Possession vs. Ownership: Bombay High Court on Redevelopment Benefits

 

The Bombay High Court’s recent decision in Ritesh Haldar v. Elite Housing LLP and Ors, Commercial Arbitration Appeals (L) No.14486/2025 and No.15542/2025, delivered on 24 June 2025, sheds light on how property and family disputes are handled during building redevelopments—a common event in Mumbai’s old housing societies.

In this case, a flat in Khar, Mumbai, became the focus of a dispute between family members when their building was taken up for redevelopment. Ritesh Haldar, the appellant, is one of three brothers in the Haldar family. When the flat was purchased, Ritesh's mother's name (Sabita Haldar) was also included for society membership purposes. After Sabita passed away in 2002, Ritesh claimed to have become the sole owner of the flat, as his name remained on the society records.

However, his brothers—Rohitesh (whose wife is Leena) and Rajesh—claimed that their mother owned a 50% share in the flat, which they say passed to all siblings after her death. In the meantime, Ritesh permitted his brother Rohitesh and sister-in-law Leena to stay in the flat, describing them in legal terms as “gratuitous licensees”—that is, people allowed to stay in the property without paying rent, based solely on family arrangement and goodwill.

 The court had to decide who gets the benefits from the developer when the flat is handed over for redevelopment, especially when the person living in the flat (Leena) was not the registered owner but stayed there as a result of family arrangements.

The court ruled that benefits like temporary rent and possession of the new flat after redevelopment must go to the person actually living in the property, even if they are not the official owner. In this case, Leena, who lived in the flat with her children, will receive the transit rent and will also be given possession of the new flat after redevelopment.

However, the court also said that the main redevelopment agreement and the main compensation (called corpus) should be in the name of Ritesh, who is listed as the flat’s owner in society records. This doesn’t affect the rights of other family members, who can still pursue their claims through the proper legal channels.

The court made it clear that redevelopment cannot be misused by owners to evict someone (like a spouse or licensee) without a proper court order, and that the occupant’s right to housing must be protected during redevelopment—even when family disputes are unresolved.

For many Mumbaikars, this decision emphasises that if you are living in a flat—even if you don’t “own” it on paper—you can’t be pushed out during redevelopment without legal process. At the same time, legal ownership is respected for official paperwork and major financial benefits, subject to the outcome of any ongoing family disputes.

This judgement provides a fair balance between the rights of homeowners and those living in the house, ensuring that redevelopment benefits are distributed in a practical and just manner.