key documents referenced: public notice (21‑Apr‑2010), NOC dated 21‑Sep‑2010 (and revised 21‑Aug‑2012), certified list of occupants, annexures showing possession handed over by the appellant, amended plan dated 30‑Jun‑2021, and communications from MHADA up to 22‑Nov‑2022.
  • The PAAA stipulated 219.81 sq m + 35 % fungible area (total 309.98 sq m), translating to one flat of 1227.42 sq ft and two flats of 1054.75 sq ft each, with three covered parking spaces.

Final Outcome

  • The Supreme Court set aside the High Court judgment and revived MHADA orders dated 28‑May‑2025, 27‑Jun‑2025, and the SCN of 10‑Jul‑2025.
  • The Court directed the 1st and 2nd respondents (Kalikund Developers) to execute the PAAA and hand over possession of the three apartments in the new building within two months from the order date.
  • If possession is not delivered within the stipulated period, the appellants are entitled to damages equal to the monthly rental value for each of the three flats.
  • The Court awarded costs of Rs 50,000 each to the appellants, payable by the 1st and 2nd respondents.
  • The Court also directed that the pending Civil Suit No. 4579 of 2026 should not proceed.

Topics: Court Judgment, Housing Redevelopment, Occupant Rights