Developer's Unilateral Allotment in SRA Scheme Declared 'Ab Initio Void' by High Court

Mumbai: In a significant ruling clarifying the process of tenement allocation in Slum Rehabilitation Authority (SRA) schemes, the High Court has upheld the authority of the Assistant Registrar, SRA, to make final allotments via lottery, declaring any unilateral allotment by the developer as "ab initio void" (invalid from the beginning).

The judgment came in a writ petition filed by slum dwellers who challenged orders from the Apex Grievance Redressal Committee (AGRC), the Tahsildar (SRA), and the Assistant Registrar (SRA). These orders collectively deemed the Petitioners' occupation of tenement D-1508 unauthorized and directed their eviction, validating the allotment of the same tenement to another eligible slum dweller, Respondent No. 4, Sangita Balu Zimal, by the Assistant Registrar.

Case Background

The dispute arose within an SRA scheme in Kurla, Mumbai, where Respondent No. 6 was appointed as the developer. Both the Petitioners and Respondent No. 4 were listed as potentially eligible slum dwellers. While Respondent No. 4's eligibility was initially under verification and later confirmed, the Petitioners claimed they were eligible and awaiting allotment for years after their structure was demolished.

With a rehabilitation building constructed and many dwellers accommodated, four vacant tenements remained available for allotment among 21 waiting eligible persons.

Conflicting Allotments

The developer initially proposed to the Assistant Registrar (SRA) in July 2021 that one tenement in D-Wing (intended for Petitioners) be allotted through a lottery conducted in the presence of an SRA official, acknowledging the standard procedure. However, the Assistant Registrar did not act on this proposal.

Later, in a letter dated March 1, 2022, the developer informed the Assistant Registrar that four specific tenements, including D-1508, were reserved for four slum dwellers, including Respondent No. 4, pending re-verification of their eligibility.

Despite this representation and the absence of SRA approval or lottery, the developer unilaterally allotted tenement D-1508 to the Petitioners on March 24, 2022, and informed the Assistant Registrar afterwards. The Petitioners subsequently occupied the tenement.

Upon learning of this, the Assistant Registrar issued Form No. 1 on March 28, 2022, explicitly stating that the developer's unilateral allotment was invalid and that allotment would only occur through a lottery process overseen by the SRA. Following the confirmation of Respondent No. 4's eligibility in May 2022, the Assistant Registrar conducted a lottery on June 24, 2022, and formally allotted D-1508 to Respondent No. 4.

Respondent No. 4 then complained to the Tehsildar (SRA) about the Petitioners' occupation, leading to the eviction order. The Assistant Registrar also formally invalidated the developer's allotment and upheld Respondent No. 4's claim in November 2022. The Petitioners' appeal to the AGRC was subsequently dismissed.

Court's Reasoning

The High Court carefully considered the arguments. The Petitioners contended that the developer's allotment was valid given the Assistant Registrar's delay and their long wait. They argued Respondent No. 4's eligibility was confirmed later, and that they should not be evicted after occupying the premises.

Respondent No. 4, SRA, and the Assistant Registrar maintained that the developer had no authority to make unilateral allotments. They cited Clause 42 of the Letter of Intent (LoI) issued to the developer, which mandates that "the allotment of rehabilitation tenements... shall be made by drawing lots in presence of the representative of the Assistant Registrar of Societies (SRA)."

The Court agreed with the SRA's stance. It noted that the developer was fully aware of the correct procedure, as evidenced by their own proposal in July 2021 requesting an SRA official's presence for a lottery. The Court found the developer's unilateral action, especially contradicting their prior representation about reserving the tenement for Respondent No. 4, to be "totally illegal and ab initio void."

The Court stated, "Such action on the part of Respondent No.6-developer is totally illegal and ab initio void. The Assistant Registrar has rightly treated such allotment to be invalid. It has no existence in the eyes of the law." It rejected the developer's attempt to pass off the prior reservation commitment as a "mistake."

While acknowledging that Petitioners would suffer due to the developer's actions, the Court held that unauthorized occupation, even for a period, cannot legitimize an invalid allotment. It noted that Respondent No. 4 had suffered for over a year by being unable to take possession of her validly allotted tenement.

Decision and Implications

The High Court dismissed the writ petition, upholding the orders of the Assistant Registrar, Tehsildar, and AGRC. The Petitioners were directed to vacate tenement D-1508 within four weeks and hand over possession to the SRA Estate Officer.

Recognizing the Petitioners' plight caused by the developer's illegality, the Court directed the SRA to allot a suitable Permanent Alternate Accommodation (PAP) tenement to the Petitioners within two weeks of receiving a written application choosing one from available options.

Furthermore, the Court ordered the developer (Respondent No. 6) to pay exemplary costs of Rs. 1,00,000 to the Petitioners within four weeks for making the unauthorized allotment and causing inconvenience and loss.

This judgment strongly reiterates that developers in SRA schemes act as facilitators and cannot bypass the official allotment process overseen by the SRA authorities, safeguarding the rights of eligible slum dwellers who are awaiting formal allocation.