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By Avikshit Moral and Mr. Akanksh Bhardwaj

As per the Merriam Webster Dictionary, a terrace has been defined as a flat roof or open platform. Some developers of the co-operative housing societies/buildings resort to the unfair practice of selling the roof top/terrace. A common easement of the housing society/building which includes the terrace is for the benefit and enjoyment of all the members/residents. No single member can appropriate such common easement and deprive the other members/residents from using the same.

Is Sale of Terraces Legal?

Owning or occupying of terrace of a housing society building is unfair and illegal practice. However, in some co-operative housing societies, terraces have been purportedly sold by developers. Also, in some societies, top floor flat owners have claimed ownership of terraces, with the connivance of some of the office bearers. Further, the builder has no right to sell the terrace to a member and deprive the other member of the open space rights.

The intent is clear from the reading of Section 4(1A) (a) (iii), (viii), (x) and section 10(1) of the Maharashtra Ownership Flats Act 1963 (“MOFA”), whereby the builder has absolutely no right or authority to sell the terrace. In fact none of the provisions, individually or collectively, authorize the builder or any other entity including the society, to sell a terrace of the housing society/building. At the time the BMC passes the building construction plans, the terrace is not included while calculating the FSI as it is for all the members/residents of the housing society/building. The law and BMC regulations are quite clear in this regard that the terrace of the housing society/building can not be sold, and is absolutely meant for the benefit of all the members/residents of the housing society/building.

Case Law Reference:

Ramagauri Keshavial Virani v. Walkeshwar Triveni Cooperative Housing Society Ltd., 1999(3) Mh.L.J. 145, 2000 (2) Born. C.R. 687

The dispute was raised against member by the society. The Co-operative court confirmed the award in favour of society in Appeal. The society was registered in 1962 and conveyance was executed in favour of society on 8th February, 1963. The Petitioner purchased the flat and became a member in 1968. The Society filed a dispute in 1973.

It was argued that Petitioner has purchased from original builder a two-bedroom flat on the 7th floor having an area of about 1000 sq.ft. and more along with a terrace appertaining to the said flat admeasuring about 1700 sq.ft. According to petitioner the flat along with the terrace was purchased by the petitioner on 20th June, 1966. It was argued that the petitioner had proved the title to the said flat along with the terrace and since the flat had two doors opening into that terrace, the ownership of the terrace was required to be accepted in favour of the petitioner for the purpose of the security of her flat. It was stated that the dispute did not fall in the ambit of Section 91 of Maharashtra Co-operative Societies Act since it was not a dispute between society and its member. Since the Petitioner has purchased the flat in 1966, he became member subsequently.

It was also contended that the builder is empowered to sell the rights over terrace to any one. The document executed by the builder in favour of society was not registered. Therefore, the rights over the terrace by the society could not be established. It was held by the Single Bench that the statutory provisions of Section 4 alongwith Section 10, individually or collectively do not authorise the builder to sell the rights over terrace of a building. The words such as common areas, facilities, carpet area do not include “the terrace” and therefore none of the aforesaid provisions can be interpreted to mean that a builder or promoter can dispose of the terrace to one of the purchasers of flat. Similarly, the definition of the word flat as given in Section 2 does not include in its ambit the terrace of the building nor the protection given under Section 10(1) authorise the builder or promoter to sell the terrace of the building. Petition was rejected.

In Nahalchand Laloochand P.Ltd vs Panchali Co-Op.Hng.Sty.Ltd. the Supreme Court of India had held that the promoter has no right to sell any portion of such building which is not `flat’ within the meaning of Section 2(a-1) and the entire land and building has to be conveyed to the organization and the only right that remains with the promoter is to sell unsold flats. Although, this was held while dealing with the issue of sale of parking space, but the same rationale can be used for a terrace.

According to section 2(a-1) MOFA ‘Flat” means a separate and self-contained set of premises used or intended to be used for residence, or office, show-room or shop or godown for carrying on any industry or business] (and includes a garage), the premises forming part of a building [and includes an apartment]. Thus, it is clear from the definition that terrace does not form part of Flat as is defined hereinabove. Terrace is a part of the common area which is accessible by everyone in the building.