Murali Krishnan and Varun Chirumamilla.In an important decision, the Bombay High Court has held that the owner of the land has the preferential right to redevelop the land under the Maharashtra Slum Areas (Improvement, Clearance and Redevelopment) Act, 1971 (Slum Act)..A Bench comprising Justice Shantanu Kemkar and Justice GS Kulkarni ruled that the Government is legally obliged to stay within the statutory scheme of things and absolute reason must be available on record, to show that there was no other option available, whilst acquiring land for slum re-development..The decision came in a petition filed by Indian Cork Mills Private Limited (petitioner) challenging a notification of December 2016 issued by the State of Maharashtra acquiring the petitioner’s land in Mumbai..The notification was under subsection (1) of Section 14 read with paragraph (A) of subclause (i) of clause (c) of Section 3D of the the Slum Act, declaring acquisition of the said land of the petitioner. The purpose of acquisition was to enable the Slum Rehabilitation Authority (SRA) to carry out development under a Slum Rehabilitation Scheme, on the said land, which had been declared as a ‘slum rehabilitation area’ under Section 3C (1) of the Slum Act..The petitioner objected to the acquisition and expressed its opposition to introduce any third party for development of the petitioner’s land. It also undertook to redevelop the land..However, it was the petitioner’s case that though the State government and SRA initially took note of the petitioner’s objection, they subsequently took a u-turn and decided to acquire the land on the ground that the petitioner did not submit any proposal for slum rehabilitation..This prompted the petitioner to invoke the jurisdiction of the High Court under Article 226..The issue before the court was whether the owner of the land would have a preferential right to undertake redevelopment or the only method to redevelop such areas would be to resort to compulsory acquisition of such private land..The following two questions were framed in this regard:.“(i) Whether the petitioner who is owner of the land which is declared as a slum rehabilitation area under section 3C (1) of the Slum Act would have a preferential right under section 3B (4)(c) and (e) read with section 13 (1) falling under Chapter I–A of the Slum Act, as inserted by Maharashtra Act 4 of 1996 to undertake redevelopment the slum rehabilitation area ?.(ii) If the owner of the land has such rights under the provisions as referred in (i) above, whether the failure of the authorities to recognize and enforce such rights of the owner of the land, would render illegal, the acquisition of land under section 14 (1) of the Slum Act?”.The Court proceeded to dissect the statutory mechanism in force, particularly Sections 3B, 3C, 13 and 14 of the Slum Act..It held that the consequence brought about by section 13 as falling in chapter IA, is twofold..Firstly it recognizes the pre-emptory right of the owner to redevelop the land as provided under sub-section (10) of Section 12. Secondly, without disturbing the general right to redevelop the land, it nevertheless provides that if the landholders or occupants of such area do not come forward, within a reasonable time with a scheme for redevelopment of such land, then the SRA by an order can determine to redevelop the land (which is declared as a slum rehabilitation area) by entrusting it to any agency..“In fact sub-section (2) of section 13 is a complete legislative recognition of what is stipulated by the provisions of section 3B (4)(e) read with section 12(10) and section 13 subsection (1) namely that for a slum rehabilitation scheme, notified under section 3B the scheme would contemplate development of slum rehabilitation area by the landholders and occupants by themselves or through a developer and the terms and conditions of such development (sub-clause(e) of section 3B (4)).”.Thus, it held that once the land is declared as a slum rehabilitation area, the said statutory scheme/provisions recognize the participation of owners/landholders and occupants in the redevelopment of such land. Once such a right is created by law [section 3B(4)(c) and (e) and section 13 (1)] an opportunity in that terms is required to be granted to the owners, occupants and/or landholders, without which the provision as made in the statute for such rights would be meaningless..Regarding the respondents argument that the petitioner had ample opportunity to submit a re-development scheme, and that a failure on their part to do so necessitated the acquisition, the Court held that there is no time limit prescribed by the Slum Act or Development Control Regulations (DCR) for submitting such a scheme..“..a perusal of the provisions of DCR 33 (10) read with appendix IV or the provisions of Slums Act nowhere contemplates any time limit within which the owner occupier or landholders are required to submit a slum redevelopment scheme on the issuance of a declaration under section 3C or even under section 4 of the slums Act.”.The Court also observed that the show cause notices issued to the owner had been cryptic and had at no point explained why acquisition was being contemplated or what necessitated it..That the land owner had made several representations to the authorities expressing willingness to re-develop the land (though no proposal was submitted), was taken on record. So was the fact that no proposal had been called for by the recipients of these representations..The Court, therefore, held that the impugned notification was issued in violation of the provisions of section 3B(4)(c)and (e) and Section 13(1) falling under Chapter IA and proceeded to set aside the same..Further, it directed the SRA and State of Maharashtra to process the petitioner’s application/proposal for implementation of a slum rehabilitation scheme as expeditiously as possible and preferably within a period of eight weeks..The petitioner was represented by Senior counsel Virag Tulzapurkar and advocates Nikhil Sakhardande and Vikram Deshmukh along with a team from Wadia Ghandy & Co. which included Abinash Pradhan, Deepu Jojo, and Akshit Dedhia..The Slum Rehabilitation Authority was represented by Senior Advocate Milind Sathe briefed by a team from Utangale & Co..Additional Government Pleader Sukanta Karmarkar appeared for State of Maharashtra..Senior Counsel Pravin Samdani appeared for the Tarabai Nagar Housing Society, that had made a proposal for re-development, claiming to be a body representative of the slum dwellers..Read the judgment below.
Murali Krishnan and Varun Chirumamilla.In an important decision, the Bombay High Court has held that the owner of the land has the preferential right to redevelop the land under the Maharashtra Slum Areas (Improvement, Clearance and Redevelopment) Act, 1971 (Slum Act)..A Bench comprising Justice Shantanu Kemkar and Justice GS Kulkarni ruled that the Government is legally obliged to stay within the statutory scheme of things and absolute reason must be available on record, to show that there was no other option available, whilst acquiring land for slum re-development..The decision came in a petition filed by Indian Cork Mills Private Limited (petitioner) challenging a notification of December 2016 issued by the State of Maharashtra acquiring the petitioner’s land in Mumbai..The notification was under subsection (1) of Section 14 read with paragraph (A) of subclause (i) of clause (c) of Section 3D of the the Slum Act, declaring acquisition of the said land of the petitioner. The purpose of acquisition was to enable the Slum Rehabilitation Authority (SRA) to carry out development under a Slum Rehabilitation Scheme, on the said land, which had been declared as a ‘slum rehabilitation area’ under Section 3C (1) of the Slum Act..The petitioner objected to the acquisition and expressed its opposition to introduce any third party for development of the petitioner’s land. It also undertook to redevelop the land..However, it was the petitioner’s case that though the State government and SRA initially took note of the petitioner’s objection, they subsequently took a u-turn and decided to acquire the land on the ground that the petitioner did not submit any proposal for slum rehabilitation..This prompted the petitioner to invoke the jurisdiction of the High Court under Article 226..The issue before the court was whether the owner of the land would have a preferential right to undertake redevelopment or the only method to redevelop such areas would be to resort to compulsory acquisition of such private land..The following two questions were framed in this regard:.“(i) Whether the petitioner who is owner of the land which is declared as a slum rehabilitation area under section 3C (1) of the Slum Act would have a preferential right under section 3B (4)(c) and (e) read with section 13 (1) falling under Chapter I–A of the Slum Act, as inserted by Maharashtra Act 4 of 1996 to undertake redevelopment the slum rehabilitation area ?.(ii) If the owner of the land has such rights under the provisions as referred in (i) above, whether the failure of the authorities to recognize and enforce such rights of the owner of the land, would render illegal, the acquisition of land under section 14 (1) of the Slum Act?”.The Court proceeded to dissect the statutory mechanism in force, particularly Sections 3B, 3C, 13 and 14 of the Slum Act..It held that the consequence brought about by section 13 as falling in chapter IA, is twofold..Firstly it recognizes the pre-emptory right of the owner to redevelop the land as provided under sub-section (10) of Section 12. Secondly, without disturbing the general right to redevelop the land, it nevertheless provides that if the landholders or occupants of such area do not come forward, within a reasonable time with a scheme for redevelopment of such land, then the SRA by an order can determine to redevelop the land (which is declared as a slum rehabilitation area) by entrusting it to any agency..“In fact sub-section (2) of section 13 is a complete legislative recognition of what is stipulated by the provisions of section 3B (4)(e) read with section 12(10) and section 13 subsection (1) namely that for a slum rehabilitation scheme, notified under section 3B the scheme would contemplate development of slum rehabilitation area by the landholders and occupants by themselves or through a developer and the terms and conditions of such development (sub-clause(e) of section 3B (4)).”.Thus, it held that once the land is declared as a slum rehabilitation area, the said statutory scheme/provisions recognize the participation of owners/landholders and occupants in the redevelopment of such land. Once such a right is created by law [section 3B(4)(c) and (e) and section 13 (1)] an opportunity in that terms is required to be granted to the owners, occupants and/or landholders, without which the provision as made in the statute for such rights would be meaningless..Regarding the respondents argument that the petitioner had ample opportunity to submit a re-development scheme, and that a failure on their part to do so necessitated the acquisition, the Court held that there is no time limit prescribed by the Slum Act or Development Control Regulations (DCR) for submitting such a scheme..“..a perusal of the provisions of DCR 33 (10) read with appendix IV or the provisions of Slums Act nowhere contemplates any time limit within which the owner occupier or landholders are required to submit a slum redevelopment scheme on the issuance of a declaration under section 3C or even under section 4 of the slums Act.”.The Court also observed that the show cause notices issued to the owner had been cryptic and had at no point explained why acquisition was being contemplated or what necessitated it..That the land owner had made several representations to the authorities expressing willingness to re-develop the land (though no proposal was submitted), was taken on record. So was the fact that no proposal had been called for by the recipients of these representations..The Court, therefore, held that the impugned notification was issued in violation of the provisions of section 3B(4)(c)and (e) and Section 13(1) falling under Chapter IA and proceeded to set aside the same..Further, it directed the SRA and State of Maharashtra to process the petitioner’s application/proposal for implementation of a slum rehabilitation scheme as expeditiously as possible and preferably within a period of eight weeks..The petitioner was represented by Senior counsel Virag Tulzapurkar and advocates Nikhil Sakhardande and Vikram Deshmukh along with a team from Wadia Ghandy & Co. which included Abinash Pradhan, Deepu Jojo, and Akshit Dedhia..The Slum Rehabilitation Authority was represented by Senior Advocate Milind Sathe briefed by a team from Utangale & Co..Additional Government Pleader Sukanta Karmarkar appeared for State of Maharashtra..Senior Counsel Pravin Samdani appeared for the Tarabai Nagar Housing Society, that had made a proposal for re-development, claiming to be a body representative of the slum dwellers..Read the judgment below.
