Land Transfer Dispute: Supreme Court Ruling on Housing Scheme for Bank Employees

In a significant legal case concerning a housing scheme for bank employees, the Supreme Court of India has issued a ruling on the land transfer dispute. The case involves a dispute between a bank and a housing society regarding the transfer of land and ownership rights. This judgment addresses the concerns raised by both parties and provides a resolution to the longstanding issue. Read on to discover the full details of the Supreme Court’s decision on this matter.


  • The Appellant, a bank, undertook a housing scheme for its peon employees by purchasing 14 plots in 1973.
  • The plots were divided into 16, and 28 tenements were constructed, with 2 plots remaining vacant.
  • Employees paid for construction costs and took loans, but the lease deed was not executed on time.
  • Legal issues arose as employees were not granted ownership despite loan repayment and completion of formalities.
  • State Commission found the bank deficient in service for delay in lease deed execution, causing financial loss to the employees.
  • The bank was directed to bear costs for renewal and registration of the lease deed.

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  • The State Commission ordered all expenses in the registration of the lease deed to be borne by the appellant bank.
  • It is a common practice for the purchaser to bear the burden of stamp duty and registration charges.
  • Even if the lease deed is transferred to the Society, the expenses should be borne by the Society or its members, not the bank.
  • Out of the 16 plots, only 14 have been utilized, and two remain vacant and unallocated.
  • Therefore, it is impractical to fully implement the State Commission’s order.
  • The two vacant plots remain the property of the bank and cannot be leased to the Society.
  • The learned counsel for the Appellant argued that the order of the State Commission should be set aside.
  • Mr. Deshmukh represented the Appellant as the Advocate.
  • Mr. Kishor Ram Lambat represented the Respondent.
  • Mr. Satyajit A Desai represented another Respondent.
  • The counsel argued that the State Commission’s order is not justified on two specific counts.

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  • The Appellant never intended to transfer interest in two plots to employees or their society.
  • Tenements were constructed by the Appellant for employee housing needs with extended loan facilities at comfortable interest rates.
  • State Commission’s order regarding certain plots and extra charges imposed on tenement holders.
  • Assertion that the value of the two plots in question was significant.
  • Absence of evidence suggesting the decision to transfer interest in the two plots.
  • Resolution for land transfer to employees passed on 21.01.2004.
  • No delay or refusal on Appellant’s part in executing the transfer resolution.
  • Possibility of increased stamp duty for the society due to delayed document execution.
  • Cost division for land and tenement construction, with tenants reimbursing the amount.
  • Lack of indication that tenement holders had interest in the two vacant plots.
  • Non-involvement of Petitioner No.1 or its members in initial allotment process by Bank.
  • Ease of transferring lease deed to Petitioner No.1 or its members post renewal.
  • Requirement for stamp duty payment as per current law for lease deed transfer.
  • Order for Appellant to share 50% of total expenses for delayed free registration opportunity.
  • Acknowledgement of contributions made by all tenement holders towards land costs.
  • Confirmation of no profit motive and recovery of only actual costs incurred by the Appellant.
  • The appellant provided housing support to its employees, not as a service provider but as a helping hand.
  • The appellant claimed no profit and incurred significant interest burden for the employees’ benefit.
  • The matter was considered maintainable under the Act, although disputed by the appellant.
  • No deficiency or wrongdoing was found on the part of the appellant.
  • The orders of the State Commission and National Commission were set aside.
  • The appellant was directed to either pay Rs. 10,000 to each tenement holder or convey interest in 28 tenements and the land within specified timelines.
  • Stamp duty for the documents to be borne by the housing society.
  • The appellant retains rights to the portion of land with no tenements.
  • In case of payment, the housing society is entitled to convey interest in the specified properties.

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  • Respondent No.1 in option ā€˜eā€™ in para 13 accepted the plea
  • Appellant directed to pay each tenement holder Rs.10,000 in compensation
  • Appellant given the option to either pay the compensation or transfer the land to the Society
  • The Appeals allowed in the mentioned terms with no costs


Case Number: C.A. No.-008606-008606 / 2019

Click here to read/download original judgement

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