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2011 Supreme(Bom) 571

2011(4) ALLMR 255
High Court of Judicature at Bombay
THE HONOURABLE CHIEF JUSTICE MR. MOHIT S. SHAH & THE HONOURABLE MR. JUSTICE D.G. KARNIK
M/s Lokhandwala Infrastructure Pvt. Ltd.
Versus
Om Dattaji Rahiwasi Seva Sangh & Others
APPEAL (L) NO. 235 OF 2011 IN NOTICE OF MOTION NO. OF 2011 IN SUIT (L) NO. 814 OF 2011 WITH APPEAL (L) NO. 234 OF 2011 IN NOTICE OF MOTION NO. OF 2011 IN SUIT (L) NO. 813 OF 2011
Decided on: 07-05-2011

Advocates Appeared:
For the Appellant:Pravin Samdani, Senior Advocate with Farid Karachiwala, Bhavik Manek and Ms. Pallavi Smriti i/b Wadia Ghandy & Co., Advocates.
For the Respondents:R1, S.G. Surana, R2, S.U. Kamdar, Senior Advocate with Ms. Pooja Patil i/b Uma Shankar Upadhya, R23, I.M. Chagla, Senior Advocate with Ms. Naira Variava, Vivek A. Vashi and Ms. Shorger Merchant i/b Bharucha & Partners, R24, JG. Aradwad / Reddy, Advocates, R25, R.Y. Sirsikar with Mr. H.C Pimple for – BMC.

Headnote:Maharashtra Slum Areas (Improvement, Clearance and Re-development) Act, 1971 - Section 1-Civil Procedure Code, 1908, Order XXXIX, Rule 1-Development agreement-Injunction-Slum dwellers cancelled agreement with appellant/developer-Appointed new developer-Injunction sought restraining slum dwellers and new developer from acting upon development agreement-Rightly refused by Single Judge-Monetary interest of appellant protected by restraining new developer from transferring, alienating, selling of free sale area.-A scheme for redevelopment of the slum is essentially for the benefit of the slum dwellers and for their rehabilitation. They are entitled to a free accommodation in the developed buildings. Of course, the developer is entitled to recover the cost incurred by him for the redevelopment by sale of flats available in the free sale component. Yet the main object and focus of the scheme is the occupiers of the slums and not the developers who pursues a venture for profit through sale of flats in the free sale components. The main object is rehabilitation of the slum dwellers, though in the process invariably the developer would earn good deal of profit by sale of flats in the free sale components of the scheme. In fact, the good part of the arguments in the present case revolved around the profit of the developer and ’S’ fairly submitted that the appellant was not pursuing the scheme of redevelopment as a gesture of charity or goodwill for the slum occupiers but for profit which the appellant would earn by sale of flats in the free sale component. Keeping in mind that the principal object of the slum rehabilitation scheme is rehabilitation of the slum dwellers as also the inevitable consequence, any injunction granted viz. delay in the redevelopment of the slum rehabilitation scheme, decline to grant any injunction. Nearly 500 eligible slum dwellers who have been waiting since August, 2003 when the appellant entered into the contract would not get accommodation by way of rehabilitation for quite a few years. The very persons for whom the slum rehabilitation scheme is intended would be deprived of the benefits for a number of years.

       In Court’s view, protecting the interest of 500 slum dwellers in getting accommodation in the slum rehabilitation scheme within a reasonable time far outweighs the loss, if any, which the appellant would suffer by refusal of an injunction. In any event, the appellant is not interested in retaining the property for himself but he is only a professional developer in making quick money. His interests are purely monetary. He would have adequate remedy in damages if at all he succeeds in the suit. His monetary interest can be protected by the order that Court proposes to pass hereafter.

       The interest of the appellant would be adequately protected by restraining the respondent No. 23 from selling, transferring, alienating or otherwise creating any third party interest in respect of 15% (15,000 sq. ft.) out of the free sale area available to him for redevelopment. Court accordingly passes the following order :

       (i) Orders passed by the Single Judge is partly modified to the extent that Court directs the respondent No. 23 not to sell, transfer, alienate, encumber or otherwise deal with or part with possession to the extent of 15% of the area of free sale component, i.e. 15,000 sq.ft in the free sale area.

       (ii) Order of the single Judge refusing to grant injunction for the development and refusing to appoint receiver is confirmed.

Judgment :-

D.G. Karnik, J.

1. These appeals are against two judgments and orders dated 5th April 2011 passed by the learned Single Judge of this Court declining to grant ad-interim relief in the notices of motion taken out by the appellant in Suit (L) No. 814 and 813 of 2011.

2. The property in question is one single property which consists of a sensused slum on the land owned by Municipal Corporation of Greater Mumbai. 753 families (678 residential, 142 commercial, 25 R/C and 8 others) are in occupation of the slums in these two appeals. Out of these occupants, about 500 occupants are held to be eligible for allotment of the premises in the slum rehabilitation scheme by the Competent Authority.

3. The occupiers of huts in the slum are divided into two groups. One group has formed an association which is respondent no.1 in the first appeal and the other group has formed an association which is respondent no.1 in the other appeal. They have also proposed to form two different cooperative societies which are respondent no.2 in the respective appeals. All other facts in both the appeals are identical. Since common questions of law and fact arise, we are disposing of these appeals by this common judgment.

4. According to the appellant, on 10th August 2003 the respondent no.1 Association and the respondent no.2 society (proposed) representing their members entered into an agreement with it for redevelopment of the property in question. More than 70% of the slum occupiers are the members of the respondent nos.1 and 2 and, therefore, the appellant is entitled to implement the slum rehabilitation scheme in accordance with the provisions of the Maharashtra Slum Areas (Improvement, Clearance and Redevelopment) Act, 1971 (for short “the Slum Rehabilitation Act”). According to the appellant, from execution of the agreement dated 10th August 2003 the appellant has been pursuing the matter with the authorities and the list of persons eligible for allotment in the form of Annexure-2 was approved by the Municipal Corporation on 18th September 2009 (Exhibit-S / page 174), on account of continuous efforts of the appellant. However, soon after the list was approved and all procedural formalities were completed by the appellant at a greater expanse of time and money and the scheme was about to take of, the respondent no.23 – another builder stepped in. Thereafter by two separate notices dated 6th July 2009, the respondent nos. 1 and 2 purported to terminate the agreement dated 10th August 2003 and thereafter sought to appoint the respondent no.23 (a competing builder) for implementing the slum rehabilitation scheme. The appellant, therefore, filed a suit for specific performance of the agreement dated 10th August 2003 and in the suit it took out a notice of motion for (i) appointment of a Receiver of the property with a further direction to permit the appellant to carry out the redevelopment, and (ii) an injunction restraining the respondents(respondent nos.1 and 2, their members and the new developer) from acting upon the development agreement dated 30th September 2009 entered into with respondent no.23 and from creating any other assignment in favour of any third party.

5. Mr. Samdani, learned Senior Advocate appearing on behalf of the appellant, submitted that the purported termination of the agreement dated 10th August 2003 by two notices dated 6th July 2009 issued by respondent nos.1 and 2 is illegal and therefore the appellant is entitled to an injunction. He submitted that the appellant had toiled from the year 2003 to 2009 for getting all approvals for implementation of the scheme and just when all approvals were to be obtained, the respondent nos.1 and 2 sought to terminate the agreement illegally and have entered into an agreement with the respondent no.23 illegally. He submitted that on the date of the agreement, i.e. 10th August 2003, more than 70% of the eligible slum dwellers had agreed for the redevelopment work to be carried out














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