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Mrs Mahabanoo Contractor and Anr vs M/s Kalikund Developers and Ors 2026 INSC 737
Statutory Scheme Overrides Private Agreement: Supreme Court Enforces PAAA Against Developer's Unilateral Repudiation
Case Snapshot
Case Name: Mrs. Mahabanoo Contractor and Anr. v. M/s. Kalikund Developers and Ors.
Citation: 2026 INSC 737
Bench: Justice J.B. Pardiwala and Justice K. Vinod Chandran
Date of Judgment: July 23, 2026
Area of Law: Property Law, Maharashtra Housing and Area Development Act, Redevelopment, Occupant Rights
Judgment in Brief
The Supreme Court allowed the appeal and set aside the High Court's judgment, which had restrained the Maharashtra Housing and Area Development Authority (MHADA) from enforcing its orders directing the developer to execute the Permanent Alternate Accommodation Agreement (PAAA) and hand over possession of the promised flats to the appellants. The Court held that the PAAA was not a private arrangement but was executed under the statutory framework of the MHAD Act and DC Regulations for redevelopment of cessed buildings. The appellants, as "occupants" of the old building, were entitled to alternate accommodation in the redeveloped building. The developer could not resile from its obligations after obtaining consent and possession from the appellants, demolishing the old building, and constructing the new building. The Court found the civil suit filed by the developer to be misconceived and mala fide, particularly after the undertaking given before the High Court. The developer was directed to execute the PAAA and handover possession within two months, failing which damages would be payable.
Relevant Facts
The building was a cessed building found unfit for human habitation, requiring demolition and redevelopment under the MHAD Act and DC Regulations.
The 1st appellant was an "occupant" of Room No. 5 on the third floor, jointly with Ms. Gool Peshotan Unwalla (the original tenant).
Ms. Unwalla died in 2012. The appellants, as her legal heirs, succeeded to her estate, including the occupancy status.
The developer obtained consent and possession from the occupants, including the 1st appellant, for redevelopment, promising a
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