In the landmark case of Nahalchand Laloochand v. Panchali Co-op Housing Society [2010 INSC 563], the Supreme Court ruled that open or stilt parking spaces are “common areas” intended for the use of all residents.
Consequently, these spaces cannot be sold as independent units. In practice, these areas must be handed over to the housing society and shared among the apartment owners.
Builders are required to include the cost of common parking in the total price of the flat. Buyers should not be charged extra for these spaces beyond the amount specified in the sale agreement. Charging separately for an open or stilt parking slot is considered an unfair trade practice.
Distinction Between Private Parking and Shared Parking
A distinction exists between private parking and shared parking in the law and that is as follows:
- Private Parking: A fully enclosed garage or designated basement parking shown on the approved plan is treated as a private spot. Developers may sell these separately if they are clearly defined in the building plan.
- Shared Property: Open parking is recognized as shared property. Any attempt to sell it separately is illegal. Builders must disclose all parking details in the plan and can only charge extra for truly private spaces.
The Legal Framework in Kerala
In Kerala, builders and promoters are legally prohibited from selling common areas, as these belong collectively to the apartment owners.
The above principle is reinforced by the Kerala Apartment Ownership Act, 1983, the Real Estate (Regulation and Development) Act, 2016 (RERA), and various Supreme Court judgments.
Under these laws, common areas include the land, staircases, lifts, lobbies, fire escapes, entrances, basements, gardens, parks, play areas, and open parking spaces.
Section 6(4) of the Kerala Apartment Ownership Act explicitly states that the “undivided interest” in common areas cannot be separated from the apartment itself. The Act reads:
“The percentage of the undivided interest in the common areas and facilities shall not be separated from the apartment to which it appertains, and shall be deemed to be conveyed or encumbered with the apartment even though such interest is not expressly mentioned in the conveyance or other instrument.”
The Kerala High Court, in Babu P.T. v. Sub Registrar and Others [2020:KER:25193], emphasized that common areas are deemed to be transferred along with the apartment, regardless of whether they are specifically mentioned in the sale deed. Selling any area marked as “common” in the approved plan is a violation of both RERA and the building permit.
Resolving Parking Disputes
If a builder or society violates these rules—for instance, by illegally selling common parking spaces—homeowners have legal recourse:
File a RERA Complaint: You can file a formal complaint with the local Real Estate Regulatory Authority (RERA). This requires evidence such as the sale agreement, the approved building plan, and any relevant correspondence.
Review and Refund: RERA will review the case. If a violation is found, the authority can direct the builder to refund the amount paid for the parking space, often with interest.
Appeals: RERA decisions are enforceable. If parties are dissatisfied, they can appeal to the RERA Appellate Tribunal or the higher courts.
RERA acts as a vital safeguard, ensuring that builders adhere to approved plans and protecting the rights of homebuyers.
