Karnataka High Court Maintains Status Quo in Commune-1 Residential Project Dispute

The Karnataka High Court has directed all parties to maintain the status quo in a dispute concerning the “Commune 1” residential apartment project at Marasur Village, Anekal Taluk, Bengaluru. This decision comes after the Karnataka Real Estate Regulatory Authority (RERA) permitted a Co-operative Society to take over the project to complete the pending construction.

A Division Bench comprising Chief Justice Vibhu Bakhru and Justice C.M. Poonacha, in Writ Appeal No. 1347 of 2025, passed an interim order directing that the earlier interim arrangement shall continue, and parties must maintain the status quo as of the date of the order. The appeal arises from a Single Judge's order dated 30.06.2025, passed in connected writ petitions.

The dispute pertains to the “Commune 1” residential apartment project developed by Commune Properties India Pvt. Ltd. The project consists of 384 apartments across five towers (A to E). Towers B, C, and D were substantially completed and occupied, while the construction of Towers A and E was delayed. Apartment owners in the completed towers formed a residents' welfare association under the Karnataka Societies Registration Act, 1960, claiming to represent a majority of the allottees.

Meanwhile, certain agreement holders of Towers A and E formed a separate association and approached RERA, seeking directions for the completion of the pending construction. RERA, exercising powers under Section 8 of the Real Estate (Regulation and Development) Act, 2016, permitted the association of allottees to take over the project and complete the remaining construction. Subsequently, a Co-operative Society named “Commune 1 Apartment Co-operative Society Ltd.” was registered under the Karnataka Co-operative Societies Act, 1959.

Aggrieved by this, the residents' association representing occupants of Towers B, C, and D challenged: - The RERA directions permitting the takeover of the project - The registration of the Co-operative Society - Subsequent actions allegedly affecting the management of common areas

The petitioners contended, among other points, that: - The common area has already been included in the undivided share of the apartment owners, and transferring it to a co-operative society amounts to double conveyance - The Co-operative Society did not represent a majority of apartment owners across the entire project - The direction to form a Co-operative Society was contrary to the scheme of the Karnataka Apartment Ownership Act, 1972 - Agreement holders of incomplete towers could not assume control over completed towers and common areas already under occupation - The RERA order effectively handed over control of the entire project, including completed towers, to persons not in possession

The Single Judge adjudicated the writ petitions by order dated 30.06.2025, following which the matter was carried in appeal. Hearing the appeal, the Division Bench issued notice and directed the parties to maintain the status quo as of the date of the order. The Court further ordered that the earlier interim protection granted in the matter shall continue to operate until the next date of hearing.

The Bench has not entered into the merits of the dispute at this stage. The order effectively preserves the existing arrangement concerning the management and control of the Commune-1 project pending further consideration. The Bench clarified that the interim protection already operating in the matter would remain in force. Earlier interim orders in the proceedings had stayed conveyance and maintenance actions arising from the RERA directions. The matter is now pending before the Division Bench.