I am a 45-year-old man living in Juhu, which falls under the traditional ‘pagdi’ rental system in Mumbai. My building is undergoing redevelopment. What are my rights as a tenant under this system?
– Name withheld on request
In Mumbai, the ‘pagdi’ system, a unique tenancy model rooted in historical landlord-tenant agreements, provides significant protections for tenants, particularly during building redevelopment. Here are the rights of pagdi tenants under Maharashtra’s tenancy laws, with a focus on the critical question of ownership status post-redevelopment.
Under the Maharashtra Rent Control Act, 1999, pagdi tenants, who pay nominal rent under long-term agreements, enjoy robust protections when their buildings are redeveloped. The Act mandates that developers provide tenants with equivalent or larger accommodation in the redeveloped building at no cost. This ensures that you are not displaced due to urban renewal. The new flat must match or exceed the original carpet area, and tenants are not required to pay for additional space if the redeveloped flat is larger.
A key concern is whether tenants retain their pagdi status or gain full ownership post-redevelopment. Typically, as a pagdi tenant, the tenant does not automatically receive ownership rights unless explicitly agreed upon in the redevelopment contract. The default legal position, as upheld by the Bombay high court, is that the tenant will retain his protected tenancy status in the new premises.
You are entitled to a permanent alternate accommodation agreement, which ensures continued tenancy under similar terms as the original pagdi arrangement, including nominal rent obligations to the landlord or developer, depending on the agreement.
However, in some cases, developers may offer ownership flats as part of the redevelopment deal, particularly if the landlord relinquishes his rights or the tenants collectively negotiate for ownership. Such arrangements require a clear, written agreement, often involving the formation of a cooperative housing society where tenants become co-owners of the redeveloped property. Without such an agreement, tenants remain pagdi tenants, not owners, in the new building.
During redevelopment, developers must provide the tenant with transit accommodation or a reasonable rent allowance to cover temporary displacement. The tenants should scrutinize redevelopment agreements, ensuring clarity on flat size, possession timelines, and ownership or tenancy terms. Legal consultation is crucial to avoid exploitation, as developers may push for monetary compensation instead of repossession, which courts have ruled against.
Recent projects in areas like Dadar and Bhuleshwar underscore the need for tenant unity and legal awareness. By understanding their rights, pagdi tenants can secure their place in Mumbai’s evolving skyline while preserving their tenancy or negotiating ownership where feasible.
Aditya Chopra, managing partner and Moxy Shah, associate, The Victoriam Legalis (TVL).
