Law on Parking Spaces
This is an analysis of the Nahalchand case in which the SC ruled that open/stilt parking spaces can't be sold separately...Author Name: shayar
This is an analysis of the Nahalchand case in which the SC ruled that open/stilt parking spaces can't be sold separately...
Law on Parking Spaces
In a 2010 judgment, Nahalchand Laloochand Pvt. Ltd. v. Panchali Co-operative Housing Society Ltd. [AIR 2010 SC 3607], the Hon’ble Supreme Court rejected the argument of a real estate development company that they are entitled to sell garages or stilt parking areas as separate flats to owners who intend to use it as parking facilities. A bench of Justices A K Patnaik and R M Lodha, ruled that builders or promoters cannot sell parking areas as independent units or flats as these areas are to be extended as “common areas and facilities” for the owners. Also, the Court said that the developer is only entitled to charge price for the common areas and facilities from each flat purchaser in proportion to the carpet area of the flat.
Background - General Practice
As per the general practice in the market, the developer, by the agreement of sale, sells only the ‘flat’ and the purchaser has rights in respect of only the flat and no other portion of the building. This is exactly what had been agreed to between the developer Nahalchand Laloochand Private Limited and the flat purchasers of Panchali Co-operative Housing Society Ltd.Each flat purchaser had executed a declaration to the effect that stilt parking spaces/open parking spaces shown in the plan exclusively belong to the promoter and that the Society has no objection to the sale of such spaces by it. However, this was later argued by the Society as being contrary to law and hence, not binding. When the dispute arose, the developer approached the Bombay Civil Court seeking “permanent injunction restraining the Society from encroaching upon, trespassing and/or in any manner disturbing, obstructing or interfering with its possession in respect of 25 parking spaces in the stilt portion of the building”.
The City Civil Court dismissed the suit. The developer preferred first appeal before the High Court which was also dismissed. The Developer then filed an appeal with the Supreme Court.
What is a flat ?
The Court examined the provisions of Maharashtra Ownership Flats (Regulation of the Promotion of Construction, Sale, Management and Transfer) Act, 1963 ("MOFA") to determine whether open or stilt parking spaces can be sold to purchasers separately, because the answer to the question would lie in the basic interpretation of what is a flat. As per Section 2(a-1) of MOFA, "Flat" is defined to mean a separate and self-contained set of premises used or intended to be used for residence, or office, show-room or shop or go down or for carrying on any industry or business (and includes a garage), the premises forming part of a building and includes an apartment.
Apart from the statutory definition, flat means a set of rooms comprising an individual place of residence within a larger building or a self-contained set of rooms, structurally divided and separately owned or let from the rest of a building, which for the most part consists of other flats separated in like manner. Also, In Stroud's Judicial Dictionary, a reference has been made to the observations of Somervell L.J, in Murgatroyd v. Tresarden [63 T.L.R. 62] and it is stated; the natural meaning of the word `flat' is a separate self-contained dwelling.
Therefore, for a `flat' to be within the meaning of the definition in Sec. 2 (a-1), it must be a separate unit conforming to the description capable of being used for one of the purposes given in the definition. Separateness of one premises from another premises physically and also in use or intended use for one of the uses specified in the definition clause containing the necessary facilities for self-contained accommodation is sine qua non for a unit being covered by the definition of `flat' occurring in Section 2(a-1).
Also, the Court has categorically stated that the meaning and significance of the bracketed portion "(and includes a garage)" should be seen in the context given to the word `flat' which is true indication of intent of the legislature. The phrase `and includes a garage' in the bracket does not bring in `garage' by itself within the meaning of word `flat'. If stand alone `garage' was intended by the legislature to be a `flat' within the meaning of Section 2(a-1), that could have been conveyed by use of the expression `or garage' after the word `business' in the same breath as preceding uses. The bracketed phrase is indicative of the legislative intention to include a `garage' as appurtenant or attachment to a flat which satisfies the ingredients of Section 2(a-1).
Whether stilt parking area is a garage
It needed to be determined whether stilt parking areas would be counted as garage. The definition of garage is not provided in the MOFA. Hence, English language definitions needed to be looked into. The Oxford English Dictionary explains `garage' as a building for housing a motor vehicle or vehicles or an establishment which sells fuel or which repairs and sells motor vehicles. The Webster Comprehensive Dictionary explains the word `garage' as a building in which motor vehicles are stored and cared for.
The Development Control Regulations for Greater Bombay, 1991 define two expressions, `garage-private' and `garage-public' in Regulations 2(47) and 2(48) respectively. According to these Regulations, `garage-private' means a building or a portion thereof designed and used for the parking of vehicles and `garage-public' means a building or portion thereof designed other than as a private garage, operated for gain, designed and/or used for repairing, serving, hiring, selling or storing or parking motor-driven or other vehicles.
The developer had argued that open parking space amounts to a `garage' within the meaning of Section 2(a-1). However, the Court disagreed with this argument and said that a person buying a flat for residence or one of the uses mentioned in Section 2(a-1) will not really think that open to the sky or open space for parking motor vehicles is a garage. “The word `garage' may not have uniform connotation but definitely every space for parking motor vehicles is not a garage. A roofless erection could not be described a garage. What is contemplated by a `garage' in Section 2(a-1) is a place having a roof and walls on three sides. It does not include an unenclosed or uncovered parking space.”
Hence, the Court stated that while stilt area may be usable as a parking space but for the purposes of MOFA, such portion could not be treated as garage. For the purposes of MOFA, the term `garage' must be considered as would be understood by a flat purchaser and such person would contemplate garage which has a roof and wall on three sides.
Whether stilt parking spaces are part of common areas and facilities
The MOFA does not define common areas and facilities. However, the Maharashtra Apartment Ownership Act, 1970 does define `common areas and facilities' in Section 3(f). The Court, while referring to it, said that just like it is unreasonable that a developer cannot take common passage/lobbies or staircases out of the purview of `common areas and facilities', it is unreasonable to say that parking spaces do not fall under `common areas and facilities'. It is not necessary that all flat purchasers must actually use `common areas and facilities' in its entirety. The relevant test is whether such part of the building is normally in common use.
Therefore, it was held that MOFA mandates the promoter to describe common areas and facilities in the advertisement as well as the `agreement' with the flat purchaser and if a promoter does not fully disclose the common areas and facilities, he does so at his own peril. Stilt parking spaces would not cease to be part of common areas and facilities merely because the promoter has not described the same as such in the advertisement and agreement with the flat purchaser.
Also, expressly stating the rights of the developer/promoter, the court said that, “insofar as the promoter is concerned, he is not put to any prejudice financially by treating open parking space/stilt parking space as part of `common areas' since he is entitled to charge price for the common areas and facilities from each flat purchaser in proportion to the carpet area of the flat.” MOFA mandates the promoter to describe `common areas and facilities' in the advertisement as well as the `agreement' with the flat purchaser and the promoter is also required to indicate the price of the flat including the proportionate price of the `common areas and facilities'.
Conclusion
Hence, `stilt parking space' is not covered by the term `garage' much less a `flat' and it is part of common areas. The court said that stilt parking space/s being part of common areas, the only right that the promoter has is to charge the cost thereof in proportion to the carpet area of the flat from each flat purchaser. Such stilt parking space being neither a `flat' nor a `garage' within the meaning of under Section 2(a-1) of MOFA, cannot be sold separately.
In the words of the Court : “The promoter has no right to sell any portion of such building which is not ‘flat’ within the meaning of Section 2(a-1) and the entire land and building has to be conveyed to the organisation; the only right remains with the promoter is to sell unsold flats. It is, thus, clear that the promoter has no right to sell ‘stilt parking spaces’ as these are neither ‘flat’ nor appurtenant or attachment to a ‘flat’.
Critique
First and foremost, the judgment has been given in the context of the laws in Maharashtra. The universal applicability of this judgement would come into question if there are different laws in a particular state. For instance, the judgment can be applied to the NCT of Delhi in view of the Delhi Apartment Ownership Act, 1986 but it is uncertain whether it would also apply to the state of Rajasthan, which has no such laws.
Secondly, it is contemplated that the developers/promoters/builders would now increase the cost of the flats to compensate for the loss that they would suffer by not being able to sell these parking spaces separately. The financial burden on the purchasers would either increase or remain the same, but will not decrease. The Confederation of Real Estate Developers’ Association of India (CREDAI), Pune branch, said though SC has made it categorically clear that “stilt parking/open parking” cannot be sold as it does not fall under the definition of ‘flat’ or ‘garage’, it has also stated that the builder can charge for stilt parking/open parking under common area and facilities separately.
Thirdly, the entire ruling is based upon the meaning of the word "garage". According to the Hon’ble S.C., the area closed by three sides and above used for parking is a garage. This logic puts stilt area enclosed by less than three sides or not at all enclosed in a different footing than the area covered by three sides.
However, the positive point is that the developers/promoters/builders cannot retain or sell such parking spaces separately since they are included in the common areas. Parking cannot be given or charged from persons who have not bought a flat in the premises. The purchasers would be able to enjoy the same by paying only an amount proportionate to the carpet area of the flat.
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# Nahalchand Laloochand Pvt. Ltd. v. Panchali Co-operative Housing Society Ltd. [AIR 2010 SC 3607], Para 2
# MOFA, Section 2 (a-1)
# Concise Oxford English Dictionary (10th Edn., Revised)
# P. Ramanatha Aiyar, Advanced Law Lexicon (3rd Edn., 2005)
# Stroud's Judicial Dictionary (5th edition, Vol. 2)
# Supra 1, Para 29
# Concise Oxford English Dictionary (10th Edition, revised)
# Webster Comprehensive Dictionary, International Edition (Vol. 1)
# Supra 1, Para 35
# Supra 1, Para 36
# Supra 1, Para 38
# Supra 1, Para 40
# “Allotted parking will have to be bought: builders”, The Indian Express, Sep. 3, 2010
The author can be reached at: shayar@legalserviceindia.com
ISBN No: 978-81-928510-1-3
Author Bio: Devesh Ratan Srivastava, IVth Year, Symbiosis Law School, Pune
Email: shayar@legalserviceindia.com
Website: http://www.
Views: 78263
Binal : I live in a 7 floor building where top 4 floors are of the building owner. My problem is, he uses parking space only for himself and his family members. Whereas myself and other 2 families in the building are parking our own cars on the road. Also to inform that we own the flat and not live on rent. How can I legally tell him to allot Atleast one parking space per family? Our polite requests for the same are on his deaf ears.
Amitava Basu : Sir We have an ancestral house in Kolkata. The house was built in 1954 and it has no provision for garage. It has to passage way. One 4' passage serves as service passage and the other 8' passage is the only passage that serves for ingress and egress from the house. On recent times, one gentleman has purchased a part of the house and is forcibly parking his cars in the common passage leaving no space for walking. I am trying to stop his car parking which is also against the West Bengal Fire Act which says the staircase and the passage leading to the road must be clear at all times. Will the Supreme Court judgment over common and stilt area parking help stop him? Thanks
jitender : whether open car parking area for visitor can be rented out for commercial purpose by the officials of court receiver
R T RAJ : Sir,in our apartment Our flat owners association is objecting to keep children bi cycles in parking area and they are not parking their cars in in the allotted slots, because the area given to them is not sufficient to keep their cars and they are occupied more places from common area. Is this acceptale. pl.help me.
Pawan Kumar : What should be the size of a Car Parking Space alloted by the builder as per UP Apartment Act.
Dr HSR Arora : Sir,I live in Aparna Hight-2 Kondapur Hyderabad it has registered society. Its 9 Floor Building.Some of the flat owners wants erect wall around the open parking space provided in cellars.What is the legal provision on the subject. Regard.
shraddha : I stay on ground floor of my building.recently people have started parking cars in front of my bedroom and kitchen window.can i take any legal action.
Mithun soni : Hi sir, Recently I bought flat in parking area. I was not aware this rule earlier. I have t home loan from obc bank . if builder can not sell parking . how can bank give me loan. Plaese advise how to handle this issue and getting mental frastration from all this thing. Thanks mithub soni - 9717668561
Neha : I stay on ground floor of my building.recently people have started parking cars in front of my bedroom and kitchen window.can i take any legal action & please guide us in brief which action we have to taken???
Laxman Dawkhar : Can I know the Stilt parking charges should be charged to the owner of the parking area and how much it should be?
Biswanath : Can anybody coverup his stilt parking area, if no in which section it fallen? Please guide me.
ashok : The builder agreement states the parking charges of 4.5 lakhs. Can a buyer of flat refuse to take parking slot and not pay parking charges. Is it mandatory for the buyer of flat to take parking slot in the building even if it is mentioned in agreement.
apurva : Recently people have started parking their bikes/scooters in front of my bedroom , facing the bedroomand only less than 1 foot distance from the wall. Pl. suggest legal action. Any judgements.
udipth : We are in an office complex with limited parking and 2 sizes of offices. around 70 offices are of 300 square feet while 30 offices are of 2900 square feet. Now there are only 100 parking available. Now the 70 small offices owners are insisting on allotting one parking to each office while the 30 big office owners insist on allotting parking as per square feet owned . If distributed on basis of square feet, big offices will get 3 parking on 2 offices and small offices will get 1 parking on 2 offices. Question: 1. What is legally enforceable logic - memberwise or square feet wise. 2. As small office owners are more they are in majority and tries to do what is convenient to them irrespective of what is equitable. What recourse is available in this case with majority office owners
DEEPAK : can owner commercial car parking is objectionable?
girish kaliwada : is parking just beside a ground floor window flat allowed, our area is prone to snakes As we have a lot of mangrove coverage area around
Ganesh : Recently bought a flat at Nagaram, Keesara Mandal, Secunderabad, Telengana, in a builder apartment consisting of (1 3 1) Cellar-Parking, Flats-Ground, I, II and Pent house. Each floor consists 3 Flats and 2 on the roof top (Penthouses). [ 3*3 = 9 2*1 = 2 ] Total Eleven. The allotment of the car parking is taken for all the 11, whereas the cellar cannot accommodate more than 9 parking slots. 1) Between the two entrances (gates), the passage is allotted for parking without leaving any move place (approach to the other part of the building where the Lift is provided) 2) Other allotment is in-front of the Lift blocking the way. Explained the same to the builder but no response. Talking to other owners is of no use. (When apprised, results are negative leading to disputes in another form.) What are my rights, to whom I should approach? Please suggest the best way to find a solution. After all, we all have to stay together ……
Nllesh : If in corporation record plan some parking area is clearly mentioned as cycle parkings,can we use legally it as car parking? If someone taken objection to park car is there any other option to use that cycle parking as car park?
Kumar : Sir, Most of the duplex houses have their car parking in ground floor portico. In our gated community in Hyderabad also there are around 200 independent duplex houses and as per building plan, each duplex house has car parking in portico. However, most of the house owners park their car on internal roads in front of their houses. When asked, these owners state various reasons like they need portico space for their children to play, they need this space for a swing hooked to the roof of portico and cannot park the car inside. They are causing trouble to other house owners who want to park their cars in their own portico as the cars parked on road obstructs their way to portico and makes it very difficult and some times impossible to park the car in portico. I would lke to know whether the colony welfare association will have any right to demand all house owners to park their vehicles in the designated parking space i.e. their own portico and not to park cars on roads. Thanks, Kumar.
sanjay : Respected sir, In a duplex different floor. The owner of the first floor has outlet the property to Tenants bachelors around 7 vehicles they are parking and i am being forced to park my two wheeler outside the gate. The owner has no parking space mentioned in the deed though they do block our window, walking space blocking gate to open. Kindly suggest sir. Regards Neredmet, Telangana
K.V. BHASKAR RAO : in hyderabad what is standard building parking area (size). is there a different parking sizes for different Buildings,Areas.
Singh Rajesh : I have purchased flat at Ahmedabad Gujarat. Total no of Flats in housing society is 650 & total parking space is 500 alloted 40 common parking space ( That is housing society is going to give on rent for 03 months ), now builder is going to handover the society & Housing commitee is saying that they will alloow only 40 cars in the society compound and for others (Balance 110) they will not allow to enter there vehicle on the society compound. Is it legal, or any other option we have.
kishan.gopal@lalpathlabs.com : I want to know parking rules in commercial complexes
rahul : can owner commercial car parking is objectionable?
Adish : Sir I live in ludhiana...according to punjab act 1995 can the builder sell or charge separately for car park in basement..if yes then is there any law by which he can't do so.and the judgement of the sc in respect of car park was according to appartment act of Maharashtra. ..is it applicable here also..and do the real estate regulatory bill be applicable in my case also...I had booked an apartment in 2013..registry is still pending.
Asha : I had taken a flat in Serilingampally, Hyderabad 2 years ago. But the car parking space given is not sufficient to park the car. Is there any minimum car park size to be adhered as per any regulations Act? Builder did charge us 2 lakhs over and above the flat cost inspite of Supreme Court judgement not to charge for car parking slot.
Dreet : Are commercial vehicles allowed to park on residential areas.?
krishnamurthy k : Hi Sir, recently I bought a flat in Chennai. I have few queries. Kindly guide me on that 1.I paid 1.5 Lac for car parking.it was mentioned in the construction agreement registered.as per law builder should not sell car parking.is it legal to mention the car parking cost as part of construction agreement? Is it possible to file a complaint in consumer court to get that money. 2.builder said that he will maintain the flat for 3 years and maintenance amount would be collected from owner and it was mentioned in the sale deed registered. We feel that the amount(3000 rs in my case) is costly.is there a limit to the maintenance cost imposed by govt or any legal body. we also signed a lifetime maintenance with him due to his compulsion.is it possible to break that. 3.as per the floor plan entire land is spitted into UDS for all the flat owners. But few flats were registered below the UDS specified. Now builder is arguing that he have land for him and he is constructing a commercial property saying that he is having approval.is it possible to construct commercial in residential property.is it possible to get approval from govt authorities for commercial property. What is the procedure to stop that if it is not legal.he is also not sharing the approval plan.how to get that.bank also not giving proper response on that. Kindly clarify on that
Mandar Gaikwad : Dear Sir/Madam, I have a query with respect to Parking laws for commercial properties, are these properties governed by any rules or it is at there discretion to charge any fees for parking vehicle. Anticipating reply from your side.
kvr : sir I live in house but with no space for car parking , so I park on footpath next to flat compound is it legal?? can I park there ??
Neel : Sir how can we restrict tenants using the car parking space for personal other activities - like carpenter work and storing personal belonging. They also park 1 car and couple of 2 wheeler in the same car parking area.
Vinit gohil : Are commercial vehicles allow to park in residential society.
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