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2024 Supreme(SC) 614

SUPREME COURT OF INDIA
PAMIDIGHANTAM SRI NARASIMHA, ARAVIND KUMAR, JJ.
Yash Developers – Appellant
Versus
Harihar Krupa Co-Operative Housing Society Limited & Ors. – Respondents
Civil Appeal No. 8127 of 2024(Arising Out of SLP(C) No. 20844 of 2022) With Contempt Petition (Civil) No. 217 of 2024 IN SLP (C) No. 20844 of 2022
Decided on : 30-07-2024

Advocates appeared:
For the Petitioner(s): Mr. Vikas Mehta, AOR
For the Respondent(s): Mr. Rajeev Maheshwaranand Roy, AOR Mr. Sanjay Kharde, Sr. Adv. Mr. Satyajeet Kharde, Adv. Mr. Sunny Jadhav, Adv. Mr. Sunil Kumar Verma, AOR Mr. Aniruddha Joshi, Adv. Mr. Shashibhushan P. Adgaonkar, AOR Mr. Pradnya S. Adgaonkar, Adv. Mr. Aaditya Aniruddha Pande, AOR Ms. Rukmini Bobde, Adv. Mr. Siddharth Dharmadhikari, Adv. Mr. Bharat Bagla, Adv. Mr. Sourav Singh, Adv. Mr. Aditya Krishna, Adv. Ms. Preet S. Phanse, Adv. Mr. Adarsh Dubey, Adv. Ms. Soumya Priyadarshinee, Adv. Mr. Amit Srivastava, Adv. Mr. Amlaan Kumar, Adv. Mr. P. N. Puri, AOR Mr. C.A. Sunderam, Sr. Adv. Mr. Aman Vachher, Adv. Mr. Yadunath Chaudhary, Adv. Mr. Dhiraj, Adv. Mr. Ashutosh Dubey, Adv. Mrs. Anshu Vachher, Adv. Ms. Abhiti Vachher, Adv. Mr. Akshat Vachher, Adv. Ms. Nandni Sharma, Adv. Mr. Amit Kumar, Adv. Mr. Jasvinder Chaudhary, Adv. Mr. Ashwin Sawlani, Adv. Mr. Anil Nag, AOR Mr. M. Yogesh Kanna, AOR Mr. Vinay Navare, Sr. Adv. Ms. Anshula Vijay Kumar Grover, AOR Mr. M. Yogesh Kanna, AOR

The court affirmed that developers under the Slum Rehabilitation Act have a statutory duty to complete projects within a specified timeframe, with accountability enforced by the Slum Rehabilitation Authority.

Headnote:(A) Maharashtra Slum Areas (Improvement, Clearance and Redevelopment) Act, 1971 - Section 13 - Termination of development agreement - Developer's failure to commence construction for over 16 years - The Apex Grievance Redressal Committee terminated the agreement due to inordinate delay, which was upheld by the High Court - The court emphasized the statutory duty of the developer to complete the project within the stipulated time and the accountability of the Slum Rehabilitation Authority (SRA) in ensuring compliance. (Paras 6, 10, 30, 64)

(B) Judicial Review - Scope under Article 226 - The High Court reiterated the limited scope of judicial review against decisions of statutory authorities, emphasizing that the inquiry must focus on whether the decision is arbitrary or unreasonable. (Paras 4, 27)

Facts of the case:
The appellant was appointed as a developer in 2003 for a slum rehabilitation project but failed to commence construction for over 16 years due to various delays, including litigation and lack of financial resources. The AGRC terminated the development agreement, which was challenged in the High Court. (Paras 2, 30)

Findings of Court:
The High Court upheld the AGRC's findings that the developer had grossly delayed the project and that the reasons provided for the delay were insufficient. The court emphasized the need for timely completion of slum rehabilitation projects. (Paras 23, 30)

Issues: The main issues included whether the developer's delay was justified and the extent of the SRA's accountability in ensuring project completion. (Paras 3, 4)

Ratio Decidendi: The court ruled that the developer's failure to act within the stipulated time frame justified the termination of the agreement, and the SRA has a duty to ensure timely project completion. (Paras 10, 30)

Result: Appeal dismissed with costs quantified at Rs. 1,00,000/- payable to the Supreme Court Mediation and Conciliation Project Committee. (Paras 30, 31)

JUDGMENT :

PAMIDIGHANTAM SRI NARASIMHA, J.

Table of Contents

I. Introduction :

II. Scope of Judicial Review against an order under Section 13 of the Act:

III. Accountability of officers exercising power coupled with duty under Section 13

IV. Submissions and Analysis

(i) The first phase of delay is between 2003 and 2011

(ii) The second phase relates to the delay in obtaining necessary permissions, approvals and environmental clearances from 2011 to 2014

(iii) The third phase of delay relates to the alleged non-cooperation of certain slum dwellers leading to the stalling of the project from 2014 to 2019

(iv) The next period of inaction is from 2015 to 2017. This is sought to be justified on the ground that the Municipal Corporation sanctioned a road that may pass through the property and published the draft development plan (DP) on 25.02.2015.

(v) Re: Appellant did not have the financial resources

(vi) Re: Submission on maintainability of proceedings before AGRC.

(vii) Re: Locus or conflict of respondent no.6.

V. Findings

VI. Conclusion

VII. Re : Performance audit of statute

1. Leave granted.

I. Introduction :

2. The present controversy is a manifestation of common battles between competing real estate developers under the pretext of rehabilitating slum dwellers under the Maharashtra Slum Areas (Improvement, Clearance and Redevelopment) Act, 19711[Hereinafter, referred to as the “Act”.]. In the year 2003, the appellant was appointed as a developer by respondent no. 1, a co-operative Housing Society of slum dwellers having their hutments on the subject land in Borivali, Mumbai which was declared as a ‘slum area’ under the Act. As the development was unduly prolonged for over two decades, the development agreement in favour of the appellant was terminated by the Apex Grievance Redressal Committee2[For short, the ‘AGRC’.] by its order dated 04.08.2021. The order of termination was challenged by the appellant before the Bombay High Court3[Writ Petition (L) No. 18022 of 2021.].

3. The Bombay High Court formulated the following issues:

    “(i) A developer being removed on the non-fulfillment of the basic requirement to commence construction of a slum rehabilitation building for a long period of 18 years, whether is not fatal to the object and intention of a statutory intent behind a Slum Rehabilitation Scheme.

    (ii) Another question would be as to whether the right to shelter which is part of the slum dwellers’ right to livelihood guaranteed under Article 21 of the Constitution, can be continued to be nullified by such actions of unconscionable delay on the part of the developer, in not commencing construction of the slum project even by an inch more particularly when the nature of such work awarded to a developer for him is purely a commercial venture, for profit.”

4. Apart from the above two issues, the High Court highlighted the limited scope of judicial review under Article 226 of the Constitution against the decision of the statutory authority-AGRC. The High Court, however, proceeded to examine the facts in full detail and dismissed the writ petition on facts, as well as on law4[By judgment dated 14.10.2022, reported as 2022 SCC Online Bom 3712, hereinafter referred to as the impugned Judgment.]. Thus, the present appeal.

5. Even before us, the appellant argued the case only on facts, to the extent that we were under an illusion that we were hearing suit for specific performance involving an issue of ready and willingness. Having heard the learned counsels for the parties at length on facts, we will certainly deal with their submissions, but before that we must reiterate the limited scope of inquiry under Article 226 of the Constitution.

II. Scope of Judicial Review against an order under Section 13 of the Act:

6. In this case, as in any other public law proceedings, we are concerned with the legality and validity of the po

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