HC rejects housing society’s plea in TDR dispute

TDRs are certificates issued by the municipal authorities which allow a property owner to build more on their land than normally permitted by giving up some of their land for a public purpose such as a park or the widening of a road

MUMBAI: The Bombay High Court on Friday dismissed a plea by the Green Garden Apartments Co-operative Housing Society in Borla, Deonar, which sought to restrain developers from using Transferable Development Rights (TDR) sold to them by the society. The court criticized the society for attempting to retain sale proceeds and questioned the legality of the transactions.

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TDRs are certificates issued by the municipal authorities which allow a property owner to build more on their land than normally permitted by giving up some of their land for a public purpose such as a park or the widening of a road.

The society claimed that TDR worth over ₹46 crore had been sold to developers by certain members of the society without consulting the rest of the people. The society members called the sale “unauthorised and fraudulent”, but justice Sandeep V Marne refused to uphold their plea against 18 developers and the Municipal Corporation of Greater Mumbai (MCGM).

The court noted that the transactions were backed by resolutions passed in January and June 2023, and that payments from developers had begun flowing into the society’s bank accounts as early as March 2023. Justice Marne said that audit reports, SMS alerts, and WhatsApp chats between the treasurer and other members showed that the society was aware of the transactions.

The dispute traces back to land acquired by the then Municipal Corporation of Greater Mumbai (MCGM) in 1986 for road construction. The MGCM had secured a TDR for the road construction in August 2023. However, to raise funds for settling a private land dispute, the society mortgaged part of the TDR and executed several agreements with various developers. By early 2024, most developers had obtained commencement or occupancy certificates for their projects.

In February 2025, nearly two years after being compensated for the TDR’s sale, the society approached the court, claiming the transactions were unauthorised and fraudulent. The delay was unacceptable, and the court said, “Third-party rights have been created, projects have advanced, and innocent flat purchasers would suffer on account of the belated challenge.”

“The society received compensation for the TDR, settled a longstanding land dispute by paying ₹14 crore to a neighbour, and is now attempting to take a volte-face (reversal of attitude) by questioning the very transactions from which it benefitted,” the judge observed.

The court also rejected the society’s claim that in earlier such cases TDR had been treated like an immovable property. Instead, the court accepted the view of stamp authorities and past rulings that TDR, once detached from land, is treated as movable property and freely tradable in the market.