Archive · 2 Aug 2025
Bombay HC: 5% Allotment Rule Applies Only to Future Projects
A court in Mumbai decided whether a rule about how many flats in housing projects must go to the government should be applied to an older project.
A builder wanted to follow a rule from a Supreme Court case that said only 5% of flats should go to the government.
However, the court said this rule only applies to new projects.
Since the builder's project started before that rule, they still had to give 30% of the flats to the government and pay fines.
Bombay High Court ruled the 5% government allotment cap applies only to future projects.
The ruling addressed a builder's challenge to a 30% allotment requirement in a 1989 scheme.
The builder cited the Shantistar judgment and a 1997 government resolution.
The court referenced previous rulings to confirm the 5% allotment rule is prospective.
The High Court upheld penalties against the builder and sent the case for further hearing.
- Who
- The Bombay High Court, Dattatray Laxman Desai, and the government.
- What
- Bombay High Court clarified the applicability of a Supreme Court ruling on government allotment in housing schemes.
- When
- The ruling was recently announced, referencing a 1990 Supreme Court judgment.
- Where
- Bombay High Court, Mumbai, India.
- Why
- To determine if the Supreme Court's 5% allotment rule applied to a pre-1990 project.
Builder's Perspective
Court's Ruling
Application of Shantistar Judgment
Builder's Perspective
Argued for application of the 5% allotment rule, citing the Shantistar judgment and a 1997 GR.
Court's Ruling
The court ruled against them, stating the 5% allotment rule is prospective, applying only to schemes sanctioned after January 31, 1990.
- Court
- Bombay High Court
- Case
- Shantistar Builders
- Year of Supreme Court Ruling
- 1990
- Builder's Scheme Year
- 1989
- Government Allotment Sought
- 30%
- Fines
- ₹20.65 lakh