Susme Builders Pvt. Ltd. vs Chief Executive Officer, Slum Rehabilitation Authority and Ors.

Rehabilitation of 800 slum dwellers – Various agreement between the slum dwellers and appellant-developer to develop the slums and rehabilitate the slum dwellers – In terms of amended DCR, the developer to obtain consent of 70% slum dwellers – However, project not developed as per the agreement – Dispute between the appellant and respondent no. 4-new developer – Matter before Supreme Court, wherein former judge of Supreme Court appointed to verify the consent of the slum dwellers in praesenti – Scope, ambit and effect of the said order– Held: Intention of the Court, will have to be deduced from the entire order – Phrase “there should be appropriate verification of the consent of the eligible slum dwellers in praesenti” cannot be read in isolation – It has to be read in the context of the contention of the contesting parties that each one of them had the consent of more than 70% of the slum dwellers – This Court was not oblivious of the requirements of the Slum Act though may not have explicitly mentioned 70% in its order – It is clear that the judge had understood that he was to ascertain whether 70% of the eligible slum dwellers are in favour of the redevelopment scheme signed with the appellant or with respondent no. 4 – Holistic reading of the order admits of no other meaning – Admittedly, neither the appellant nor respondent no. 4 received 70% support of slum dwellers, as such, the said order cannot be taken to its logical conclusion.

Maharashtra Slum Areas (Improvement, Clearance and Redevelopment) Act, 1971:

s.13(2) – Power of Competent Authority to redevelop clearance area – Held: Under s.13(2), the Slum Redevelopment AuthoritySRA has the authority to take action and hand over the development of land to some other recognized agency under three circumstanceswhen there is contravention of the plans duly approved; when there is contravention of any restriction or condition imposed under subsection 10 of s. 12; and when the development has not taken place within time, if any, specified – On facts, slum dwellers are virtually the owners of the land as members of the owner Society, the SRA had the power u/s. 13(2) to issue the order of setting aside the appointment of the appellant as developer.

s.3A(3)(c) and (d) – Slum Redevelopment Authority-SRA – Power to remove the developer – Held: Since SRA issued the letter of intent, it necessarily has the power to cancel the same – In terms of clause (c) and (d) of sub-section (3) of s.3A, SRA not only has the power, but it is duty bound to get the slum rehabilitation scheme implemented and to do all such other acts and things necessary for achieving the object of rehabilitation of slums – On facts, SRA was faced with a situation where the slum dwellers were suffering for more than 25 years, thus, action by SRA to remove the developer for the unjustified delay totally justified – Developer could not have carried out the development work on the basis of its agreement with the Society – It needed permission of SRA – Thus, SRA can revoke such permission.

s.13(2) – Notice u/s.13(2) – Issue of 70% consent, if raised – Held: When a notice is issued to a party, it must be clear and unambiguous as to what are the allegations it must meet – No allegation in the notice that right to develop granted in favour of the developer was liable to be revoked because it had not obtained consent of 70% of the slum dwellers but was confined to the issue of delay – Reference to Regulation 33(10) also did not specifically raise the issue of 70% consent.

Development Control Regulations of 1991:

70% consent of the slum dwellers, if mandatory – Held: Development Control Regulations of 1991 makes it absolutely clear that at least 70% of the slum dwellers/occupiers were to form a Society for the purpose of slum re-development scheme – Under the amended DCR of 1997, the developer/owner was required to enter into agreements with 70% of the slum dwellers to take up the slum rehabilitation scheme for consideration – Figure remains at 70% – Even if the remaining minority slum dwellers do not agree to be part of the scheme, the owner/developer is duty bound to make adequate arrangements for their rehabilitation and they can join the scheme, and can take benefit even at any later stage – Thus, 70% consent of the occupiers is mandatory – On facts, developer having applied for migration to new Scheme, had to obtain consent of 70% of the slum dwellers – Stand of the developer that it was not required to submit agreements with 70% slum dwellers, not legally tenable – Agreements with 70% slum dwellers should have been provided within a reasonable time and, though almost 20 years have elapsed since the second letter of intent was granted in favour of developer, it has till date failed to submit agreements – Development Control Regulations of 1997.

Rehabilitation of slum dwellers – Whether developer delayed the construction of the scheme – Entitlement to relief – Held: Developer never earnestly pursued the authorities for approval of the plans because it did not have consent/agreements of 70% slum dwellers – It sought waiver of the requirement of obtaining 70% consent from the slum dwellers – Furthermore, only a portion of plot was covered by the CRZ Notification and the developer not prevented from raising construction on that portion of the land which was not affected by the CRZ Notification – Finding given by SRA that developer was responsible for the delay, based on appreciation of material on record and cannot said to be perverse – Though there may have been a few stop orders and a few occasions when the developer may not have been able to raise the construction but, by and large, developer was itself guilty of delaying the construction for no reason – Thus, developer rightly held responsible for the delay in implementation of the rehabilitation scheme. Rehabilitation of slum dwellers – Developer entered into rehabilitation scheme for slum dwellers – Inordinate delay in completion of the project – Developer, if entitled to continue with the Scheme – Held: Developer not entitled to continue with the rehabilitation Scheme – Developer cannot take the benefit of technical points to defeat the rights of the slum dwellers – On facts, both equity and law against the developer – Slum dwellers dealt in a highly inequitable manner – Law and the conditions of the letter of intent and various letters issued by SRA clearly required the developer to produce agreements with at least 70% of the slum dwellers – However, developer failed to do so – Developers as a legal entity was treating the slum dwellers only as a means of making money, thus, not entitled to any relief.

Rehabilitation Scheme – Cancellation of slum rehabilitation agreement in favour of appellant-developers – Entitlement of respondent no.4(new developer) to continue with the rehabilitation Scheme – Held: Respondent no. 4 had misled the members of the Society in entering into an agreement with it by holding out a false promise that they would be given much larger flats – Respondent no.4 legally not entitled to make this offer – Also respondent no. 4 failed to get the consent of 70% slum dwellers and Society had terminated its agreement with the respondent no. 4 – Thus, consent having been obtained by misrepresentation of facts being no consent, respondent no. 4 not entitled to continue with the project and not entitled to any relief.

Constitution of India – Arts. 142 and 136 – Order of this Court requesting former judge of this Court to verify the consent of the slum dwellers in praesenti – Held: Court was aware that the slum dwellers were suffering due to the long protracted litigation and was moved by the pathetic condition in which most of the slum dwellers continued to reside – Court felt the need to find an innovative solution – Thus, the order fell within the ambit of Art. 142 to do complete justice between the parties.

Judicial propriety – Requirement – Judicial propriety and discipline requires that a Coordinate Bench must respect the order of an earlier Bench – Even a larger Bench should not brush aside the order passed by an earlier Bench even if it be a smaller Bench unless the order is in issue before the larger Bench. Judgment/Order – Interpretation – Held: Judicial order or judgment has to be read as a whole and a single line or phrase cannot be read out of context – Judgment is not to be interpreted like a statute.

Tender – Bid – Competitive bidding – Rehabilitation scheme of slum dwellers by developers – Inter se bidding between the builders – Held: High Court rightly held that consent once given by the slum dwellers should not be permitted to be withdrawn and there should be no inter se bidding between the builders – Competitive bidding can lead to a very unholy practice of developers trying to buy out the slum dwellers, which is also not in the interest of the rehabilitation scheme.

Disposing of the appeal subject to compliance, the Court HELD: 1.1 Both the contesting developers, the appellant and respondent no. 4 are not entitled to any relief. It is the duty to ensure that these owners who also happen to be slum dwellers do not live in sub-human conditions for eternity. The following conclusions are arrived at:

(i) That the order dated 27.03.2015 was passed in exercise of jurisdiction vested in this Court under Article 142 of the Constitution of India and is an order binding on the parties;

(ii) That vide order dated 27.03.2015, this Court wanted Justice B.N. Srikrishna to find out whether appellant or respondent no. 4 had the consent of 70% slum dwellers;

(iii) That, as a result of the Report submitted by Justice B.N. Srikrishna both the appellant and respondent no. 4 have failed to show that they enjoyed support of the 70% of the slum dwellers;

(iv) That, in the peculiar facts and circumstances of this case, where the owners and occupiers are virtually one, the SRA had the jurisdiction to invoke the provisions of Section 13(2) of the Maharashtra Slum Areas

(Improvement, Clearance and Redevelopment) Act, 1971 to revoke and set aside the right to develop and cancel the letter of intent granted in favour of the appellant. Even if it be assumed that s. 13(2) is not applicable, then the SRA could have exercised the power under Section 3A (3)(c) and (d);

(v) That the notice issued by the SRA to the appellant was only on the ground of delay and the issue of obtaining 70% consent was not specifically raised in the notice. Consequently, the order dated 24.02.2012 passed by the SRA in so far as it rejects the case of the appellant for lack of 70% consent is beyond the terms of the notice. Therefore, this part of the judgment of the High Court, holding that the appellant was aware about this allegation, is not accepted and is set aside;

(vi) That, the appellant was responsible for the delay in implementation of the Scheme and construction of the buildings and, therefore, the SRA was justified in setting aside the appointment of the appellant as developer and impliedly cancelling the letter of intent issued in its favour vide order dated 24.02.2012;

(vii) That, the appellant has failed to show that it has the consent/agreements of 70% of the slum dwellers and, therefore, is not entitled to any relief from this Court; and

(viii) That respondent no. 4 obtained the consent of the members of the Society by holding out a false promise of a larger flat and, therefore, the agreements entered into by respondent no. 4 with the slum dwellers are legally unconscionable and not enforceable and, as such, respondent no. 4 is also not entitled to continue with the Scheme. [Paras 84, 85][57-B-H; 58-A-C]

1.2 The Court is not only disappointed with the conduct of the appellant, but also with the conduct of those persons who were the office-bearers of the Society whichever faction they may belong to. It is more than obvious that the two rival developers and the office-bearers of the Society were playing with the lives of large number of slum dwellers. On examining the various agreements entered into by the appellant with the Society, it is found that though the members may have been entitled to larger flat in each subsequent agreement but, in fact, it was the builder, who was the biggest gainer as the advantage of higher FSI was cornered by the builder. Only a small portion of this advantage was being transferred to the slum dwellers and a large portion was being retained by the builder. Furthermore, it is the occupiers who, through the Society, are also the owners of the land. In addition to the flats which they would be entitled to as slum dwellers or occupiers or encroachers of land, they should have been given some benefits as owners of the land. When a slum, owned by any authority or person, is handed over to the developer, in addition to rehabilitating the slum dwellers, the developer also has to compensate the owner. It is these 800 plus slum dwellers, who own this 23018.50 sq. mtrs. of land, which would be valuing thousands of crores of rupees and, therefore, there is no reason why the slum dwellers, who also happen to be the owners of the land, should also not be compensated for the price of the land.[Para 86][58-D-H]

1.3 This is a case where the earlier Bench of this Court had invoked its power under Article 142 of the Constitution of India and it is a fit case for invocation of this Court’s jurisdiction under Article 142. Hence, in exercise of this Court’s power under Article 142, the SRA is directed to invite letters of interest from renowned builders/developers, who have the capacity and experience to take up such a large project by issuing advertisements. The successful developer should undertake to complete the rehabilitation of part of the project to rehabilitate all eligible occupiers/slum dwellers within a period of two years from the date of sanction of the plan. The successful bidder must give a bank guarantee of Rs. 200,00,00,000/- (Rupees Two Hundred crores only) to ensure that it does not violate the terms and conditions of the rehabilitation scheme. In case of violation of the terms and conditions of the rehabilitation scheme without reasonable cause, the SRA would be entitled to invoke the bank guarantee, after giving notice to the developer. [Para 87][59-A, B-C; 60-A-C]

The scope, ambit and effect of the order of this Court dated 27.03.2015:

2.1 Judicial propriety and discipline requires that a Coordinate Bench must respect the order of an earlier Bench. In fact, even a larger Bench should not brush aside the order passed by an earlier Bench even if it be a smaller Bench unless the order is in issue before the larger Bench. The order in question holds the field. It has not been recalled and prayer for modification in I.A. No. 10 was rejected on 13.05.2015. Therefore, the order of this Court dated 27.03.2015 holds the field and the Court bound by the same. At the same time, it is the duty to decipher what was the intention of the Bench while passing the order and to find out what the Court intended to do by the said order. [Para 34][36-C-D]

2.2 The Court was aware that the slum dwellers were suffering due to the long protracted litigation. Therefore, the Court felt the need to find an innovative solution. In the order, the Court noted the factual aspects and again emphasized the need to find a solution to resolve the various issues. The Court was obviously moved by the pathetic condition in which most of the slum dwellers continued to reside. It is thus, apparent that this is an order falling within the ambit of Article 142 to do complete justice between the parties. [Para 35][36-E-G]

2.3 It is settled law that a judicial order or judgment has to be read as a whole and a single line or phrase cannot be read out of context. A judgment is not to be interpreted like a statute. As far as the order dated 27.03.2015 is concerned, the intention of the Court, will have to be deduced from the entire order. The phrase “ there should be appropriate verification of the consent of the eligible slum dwellers in praesenti.” cannot be read in isolation. This has to be read in the context of the rival contention of the contesting parties that each one of them had the consent of more than 70% of the slum dwellers. This Court was not oblivious of the requirements of the Slum Act though it may not have explicitly referred to them. It is obvious from the order dated 27.03.2015 that counsel for both the parties claimed that their respective clients had the support of 70% of the slum dwellers. Obviously, both of them could not be correct. This factual dispute could not be decided in these proceedings. This was the dispute which was referred for resolution to Justice B.N. Srikrishna. It is, thus, clear that Justice B.N. Srikrishna had understood that he was to ascertain whether 70% of the eligible slum dwellers are in favour of the redevelopment scheme signed with the appellant or with respondent no. 4. A holistic reading of the order admits of no other meaning. The only dispute raised before this Court on 27.03.2015 was which of the builders had the support of the 70% of the slum dwellers. Since this factual dispute could not be decided in Court, Justice B.N. Srikrishna was requested to do this job. Admittedly, neither the appellant nor respondent no. 4 has received 70% support. [Paras 38, 39][37-E-G; 38-C-D]

2.4 The words ‘in praesenti’ only mean that the Court wanted the verification of the consent of the eligible slum dwellers as on date of passing of the order. ‘In praesenti’ cannot be read to mean ‘present and voting’. It only means eligible slum dwellers as on 27.03.2015. Justice B.N. Srikrishna has divided the slum dwellers into four categories; 263 were the original slum dwellers, 318 were the legal heirs, 207 were those who had become members by means of sale and transfer of shares and 79 voters were disputed. During these entire proceedings not a single complaint has been filed that an ineligible slum dweller was permitted to vote or that an eligible slum dweller was not permitted to vote. The procedure followed by Justice B.N. Srikrishna is absolutely correct and no error can be found in this regard. Therefore, there is no hesitation in accepting the report submitted by Justice B.N. Srikrishna. [Para 40][38-D-G]

2.5 Out of 867 total eligible voters only 651 voted and the appellant secured 423 votes, which would mean 64.98% or roughly 65% of the votes polled. But, if the percentage is calculated from the total number of slum dwellers-867 then the percentage is 48.78%, which is less than 50%. In case 79 votes are excluded which are doubtful, then the total eligible voters would be 788 and the appellant secured 413 i.e. 52.41% of the total eligible slum dwellers, well below the magic figure of 70%. It cannot be said that to put an end to all litigation, the Court only wanted to find out who had the majority. That, is not the essence of the order dated 27.03.2015. It is true that 70% is not reflected in the direction given in the order but the directions have to be understood in view of the intention of the Court, which was to find out that which of the builders had the support of 70% of the slum dwellers. Unfortunately, both the developers do not enjoy 70% support, though it is true that the appellant has the support of more than twice the number of slum dwellers as compared to respondent no. 4. Since neither the appellant nor respondent No.

4 has the support of 70% slum dwellers, the order dt 27.03.2015 cannot be taken to its logical conclusion. [Para 41][38-G-H; 39A-C] The scope of powers under section 13(2) of the Slum Act:

3.1 Under Section 13(2), the SRA has the authority to take action and hand over the development of land to some other recognized agency under three circumstances: (i) When there is contravention of the plans duly approved; (ii) When there is contravention of any restriction or condition imposed under subsection 10 of Section 12 of the Slum Act; and (iii) When the development has not taken place within time, if any, specified. The requirement to complete the development within time may be there in the letter of intent issued by the SRA or may be in the agreement entered into between the owner/developer with the slum dwellers. Such condition, if violated, would attract the provisions of Section 13(2) of the Slum Act. Over and above that, when a clearance order is passed, then in terms of sub-section

10 of Section 12, the competent authority can include a condition with regard to the time within which the development should be completed and in that case also Section 13(2) would be attracted. It cannot be said that in case of delay, the condition that is violated must be laid down under Section 12(10) of the Slum Act. [Paras 44-45][40-D-G]

3.2 There may be cases where the slum dwellers do not offer any resistance and willingly consent to move into transit accommodation provided by the owner/developer. Therefore, the conditions laid down under Section 12(10) will come into play only when there is a clearance order, but in case there is no clearance order, then under Section 13(2), the SRA would be empowered to take action when there is violation of any plan or when there is violation of any condition relating to developing the project within time. The time limit can, some time, be provided in the letter of intent, in the agreement or even in the regulations. [Para 46][40-G-H; 41-A-B]

3.3 Normally under Section 13(2) of the Slum Act, action by the SRA has to be taken against the owner. This is a unique case where the slum dwellers are the members of the owner-Society. The Society, in turn, has given power of attorney to the builder. The builder virtually has two roles-one as developer and the other as power of attorney holder of the owner. Both are closely interlinked and inextricably mixed with each other. Therefore, though normally it would be accepted that under Section 13(2) action can only be taken against the owner, in the instant case, it cannot be accepted in its totality. Even the SRA, in its order, has itself noted that since the Society is the owner of the plot of land, it is empowered and within its right to terminate the agreement executed with the said developer for breaches committed by the developer. It has, however, held that a private dispute between the Society and the developer cannot prevent the SRA from discharging its obligations. The SRA agreed that appellant had not completed the project within time. It took action under Section 13(2) of the Slum Act. The action taken by the SRA is to remove appellant as developer which amounts to cancelling the letter of intent issued in favour of appellant. Otherwise, there would be an anomalous situation where the Society would have terminated its contract with appellant but the letter of intent issued by the SRA would continue to hold the field and it would be entitled to develop the land. The Society approached the SRA, in fact, asking it to take action against the developer. Since the SRA is the authority which issued the letter of intent, it will definitely have the power to cancel the letter of intent. In the peculiar facts and circumstances of the case where the slum dwellers are virtually the owners of the land as members of the owner Society, the SRA had the power under Section 13(2) to issue the order dated 24.02.2012 setting aside the appointment of the appellant as developer. [Paras 47-49][41-B-H]

Whether the SRA has any other power to remove the developer:

4.1 Since it was the SRA which issued this letter of intent, it necessarily must have the power to cancel the same. A bare reading of clause (c) and (d) of sub-section (3) of Section 3A of the Slum Act shows that in terms of the provisons, the SRA not only has the power, but it is duty bound to get the slum rehabilitation scheme implemented and to do all such other acts and things as will be necessary for achieving the object of rehabilitation of slums. In the instant case, the SRA was faced with a situation where the slum dwellers were suffering for more than 25 years and, therefore, the action taken by SRA to remove the appellant for the unjustified delay was totally justified. [Paras 50, 51][42-B, F-G]

4.2 A perusal of the various provisions of the Slum Act would show that normally in a case falling under the Slum Act, it is the owner of the land, whether it be the Government, a statutory authority or a private person, who will be interested in the development work. Normally, the occupiers will be encroachers of slum land. Therefore, there will be a conflict of interest between the occupiers and the owner. The owner, in turn, will always engage a developer/builder to carry out the development work. In case the owner gives a power of attorney to the developer, as in the instant case, the developer now has two identities-(i) the power of attorney holder of the owner and (ii) the developer. As far as the instant case is concerned, the Society is made up of the members who are occupiers and this Society has given power of attorney to the developer. Therefore, the developer is actually having a dual role of owner and developer. Both the letters of intent have been issued in favour of the Society, developer and the architects of the developer. The developer could not have carried out the development work on the basis of its agreement with the Society. It needed the permission of the SRA. Therefore, SRA can obviously revoke such permission.[Para 52][42-G-H; 43-A-C]

Whether in the notice issued under section 13(2) the issue of 70% consent was raised:

5. When a notice is issued to a party it must be clearly told what are the allegations which it must meet. The notice should be clear and unambiguous. There was no allegation in the notice(s) that the right to develop granted in favour of the appellant was liable to be revoked because it had not obtained consent of 70% of the slum dwellers. The reference to Regulation 33(10) also did not specifically raise the issue of 70% consent. The appellant was never put to notice by the SRA that its right to develop the land may be cancelled because of not having consent of 70% slum dwellers. It was confined to the issue of delay. However, while considering the issue of delay, the SRA was justified in making reference to the various communications made by the developer and its architects seeking time to obtain consent of 70% slum dwellers. [Paras 54-56][43-F-H; 44-A] Whether support of 70% of the slum dwellers is mandatory and whether slum dwellers are entitled to withdraw their consent:

6.1 A bare reading of Development Control Regulations of 1991 makes it absolutely clear that under the said DCR at least 70% of the slum dwellers/occupiers have to get together and form a Society for the purpose of slum re-development scheme. Therefore, unless 70% slum dwellers agree to form a Society, the provisions of the Slum Act could not be invoked to frame an SRD scheme. Under the amended DCR of 1997, there is a change that now the developer/owner was required to enter into agreements with 70% of the slum dwellers and unless 70% of the slum dwellers agree, the slum rehabilitation scheme cannot be entertained. The magic figure remains at 70%. The idea behind it is that more than 2/3 of the occupiers must agree for the rehabilitation scheme. Even if the remaining minority slum dwellers do not agree to be part of the scheme, the owner/developer is duty bound to make adequate arrangements for their rehabilitation under the scheme and they can join the scheme, and can take benefit of the scheme even at any later stage. Therefore, 70% consent of the occupiers is mandatory. [Paras 61-62][46-D-F]

6.2 The circulars issued by the SRA, specially Circular dated 21.08.1997, 19.09.1998 and Circular No. 27 permit conversion of old approved SRD Scheme to new SRA Scheme under the provisions of Clause No.10.1 of Appendix IV of DCR. In the instant case, the scheme was initiated under the old DCR of 1991. There is no manner of doubt that the Society was formed by more than 90% of the occupiers. The migration was done to the Scheme of 1997. Since there is no clear cut provision in the 1997 DCR as to how this migration has to be done, it is presumed that while migrating, it was not necessary for the appellant to have individual agreements with 70% of the slum dwellers. However, it was the appellant who applied for migration to the new Scheme, obviously because the new Scheme gave greater benefits to the developer. When migration was done, it was on the clear cut understanding that after the migration, the provisions of amended DCR would be applicable. When this application of the Society and the appellant for conversion was taken up, it was noticed that one of the main objections was that there were no individual agreements with the slum dwellers. Later, the appellant submitted agreements of 450 of the eligible slum dwellers and stated in writing that the remaining to make up 70% would be submitted before start of Phase II of the construction. Fresh letter of intent dated 27.01.1998, in terms of the new DCR, was issued in favour of the appellant and approved in accordance with Clause No.33(10) and Appendix IV of amended DCR subject to certain conditions. [Paras 63-65][46-G-H; 47-A-E]

6.3 In a migration from 1991 Scheme to 1997 Scheme, obviously 70% individual agreements cannot be obtained prior to submission of the Scheme. However, while granting migration, the SRA can lay down conditions and such conditions can also be laid down during the course of the Scheme. From the facts narrated, it is more than amply clear that the SRA envisaged, and appellant clearly understood, that it had to obtain consent of 70% of the slum dwellers. Even in the resolutions of the Society authorizing the appellant to take up the development work entered after DCRs were amended it was clearly mentioned that amended Regulation 33(10) would govern the agreements. The appellant cannot now say that it is not governed by the amended regulations. Even the letters issued by the architects of the appellant clearly indicate that they would make up the balance to achieve 70% agreements. The main dispute is by when this should have been done. Initially, time was given till commencement certificate of the sale building was issued. This was a meaningless condition because if this condition was to be applied after the rehabilitation buildings had been built, then having the consent of the slum dwellers would be an exercise in futility because by then they would have been thrown out of their dwellings. At best, it can be understood to mean commencement of the rehabilitation buildings. The slum dwellers are interested with the rehabilitation buildings and not with the free sale buildings. Later on, when applying for permission to trade their development rights, the appellant clearly understood and undertook that it would furnish the consent forms of 70% of the slum dwellers. The architects of the appellant, in fact, deposited 580 individual agreements but out of these, only 372 were found to be correct. Thereafter, the appellant took a U-turn and, relying upon the judgment of the High Court took a stand that it was not required to submit agreements with 70% slum dwellers, which was not legally tenable. The appellant cannot be permitted to back out of its commitments. The agreements with 70% slum dwellers should have been provided within a reasonable time and, though almost

20 years have elapsed since the second letter of intent was granted in favour of the appellants, it has till date failed to submit the agreements. This only dealt with for showing that the appellant delayed the project because it failed to get consent from 70% of the occupiers.[Para 70][49-G-H; 50-A-E]

Whether the appellant delayed the construction of the scheme, and is, therefore, not entitled to any relief:

7.1 Both SRA and the High Court came to the concurrent finding of fact that the appellant was responsible for the delay in implementation of the Scheme. It is more than obvious from the facts narrated that the appellant never earnestly pursued the authorities for approval of the plans and the reason is not far to seek-the reason being the appellant did not have consent/agreements of 70% slum dwellers. It is more than obvious that the appellant was buying time on one excuse or the other. On 18.01.2000, the SRA called upon the appellant to submit revised plans in respect of rehabilitation buildings within 10 days of the receipt of the letter. In reply thereto, the architects of the appellant sent a letter on 27.01.2000 expressing their intention to start Phase II of the project but, at the same time, sought waiver of the requirement of obtaining 70% consent from the slum dwellers. This clearly shows that the appellant was using this excuse to delay the construction. On 05.01.2001, the appellant addressed a letter to the SRA praying that the plan submitted in 1997 be approved. Thereafter, the SRA did not consider appellant’s proposal since, the proposal was affected by the Coastal Regulations Zone (CRZ) Notification. [Para 71][50-G; 51-G-H; 52-A-B]

7.2 On 07.07.2001, the appellant and the Society filed Writ Petition in the High Court seeking removal of the remarks which indicated that part of the property of the Society was being affected by the CRZ Notification. A perusal of the writ petition and the other documents clearly shows that the entire property was not affected by the CRZ Notification, but only a part thereof. On 07.08.2002, in the petition filed by the appellant and the Society, the High Court passed an order. It is apparent from the said order that stay was granted not to raise construction in the area which is covered by the CRZ Notification. No material has been brought on record to show that the entire plot was covered by the CRZ Notification and it is amply clear that only a portion of the plot was covered by the CRZ Notification and nothing prevented the appellant from raising construction on that portion of the land which was not affected by the CRZ Notification. However, for reasons known only to the appellant, it withdrew the Writ Petition only on 07.04.2008. It was only thereafter that respondent no. 3Society passed a resolution on 29.03.2009, terminating the development agreement with the appellant. Even after that, the SRA on 15.06.2009 issued a letter that the Society’s request for change of developer need not be considered. On 14.09.2009, the Society entered into agreement with respondent no. 4. Thereafter, civil litigation started. It has also been urged on behalf of the appellant that, in the meantime, a one man Commission was constituted and due to the constitution of this Commission, work was affected. [Paras 72-73][52-B-C, F, G; 53-C-D]

7.3 The finding given by the SRA that the appellant was responsible for the delay, is a finding based on appreciation of material on record. It cannot be said to be a perverse finding. It is a finding of fact and, therefore, the High Court was justified in coming to the conclusion that it could not set aside this finding of fact in writ jurisdiction. Though there may have been a few stop orders and a few occasions when the appellant may not have been able to raise the construction but, by and large, the appellant was itself guilty of delaying the construction for no reason at all. Therefore, the appellant was rightly held responsible for the delay in implementation of the rehabilitation scheme and, as such, there is no error in the impugned order. [Para 74][53-E-G] Whether the appellant is entitled to continue with the scheme:

8.1 The appellant is not entitled to continue with the rehabilitation Scheme on account of the fact that it has been responsible for the delay in completion of the project for an inordinately long time. The appellant has not been able to explain the delay. The slum dwellers are dealt with and the appellant cannot take the benefit of technical points to defeat the rights of the slum dwellers. The claim of the appellant that it had the support of 70% slum dwellers, was contested before Justice B.N. Srikrishna and his findings clearly reveal that the appellant does not have the support of 70% of the slum dwellers. Since the notice by the SRA to the appellant did not make any specific allegation with regard to the appellant not having 70% consent, that portion of the order of the SRA, setting aside the right to develop the land on the ground of lack of 70% consent, may have been beyond the scope of the notice. However, this issue was argued before the HPC and the High Court and on rival claims being made, this Court vide order dated 27.03.2015, referred this dispute to Justice B.N. Srikrishna who submitted his report. [Para 75][54A-C]

8.2 In writ proceedings, the petitioner must show that both in law and in equity it is entitled to relief. In this case, both equity and law are against the appellant. It has dealt with slum dwellers in a highly inequitable manner. The law and the conditions of the letter of intent as well as the conditions imposed in the various letters issued by the SRA clearly required the appellant to produce agreements with at least 70% of the slum dwellers. This, the appellant has miserably failed to do. Though the appellant may have remained the same entity in name, there have been, at least, three changes in the promoters of the appellant and these transfers of shareholdings obviously must have been done for consideration. It is more than obvious that the appellant as a legal entity, was treating the slum dwellers only as a means of making money and, therefore, the appellant is not entitled to any relief. [Para 76][54-D-F]

In case the appellant is not entitled to continue with the scheme whether respondent no. 4 is entitled to continue with the rehabilitation scheme:

9.1 Under the terms of the agreement, respondent No. 4 agreed to provide permanent alternative accommodation of 344 sq. ft./419 sq. ft. carpet area to the slum dwellers. Obviously, the slum dwellers, who had been waiting for 23 long years for a flat admeasuring 269 sq. ft. would happily accept the offer of a flat of 344/419 sq. ft. From the communications addressed by the SRA, it is obvious that the respondent was legally not entitled to make this offer. It is submitted that respondent no. 4 was willing to sacrifice its free sale area to give a larger flat. However, he failed to submit even one document to show that the SRA had agreed to this proposal of the respondent no. 4. In fact, the communication sent by SRA clearly shows that the proposal was not accepted. It is, therefore, obvious that respondent no. 4 had hoodwinked the members of the Society in entering into an agreement with it by holding out a false promise that they would be given much larger flats. As such, the request of respondent no. 4 to be permitted to continue with the project cannot accepted. The Society has terminated its agreement with the respondent no. 4. In the voting conducted by Justice B.N. Srikrishna, the respondent no. 4 failed to get the consent of 70% slum dwellers and, in fact, it has got less than 1/2 of the votes, as compared to the appellant, and its support is even less than 30%. [Paras 78-79][55-B-F]

9.3 It is accepted that agreements once entered into and the consent once given, cannot be withdrawn. However, if the consent is obtained by misrepresentation of facts, then that is no consent. The position stands clarified that the slum dwellers would get flats of 269 sq. ft. area only, respondent no. 4 has failed to get support of even 30% of the slum dwellers. In view thereof, respondent no 4 is not entitled to continue with the project and is not entitled to any relief. [Paras 80-81][55-G-H; 56-A] Law laid down by the High Court:

10.1 The views of the High Court that consent once given by the slum dwellers should not be permitted to be withdrawn; that voting inter se developers should not be done; that in case voting is done, then this will lead to developers trying to buy out the slum dwellers and then no rehabilitation scheme would attain fruition, is accepted. Slum dwellers normally belong to the poorest section of the society. They can be tempted to change their mind. In the instant case itself, the slum dwellers shifted from the appellant to respondent no. 4. for two reasons-(i) appellant had delayed the project and (ii) respondent no. 4 made a promise that it would give a flat of 344 sq. ft./419 sq. ft. area, which promise was obviously a false promise. The view of the High Court that consent once given should not be permitted to be withdrawn, is absolutely the right view. Otherwise, a person may give consent one day, withdraw it the second day and review the consent the third day, leaving the Scheme in a perpetual state of flux. For the said reasons, the view of the High Court that there should be no inter se bidding between the builders is accepted. The proper course is that the scheme of the developer who is the first choice, should be placed before the slum dwellers and if it gets 70% votes, then the Scheme can be considered, but if it does not get 70% consent, then obviously, the second developer can be considered. However, competitive bidding should not be done because that can lead to a very unholy practice of developers trying to buy out the slum dwellers, which is also not in the interest of the rehabilitation scheme.[Para 82][56-BF]

10.2 As far as the instant case is concerned, this Court while passing the order dated 27.03.2015, made a departure because of the peculiar facts of this case. The instant case because of its own unique facts cannot be treated as a precedent in other cases with regard to action taken in this case. [Para 83][56-G]