Maharashtra REAT Imposes Penalty Equivalent to 2% of Project Cost on RA Associates for Altering Project Plan Without Allottees’ Consent
Case Title: RA Residences Co-operative Housing Society Ltd. v. RA Associates & Ors.
Case No.: Appeal No. AT06/00804/2025
Date of Decision: 16 September 2026
Forum: Maharashtra Real Estate Appellate Tribunal (MahaREAT)
The Maharashtra Real Estate Appellate Tribunal (MahaREAT), by its judgment dated 16 September 2026, imposed a penalty equivalent to 2% of the project cost upon RA Associates and its partners, the promoters of the “RA Residences” project in Mumbai, for altering the disclosed project plans and increasing the Floor Space Index (FSI) of the commercial building without obtaining the requisite prior consent of the allottees.
A Bench comprising Chairperson Justice S.S. Shinde and Administrative Member Shrikant M. Deshpande further directed the promoters to execute the conveyance of the residential building within 60 days. The Tribunal held that a promoter cannot indefinitely defer conveyance on the ground that additional FSI or Transferable Development Rights (TDR) may become available in the future.
The Tribunal observed:
“...In fact, once the FSI available in the project property is exhausted, the promoters are obligated to execute the conveyance and are not entitled to any further FSI, if available, due to change in policy within the property or procured from elsewhere.”
Background
The dispute arose in relation to the “RA Residences” project in Mumbai, comprising residential Wings A and B and a separate commercial/IT building. The promoters had initially proposed to complete the project by 30 June 2018, following which the registration of the project was extended by the Maharashtra Real Estate Regulatory Authority (MahaRERA).
Part occupation certificates for the residential wings were obtained on 23 June 2020, 15 December 2020 and 9 December 2021, while the housing society was registered on 18 October 2022.
The society subsequently approached MahaRERA alleging, inter alia, that the promoters had:
materially altered the sanctioned and disclosed plans;
utilised additional FSI without obtaining the requisite consent of the allottees;
altered common and recreational areas;
failed to execute the conveyance; and
failed to hand over project documents, amenities and other facilities.
MahaRERA, by its order dated 7 July 2025, partly allowed the complaint and held that the promoters had violated Section 14(2) of the Real Estate (Regulation and Development) Act, 2016, which requires the prior consent of at least two-thirds of the allottees for specified alterations or additions to sanctioned plans.
The society thereafter preferred an appeal before MahaREAT seeking further reliefs.
Alteration of Plans Without Consent
Before the Tribunal, the promoters contended that the residential buildings had been completed in accordance with the sanctioned plans and that occupation certificates had been obtained. They further relied upon the agreements for sale, contending that the contractual arrangements contemplated separate residential and commercial structures and permitted development through additional FSI/TDR.
The Tribunal, however, held that the promoters had violated Section 14 of RERA by altering the disclosed sanctioned plans without obtaining the requisite consent of the allottees.
The Tribunal also found violations of Section 11 of RERA, which prescribes the promoter's statutory obligations, including obligations concerning conveyance.
Consent Under RERA and MOFA Cannot Be Contractually Dispensed With
The Tribunal additionally held that the promoters had violated Section 7 of the Maharashtra Ownership Flats Act (MOFA), which requires the consent of flat purchasers for additions or alterations to the structure disclosed to them.
In particular, the Tribunal noted that construction of the commercial C-Wing under the revised 2021 plan required the consent of two-thirds of the allottees.
Significantly, it rejected the promoters' reliance upon deemed-consent clauses contained in the agreements for sale, observing:
“the deemed consent in the clauses of the agreements for sale is not the consent within the meaning of consent under section 7 of MOFA or section 14 of RERA.”
Thus, contractual provisions cannot be treated as a substitute for the statutory consent contemplated under RERA and MOFA.
Additional FSI/TDR and Entitlement of the Societies
The Tribunal further held that the additional FSI/TDR utilised by the promoters, but not disclosed in the 2017 plan, belonged to the societies representing the residential and commercial buildings of the project.
The Tribunal therefore directed proportionate apportionment of the sale proceeds generated from commercial units constructed by utilising the additional 4,225.57 square metres of FSI.
The finding assumes significance in the context of the promoter's rights over additional development potential after the disclosure of the original project plans and the rights of the allottees/societies in such additional development potential.
Conveyance Cannot Be Deferred Indefinitely
Since Wings A and B had received occupation certificates and possession had been handed over to the respective allottees, the Tribunal directed the promoters to complete the conveyance of the residential building.
It specifically rejected the proposition that conveyance could be postponed merely because additional FSI or TDR might become available in the future. The Tribunal held that once the FSI available in the project property has been exhausted, the promoters are required to execute the conveyance and cannot retain rights over future FSI merely because of a subsequent change in policy or because additional FSI/TDR may be procured from another source.
Accordingly, the promoters were directed to convey the residential building's proportionate interest in the project property, together with the relevant common areas and amenities, within 60 days.
Maintenance, Clubhouse and Corpus Fund
The Tribunal also considered amounts collected by the promoters towards maintenance charges, clubhouse charges and corpus fund.
Since the residential buildings had been completed and possession had been handed over, MahaREAT directed the promoters to furnish audited accounts of the amounts collected under these heads.
The Tribunal observed:
“Since the residential building (wing 'A' and wing 'B') is completed with occupation certificate and the allottees have taken the possession of their respective flats, we deem it appropriate to direct the promoters to provide audited accounts of the amounts collected under agreements towards maintenance charges, clubhouse charges, and corpus fund and refund the amount as per the audited accounts to the appellant with accrued interest on the said amount, if kept in a separate account.”
The promoters were consequently directed to refund the balance amount to the society, along with accrued interest wherever applicable.
Other Directions
MahaREAT further directed the promoters to:
hand over the remaining 64 guest parking spaces;
execute the conveyance of the residential building's proportionate interest in the project property;
hand over the relevant common areas and amenities;
furnish audited accounts concerning maintenance, clubhouse and corpus-fund collections; and
refund the balance amounts to the society with applicable interest.
The issues relating to incomplete works, repairs, deficiencies in services and rectification of defects were remanded to MahaRERA for fresh adjudication.
Key Takeaway
The decision reiterates that the promoter's contractual rights under an agreement for sale do not override the statutory protections afforded to allottees under RERA and MOFA. Alterations to disclosed plans and structures requiring statutory consent cannot be justified merely by relying upon deemed-consent clauses in agreements for sale.
The ruling also emphasises that future availability of FSI/TDR cannot be used as an indefinite ground to postpone conveyance once the relevant project development has reached the stage where conveyance is required. Further, where additional development potential is utilised in a manner not disclosed in the original project plan, the Tribunal may examine the consequential rights of the societies/allottees in the benefits arising from such additional development.
