Bombay High Court Rules TDR Grants Right To Monetize, Not Ownership Over Third-Party Property

Mumbai : The Bombay High Court has clarified that transferable development rights (TDR) constitute a monetisable entitlement rather than a basis for asserting ownership over property developed using those rights, overturning part of a trial court’s decision in a long-running Thane land dispute. 

In a judgment delivered on February 3 and published late Friday, Justice Sandeep Marne ruled that using TDR generated on one plot of land for construction on another does not give the original owner any ownership interest in the resultant buildings on third-party land. The decision stems from a civil suit in which plaintiff Vinod Anand claimed rights over residential units built on adjacent land because TDR issued from his disputed property had been utilised there. 

The dispute revolves around a parcel in Thane’s Survey No. 29/6, where Anand owns more than 12,538 square metres. A large section was surrendered to the municipal corporation under development reservation rules, producing TDR in favour of a developer. That TDR was later applied to construction on a neighbouring property owned by petitioners including Abdul Aziz Bharmar, who had separately granted development rights to the same developer in exchange for built units. Anand contended that this linkage entitled him to claim ownership of 41 flats allotted to Bharmar. 

The trial court had permitted adjoining landowners to be added as defendants and allowed amendments to include these ownership allegations. But the High Court found this approach legally flawed. Justice Marne said that once TDR is detached from the original land and used elsewhere, it “loses the characteristic of immovable property” and its connection to that land. He stressed that the mere use of such rights on another parcel doesn’t justify adding third-party owners to the suit. 

Instead, the judge said Anand’s recourse if he believes the developer misused TDR is to seek monetary recovery from the developer, not to pursue title claims against neighbouring landowners. The court accordingly struck down the impleadment of Bharmar and others in respect of the flats, while allowing other parts of the suit to proceed. 

The ruling further defines the legal character of TDR in property disputes, distinguishing monetisable rights from enforceable claims on third-party property.