Supreme Court Eases Maharashtra’s Self-Redevelopment Rules, Lowers Consent To 75%

Apex Court Upholds Guidelines’ Validity But Grants Relief To Housing Societies On Financial And Procedural Burdens

In a landmark verdict on September 18, 2025, the Supreme Court of India delivered its ruling in Civil Appeal No. 11234 of 2025 — Rajesh Kumar Gupta & Ors. vs. State of Maharashtra & Ors. — resolving a critical constitutional challenge to Maharashtra’s 2019 Self-Redevelopment Guidelines and their integration with the Maharashtra Ownership Flats Act (MOFA) and RERA.

The petitioners, led by Rajesh Kumar Gupta, represented members of a Mumbai-based housing society that had obtained deemed conveyance in 2021 for their 45-year-old building. They argued that the 2019 Guidelines imposed arbitrary and unequal financial obligations such as mandatory bank guarantees, escrow requirements, and 100% member consent, which they claimed violated Article 14 (equality) and Article 19(1)(g) (right to occupation). The petitioners contended these rules unfairly favored developers over resident-led redevelopment efforts.

The State of Maharashtra defended the guidelines, stating that stringent conditions were essential to prevent mismanagement and ensure accountability, citing rising defaults and financial risks in society-managed projects. The Bombay High Court had dismissed the plea in 2024, prompting the current appeal before the apex court.

Court’s Reasoning

The Supreme Court partly allowed the appeal, upholding the validity of the 2019 Guidelines while relaxing key provisions to improve access and feasibility for cooperative societies.

The bench held that the guidelines serve a legitimate state objective under Article 21 (right to shelter) and promote safe and transparent urban renewal. However, it ruled that the 100% consent requirement was “excessively rigid and impractical”, diluting it to 75% to align with MOFA and RERA provisions that recognize majority rule in redevelopment decisions.

Citing Samruddhi Co-operative Housing Society vs. State of Maharashtra (2024), the Court affirmed that once a society secures deemed conveyance, it qualifies as a “promoter” under RERA, empowering members to undertake redevelopment without government micromanagement.

Key financial relaxations were also introduced:

Bank guarantees remain mandatory only for projects above ₹50 crore, ensuring accountability for large-scale ventures.
Smaller societies (below 50 units) with verified audits are exempted from guarantees.
Integration with MOFA Section 11 was upheld to secure title-based loan access for societies.

The Court noted that state oversight is necessary to prevent fraud, citing 2024–25 data showing 15% of failed self-redevelopment projects due to poor planning. However, it distinguished cooperative societies from commercial developers, emphasizing that both require tailored governance models, not uniform regulation.

Supreme Court’s Orders

Guidelines Upheld, Modified: 100% consent reduced to 75%; smaller societies exempted from bank guarantees.
Timeline Mandates: All societies must register with RERA within 60 days of passing self-redevelopment resolutions.
Administrative Reform: Maharashtra must amend guidelines within 90 days and create a dedicated MahaRERA cell to expedite approvals.
Compensation: ₹5 lakh awarded to petitioners from state funds for litigation delays, to aid feasibility studies.
Ease of Process: Societies with deemed conveyance need no fresh municipal NOC, provided structural compliance is certified.

Broader Significance

This ruling provides nationwide clarity on the balance between state regulation and housing society autonomy, shaping future self-redevelopment frameworks. By integrating MOFA, RERA, and cooperative principles, the Court has created a model for simplified, community-driven urban renewal.

Experts estimate that over 2,000 Maharashtra societies with deemed conveyance will benefit from the relaxed norms, particularly in Mumbai, Thane, and Pune. The verdict also sets a national precedent likely to influence Gujarat and Karnataka RERA policies, promoting citizen-led redevelopment amid India’s urban housing challenges.