The court held that the Municipal Corporation was not legally bound to convey land to the lessee after lease expiry due to lack of express obligation and significant delay in seeking relief.

JUDGMENT :

VIKRAM NATH, J.

1. The Municipal Corporation of Greater Mumbai¹[MCGM] and its officers have filed this appeal assailing the correctness of judgment and order dated 14.03.2022 passed by the Bombay High Court allowing the Writ Petition No. 295 of 2017 filed by the Respondent No.1 directing the appellant (Respondent No.1 therein) to execute formal conveyance of plot bearing C.S. No.1546 of Lower Parel Division, Mumbai in favour of the Respondent No.1 (Petitioner no.1 therein) within a period of eight weeks.

2. Brief facts giving rise to the present appeal are summarised hereunder:

2.1. Century Textiles and Industries Limited (Respondent No.1) is a company incorporated under the Companies Act running a cotton mill. Under the provisions of the City of Bombay Improvement Act, 1898²[The 1898 Act], Respondent No.1 applied to the Improvement Trust under Section 32B thereof under the Poorer Classes Accommodation Scheme (in short, “PCAS”) to provide dwellings to the poorer class workers. The said application was filed on 12.04.1918.

2.2. The Improvement Trust Board, vide Resolution no. 121, in its meeting dated 16.04.1918, approved the PCAS of the Respondent No.1 which provided for construction of 44 Blocks of poorer class dwellings containing a total of 980 rooms and 20 shops as a pre-condition for execution of the lease under Section 32G of the 1898 Act (as amended in 1913), with other consequences to follow.

2.3. It would be worthwhile to mention here that the construction was to take place on a piece of land measuring 50,000 sq. yds. sub-divided into three plots A, B and C. However, at present, the dispute relates only to plot A admeasuring 23,000 sq. yds.

2.4. The above scheme, as approved by the Board, was duly notified on 01.05.1918 as Scheme No. 51. The Special Collector handed over the charge of the property/plot bearing C.S. No. 1546 of Lower Parel Division to the Improvement Trust, pursuant to the aforesaid Resolution No. 121 and the notification of Scheme No. 51, sometime in August, 1919. The possession of the said plot was, later on, handed over by the Improvement Trust to the Respondent No.1, whereupon, they started the construction and constructed 476 dwellings and 10 shops till the year 1925, as a part of the pre-condition for execution of lease under Section 32G of the 1898 Act.

2.5. In the year 1925, the 1898 Act was repealed by The Bombay Improvement Trust Transfer Act, 1925³[The 1925 Act]. On 10.03.1927, Respondent No.1 applied to the Improvement Trust under Section 37(2) of the 1925 Act for alteration of the notified Scheme No. 51. Again, on 20.05.1927, Respondent No.1, through their solicitors M/s C.N. Wadia and Company applied to the Improvements Committee making the same request for modification of the notified Scheme No. 51 requesting the committee to accept the 476 rooms instead of 980 rooms and 10 shops instead of 20 shops, as required under the notified scheme. The Improvement Trust/Board, vide Resolution No. 325 dated 31.05.1927, granted alteration of the notified Scheme No. 51. According to the said resolution, Block-B and Block-C would be excluded from Estate Agent’s plan, lease of Block-A for a period of 28 years to be granted to the company on the terms mentioned in paragraphs 2 and 4 of the letter dated 20.05.1927, Block-B to be conveyed to the Respondent No.1 on terms and conditions stated in paragraph 5 of the letter dated 20.05.1927 and Block-C to remain the property of the Improvement Trust/Board.

2.6. Pursuant to the said Resolution No. 325, Block-B was conveyed to the Respondent No.1 on 10.01.1928 for which the Respondent No.1 paid Rs.1,20,000/- as sale consideration.

2.7. Later on, a lease was granted by the Board in favour of Respondent No.1 on 03.10.1928 with respect to Block-A, which included both the land and buildings for a period of 28 years w.e.f. 01.04.1927 at a yearly rent of Rupee One. The lease was to expire on 31.03.1955 i.e. on completion of 28 years. The Respondent No.1 also paid th