Chapter I: Properties On The Tender Plots Allotted By CIDCO

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By Advocate S. R. Agarwal

As per the procedure being followed by CIDCO, when the allotment of a plot is confirmed to the highest bidder, initially an Allotment Letter is issued, followed by an Agreement to Lease and after the issuance of Occupancy Certificate on the completion of the construction, a Lease Deed is executed in respect of the plot as well as the demised premises. The Allotment Letter in such cases, inter alia, provides as under:-

“ Transfer or Assignment of Rights : The intending lessee can transfer or assign his rights, interests or benefits which may accrue to him from the agreement with the prior written permission of the Corporation and on payment of such transfer charges as may be prescribed by the Corporation from time to time. Such permission can however be granted only after agreed lease premium and any other amount requiredas been paid in full.

However, the intending lessee shall be permitted to sell the flats / shops / offices to his intending buyers and to obtain a lease in favour of a Co-operative Housing Society/Company / Association to be constituted of his buyers under the provision of the Section 10 of the Maharashtra Ownership Flats ( Regulation of the Promotion of Construction, Sale, Management and Transfer ) Act, 1963. ”

The Agreement to Lease, which follows such Allotment Letter is termed merely a licence by CIDCO to the Allottee to enter the plot and to raise the construction within a period of six years or the permitted extended term. This Agreement is not construed as a demise in law of the said plot to give the Lessee any legal interest therein until Lease Deed has been executed and registered; Clause No: 2 of such Agreement to Lease permits the Lessee to have the lease in the name of a Co-Operative Housing Society or a Company or an Association of Apartment Owners’ , subject to the compliance of other terms and conditions and obligations as per Section 11 of MOFA.

In spite of these clear cut-provisions about the transfer, sale of flats, shops or offices in the building constructed or to be constructed on such tender plots, an anomaly has been created by way of Clause (o) of the Lease Deed executed by CIDCO in its prescribed format. The Clause (o) is produced below:- “ Not to sell, assign, mortgage, underlet or otherwise transfer wholly or partly the demised premises or its interest therein or part wholly or partly with the possession of the demised premises or permit any person to use wholly or party the demised premises PROVIDED THAT nothing contained herein shall apply if the Lessee shall perform to the satisfaction of the Lessor the following conditions :

(i) BEFORE TRNASFERING THE DEMISES PREMISES the Lessee shall pay….. Please buy the book to read the full article.

Credits: Legal Aspects of Property Transactions in Maharashtra (Book)

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