# DLF LIMITED v. MANMOHAN LOWE AND OTHERS

- **Citation:** [2013] 16 S.C.R. 979
- **Court:** Supreme Court of India
- **Decided:** 2013-12-10
- **Case number:** Civil Appeal No. 10930 of 2013
- **Bench:** K.S. Radhakrishnan, A.K. Sikri
- **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/dlf-limited-v-manmohan-lowe-and-others-29033
- **Pages:** 44

## Headnote

Urban Development - Haryana Apartment Ownership
A
B
Act, 1983 - ss. 3(i), 3(f), 11 (2) - Haryana Development and
Regulation of Urban Areas Act, 1975- ss. 3(3)(a)(iv) - Rights
C
of the apartment owners vis-a-vis the colonizers - Apartment
owners filed writ petition. seeking writ of certiorari to quash
declaration filed by appellant-colonizer, on the ground that the
same was not in conformity with s.3(f) of the Apartment Act
since the appellant failed to include certain areas of the
D
complex as "common areas and facilities" within the
declaration, thereby effectively depriving the apaltment
owners of their rights over the same - High Court held in
favour of the apartment owners - On appeal, held: In a given
case if the developer does not provide common areas or
E
facilities like corridors, lobbies, staircases, lifts and fire
escape etc. the Competent Authority can look into the
objections of the apartment owners but when statute has given
a discretion to the colonizer to provide or not to provide as
per s.3(f)(7) of the Apartment Act the community and
F
commercial facilities referred to in s. 3(3)(a)(iv) of
Development Act, no objection could be raised by the
apartment owners and they cannot claim any undivided
interest over those facilities except the right of user - High
Court erred in directing the DTCP (Director, Town and Country
G
Planning) to decide the objections of the apartment owners
with regard to the declaration made by the appellant-colonizer.
The Apartment owners of Silver Oaks Apartments,
DLF Qutub Enclave, Phase-1, Gurgaon, filed writ petition
979
H
980
SUPREME COURT REPC~TS
[2013] 16 S.C.R.
A seeking a writ of certiorari to quash the declaration dated
19.04.2001 filed by the appellant-colonizer, on the ground
that the same was not in conformity with Section 3(f) of
the Haryana Apartment Ownership Act, 1983 since the
appellant failed to include certain areas of the complex
B as "common areas and facilities" within the declaration,
thereby effectively depriving the apartment owners of
their rights over the same.
While the Apartments owners maintained the stand
C that "community and commercial facilities", like providing
community centre, schools, shops etc., would fall within
the statutory definition of "common areas and facilities"
under Section 3(f) of the Apartment Act, the colonizers
maintained the stand that it can be so only if the colonizer
has provided so in the statutory declaration filed by it
D under Section 3(f) of the Apartment Act.
The High Court held that the apartment owners are
entitled to undivided interest in common areas and
common facilities under Section 6 of the Apartment Act
E and would be vitally affected if those areas are not
declared as common areas. The High Court also held,
inter alia, that the competent authority under Section 3(i)
of the Apartment Act is under an obligation to decide the
objections of the apartment owners to the declaration
F filed by the colonizer-appellant.
Allowing the appeal, the Court
HELD:1. The expression "colonizer" is defined
under Section 2(d) of the Haryana Development and
G Regulation of Urban Areas Act, 1975 (Development Act).
As per Section 3(3)(a)(iv) of the Development Act obliges
the colonizer to construct at his own cost schools,
hospitals, community centers and other buildings on the
lands set apart for that purpose, or also can get them
H constructed by any other institution or an individual, at
DLF LIMITED v. MANMOHAN LOWE AND OTHERS
981
its own cost, but the ownership of land set apart for the A
said purpose continues with the colonizer. Option is also
provided under Section 3(3)(a)(iv) to the colonizer to
transfer to the Government, at any time, if so desired by
the Government, free of cost, the land set apart for
schools, hospitals, community centers and community B
buildings, in which case, the Government shall be at
liberty to transfer such land to any person or institution,
including a local authority on such terms and conditions
as it m

## Text

_Characters 0–39,684 of 83,423. This is a partial read: ask again with offset=39684 for what follows._

[2013] 16 S.C.R. 979
DLF LIMITED
v.
MANMOHAN LOWE AND OTHERS
(Civil Appeal No. 10930 of 2013)
DECEMBER 10, 2013
[K.S. RADHAKRISHNAN AND A.K. SIKRI, JJ.]
Urban Development - Haryana Apartment Ownership
A
B
Act, 1983 - ss. 3(i), 3(f), 11 (2) - Haryana Development and
Regulation of Urban Areas Act, 1975- ss. 3(3)(a)(iv) - Rights
C
of the apartment owners vis-a-vis the colonizers - Apartment
owners filed writ petition. seeking writ of certiorari to quash
declaration filed by appellant-colonizer, on the ground that the
same was not in conformity with s.3(f) of the Apartment Act
since the appellant failed to include certain areas of the
D
complex as "common areas and facilities" within the
declaration, thereby effectively depriving the apaltment
owners of their rights over the same - High Court held in
favour of the apartment owners - On appeal, held: In a given
case if the developer does not provide common areas or
E
facilities like corridors, lobbies, staircases, lifts and fire
escape etc. the Competent Authority can look into the
objections of the apartment owners but when statute has given
a discretion to the colonizer to provide or not to provide as
per s.3(f)(7) of the Apartment Act the community and
F
commercial facilities referred to in s. 3(3)(a)(iv) of
Development Act, no objection could be raised by the
apartment owners and they cannot claim any undivided
interest over those facilities except the right of user - High
Court erred in directing the DTCP (Director, Town and Country
G
Planning) to decide the objections of the apartment owners
with regard to the declaration made by the appellant-colonizer.
The Apartment owners of Silver Oaks Apartments,
DLF Qutub Enclave, Phase-1, Gurgaon, filed writ petition
979
H
980
SUPREME COURT REPC~TS
[2013] 16 S.C.R.
A seeking a writ of certiorari to quash the declaration dated
19.04.2001 filed by the appellant-colonizer, on the ground
that the same was not in conformity with Section 3(f) of
the Haryana Apartment Ownership Act, 1983 since the
appellant failed to include certain areas of the complex
B as "common areas and facilities" within the declaration,
thereby effectively depriving the apartment owners of
their rights over the same.
While the Apartments owners maintained the stand
C that "community and commercial facilities", like providing
community centre, schools, shops etc., would fall within
the statutory definition of "common areas and facilities"
under Section 3(f) of the Apartment Act, the colonizers
maintained the stand that it can be so only if the colonizer
has provided so in the statutory declaration filed by it
D under Section 3(f) of the Apartment Act.
The High Court held that the apartment owners are
entitled to undivided interest in common areas and
common facilities under Section 6 of the Apartment Act
E and would be vitally affected if those areas are not
declared as common areas. The High Court also held,
inter alia, that the competent authority under Section 3(i)
of the Apartment Act is under an obligation to decide the
objections of the apartment owners to the declaration
F filed by the colonizer-appellant.
Allowing the appeal, the Court
HELD:1. The expression "colonizer" is defined
under Section 2(d) of the Haryana Development and
G Regulation of Urban Areas Act, 1975 (Development Act).
As per Section 3(3)(a)(iv) of the Development Act obliges
the colonizer to construct at his own cost schools,
hospitals, community centers and other buildings on the
lands set apart for that purpose, or also can get them
H constructed by any other institution or an individual, at
DLF LIMITED v. MANMOHAN LOWE AND OTHERS
981
its own cost, but the ownership of land set apart for the A
said purpose continues with the colonizer. Option is also
provided under Section 3(3)(a)(iv) to the colonizer to
transfer to the Government, at any time, if so desired by
the Government, free of cost, the land set apart for
schools, hospitals, community centers and community B
buildings, in which case, the Government shall be at
liberty to transfer such land to any person or institution,
including a local authority on such terms and conditions
as it may deem fit. But, the ownership of the Colonizer
cannot be transferred or divested, unless the colonizer c
volunteers to transfer the same free of cost to the
Government. Community and other facilities like schools,
hospitals, community centers, shops etc. provided in the
land set apart under Section 3(3)(a)(iv) are, therefore,
meant for the benefit of the entire colony and not for the 0
apartment owners in one part of the colony and the costs
incurred in discharge of the statutory obligations cannot
be passed on/transferred from the plot owners/apartment
owners by the colonizer. [Paras 21, 24, 25] [997-G, H;
1004-C-E, G, H]
DLF Qutub Enclave Complex Educational Charitable
Trust v. State of Haryana and others (2003) 5 SCC 622: 2003
(2) SCR 1; Ansal Properties and Industries Limited. v. State
of Haryana and Another (2009) 3 SCC 553: 2009 (1 ) SCR
E
553 - referred to.
F
2. It is the obligation of the colonizer to construct
schools, community centers and commercial facilities on
the lands set apart ·for! that purpose in the colony under
Section 3(3)(a)(iv) of the Development Act and also on the
basis of agreement executed between the colonizer and G
the DTCP (Director, Town and Country Planning). No
obligation is cast on the colonizer under the Apartment
Act or the Rules framed thereunder to provide those
facilities which are specifically mentioned under Section
3(3)(a)(iv) of the Development Act. But the Colonizer has H
982
SUPREME COURT REPORTS
[2013] 16 S.C.R.
A to provide various other facilities like "common areas and
facilities", to the apartment owners, as provided under
the Apartment Act. [Para 28] [1007-E-H]
3. The Apartment Act casts an obligation on the
colonizer to file a statutory declaration. Section 6 read
8 with Section 3(f) of the Apartment Act clearly indicates
that clauses 1 to 8, except 7 of Section 3(f) are to be
provided by the colonizer to the apartment owners and
each apartment owner is entitled to an undivided interest
in the common areas and facilities, in the percentage
C expressed in the declaration. The only exception is clause
7, which gives a right to the colonizer either to provide
or not to provide in the declaration, the community and
commercial facilities referred to in Section 3(3)(a)(iv) of the
Development Act. There is a marked difference between
D "common areas and facilities" and "community and
commercial facilities". A colonizer is duty bound to
provide all the common areas and facilities as per Section
3(f), except community and commercial facilities referred
to in Section 3(f)(7). "Common areas and facilities"
E referred to in Section 3(f)(7) of the Apartment Act has a
co-relation with the "Community and Commercial
facilities" referred to in Section 3(3)(a)(iv) of the
Development Act. It is for that reason that a discretion has
been given to the colonizer to either provide the same or
F not to provide the same in the declaration referred to in
Section 3(f) of the Apartment Act. The expression "may"
used in Section 3(f)(7) of the Apartment Act clearly
indicates that no duty is cast on the colonizer to give an
undivided interest over those community and commercial
G facilities exclusively to the apartment owners of a
particular colony, since the same have to be enjoyed by
other apartment owners of DLF City, Phase I, II and Ill as
well. Even otherwise, the colonizer could not have parted
with his ownership rights exclusively to one Colony
H alone. [Para 32] [1011-G-H; 1012-A-E]
DLF LIMITED v. MANMOHAN LOWE AND OTHERS 983
4. Section 11 of the Apartment Act deals with
A
"contents of declaration". "Contents of deed of
apartment" is dealt with in Section 12 of the Act. What is
discernible is that each apartment owner shall be entitled
to an undivided interest in the common areas and
facilities in the percentage expressed in the declaration
B
and such percentage shall be computed by taking as a
basis the value of the apartment in relation to the value
of the property. Common areas and facilities shall also
remain undivided and the apartment owner or any other
person can. use the common areas and facilities in c
accordance with the purpose for which they are intended
without entering or encroaching upon the rights of other
apartment owners. Apartment owners are entitled to an
undivided interest in the common areas and facilities in
the percentage expressed in the declaration, within the
D
meaning of Section 3(f) (1) to (6) and (8) and it is also
open to the colonizer to provide, at its own cost, the
community and commercial facilities referred to in clause
7 of Section 3(f) read with Section 3(3)(f)(iv) of the
Development Act by including them in the declaration.
Colonizer cannot also, under certain circumstances,
confer any undivided interest to an exclusive set of
apartment owners to the detriment of similar apartment
owners, who have apartments in other phases of a larger
colony or city. Apartment owners are, therefore, not
entitled to an undivided interest or possession over those
community and commercial facilities, referred to in
Section 3(3)(a)(!v) of the Development Act, unless
specifically provided by the colonizer in the statutory
declaration. [Para 33, 34 and 35] [1012-F; 1014-C; 1015C-G]
Ownership Vs. User:
E
F
G
5. The ownership right over the land earmarked for
schools, hospitals, comm1,rnity centers ~nd other
community buildings referred to in Section 3(3)(a)(iv) of H
984
SUPREME COURT REPORTS
[2013] 16 S.C.R.
A the Development Act vests on the colonizer. That
ownership can be divested by the colonizer through a
declaration under Sections 11 to 13 read with Section 3(f)
of the Apartment Act. The colonizer has to provide those
facilities in discharge of its legal obligations under the
B Development Act and the Act itself has recognized its or
his legal ownership over the area set apart for those
facilities under Section 3(3)(a)(iv) of the Act. All the same,
the right to enjoy those facilities referred to in Section
3(3)(a)(iv) of the Development Act, whether shown in the
c declaration or not, under the Apartment Act, cannot be
restricted or curtailed and the apartment owners have no
other right, except the right of "user". Community
centers, nursery schools, shops etc., therefore, being part
of the approved layout plans by the DTCP, can be used
0 by the apartment owners and, being part of the larger
colony, are intended for independent use of all the
apartment owners having direct exit to common areas, to
the public street, road, etc. All those facts would indicate,
so far as apartment owners are concerned, they have
E only a right of user, so far as the facilities provided under
Section 3(3)(a)(iv) of the Development Act are concerned.
[Para 36] [1015-H; 1016-A-E]
6. Some structures were developed by the developer
i.e. the appellant to which it is claiming its exclusive right.
F These structures are two nursery schools, three shops
and one community centre, which cannot be treated as
"common areas and facilities" within the definition of
Section 3(f) of the Act. They are parts of planning for
larger area, which plans were submitted by the appellant.
G It is not meant for the exclusive use of the flat owners of
Silver Oaks Apartments. Position would have been
different had these been integral parts of the facilities, in
the sense that these facilities are essential for the
enjoyment of the flats. [Para 37] [1016-H; 1017-A-B]
H
DLF LIMITED v. MANMOHAN LOWE AND OTHERS
985
7. Common passages, staircases, lifts etc. are the
A
examples of such common areas and facilities. Likewise,
stilt parking area may be treated as part of common areas
and facilities, in certain circumstances. Here these
structures are the part of the larger area of about 130
acres in respect of which 7 licenses were obtained for
B
development of the colony. Silver Oaks Apartments,
which comprises of 14.75 acres, is only a part thereof. The
nursery schools, shops and community centre are meant
for the development of the entire colony and are not
confined only to these apartments. Further, it is clear that c
the developer is given right to transfer these "community
buildings and community centers". Likewise, even
schools cannot be termed as part of "integral
development" use whereof would be confined to
residents of these apartments. Even the shops which are
D
inside the boundary walls have their opening from
outside to enable the shopkeepers to cater to the
customers not only from these apartments, but outsiders
as well. [Para 38] [1017-H; 1018-C-F]
Cost not on Apartment owners:
8. The Colonizer is legally obliged under Section
3(3)(a)(iv) of the Ai:t to construct at his own cost the
community and commercial facilities stipulated therein
and an agreement has to be entered into by the Colonizer
with the DTCP (Director, Town and Country Planning)
under the Development Act by which the Colonizer is
prohibited by law from recovering the cost of providing
those facilities from the apartment owners. [Para 39]
[1017-H; 1018-A]
9. Section 3(3)(a)(iv) of the Development Act read
with the agreement executed by the colonizer would
indicate that ownership of the portion of the land set apart
E
F
G
for the common areas and facilities referred to therein
vest with the Colonizer so also the obligation "at his own
cost" to provide those facilities in the land set apart for
H
986
SUPREME COURT REPORTS
[2013] 16 S.C.R.
A the said purpose. The Colonizer cannot recover cost of
land or the amounts spent by him for providing those
facilities from the apartment owners. It is for the said
reason that clause 7 of Section 3(f) of the Apartment Act
has not made it obligatory, on the part of the Colonizer
B to include the "community and commercial" facilities in
the declaration. If the colonizer includes the same within
the declaration, then Section 6 of the Apartment Act will
kick in, consequently, the apartment owners would be
entitled to the undivided interest in respect of the
C community and commercial facilities provided therein
without bearing the cost incurred by the colonizer in
purchasing the land and the cost of construction. The
colonizer could not have included the community and
commercial facilities referred to in Section 3(3)(a)(iv) of the
0 Development Act, because the same is meant for the
benefit of the entire colony, not merely the flat/apartment
owners in one part of the colony since they form part of
the lay out plans duly approved, which takes in plotted
area and the group housing societies area as well. [Para
E 40] [1019-A-E]
F
Naharchand Laloochand Private Limited v. Panchali Cooperative Housing Socities Limited (2010) 9 SCC 536: 2010
(10) SCR 804 - held inapplicable.
Competent Authority:
10. The High Court has committed an error in
directing the DTCP to decide the objections of .the
apartment owners with regard to the declaration made by
the colonizer. The Competent Authority is defined under
G Section 3(i) of the Apartment Act. Section 11 (2) provides
for filing of declaration in the office of the Competent
Authority. Section 24A of the Act prescribes penalties and
prosecution for failure to file a declaration and Section
248 permits the prosecution only with the sanction of the
Competent Authority. In a given case if the developer
H does not provide common areas or facilities like corridors,
DLF LIMITED v. MANMOHAN LOWE AND OTHERS 987
lobbies, staircases, lifts and fire escape etc. the
A
Competent Authority can look into the objections of the
apartment owners but when statute has given a
discretion to the colonizer to provide or not to provide
as per Section 3(f)(7) of the Apartment Act the facilities
referred to in Section 3(3)(a)(iv) of Development Act, no
B
objection could be raised by the apartment owners and
they cannot claim any undivided interest over those
facilities except the right of user. In the instant case the
apartment owners have raised no grievance that they are
being prevented from using the community and c
commercial facilities referred to in Section 3(3)(a)(iv) of
Regulation Act, but they cannot claim an undivided
interest or right of management over them. [Para 43]
[1021-8-F]
11. The Haryana Development and Regulation of D
Urban Areas (Management) Act, 2003 came into force on
03.04.2003. By virtue of the amended definition of
"external development works", the scope of the said
expression has been widened and the State Government
has given a Wider discretion in expending the amount
E
collected from the colonizer as external development
charges. The Amendment Act does not seek to transfer
an obligation of actually carrying out the external
development work upon the colonizer. [Para 44] [1021G-H; 1022-A, B]
F
12. The High Court has not properly appreciated or
applied the various statutory provisions of the Regulation
Act and the Rules framed thereunder, the terms of
licences issued, agreements executed between the
colonizer and the DTCP vis-a-vis the various provisions
G
of the Apartment Act, the statutory declaration made by
the colonizer and the Sale Deeds executed between the
parties. In such circumstances, the judgment of the High
Court is set aside. [Para 45] [1022-D-E]
H
A
B
988
SUPREME COURT·REPORTS
[2013] 16 S.C.R.
Case Law Reference :
referred to
Para 11
2003 (2) SCR 1
2010 (10) SCR 804
2009 (1) SCR 553
held inapplicable
Para 16
referred to
Para 26
CIVIL APPELLATE JURISDICTION : Civil Appeal No.
10930 of 2013.
From the Judgment and Order dated 09.09.2009 of the
High Court of Punjab & Haryana at Chandigarh in CWP No.
C 960 of 2000.
WITH
Contempt Petition (C) D. No. 29500 of 2012.
Mukul Rohatgi, Uday U. Lalit, Randip Singh Rai, Vikas
D singh T. R. Andhyarjuna, Narender Hooda, Sr. AAG, Pravin
Bahadur, Mallika Joshi, Amit Agarwal, Prit Pal Nijjar, Rajan
Narain, Rajeev Anand, Saurabh Kirpal, Ranjita Rohtagi, Gagan,
Gupta, lmran Ahmad Abbasi, Deepika Kalia, Sanket, Vaibhav
Gaggar, Garima Malhotra, Gauhar Miraza, C.S. Ashri, Anubha
E Agarwal, Ambuj Agarwal, Kamal Mohan Gupta, Santosh Paul,
Arti Singh, Piyus Sharma, Madhu Tewatia, Sidhi Arora for the
Appearing Parties.
F
The Judgment of the Court was delivered by
K.S. RADHAKRISHNAN, J. 1. Leave granted.
2. This appeal arises out of a writ petition filed by the
Apartment owners of Silver Oaks Apartments, DLF Qutub
Enclave, Phase-1, Gurgaon, seeking a writ of certiorari to quash
the declaration dated 19.04.2001 filed by the Appellant, on the
G ground that the same is not in conformity with Section 3(f) of
the Haryana Apartment Ownership Act, 1983 (for short "the
Apartment Act") since the appellant failed to include certain
areas of the complex as "common areas and facilities" within
the declaration, thereby effectively depriving the apartment
H owners of their rights over the same.
DLF LIMITED v. MANMOHAN LOWE AND OTHERS 989
[K.S. RADHAKRISHNAN, J.]
3. The Division Bench of the Punjab and Haryana High
A
Court accepted their contention and held that the apartment
owners are entitled to undivided interest in common areas and
common facilities under Section 6 of the Apartment Act and
would be vitally affected if those areas are not declared as
common areas. The Court also held, inte-r alia, that the
B
competent authority under Section 3(i) of the Apartment Act is
under an obligation to decide the objections of the apartment
owners to the declaration filed by the colonizer-appellant herein.
Aggrieved by the same, this appeal has been preferred by the
colonizer.
c
4. The colonizer purchased large extent of lands in villages
Chakarpur, Sarhaul, Shahpur, Nathupur and Sikanderpur Ghosi,
Tehsil and District Gurgaon, Haryana, with a view to develop a
residential colony to be known as DLF Qutab Enclave Complex.
Any intending company or association having land for converting
it in the colony, was required to apply for licence under the
Haryana Development and Regulation of Urban Areas Act,
1975 (for short 'the Development Act'). The colonizer submitted
an application in accordance with Section 3 of the Development
Act for necessary licences. During the years 1980-81 seven
licences were obtained by the Colonizer in relation to 130.62
acres. Licences were granted by the Director, Town and
Country Planning, Haryana (DT(;P) in accordance with the
provisions of the Development Act. The Department of Town
D
E
and Country Planning, Haryana (the Department) in the year
1982 approved the group complex, Silver Oaks, as part of the
colony being developed by the Colonizer. Licences were
initially granted for two years, and later got periodically
renewed. On 30.05.1990 a condition was imposed by the
Competent Authority that the Colonizer should provide
G
Economically Weaker Sections Complex (EWS) and service
units to the extent of 10% of main dwelling units. Consequently,
revised plan was submitted, which was approved by the
Competent Authority on 08.11.1990 in which residential blocks
comprising parking in basement, EWS Flats and three shops
F
H
990
SUPREME COURT REPORTS
[2013] 16 S.C.R.
A were approved. There was further revision for zoning and
building plan in the years 1992 and 1995.
5. The Department, in the meantime, circulated norms for
provision of community facilities vide DTCP Endst No.20028
8 dated 24.11.1988. During the year 1990, agreements were
entered into between the Colonizer and the Apartment Owners
of the above-mentioned complex. Apartment buyers agreement
provided for sale of a quantified 'super area' against the sale
consideration specified in the agreement. The 'super area'
comprises of an exclusive right to use the common area within
C the building in which the apartment was situated. Agreement
also states that the colonizer will transfer and convey its right,
title and interest in the said site, common area and common
facilities in favour of the co-operative society or limited company
or association of persons, etc. in accordance with the
D provisions of the Apartment Act and the Rules framed
thereunder.
6. The Colonizer later applied for completion certificate on
15.04.1996 for group housing scheme measuring 14.75 acres.
E The Apartment Act, though was enforced by notification dated
08.09.1986, issued by the Haryana Department, the same was
rescinded on 24.10.1997 as the concerned department which
notified the Act was the Town Planning Department.
Consequently, a fresh notification dated 10.11.1997 was issued
F by the Department notifying the applicability of the Act in the
entire State of Haryana. Later several sale deeds were
executed by the Colonizer in favour of the apartment owners in
the year 1997, wherein both had agreed that they would conform
to the provisions of the Apartment Act. Writ Petition No.960 of
2000 was filed by respondents 1 to 5, before the Punjab &
G Haryana High Court, seeking a direction to the Colonizer to file
a deed of declaration in relation to the Complex under the
Apartment Act.
7. The Department later gave a partial completion
H certificate to the Colonizer on 22.01.2001, subject to the
DLF LIMITED v. MANMOHAN LOWE AND OTHERS
991
[K.S. RADHAKRISHNAN, J.]
condition of filing a deed of declaration under the Apartment A
Act within 90 days. Later the Department on 14.03.2001 revised
the earlier partial completion certificate for the complex, inter
alia, requiring the Colonizer to file a deed of declaration within
a period of 90 days. It was also provided that the responsibility
of the ownership of common areas and common facilities as
B
well as their management and maintenance should continue to
vest with the Colonizer till such time the responsibility was
transferred to the statutory condominium association under the
Apartment Act.. The Colonizer accordingly on 19.04.2001 filed
the "deed of declaration" along with bye-laws of the statutory c
condominium association (Silver Oaks Condominium
Association for short 'the SOCA') as required under Section
11 (2) of the Apartment Act. The Colonizer on 20.04.2001
issued a letter to the SOCA stating that all the dwelling units,
areas, with the common areas and facilities along with other D
assets, plant and machinery and equipments, as declared in
the declaration stands transferred tc::i the SOCA for the
maintenance. The Colonizer on 23.04.2001 also wrote a letter
to the SOCA requesting them to take over the responsibility of
maintaining common areas and facilities along with other
assets, plant and machinery and equipments etc.
E
8. The SOCA on 27.04.2001 passed a resolution that it
would take over the responsibility of managing of common
areas and facilities along with other assets, plants and
rr>achinery and other equipments, as transferred to the
F
Association by the Colonizer. The same was confirmed by the
Association by sending a letter on 03.05.2001 to the Colonizer.
9. Writ Petition No.960 of 2000, filed by respondents 1 to
5 was later amended, challenging the declaration filed by the G
Colonizer, stating that the same was not in conformity with the
mandate of the Apartment Act, and that the common areas and
facilities should also include shops or parking areas,
community centers, nursery school and other common facilities.
Amendment sought was allowed by the High Court on
H
992
SUPREME COURT REPORTS
[2013] 16 S.C.R.
A 26.11.2001. Before the High Court Silver Oak Society also got
themselves impleaded as party. The High Court also impleaded
the statutory SOCA as a party respondent to the writ petition.
The High Court also sought a clarification from the Department
with regard to the meaning of expression "common areas and
B facilities". The Department clarified that the "common areas
and common facilities" need to be defined categorically in the
declaration to be filed under Section 2 of the Apartment Act
which may or may not include community buildings, shops etc.
10. The Division Bench of the High Court after hearing all
C the parties took the view that the question whether primary
schools, shops or community center are common areas or any
other objection of the flat owners could be decided by the
Competent Authority, having regard to the provisions, objects
and spirit of the Act. Further, the Court also took the view that
D it is not the intention of the Legislature that the developer/
Colonizer assumes absolute power of declaring or not
declaring areas, normally in common use, to be common areas.
The Court also held that Section 11, which deals with the
contents of the declaration, cannot be read as giving absolute
E power to the Colonizer/developer to exclude common areas
from the said concept. The Court also held that the apartment
owners are entitled to object to the contents of the declaration
and it is for the Competent Authority to decide cross-objections.
The Court after holding so, disposed of the writ petition with a
F direction to the Competent Authority to take a decision on the
various objections raised by the apartment owners and the
association. The legality of which is the question that arises for
consideration in this appeal.
G
11. Shri Mukul Rohatgi, learned senior counsel appearing
for the Colonizer, submitted that the High Court has completely
misunderstood the scope of various provisions of the
Development Act and the Rules framed thereunder as well as
the Apartment Act, and the Rules framed thereunder. Learned
senior counsel submitted that the judgment of the High Court
H
DLF LIMITED v. MANMOHAN LOWE AND OTHERS
993
[K.S. RADHAKRISHNAN, J.]
has the effect of rendering the provisions of the Development
A
Act, particularly, Section 3(3)(a)(iv) otiose in as much as it
compels the Colonizer to divest its ownership rights in re.lation
to community and commercial facilities developed by it in terms
of the provision of the Development Act. Learned senior
counsel also submitted that the direction of the High Court that
B
the declaration must categorise the whole property into
"apartment, common areas and facilities" and "limited common
areas and facilities" is contrary to Section 3(f) of the Apartment
Act, which itself, accord'ing to the learned senior counsel, does
not compel the Colonizer to divest its ownership rights in c
community and common facilities developed by it as part of the
obligation under the Development Act. Learned senior counsel
also submitted that the High Court has failed to appreciate that
the community and commercial facilities, in SOCA, were
provided as part of the Colonizer's over all obligations under
D
Section 3(3)(a)(iv) of the Development Act for the colony as a
whole and the same cannot be considered separate only on
account of being located at a specific site in the colony i.e.
inside the Silver Oaks Complex. Learned senior counsel
placed considerable reliance on the Judgment of this Court in
E
DLF Qutub Enclave Complex Educational Charitable Trust
v. State of Haryana and others (2003) 5 sec 622 and
submitted that community facilities and amenities are not part
of the "development work" under the Development Act.
12. Shri Vikas Singh, learned senior counsel appearing
F
for the applicants in IA No.4 of 2013, supported the Colonizer's
contentions and also submitted that the High Court has not
properly appreciated the scope of Section 3(f) of the Apartment
Act. Learned senior counsel pointed out that the expression
"unless the context requires in the declaration" or "lawful
G
amendments thereto" which finds a place in Section 3(f) of the
Act has been completely overlooked by the High Court.
Learned senior counsel also submitted that the Colonizer is not
under an obligation either under the conditions of licence under
the Development Act or under the provisions of the Apartment
H
994
SUPREME COURT REPO~TS
[2013] 16 S.C.R.
A Act to declare certain areas to be common areas and facilities.
13. Mr. Narender Hooda, learned Additional Advocate
General, Haryana, appearing for the State of Haryana,
submitted that the internal community facilities are required to
8 be provided by the colonizer in terms of Section 3(3)(a)(iv) of
the Development Act, at his own cost and the expenditure
incurred cannot be passed on to the apartment owners and
colonizer continues to be the exclusive owner of such community
facilities and is free to incorporate or not, any or all such internal
community facilities in the declaration required to be filed in
C terms of the Apartment Act. Learned AAG also submitted that
in the instant case Silver Oaks is a part of a large colony of
130 acres and the same cannot be treated as an independent
colony but only a portion of large colony of 130 acres. Further
it is pointed out that all community facilities provided in the
D colony of 130 acres of which Silver Oaks is only one part is
meant for the use and enjoyment of all the residents of the
colony.
14. Shri T.R. Andhiyarujina, learned senior counsel
E appearing for the applicants in IA No.3 of 2010 submitted that
the High Court is right in holding that the intention of the
legislature is that the Colonizer cannot be conferred with an
absolute power to declare or not to declare areas normally in
common use, to be common areas. Learned senior counsel
F submitted that apartment owners are always entitled to object
to the contents of the declaration if the contents are not in
conformity with the statutory provisions and spirit of the
Apartment Act. Learned senior counsel submitted that the High
Court has only directed the Competent Authority to examine the
G objections raised by the apartment owners ar.d it is for the
Competent Authority to decide as to whether the declaration
is in conformity with the Apartment Act and the Rules and
Regulations framed thereunder.
15. Mrs. Madhu Tewatia, learned counsel appearing for the
H SOCA, took us extensively to the provisions of the Apartment
DLF LIMITED v. MANMOHAN LOWE AND OTHERS 995
[K.S. RADHAKRISHNAN, J.]
Ownership Act and the Rules framed thereunder and submitted
A
that the group housing complexes are totally independent and
distinct entity in terms of sanctions, applicability of development,
control, norms etc. vis-a-vis plotted colonies. Learned counsel
also submitted that the internal development work shall include
common facilities in the building complex, for example,
B
common sewerage, water supply, common staircases,
corridors, ramps, lifts, chutes etc. and the community buildings
are in addition to the provisions of development work mentioned
in Rule 5 of Development Rules, 1976. Referring to the licence
agreement ·under th.e Development Act, learned counsel c
pointed out that the common areas and facilities do not vest
or belong to the builder and the responsibility of ownership or
common areas and facilities, as well as their management,
shall continue to vest with the Colonizer only till the responsibility
is transferred to the owners of the dwelling units under the
D
Apartment Act.
16. Learned counsel also submitted that the development
charges and construction work in the colony are paid for by the
apartment owners. Learned counsel also referred to the
Judgment of this Court in Naharchand Laloochand Private
E
Limited v. Panchali Co-operative Housing Socities Limited
(201 O} 9 SCC 536, and submitted that this Court, while.
interpreting para-materia definition of common areas and
facilities held that parking area, common area and facilities and
that even the factum of not having taken money from the
F
apartment owners could not change the character and nature
of common area even though the builder may not have charged.
Learned counsel also submitted that Judgment in DLF Qutub
Enclave (supra) can be distinguished on facts and law and is
not applicable to the case on hand since in the instant case,
G
learned counsel submits, this Court is concerned with the group
housing multi-storied society unlike plotted colonies.
17. Shri Santosh Paul, learned counsel appearing for the
. applicants in IA No.5 of 2013, submitted that the Colonizer/ ' H
996
SUPREME COURT REPORTS
(2013] 16 S.C.R.
A Developer in the State of Haryana have with impunity violated
the provisions of the Apartment Act. Learned counsel submitted
that under Section 6 of the Act each apartment owner is entitled
to an undivided interest in common areas and facilities and that
percentage of undivided interest of common areas and facilities
B shall be deemed to be conveyed or encumbered with the
apartment even though such interest is not expressly mentioned
in the conveyance or instrument. Learned counsel also made
reference to the licence format LC-7 and other relevant
provisions of the Development Act as well as the Apartment
c Act and submitted that the Developer/Colonizer having
connivance with the authorities taken shelter under Section 3(1)
to sustain for profiteering. Learned counsel, therefore,
submitted that there is no reason to upset the findings recorded
by the High Court which are in tune with the over all public
D interest so that the rights of the vulnerable sections of the
society would be safeguarded from the colonizers.
18. We find that the issue involved in this case is of
considerable importance in the real estate sector, especially
in the urban areas, while developing a Scheme in connection
E with the plot development or group housing, hence, it is
necessary to examine the various legal issues which arise for
consideration in this appeal. The primary question that has
come up for consideration is with regard to the rights of the
apartment owners, vis-a-vis the colonizers over "community and
F commercial facilities" referred to in Section 3(f)(7) of the
Apartment Act.
19. Apartments owners, as already stated, maintained tne
stand that "community and commercial facilities", like providing
G community centre. schools, shops etc., would fall within the
statutory definition of "common areas and facilities" under
Section 3(f) of the Apartment Act. The colonizers maintained
the stand that it can be so only if the colonizer has provided so
in the statutory declaration filed by it under Section 3(f) of the
H Apartment Act.
DLF LIMITED v. MANMOHAN LOWE AND OTHERS
997
[K.S. RADHAKRISHNAN, J.]
20. We are, in this case, concerned with the rights and
A
obligations which flow to a colonizer, vis-a-vis, the apartment
owners on the basis of the Development Act as well as the
Apartment Act. Let us first examine the relevant provisions of
the Development Act.
The Development Act:
21. Section 2(c) of the Development Act defines the term
"colony", which reads as follows:
B
"2(c) "colony" means an area of land divided or proposed c
to be divided into plots or flats for residential, commercial,
industrial, cyber city or cyber park purposes or for the
construction of flats in the form of gr0ttp housing or for the
construction of integrated c~mmercial complexes, but an
area of land divided or proposed to be divided-
(i) ~ for the purpose of agriculture; or
(ii)
as a result of family partition, inheritance,
succession or partition ·of joint holding not with the
D
motive or earning profit; or
E
(ii)
in furtherance of any scheme sanction under any
other law; or
(iii)
by the owner of a factory for setting Lip a housing
colony for the labour or the employees working in
F
the factory; provided there is no profit motive; or
(iv)
when it does not exceed one thousand square
metres or such less area as may be decided from
time to time in an urban area by Government for the
G
purposes of this sub-clause, shall not be a colony."
The expression "colonizer" is defined under Section 2(d)
which reads as follows :-
"2(d). "colonizer" means an individual, company or
H
998
SUPREME COURT REPORTS
(2013] 16 S.C.R.
A
association or body of individuals, whether incorporated
or not, owning land for converting it into a colony and to
whom a licence has been granted under this Act."
The expression "development works" is defined under
Section 2(e) of the Act to mean as "internal and external
8
development works". Section 2(g) defines the expression
"external development works" and reads as follows:
"2(g). "External development works" include water supply,
sewerage, drains, necessary provisions of treatment and
C
disposal of sewage, sullage and storm water, roads,
electrical works, solid waste management and disposal,
slaughter houses, colleges, hospitals, stadium/sports
complex, fire stations, grid sub-stations etc. and any other
work which the Director may specify to be executed in the
D
periphery of or outside colony/area for the benefit of the
colony/area."
E
F
G
H
The word "flat" is defined under Section 2(gg) of the Act,
which reads as follows:
"2(gg). "Flat" means a part of any property, intended to be
used for residential purposes, including one or more
rooms with enclosed spaces located on one or more
floors, with direct exit to a public street or road or to a
common area leading to such streets or roads and
includes any garage or room whether or not adjacent to
the building in which such flat is located provided by the
colonizer/owner of such property for use by the owner of
such flat for parking any vehicle or for reside'nce of any
person employed in such flat, as the case may be."
The expression "group housing" is defined under Section
2(hh) of the Development Act, which reads as follows:
"2(hh). "Group housing" means a building designed and
developed in the form of flats for residential purpose or any
DLF LIMITED v. MANMOHAN LOWE AND OTHERS 999
[K.S. RADHAKRISHNAN, J.]
ancillary or appurtenant building including community, A
facilities, public amenities and public utility as may be
prescribed."
Section 2(hhh) defines the expression "integrated
commercial complex", which reads as follows :-
8
"2(hhh).