IMPORTANT POINT
The court established that tenants cannot be penalized for a developer's non-compliance with statutory obligations, emphasizing the need for authorities to enforce compliance against developers.

JUDGMENT :

(Kamal Khata, J.) :

1. These Petitions, filed under Article 226 of the Constitution of India, seek a writ of mandamus against Respondents Nos. 1 and 2 for issuing an Occupation Certificate (OC) for the Petitioner's property. Additionally, the Petitioners request a waiver of additional municipal taxes and consideration of their application dated 27th May 1999. The learned counsel agree that common issues of law and facts arise, and therefore both these petitions could be disposed of by a common judgement and order.

Brief Facts:

2. The Petitioners were tenants of Mumtaj Begum Shah Mohammed and others (“Mumtaj and Ors”), who were the owners of the final Plot No. 542, TPS III, Mahim Division, located at Miya Mohamed Chhotani Road, Mahim, Mumbai 400 016 (“the said property”).

3. The Respondent No. 3 viz. Raj Realtors Construction Company Pvt Ltd (“Developer”) purchased the property from Mumtaj and others under a deed of conveyance dated 15th December 1986 with an intention to develop. The property comprised three chawls with nine shops and nine residential tenements built in 1946, with the Petitioners as tenants of the shops and other tenants occupying the residential tenements.

4. After purchasing the property, the Developer filed a suit in the Small Causes Court for a decree of possession, asserting their intention to develop the property. The suits were settled through Consent Terms, whereby the Petitioners agreed to cooperate with the Developer for the property development and handed over possession as per the Consent Terms. Those are annexed as Exhibit A on page 25 of the Petition. Each Petitioner signed similar Consent Terms.

5. Whereas the front wing was constructed to accommodate the Petitioners in possession of the shops, the rear wing, consisting of stilts and 6 storeys, was meant for residential accommodation for the tenants, with the remaining flats to be sold by the Developer.

6. Upon completion of the front wing consisting of shops, the Petitioners were asked to take and they took possession of the shops as contemplated under the Consent Terms and were assured of an Occupation Certificate (“OC”) once the rear wing was completed.

7. Apparently, the Developer failed to secure the OC for the shops. Consequently, Respondent No. 1 (BMC) did not provide water and sewerage facilities to the Petitioners but nevertheless charged them 150% of the normal property tax.

8. Upon inquiry with the BMC, the Petitioners were informed that the OC was withheld because Respondent No. 2 (MHADA) had not granted the final No Objection Certificate (NOC). The BMC communicated with MHADA for the NOC for the commercial wing occupied by the Petitioners on 4th March 1997 and sought an urgent appraisal while acknowledging that MHADA misplaced the original file. Communications inter se between the Petitioners, BMC, and MHADA commenced and have followed since 27th February 1999.

9. The Developer was granted a Floor Space Index (FSI) of 2 for the project, for which he was obliged to give MHADA an area of 1,986 square feet, which he defaulted on. The Developer's default resulted in the Petitioners facing a 150% property tax penalty. On 24 January 1997, the Petitioners received a final notice to pay Rs. 5,49,869.60/—to the BMC.

10. Mr. Thorat, representing the Petitioners, submitted that the Petitioners were charged additional municipal taxes. The BMC demanded Rs. 10,52,375.60/-, of which the Petitioners paid Rs. 6,88,500/-. The balance amount pertained to additional municipal taxes. The Petitioners were charged Rs. 1,45,886/- for the period before they were put in possession by the Developer. Mr Thorat argued that Rs. 5,66,375/- shown as arrears were additional municipal taxes for non-issuance of the OC, which they were opposed to paying as the Petitioners were not obliged to obtain the OC the obligation was of the Developer.

11. The Petitioners' front wing was put up for auction on 7 January 2000, with the auction scheduled for 15 January 2000. Under