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IN THE HIGH COURT OF BOMBAY
Mohit S. Shah and G.S. Kulkarni, JJ.
M/s. J Gala Builders - Petitioner
Versus
Mumbai Building Repairs and Reconstruction Board and Ors. - Respondents
Writ Petition No. 2359 of 2011 With Writ Petition No. 693 of 2011, Writ Petition No. 388 of 2015, Writ Petition No. 2646, 2658 of 2014 [WP (L) NO.2045 of 2014], Writ Petition No. 2657 of 2014, Writ Petition (L) No. 2991 of 2014, Writ Petition (L) No. 3214 of 2014, Writ Petition (L) No. 3294 of 2014, Writ Petition No. 31 of 2015
Decided on : 7-05-2015
Writ petitions challenging the constitutional validity of clause-4 of Appendix-III of Regulation 33(7) of the Development Control Regulations for Greater Mumbai, 1991 ('DCR') particularly the words in bold :- “4. ...... the prescribed percentage of the surplus built-up area as provided in the Table in the Third Schedule of the Maharashtra Housing and Area Development Act, 1976 shall be made available to the Mumbai Repairs and Reconstruction Board for accommodating the occupants in transit camps or cessed building which cannot be reconstructed, on payment of an amount as may be prescribed under MHADA Act, 1976.”
Fact of the Case:
Petitioners challenged the constitutional validity of clause-4 of Appendix-III of Regulation 33(7) of the Development Control Regulations for Greater Mumbai, 1991 ('DCR') particularly the words in bold :- “4. ...... the prescribed percentage of the surplus built-up area as provided in the Table in the Third Schedule of the Maharashtra Housing and Area Development Act, 1976 shall be made available to the Mumbai Repairs and Reconstruction Board for accommodating the occupants in transit camps or cessed building which cannot be reconstructed, on payment of an amount as may be prescribed under MHADA Act, 1976.”
Finding of the Court:
The Court held that the impugned Regulation is not violative of the petitioners' constitutional rights under Article 300-A of the Constitution. The Court further held that the compensation which the petitioners have received in the form of higher FSI of 2.5 or 3.0 against the normal FSI of 1.33 in the suburb is substantial compensation for a small portion of the surplus area required to be surrendered by the petitioners to the respondent Board and, therefore, the same cannot be considered as illusory merely by looking at the amount being paid to the petitioners in cash at the rate of Rs. 235/- per sq. ft. of built up area to be surrendered by the petitioners to the respondent Board.
Issues: 1. Whether the impugned Regulation is violative of the petitioners' constitutional rights under Article 300-A of the Constitution? 2. Whether the compensation offered by the Board for such acquisition is determined by any law made by the Legislature or by any subordinate Legislation?
Ratio Decidendi: 1. The Court held that the impugned Regulation is not violative of the petitioners' constitutional rights under Article 300-A of the Constitution. The Court observed that the impugned Regulation does not provide for compulsory acquisition of property, but merely imposes certain conditions for development of the property. 2. The Court held that the compensation offered by the Board for such acquisition is determined by the circular dated 6 July 1991, which provides for payment for taking over a part of the surplus built-up area merely at the rate of Rs. 235/- per sq. ft. with effect from 25 October 1990 as against the actual cost of construction, which is about Rs. 2,500/- per sq. ft. The Court, however, held that the compensation which the petitioners have received in the form of higher FSI of 2.5 or 3.0 against the normal FSI of 1.33 in the suburb is substantial compensation for a small portion of the surplus area required to be surrendered by the petitioners to the respondent Board and, therefore, the same cannot be considered as illusory merely by looking at the amount being paid to the petitioners in cash at the rate of Rs. 235/- per sq. ft. of built up area to be surrendered by the petitioners to the respondent Board.
Final Decision: The Court dismissed the petitions.
Mohit S. Shah, J.
In this group of writ petitions, the petitioners have challenged clause-4 of Appendix-III of Regulation 33(7) of the Development Control Regulations for Greater Mumbai, 1991 ('DCR') particularly the words in bold :-
"4. ...... the prescribed percentage of the surplus built-up area as provided in the Table in the Third Schedule of the Maharashtra Housing and Area Development Act, 1976 shall be made available to the Mumbai Repairs and Reconstruction Board for accommodating the occupants in transit camps or cessed building which cannot be reconstructed, on payment of an amount as may be prescribed under MHADA Act, 1976."
2. The petitioners have broadly challenged the above Regulation on the ground that the same provides for compulsory acquisition of part of property constructed by the petitioners on their own lands without authority of law and without providing for any adequate or reasonable compensation and that the compensation proposed to be paid is illusory.
3. The petitioners have also challenged the consequential orders and notices as the petitioners were not being granted building permissions (IODs), commencement certificates or occupation certificates in respect of constructed properties without the petitioners complying with the aforesaid impugned Regulation.
4. Since all the petitions raise common questions of law, we are referring to the facts in the lead petition being Writ Petition No. 2359 of 2011.
(a) Petitioner no.1 is a registered partnership firm engaged in the business, inter alia, of development of immovable properties and construction of buildings. Petitioner no.2 is the partner of the 1st petitioner firm. Petitioner no.1 (hereinafter referred to as "the petitioner") is the owner of the property bearing CS No. 770 of Mazgaon Division in Mumbai admeasuring about 6,492 sq. meters.
(b) In its capacity as owner of the land, the petitioner applied to Mumbai Building Repairs and Reconstruction Board ('the Board') which is a unit of Maharashtra Housing & Area Development Authority (MHADA) for No Objection Certificate ('NOC') for reconstruction of a building on the above land under DCR 33(7). On 23 August 2002, the Board granted NOC for the said reconstruction scheme under DCR 33(7), subject to various conditions including the impugned condition that the petitioner is required to surrender to the Board a portion of the surplus area generated in the reconstruction scheme under the impugned Regulation. In the year 2002, the petitioner undertook to surrender surplus area.
(c) The Municipal Corporation sanctioned the building plans for construction of total built-up area of 14,354.40 sq. meters After completion of rehab buildings with built-up area of 6,018 sq. meters, when the petitioner applied for occupation certificate, the Municipal Corporation granted the occupation certificate in June 2006, but the Board also issued a letter calling upon the petitioner to surrender 833.64 sq. meters out of the total surplus built-up area of 8,336.40 sq. meters (i.e. 10% of the surplus built-up area which is calculated after excluding rehab area of 6,018 sq. meters from permissible total built-up area of 14,354.40 sq. meters).
(d) By letter dated 31 December 2010, the Board also added condition no.17 in the NOC dated 23 August 2002. As per the said condition, the Board made it mandatory for the petitioner to execute an agreement with MHADA/Board in respect of surplus built-up area within 30 days after approval of IOD/plans by the Municipal Corporation and prior to the issuance of commencement certificate. The Board also directed that the Municipal Corporation shall not grant the commencement certificate or any further permission unless the agreement as aforesaid is duly executed between the petitioner and MAHADA/Board.
(e) After the petitioner completed construction of the buildings, the petitioner applied for occupa
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