Commercial use of residential property in Mumbai sits under the same Supreme Court order as every other State capital, and this article is for owners of a flat, a ground-floor shop or a building in Greater Mumbai — particularly those who live elsewhere and let it out. If you own a flat, a ground-floor shop or a building in Greater Mumbai — particularly if you live elsewhere and let it out — you have seen headlines about a Supreme Court crackdown on residential property used commercially, and about thousands of notices issued by "BMC". Both are real. Neither, so far, is about Mumbai. As of 10 September 2026 Mumbai is caught by the order in principle, but the Brihanmumbai Municipal Corporation has not been named in a single order and has published no affidavit, survey method or misuse figure.
What the Supreme Court ordered
In Loganathan v. State of Tamil Nadu, SLP(C) 8044-8045/2025, Justices Ahsanuddin Amanullah and R. Mahadevan on 25 March 2026 impleaded the municipal corporations of every State and Union Territory capital and ordered a survey of "areas demarcated exclusively for residential use, but are being misused for non-residential purposes", with affidavits personally affirmed by Commissioners due by 15 May 2026 (LiveLaw). On 20 May 2026, only three States having filed, it ordered fresh action-taken affidavits disclosing "immediate and effective measures, including sealing, demolition, or any other action warranted in law", and gave statutory appellate authorities three months to clear pending cases. On 4 August 2026 it raised costs to ₹1,00,000 and found the affidavits filed so far had "merely narrated survey findings without indicating any concrete enforcement action" (SCC Online).
Where Mumbai stands
Mumbai is Maharashtra's capital, so MCGM falls inside the order. But the impleadment is generic: the Court impleaded "all Municipal Corporations and Municipalities ... of the capital cities of all the States and Union Territories", naming none individually (order text, 25 March 2026). Mumbai, Maharashtra, Brihanmumbai Municipal Corporation and MCGM appear nowhere in the orders of 25 March, 20 May or 4 August 2026, which name Chennai, Delhi, Gurugram, Jaipur and Lucknow. No MCGM affidavit has been reported filed; equally, MCGM has not been named a defaulter. No Bombay High Court petition or stay arising from this drive has been reported.
A naming problem is misleading Mumbai owners. In national coverage of this drive, "BMC" almost always means Bhopal Municipal Corporation or Bhubaneswar Municipal Corporation. The 1,018 notices reported on 1 August 2026 are Bhopal. The 4,632 plots notified, and the rule that no trade licence issues without an approved commercial building plan, are Bhubaneswar, as of 25 August 2026. Neither describes Brihanmumbai. Read the dateline before the number.
MCGM enforcement this year is different. On 19 June 2026 the K-West ward demolished nine illegal shops on Fun Republic Road and Veera Desai Road; no statutory section was cited and no Supreme Court order was referenced. On 23 June 2026 a further 17 illegal structures were demolished in Andheri. That is encroachment work, not change-of-user sealing. The Bombay High Court is also policing the tools: it quashed an MCGM section 354A notice over roof repairs, holding that replacing rusted sheets is tenantable repair, not illegal construction.
The rules that apply in Mumbai
Enforcement runs on the Mumbai Municipal Corporation Act, 1888. Section 351 applies where building or work is "commenced contrary to the provisions of section 342 or 347": the Designated Officer gives written notice to show cause within seven days why the work should not be "removed, altered or pulled down", and on failure may do so at the owner's expense. Section 354A is the fast track — stop work forthwith, and if work does not stop or permission is not produced within 24 hours, demolish without further notice and recover the expense as arrears of property tax.
Note what those sections do not say. Section 351 addresses structural violations; its text carries no reference to unauthorised change of user or occupancy. A flat used as an office, with nothing built, is not a comfortable fit. The realistic lever against pure change of use is section 394, which requires the Commissioner's written permission for trades listed in Schedule M Part IV. The Supreme Court has held a section 394(1)(e) licence is needed even for a members-only club eating house, so "we are not commercial" is no defence (Willingdon Sports Club). Alongside it sits zoning enforcement under the Maharashtra Regional and Town Planning Act, 1966.
Zoning turns on the "shop line". Under the Development Control Regulations for Greater Bombay, 1991, a pure residential zone (R-1) permitted up to 50% of floor space for clinics, nursing homes and student hostels, with convenience shopping limited to one shop per 15 tenements on the ground floor, carpet not exceeding 20 sq m; residential with shopping line (R-2) also permitted retail stores, professional offices up to 100 sq m and eating houses up to 200 sq m carpet, ground floor only (DCR 1991 summary). These are DCR 1991 thresholds, to be confirmed against DCPR 2034 Regulation 34, "Uses and ancillary uses permitted in the zones", now in force, whose text was not available at the time of writing. MCGM has published no fee or procedure schedule for change of user, and no figure should be quoted for it.
In a cooperative housing society there is a second layer. Commercial activity in a residential flat is treated as a breach of the condition of purchase, read with model bye-laws 43 and 19(a); the published guidance is that societies amend their bye-laws to state permitted residential usage. A member letting a flat must intimate the society eight days in advance, file a copy of the agreement and notify the local police (Free Press Journal; model bye-laws).
What it means for owners and tenants
The immediate exposure in Mumbai is not sealing. It is the licence and the society. A section 394 licence refused or withdrawn stops the activity without anything being demolished, and it reaches the tenant rather than the owner; a society acting under its bye-laws can move faster than the corporation. Where construction has been done — a mezzanine, an enclosed balcony, a shopfront cut into a residential ground floor — sections 351 and 354A do apply, and the 24-hour route leaves very little time. The Court directed on 20 May 2026 that appellate authorities clear pending building-violation cases within three months; the forum for a Mumbai change-of-user or licence refusal runs through the MRTP Act, 1966, and is to be confirmed.
What to do this month
- Pull the approved plan, occupation certificate and tax bill, and compare sanctioned use against what is built and let.
- Establish whether your ground-floor unit sits on a notified shop line or in a pure residential zone — that decides whether the use is regularisable.
- If any trade is carried on, check whether a section 394 licence exists, in whose name, and whether it is current.
- Ask your tenant in writing whether a clinic, coaching class, office or paying-guest use started without your knowledge.
- If the flat is in a society, check the eight-day letting intimation, the lodged agreement and the police notification against bye-laws 43 and 19(a).
- Check whether a notice was served at the property rather than your own address — an absent owner learns of a 24-hour notice too late.
This is general information, not legal advice; take advice on your own property.
What to watch
The next Supreme Court hearing is reported for 15 September 2026. Three things would change the Mumbai picture: an MCGM affidavit; any order naming Maharashtra or MCGM; and publication of DCPR 2034 Regulation 34, against which the older shop-line limits can be checked.
Navoasset manages residential and commercial property in Bhubaneswar, where the same Supreme Court order has produced 4,632 notices and a new trade-licence rule; many of our owners live in Mumbai or own property here. We are tracking every State capital because the same order applies to all of them — the city-by-city tracker is at /insights/supreme-court-commercial-use-residential-property-tracker-2026/.
