Darlene Carmelita D’ Cruz Vs. Kerala State Housing Board [Kerala High Court, 08-04-2016]

Housing Board – Advocates Offices in Residential Apartments – Whether Commercial Venture – Held, Advocate residing in Apartment and carrying on the Advocates office cannot be termed as a commercial venture – Residence of the professional along with his office in an apartment cannot be termed as a commercial one.


IN THE HIGH COURT OF KERALAAT ERNAKULAM

SHAJI P. CHALY, J.

W.P.(C). No.18844 of 2005

Dated this the 8th day of April, 2016

PETITIONERS

DARLENE CARMELITA D”CRUZ AND ANOTHER

BY ADV. SRI.S.SANTHOSH KUMAR

RESPONDENTS

THE KERALA STATE HOUSING BOARD, REP. BY ITS SECRETARY, SANTHI NAGAR,, THIRUVANANTHAPURAM AND OTHERS

R1 TO 3 BY ADV. SRI.P.C.IYPE, SC, KSHB R 1 & R2 BY ADV. SRI.SERGI JOSEPH THOMAS R7,R11 BY ADV. DR.K.P.KYLASANATHA PILLAY R7,R11 BY ADV. SRI.ARUN.B.VARGHESE R7,R11 BY ADV. SMT.SREEDEVI KYLASANATH R7,R11 BY ADV. SRI.T.P.DEYANANTHAN R7,R11 BY ADV. SRI.JESSEL VINOHAR RODRICKS R5,R6 & R8 BY ADV. SRI.SERGI JOSEPH THOMAS R9 BY ADV. SRI.P.GOPALAKRISHNAN NAIR R1 TO R3 BY ADV. SRI.A.JAYASANKAR, SC KSHB, TVM R1 TO R3 BY ADV. SRI.GEORGE BOBAN, SC, K.S.H.B.

JUDGMENT

This writ petition is filed by the petitioners seeking issuance of a writ of mandamus directing respondents 1 to 3 to take action in order to prevent use of apartments in Chinnakkada Housing Accommodation Scheme, Site II of the Housing Board at Kollam for commercial purposes and to ensure that apartments are used purely for residential purposes and other related relieves.

2. Necessary facts required for the disposal of the writ petition are as follows:

3. Petitioners are owners of flats purchased from the 1 st respondent, in its Housing Accommodation Scheme, Site II at Chinnakkada in Kollam. They are aggrieved by the inaction of the Board in taking action against the use of flats in the housing scheme for purposes not provided under this scheme. The Kerala State Housing Board is a statutory authority created under the

# Kerala State Housing Board Act, 1971

hereinafter called the Act, for the execution of housing and improvement schemes in Kerala. In accordance with the powers conferred on the Board under the said statute, it formulated a scheme under Section 42 of the Act, 1971 viz; Chinnakkada Housing Accommodation Scheme, Site – II for the construction of 24 EF-9 type flats. The scheme was sanctioned by the Government as per G.O.(MS) No.38/92/Housing dated 27.7.1992 and notified under Section 55 of the Act, evident from Ext.P1. Shop rooms and commercial buildings with office space mentioned in the notification are situated away from the residential buildings.

4. Board has constructed 4 blocks of multi-storied building. There are 6 apartments in each block. Petitioners purchased flats by executing a sale deed with the 3 rd respondent. First petitioner purchased flat No.EF-9/308 as per registered sale deed No.1147/1/2004 dated 29.3.2004 and 2 nd petitioner purchased flat No.EF-9/207 as per registered sale deed No.651/04 dated 27.2.2004, of S.R.O., Kollam.

5. It is the contention of the petitioners that, they are residing in the said flats along with their families. The flats in the housing scheme are exclusively meant for residential purposes. Sale deeds provide that the flats shall not be used for any purpose other than residential purpose. Likewise clause 19 of the Hire Purchase Agreement in respect of persons who opt for hire purchase also provides that the parties shall not use the building and premises thereto directly or indirectly for any purpose other than the purpose of his own residence.

6. It is contended that Regulation 6(1) of Kerala State Housing Board (Formation of Allottees Associations) Regulations, 2000, hereinafter called Regulations, also provides that all apartments in the housing scheme shall be used purely for residential purposes. In spite of the specific stipulation in the sale deed, hire purchase agreement and in the regulations, many of the allottees of flats have let out their flats for using it for commercial purposes to various persons. It is the specific contention of the petitioners that, there are godowns, offices, sales outlet etc. etc. functioning in the housing complex, that 14 flats are now being used for commercial purposes. The details of the flats used for commercial purposes are as follows:

Flat Allottee Lessee Purpose for which the flat is put to use.
104 S. Thulasidharan M/s.Bright Auto spares  Pvt. Ltd. Godown-cum-office
105 Ike Thomas ANERT Office-cum-godown
106 P.N.Narayana Pillai Speed & Safe Courier Service Office
107 Viswambaran M/s.Rajkumar & Company (Contractors & Engineers) Office
108 M.Pulomaja Devi M/s.Rajkumar & Company (Contractors) Office
201 N.Anirudhan M/s.Girish & Associates (Architects) Office
203 Kunjoojamma Baby Civil Asst. Engineer’s Office, BSNL Office
204 Soosamma Mathew Chits & Financing Co. Office
205 Beena Bhai Ajaykumar & Co.  (Chartered Accountants) Office
206 D.Jalajamani M/s.Pioneer Sales Corpn. (Dealing in surgical Instruments) Sales Outlet cum-godown
207 Deepu M/s.Vortex (Contractors & Engineers) Office
302 Youseff Kunju M/s.Bharath Tours & Travels Office
305 Mathew Kurian Computer Distribution Firm Office & Training Centre
306 K.J.Thomas M/s.Venad Computers Office & Computer Training Centre

7. Therefore, the petitioners contend that the user of the housing premises for commercial purposes is causing much nuisance and inconvenience to the residents of other flats, that as early as in 2000, some of the allottees had issued notice to Housing Board requesting to take action against the allottees, who let out the premises for commercial purposes in violation of covenants in the sale deed as well as Regulations. When the Board did not initiate any action in the matter, one of the allottees filed O.P.No.28612/2000 before this court seeking direction to the 1 st respondent to initiate action against the allottees who used the flats allotted to them for commercial purposes. This Court in CMP No.48246/2000 directed respondents 1 to 3 to see that flats are not used for any purpose other than that is mentioned under the scheme and that clause 19 of the agreement is not violated. The said order is produced as Ext.P4. It is the specific contention of the petitioners that they have purchased the flats in the housing scheme fully believing that it will provide sufficient security and privacy of a housing complex. The inaction in the part of the respondents in not taking any action to prevent letting out of apartments for commercial purposes is a violation of the condition in the sale deed as well as in the Regulation. It is under the aforementioned circumstances, petitioners have approached this Court seeking to ventilate their grievance by issuing appropriate direction to respondents 1 to 3 to remove the commercial activities carried on in the aforesaid Housing Scheme premises.

8. Respondents 1 to 3 filed counter affidavit refuting the contentions and allegations contained in the writ petition. It is admitted by the said respondents that petitioners are owners of the flats under the Housing Scheme. It is also contended by the Board that there is no agreement of sale executed with the petitioners as the flats have been sold to them in auction, that hire purchase agreement for sale of property has been executed only between the allottees and the Board. However the Board admitted that Clause 19 of the Hire Purchase Agreement (Ext.P3) specifies that the allottee shall not use the building and premises directly or indirectly for any purpose other than the purpose of his own residence. It is also contended that the allottee is entitled to get more houses than one but that will not in any manner enables the allottee to violate clause 19 of the aforesaid agreement and that the allottees are not entitled to start or continue any commercial activities in the flats under the Housing Scheme.

9. It is also contended that the Regulation (Ext.R1(b)) has been framed by the Board for the purpose of maintenance of common amenities and matters incidental thereto in a housing scheme with Clause 20 as a specific provision which reads that “the Allottees Association shall be converted into Owner’s Association after the issue of sale deed to all the allottees.”. Thereupon it is contended that petitioners have not accepted the K.S.H.B Regulation 2000 and no Allottees Association has been formed on the basis of Regulation 2000 and therefore, the provisions in the K.S.H.B Regulation 2000 does not apply to the petitioners or the residents in the scheme. That apart it is contended that the persons included in the list, have denied the use of their flats for non-residential purposes. That on inspection it is found that Flat Nos.201, 108, 205 and detenue 307 are occupied by residential and professional purpose. Flat No.107 is occupied by 4 individuals who use the flat for their residential purpose. Flat Nos.203, 105 and 306 are occupied and used as office by BSNL, ANERT and MPEDA respectively. It is the contention of the respondents that the flats are used as offices without causing any disturbance to the residents in the scheme area. That apart it is contended that the Board has not made any irregular allotments. It is also contended that pursuant to the interim direction issued by this court in O.P.No.28612/2000, the owners of the flats have been informed that the flat should not be used for non-residential purpose, that the Board has carried out the advertisement of the housing scheme by showing the specific nature and purpose of the scheme and therefore, the Board has not committed anything in violation of the provisions of the Act and the attendant regulations. However the Board in its counter has admitted that the flats have been sold to the petitioners and others incorporating the condition that the apartments shall not be used for any purpose other than residential purpose and the said condition has been emphasized in the sale deed specifically. It is also the contention of the Board that the petitioners have not brought to the notice of the Board any illegal occupancy of tenants or owners carrying on commercial activities.

10. Apart from all these contentions, Board has undertaken in its counter that it will take action against the allottees who have violated the above conditions on the basis of the judgment in this petition. The persons who were alleged to have let out the flats for commercial activities or carrying on commercial activities are impleaded as respondents 5 to 13 and the K.S.H.B. Allottees Association is impleaded as additional 4 th respondent. Even though notice was served on all the additional respondents, only the 11th respondent has filed a counter. The 11th respondent has contended that due to her poor health conditions she is forced to live in her family house at Chathannoor. She has rented out her apartment No.EF-9 to the Managing Director, BSNL, evident from Ext.RII(a). It is also contended that the lease is for a period of 5 years from 01.08.2003 and the same will expire in 2008. Anyhow the learned counsel appearing for the 11th respondent has submitted that after the lease period is over in the year 2008, 11th respondent has not let out the flat to anyone else. Learned counsel appearing for respondents 5, 8 and 12 denied the allegations and statements contained in the petition concerning them and it is submitted that the 5 th respondent has sold the apartment and the 8 th respondent is using his apartment as staff quarters. That apart it is also contended that the 12 th respondent is a lawyer by profession and he is using the apartment as residence-cum-office. Thrust of the contention of the said respondents is that after the residential apartments are sold to the respective owners, the Housing Board has no manner of control over them and they are at liberty to use the same for any purpose irrespective of the prohibition contained in the sale deed after the sale of the apartment against its user and the said clause is a void one. Therefore, counsel contended that the petitioners have no manner of locus standi to approach this court seeking the said relieves. It is also contended that the prayers sought for in the Writ Petition are not sustainable, in a proceeding under Article 226 of the Constitution of India.

11. Heard learned counsel for the petitioners, learned Standing Counsel for respondents 1 to 3 and learned counsel appearing for other party respondents as specified above.

12. Primary question remains to be considered is whether the petitioners are entitled to seek any relieves as sought for in the writ petition and whether respondents 1 to 3 are still retaining any power after the sale of the apartments to the owners in order to control the activities carried on in the said apartments. Reference to certain provisions of the Kerala State Housing Board Act, 1971 may help this court to arrive at a right conclusion. The Act is introduced as follows:

“An Act to provide for the organized direction and planning in the preparation and execution of housing and improvement schemes and for the establishment of a State Housing Board in the State of Kerala.”

Preamble of the Act reads thus:

“Preamble: Whereas it is expedient to provide for the organized direction and planning in the preparation and execution of housing and improvements schemes and for the establishment of a State Housing Board in the State of Kerala.”

Board premises is defined as:

“Board Premises” means any premises belonging to, or vesting in, the board or taken on lease by the Board or any premises which is entrusted to, or in the possession on control of, the Board for the purposes of this Act.”

Housing or improvement scheme is defined as :

“Housing or Improvement Scheme means a scheme framed under this Act and includes any of the types of schemes referred to in section 41”

Premises is defined as follows:

“Premises means any land or building or part of a building and includes-

(i) the garden, grounds and out-houses, if any, appertaining to such building or part of a building; and

(ii) any fittings affixed to such building or part of a building for the more beneficial enjoyment thereof;”

13. Constitution of the Board is taken care of under Chapter II, Section 3. On a reading of the said provision it is categoric and clear that the Board is fully owned and controlled by the State Government by appointing its own officers and nonofficers nominated by the Government. On a close reading of the provisions of the constitution of the Board, it is categoric and clear that the control of the Board vests with the State Government.

14. Section 41 of the Act defines types of Housing and Improvement Schemes. Sub-section 1(a) of the said Section reads that

“A house accommodation scheme;

(i) for the poor sections of the people having an income not exceeding Rs.2,000/- per annum especially for Scheduled Castes and Scheduled Tribes

(ii) For others; various other schemes are provided. Section 42 of the Act defines House Accommodation Scheme.

On a reading of the said scheme the intention is clearly conveyed that;

(1) Whenever the Board is of the opinion that it is the expedient or necessary to meet the need for house accommodation in any area, the Board may frame a house accommodation scheme.

(2) Such scheme shall specify the lay out of the area where the houses are to be constructed.

(3) Such scheme may provide for the construction of houses and for the sale, leasing out or sale on hire purchase basis of any house so constructed.

(4) The Board may provide in the area roads, streets, drainage, water supply, street lighting and other amenities.

Section 53 of the Act deals with publication of sanction of housing or improvement scheme which reads as follows:

“(1) Whenever the Board or the Government sanction a housing or improvement scheme, it shall be announced by notification in the Gazette.

Provided that whenever the Board sanctions a scheme with modifications, if any, it shall cause notice to that effect to be published 5 weekly or two consecutive weeks in the Gazette and in two leading daily newspapers in the State.

(2) The publication of the notification or notice under sub-section -section (1) in respect of any scheme shall be conclusive evidence that the scheme has been duly framed and sanctioned.

(3) Any person aggrieved by the decision of the Board sanctioning a housing or improvement scheme may, within thirty days from the date of last publication in the Gazette of the said scheme appeal to the Government and the decision of the Government on such appeal shall be final and shall not be liable to be questioned in any court of law.”

Section 55 deals with alteration of a housing or improvement scheme after sanction –

“At any time after a housing or improvement scheme has been sanctioned by the Board or the Government as the case may be, and before it has been carried into execution, the Board may alter or cancel it:”

15. Now the question is whether the Housing Board has got power after the sale of the apartment to exercise the power for the removal of the commercial activities carried on in the residential premises. From Ext.P1 it is categoric and clear that the scheme launched by the 1 st respondent is a comprehensive scheme whereby 24 flats, 11 car sheds, 10 shop rooms and commercial building with office facilities in the 1 st floor has approved by the Kerala State Housing Board in its meeting held on 29.4.1992. It is not in dispute that shop rooms and commercial building with office facilities are situated in a separate structure away from the 24 residential housing apartments. It is also admitted by all the parties that the sale deed contained a specific clause with respect to the user of the housing apartments and prohibiting that apart from the housing no other activities can be carried on in the apartment complex. It is the specific case of the 1 st respondent Board that there is no Allottees Associations constituted as per the Regulation and the Board has not transferred its rights on common areas to the Allottees Associations. Therefore, according to me, by virtue of the provisions contained in the Regulations, the power of the common area still remains with the Board. Therefore, respondents 1 to 3 are still vested with powers to decide and rule upon any violation of the provisions of the Housing Board Act and Regulation by any of the allottees. Moreover,when a Housing Scheme is launched it is the duty of respondents 1 to 3 to see that the scheme as such is retained for the purpose for which it is launched, otherwise the result will be disastrous consequences by commercial intruders who will occupy the apartments either as lessee or subsequent purchasers and thereby defuse the very purpose and purport of the scheme. The provisions of the Kerala State Housing Board Act, 1971 clearly specifies the intention of the housing scheme launched by the Board. It is basically to cater the needs of the middle class and marginalized sector who are poor and economically backward in the State. If such schemes are misused it will cause severe damage to the purpose for which the Board itself is constituted and the housing schemes are launched. 16. Regulation 2(c) of Regulations, 2000 defines, apartment as to mean, residential building or flat constructed by the Kerala State Housing Board or a residential building constructed by an allottee in a plot allotted by the Kerala State Housing Board. Regulation 2(h) defines Managing Committee, which includes Executive Engineer who is having administrative control over the scheme or his representative. Regulation 6 defines status of apartment common areas and facilities, which reads thus:

# 6. Status of apartment common areas and facilities

(1) All apartment in the Housing Scheme shall be used purely for residential purpose.

(2) Each allottee may use the common areas and facilities in accordance with the purpose for which they are intended, without hindering or encroaching upon lawful rights of the other allottees.

(3) The work of necessary maintenance, repairs and replacement of common areas and facilities and the making of any additions or improvements thereto, shall be carried out only as provided in these Regulations.

Regulation 8 defines duties and obligations of members and clause (2) of the said regulation reads as follows:

“A member shall not carry on any trade or business which may become in any way a nuisance or danger to the residents or other allottees.”

Sub-regulation (9) of regulation 10 deals with power of the Managing Committee to take action against the members who make default in the payment of monthly maintenance charges or other fees. Any person aggrieved by any order passed by the Managing Committee is provided with power to file appeal to the Regional Engineer concerned against such action taken by the Managing Committee.

17. That apart regulation 2(k) defines Patron, means the Chairman as well as the Secretary of the Board. Regulation (11) enlists the duties and powers of Patrons which read thus:

# 11. Duties and Powers of Patrons

(1) It shall be the duty of the Patrons to ensure that the Association function for the purpose of which it is constituted.

(2) To attend any meeting of the General Body and Managing Committee and give direction for the effective functioning of the Association.

(3) To call for records and details regarding various decisions taken by the Association.

(4) To verify the accounts of the Association and get the accounts audited.

(5) To dissolve the Managing Committee in case of severe lapses in its functioning and take over the administration of the Association for a maximum period of 3 months. Fresh election shall be conducted within the period and hand over the charges to the newly elected Managing Committee.”

18. Sub-regulation 5 of regulation 11 shows that in the event of severe lapses in the functioning of the Managing Committee, the same can be dissolved and the administration of the Association can be taken over for a period of three months. Apart from all these, regulation 19 empowers the Patrons to supersede the Managing Committee in the event of the Managing Committee consistently making default or is negligent in the performance of the duties imposed on it by the Regulation or commits any act which is prejudicial to the interests of the Association or willfully disobey the directions, the Patrons may after giving the Managing Committee an opportunity to state its objections, if any, by order in writing remove the Managing Committee and take over the administration.

19. Learned counsel for the petitioner has also brought my attention to the Kerala Apartment Ownership Act, 1983 which came into force w.e.f. 12.1.1984. Section 12 of the said Act deals with contents of deeds of apartments. Section 12(1)(c) reads as follows:

“Statement of the use for which the apartment is intended and restrictions on its use if any”.

Moreover competent authority is defined under 3(j) of the said Act in relation to buildings constructed by the Kerala State Housing Board, the Housing Commissioner etc. etc. That apart, Housing Board is defined under 3(m) to mean the Kerala State Housing Board constituted under Section 4 KSHB Act, 1971. Therefore, the provisions of the Kerala Housing Board Act, 1971, Kerala State Housing Board (Formation of Allottees Associations) Regulations, 2000 and Kerala Apartment Ownership Act, 1983 if read together will show that an apartment constructed with the intention of providing residence to an owner and if a recital is made to that effect in the sale deed then the owner of the apartment and his successors-in-interest in any manner are bound to obey and comply with the restrictive clause contained under the sale deed. Under the circumstances, viewed in any manner when the case at hand is taken into account, it is admitted that the apartment structure in which the petitioners are occupying are residential apartments meant for residence of its purchasers or their successors-in-interest or lessees and it cannot be put to any use other than for the purpose of residence. No activity other than housing can be carried on in such residential apartment complexes. The apprehension voiced by the petitioners is that if the commercial establishments are permitted to continue in a residential premise, it is detrimental to their interest, affecting their privacy and safety also. Necessarily the authorities are duty bound to see that the projects implemented by it as per a scheme for providing residence to the purchasers is not diluted in any manner.

20. For the reasons aforesaid, I am unable to agree with the argument that, after purchase of property, owners are not bound by restrictive clauses.

21. I cannot subscribe to such a contention advanced by the party respondents, especially in view of the covenants specifically contained under the sale deed restricting its use for residential purposes alone. Apart from all these, going by the provisions of the Regulations discussed above, it cannot be heard to say that the Housing Board will lose its control over a residential building constructed by it once the sale deed is executed especially due to the fact that a representative of the Board is a permanent member of the Allottees Association and patrons are vested with drastic powers under enumerated circumstances. I am persuaded to think so because the Kerala State Housing Board (Formation of Allottees Associations) Regulations, 2000 will show that the Housing Board is bound to transfer the common properties involved in the scheme to the Owners Association if and when an association is formed. Here in this case admittedly there is no apartment Owners Association constituted and therefore, the ownership of the entire property is still vesting with the Housing Board without being transferred to Allottees Association. Therefore, by statute itself a duty is cast upon respondents 1 to 3 to continue to have surveillance of the functioning of the Association, then only it can identify whether the Association constituted by the owners is functioning properly and if the 1 st respondent finds that it is not functioning in accordance with the interest of the owners of the apartments, it is vested with powers to resume/re-gain the control from the apartment Allottees Association. Viewed in that manner also, it can be seen that the Housing Board is vested with powers and imposed with a duty to see that the purpose for which the scheme was launched is retained without defacing the same in any manner.

22. Learned counsel for the Board has invited my attention to the judgment of this court in W.P.(C) No.31677/2009 dated 4.1.2010 of a learned Single Judge of this Court, wherein a similar question was considered with respect to a scheme launched by the 1 st respondent within the jurisdiction of the Chalakudy Municipality wherein the question was whether the Municipality was right in declining licence to have a commercial venture in a residential apartment and the power of the Housing Board to change the category of the building. There, this court categorically held that from the sale deed executed by the Housing Board in favour of the transferee, it is seen that the sale was subject to other terms and conditions stipulated in the conditions of allotment. It was also held that if that be so, the 2 nd petitioner therein being the transferee of the plot in question is equally bound by the conditions imposed by the Housing Board irrespective of whether such conditions are incorporated in Ext.P4, sale deed executed in his favour. Under the Housing Board Act, the category of the scheme cannot be changed after it is executed. Therefore, there is no question of changing category after the building was alloted by executing sale deeds. The said judgment of this court was upheld by the Division Bench in Writ Appeal No.205/2010 dated 20.11.2015. So also the learned counsel for the petitioners has invited my attention to the judgment of the Apex Court in

# Mittal v. State of U.P. reported in [2012 (1) KLT Suppl. 35 (SC]

and invited my attention to paragraphs 49, 51 and 53. There, the Apex Court was considering the very same issue as to whether the master plan and zonal plan specifying the user as residential can be used for any other purpose. There the plots were allotted by the Delhi Development Authority under Industrial Development Area Act, 1976 (U.P.). and held that the scheme is to be implemented strictly.

23. Taking into account the aforesaid facts and circumstances and reckoning the law as discussed above, I am of the considered opinion that respondents 1 to 3 are bound to see that residential apartments as per Ext.P1 scheme launched by the 1 st respondent, no commercial venture can be allowed to be carried on. If there are any commercial activities carried on in the said building, respondents 1 to 3 are duty bound to remove the same, if required with the assistance and help of District Administration and the Police. However, 12th respondent residing in one of the office and carrying on the Advocates office cannot be termed as a commercial venture. Therefore, residence of the professional along with his office in an apartment cannot be termed as a commercial one. But at the same time restrictive clause in the sale deed is prohibiting any other activity other than housing. Therefore if any complaint is received with respect to any nuisance caused, Board as per the power vested under the Regulation is bound to make enquiry and act accordingly. All other business activities carried on in the apartment shall be removed without any further delay. But taking into account the plight of the respondents to locate a new building, I think three months time can be granted for removing the said activities from the building in question.

24. Therefore the above writ petition is allowed directing respondents 1 to 3 to remove all commercial activities from the apartments in Chinnakkada Housing Accommodation Scheme, Site II of the Housing Board at Kollam within a period of three months if required, by securing assistance and help from the District Administration and the Police.

All pending interlocutory applications in this case stand closed.

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