Supreme Court orders MMRDA to deposit ₹646 crore with court in case against Reliance over BKC project

The Supreme Court on Monday directed the Mumbai Metropolitan Region Development Authority (MMRDA) to deposit approximately ₹646.78 crore with its registry by November 6 in the appeal filed by MMRDA challenging a Bombay High Court judgment in favour of Reliance Industries Limited (RIL). [MMRDA Vs RIL]

A Bench of Justices Dipankar Datta and Sheel Nagu passed the direction in a dispute concerning penalties imposed by MMRDA on Reliance for delays in constructing a convention centre and commercial complex at Mumbai's Bandra-Kurla Complex (BKC).

The High Court had later set aside the penalties prompting MMRDA to approach the apex court.

The top court on Monday issued notice to Reliance and directed that counter-affidavits be filed by October 30.

The dispute dates back to 2006 when MMRDA allotted Reliance a 75,000-square-metre plot in BKC for developing a convention centre and commercial complex.

The lease required Reliance to complete the construction within four years, failing which additional premium would become payable. Subsequent allotments increased the permissible built-up area to 3,12,500 square metres.

However, construction was delayed amid litigation concerning development rights and the time taken to secure statutory approvals.

MMRDA issued a demand notice in September 2017 alleging a delay of seven years and 12 days. It subsequently demanded another ₹1,116.83 crore in June 2019.

Reliance challenged the demands before the Bombay High Court.

On April 8, 2026, a Division Bench of Chief Justice Shree Chandrashekhar and Justice Suman Shyam of the High Court quashed the demands, holding that the construction deadline should be calculated from the issuance of an effective commencement certificate rather than the execution of the lease deed.

The Bombay High Court directed MMRDA to refund ₹646.78 crore to Reliance and provided for the release of a bank guarantee of approximately ₹1,312 crore after setting aside the penalties.

In its appeal before the Supreme Court, MMRDA argued that the High Court effectively rewrote the statutory lease agreement by changing the date from which the four-year construction deadline would be calculated.

The authority also contended that Reliance had furnished unconditional undertakings in 2016 agreeing to pay additional premium for extensions of time. Having obtained construction permissions and occupation certificates based on these undertakings, Reliance could not subsequently refuse to honour them, MMRDA argued.

It further questioned the High Court's exercise of writ jurisdiction in a contractual dispute where the validity of the lease provisions had not been challenged.

During the hearing, Senior Advocate Abhishek Manu Singhvi, appearing for Reliance, suggested that the company could receive the refund against a fresh bank guarantee to protect MMRDA's interests during the proceedings.

However, the Bench directed MMRDA to deposit the disputed amount with the Supreme Court registry.

"We direct the authority to deposit it with the registry," the Court said.

The Bench subsequently clarified that the amounts directed to be refunded in connected matters should also be secured through deposits.

"Whatever is the amount directed to be refunded, you deposit, let it be secured," the Court said.

The Court issued notice and directed counter-affidavits to be filed by October 30 and rejoinders by November 6. Connected matters involving similar disputes were tagged for hearing on November 18.

MMRDA was represented by Senior Advocates Shyam Divan and Balbir Singh and advocate Naman Tandon.