Case Note & Summary
The appellants, who were plaintiffs in the suit, sought enforcement of statutory obligations under the Maharashtra Ownership Flats Act (MOFA) against the respondents. The suit property was a free-sale component of a slum rehabilitation project. The plaintiffs had entered into an agreement with M/s. Mahek Developers (defendant no.1) on 3rd March 2010 to purchase 6050 sq. ft. carpet area for Rs.1.50 Crores, and paid the entire consideration before July 2010. The trial court, by order dated 12th June 2021, refused to grant an interim injunction restraining the defendants from creating third-party rights in the suit property. The plaintiffs appealed under Order 43 Rule 1(r) read with Section 104 of the Code of Civil Procedure. The key legal issue was whether the suit was maintainable against defendant nos. 3 and 4, who were not parties to the agreement. The court held that MOFA imposes statutory obligations on 'promoters', which includes persons who construct or cause to be constructed a building, and such obligations can be enforced against them even if they are not signatories to the agreement. The court found that the plaintiffs had made out a prima facie case, balance of convenience was in their favour, and they would suffer irreparable loss if injunction was not granted. Accordingly, the appeal was allowed, the impugned order was set aside, and the defendants were restrained from creating third-party rights in the suit property until the disposal of the suit.
Headnote
A) Civil Procedure - Maintainability of Suit - MOFA Obligations - Maharashtra Ownership Flats (Regulation of the Promotion of Construction, Sale, Management and Transfer) Act, 1963 (MOFA) - The court considered whether a suit for enforcement of statutory obligations under MOFA is maintainable against defendants who were not signatories to the agreement for sale. Held that the obligations under MOFA are statutory and can be enforced against persons who are 'promoters' as defined under the Act, even if they are not parties to the agreement. (Paras 3, 5-10) B) Injunction - Prima Facie Case - Balance of Convenience - Irreparable Loss - Code of Civil Procedure, 1908, Order 39 Rules 1 and 2 - The court examined whether the trial court erred in refusing to restrain defendants from creating third-party rights in the suit property. Held that the plaintiffs had made out a strong prima facie case, balance of convenience was in their favour, and they would suffer irreparable loss if injunction was not granted. (Paras 11-15)
Issue of Consideration
Whether a suit seeking enforcement of obligations under the Maharashtra Ownership Flats Act (MOFA) is maintainable against defendants who were not party to the suit agreement?
Final Decision
Appeal allowed. Impugned order dated 12th June 2021 set aside. Defendants restrained from creating third-party rights in the suit property until disposal of the suit.
Law Points
- Maintainability of suit under MOFA against non-parties to agreement
- Prima facie case for injunction
- Balance of convenience
- Irreparable loss
