Bombay High Court Orders Allotment of 2 Unfinished Flats to Original Society Members, Directs Payment of ₹2.5 Crore
Bombay High Court | Cooperative Housing Society | Flat Allotment | TDR/FSI | Unjust Enrichment
Mumbai, September 24, 2026: The Bombay High Court has directed Le Chateau Co-operative Housing Society Ltd. in Santacruz to allot two unfinished and unoccupied flats, Flat Nos. 801 and 802 in the Shamrock building, to the original members who had been deprived of their entitlement.
Justice Sandeep V. Marne held that the allotment of the four flats—701, 702, 801 and 802—to directors of the contractor was arbitrary in the circumstances of the case. However, the Court declined to disturb the allotment of Flats 701 and 702 because the existing allottees had been occupying them for a considerable period.
For Flats 801 and 802, the Court directed the original members to pay ₹2.50 crore within six weeks to the existing allottees. Upon payment, possession is to be handed over and the society is required to enter the petitioners’ names in its membership register.
Key Highlights of the Bombay High Court Judgment
Flats involved: 701, 702, 801 and 802
Society: Le Chateau Co-operative Housing Society Ltd., Santacruz
Building: Shamrock, for Flats 801 and 802
Court: Bombay High Court
Judge: Justice Sandeep V. Marne
Judgment: September 24, 2026
Case: Dr. Omprakash B. Soniminde & Anr. v. Le Chateau Co-operative Housing Society Ltd. & Ors.
Payment directed: ₹2.50 crore
Time granted: Six weeks
Result: Writ Petition partly allowed
Background of the Dispute
The dispute arose from a redevelopment and additional-construction scheme undertaken by Le Chateau Co-operative Housing Society Ltd.
In 1996, the society decided to acquire TDR/FSI and construct additional floors on the existing buildings. The additional flats were to be allotted to existing society members, subject to payment of the cost of construction and TDR/FSI.
Dr. Omprakash Soniminde and his wife, Chandrakala Soniminde, were allotted Flats 701 and 702.
The society appointed Jet Speed Developers Pvt. Ltd. as the contractor for carrying out the additional construction. Under the agreement, the contractor was to receive construction costs, including the cost of TDR/FSI and related expenses.
A dispute subsequently arose over the payments allegedly payable by the petitioners towards the additional flats.
The society eventually cancelled their allotment and allotted Flats 701 and 702 to Ramesh C. Mankani and Renu R. Mankani, who were directors of the contractor.
Bombay High Court Questions Allotment of Society Flats to Contractor’s Directors
The High Court closely examined the circumstances in which the contractor’s directors obtained the flats.
Justice Marne noted that the original 1996 General Body decision contemplated allotment of the additional flats to existing members of the society.
The contractor’s directors were not original members and, according to the Court, their role was limited to providing professional construction services and procuring TDR/FSI.
The Court therefore held that the contractor’s directors did not acquire an independent right to obtain flats merely because the contractor claimed that amounts remained payable by the society.
Contractor’s Remedy Was to Recover Money, Not Obtain Society Flats
One of the significant observations in the judgment concerns the distinction between a contractual monetary claim and a right to society property.
The High Court held that the contractor’s entitlement to receive money arose from its agreement with the society.
If money remained outstanding, the contractor could pursue a recovery action against the society.
According to the Court, this did not give the contractor’s directors a right to obtain flats belonging to the society.
The Court consequently held that allotment of Flats 701 and 702 to the contractor’s directors was itself illegal in the circumstances, and that the subsequent allotment of Flats 801 and 802 further compounded the problem.
Why Did the Bombay High Court Not Take Back Flats 701 and 702?
Although the Court found the allotment of both sets of flats to be arbitrary, it drew a distinction between Flats 701 and 702 and Flats 801 and 802.
The existing allottees had been occupying Flats 701 and 702 for a considerable period.
The Court also noted that the petitioners had admittedly not paid their contribution towards those flats.
Consequently, the Court held that it was too late to disturb the existing allotment of Flats 701 and 702.
The position was different for Flats 801 and 802 because those flats were unfinished and unoccupied.
Flats 801 and 802 to Go to Original Members
The Court found that Flats 801 and 802 remained unfinished and unoccupied.
The petitioners had sought allotment of these flats and expressed their willingness to pay the applicable costs.
During the proceedings, they offered to pay ₹2.50 crore.
The Court considered this offer while moulding equitable relief between the parties.
The Court directed that the ₹2.50 crore should be paid to the existing allottees rather than to the society.
Upon receiving the amount, they would have to surrender their allotment and hand over possession of Flats 801 and 802.
Court Says Original Members Need Not Pay Market Value
An important aspect of the judgment is that the Court did not direct the petitioners to purchase Flats 801 and 802 at their prevailing market value.
The respondents had argued that the two flats were worth approximately ₹7.31 crore.
The High Court rejected the proposition that the petitioners should pay market value.
The Court took into account the original scheme under which additional flats were intended to benefit society members on payment of construction and TDR/FSI costs.
The Court therefore fashioned an equitable arrangement under which the petitioners would pay ₹2.50 crore, despite the possibility that the current market value of the flats was substantially higher.
Bombay High Court Examines Unjust Enrichment
The Court also examined the financial position of the contractor.
The judgment records that society members had apparently paid approximately ₹4.62 crore towards the additional construction.
At the same time, the contractor’s directors had secured allotment of four flats—701, 702, 801 and 802.
The Court examined competing calculations concerning the TDR, construction costs and alleged outstanding amounts.
It concluded that even on the respondents’ calculations, the further allotment of Flats 801 and 802 was unwarranted in the circumstances.
The Court observed that if the contractor believed that any amount remained payable after adjustment of the value of Flats 701 and 702, it remained free to pursue a monetary recovery claim against the society.
However, the contractor’s directors could not retain Flats 801 and 802 on that basis.
What Did the Bombay High Court Finally Order?
The Court set aside the orders passed by the Cooperative Court and the Cooperative Appellate Court and partly decreed the dispute.
The principal directions are:
Flats 801 and 802 are to be allotted to Dr. Omprakash Soniminde and Chandrakala Soniminde.
The society must cancel the existing allotment of Flats 801 and 802 and enter the petitioners’ names in its membership register.
The petitioners must pay ₹2.50 crore within six weeks to the existing allottees.
The existing allottees must hand over possession upon receiving the ₹2.50 crore.
If they refuse to accept the amount, the petitioners may deposit the money with the society.
After such deposit, the petitioners may take possession with the assistance of the local police.
The petitioners become liable for maintenance only from the date possession is handed over.
If the petitioners fail to pay ₹2.50 crore within six weeks, the allotment of Flats 801 and 802 will revive in favour of the existing allottees.
Legal Significance of the Judgment for Cooperative Housing Societies
The judgment is significant for disputes involving cooperative housing societies, redevelopment, TDR/FSI, additional flats and contractor claims.
The case demonstrates an important distinction between:
a contractor’s contractual claim for payment, and
a proprietary or allotment right in society property.
The Bombay High Court’s decision shows that, depending on the governing resolution and contractual arrangement, a contractor’s claim for unpaid construction costs cannot automatically be converted into a right to receive society flats.
The judgment is particularly relevant where additional development potential is being utilised for the benefit of existing society members and disputes subsequently arise regarding allotment of the additional premises.
Frequently Asked Questions
Can a cooperative housing society allot additional flats to a contractor?
The answer depends on the society’s governing resolutions, contractual arrangements, applicable law and facts. In the present case, the Bombay High Court found the allotment problematic because the original scheme contemplated allotment of the additional flats to existing members, while the contractor’s directors were not original members.
Can a contractor claim society flats for unpaid construction dues?
In this case, the Bombay High Court held that the contractor’s remedy for any unpaid contractual amount was to pursue recovery against the society. The Court did not accept that the contractor’s directors thereby acquired a right to retain additional society flats.
What happened to Flats 701 and 702?
The Court did not disturb their existing allotment because the allottees had occupied them for a considerable period and the original petitioners had not paid their contribution towards those flats.
What happened to Flats 801 and 802?
The Court directed that Flats 801 and 802 be allotted to the original petitioners, subject to payment of ₹2.50 crore to the existing allottees within six weeks.
What happens if the ₹2.50 crore is not paid within six weeks?
The Court ordered that the allotment of Flats 801 and 802 will revive in favour of the existing allottees.
Case Details
Case: Dr. Omprakash B. Soniminde & Anr. v. Le Chateau Co-operative Housing Society Ltd. & Ors.
Court: Bombay High Court
Judge: Justice Sandeep V. Marne
Writ Petition: No. 751 of 2019
Judgment Date: September 24, 2026
Subject: Cooperative Housing Society / Flat Allotment / TDR-FSI / Construction Dispute
Result: Writ Petition partly allowed.
Click Here To Read and Download The Order
Concluding Note & Public Interest Disclaimer
This article has been published by The Law Suits with the objective of promoting public awareness, legal literacy and a better understanding of important judicial pronouncements affecting citizens, cooperative housing societies and property rights. The purpose is to make significant developments in law more accessible to the public and to encourage informed understanding of legal rights and remedies.
This article is intended solely for general information, public awareness and academic discussion. It does not constitute legal advice, a legal opinion, or a substitute for professional legal consultation, nor does it create an attorney-client relationship. The facts, findings and directions discussed herein are based on the judicial order referred to in the article. Readers facing specific housing society, redevelopment, real estate or other legal disputes are advised to seek independent advice from a qualified legal professional based on the facts and documents of their individual matter.
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