Tarabai Nagar Co-Op. Hog. Society (Proposed) vs The State of Maharashtra and Others

Held: A landowner has the first right among stakeholders to undertake redevelopment under an SR Scheme – Owner’s right to develop an SR Area, holds preference over that of the SRA within Chapter I-A of the Slums Act – ss.3B(4)(e) and 13(1) make it clear that the SRA’s power to undertake redevelopment can only be invoked if the owner extinguishes its right to redevelop – s.13 has its own measure to balance the rights of slum dwellers, by imposing the restriction of ‘reasonable time’ on the owner’s right to redevelop – The SRA cannot undertake development of the SR Area unless the owner fails to come forward with a scheme within a reasonable time – SRA has recognised the legislative preference granted to the owner or landlord in Circular No. 144-A dated 09.11.2015, which stipulates that “the first right to file the Slum Rehabilitation scheme is of the owner of the land” – By relaxing the requirement of consent of seventy percent of the slum occupants, it depicts a clear intention on behalf of the SRA that the occupants cannot override the owner’s proposal for an SR Scheme – Impugned judgement upheld. [Paras 51, 53, 61, 63, 107] Maharashtra Slum Areas (Improvement, Clearance and Redevelopment) Act, 1971 – Whether the preferential right of the owner, if any, entails that the owner be specially notified and invited to redevelop the SR Area before the SRA takes a decision u/s.13 r/w s.3D(b)(iii), Slums Act: Held: Though, the Gazette notification or a public notice in newspapers shall be deemed to have informed an owner regarding the s.3C(1) Declaration however, it will be far-fetched and preposterous to further assume that such owner is also obligated to submit a redevelopment scheme when the said notification does not invite the owner to submit any proposal – Mere declaration of an area as an SR Area does not amount to inviting the landowner to redevelop the land, and the publication of the former cannot attract the consequences attributable to the latter – Mere declaration of an area as an SR Area does not amount to inviting the landowner to redevelop the land, and the publication of the former cannot attract the consequences attributable to the latter – Considering the dire consequences potentially suffered by the owner upon inadvertent failure to exercise its preferential right and the SRA’s previous notices, the requirement for a specific notice inviting the owner to submit an SR Scheme, as prescribed in the Impugned Judgement, must be read as mandatory. [Paras 69, 75]

Maharashtra Slum Areas (Improvement, Clearance and Redevelopment) Act, 1971 – s.14 vis-à-vis s.13 – Power of State Government to acquire land – Power of Competent Authority to redevelop clearance area – Whether the power of the State Government to acquire land u/s.14 r/w s.3D(c)(i), Slums Act is subject to the preferential right, if any, of the owner: Held: The owner has a preferential right over other stakeholders to develop an SR Area – If the owner then chooses to exercise this right by submitting and implementing a valid SR Scheme, issues involving rights over the property would not arise – It is, thus, not fathomable that when the landowner is implementing an SR Scheme on its own, a necessity to acquire the land could arise – Rather, any process to acquire the land shall have to be kept in abeyance till such time as the owner’s preferential right to develop it stands extinguished – Since it is open to the owner to file its own SR Scheme within a reasonable time and the proposal of the owner, if valid and complete, would take primacy, it cannot be said that there is any legal necessity to acquire the land – If acquisition is allowed to take place at this stage, it will jeopardise the preferential right of the landowner – It is only when the owner declines to undertake development or to support any third-party development, thereby foregoing its preferential right, that such a necessity would actually arise – Thus, as long as the owner is willing to undertake development in exercise of its preferential right, the acquisition cannot proceed – This can also be harmoniously read in conjunction with the requirement for a notice-cum-invitation to the owner in s.13 – When an SR Area has been notified u/s.3C(1) of Chapter I-A and its development through an SR Scheme is conceptualised, where-under there is an inbuilt preferential right of an owner to carry out redevelopment, the power of acquisition u/s.14 would not operate in an independent silo; rather, it must derive meaning and effect from the principles prevailing throughout the legislative scheme of Chapter I-A – The owner possesses a preferential right to redevelop the SR Area – SRA is duty-bound to invite the owner to submit an SR Scheme and acquisition is not warranted until such right stands extinguished. [Paras 83, 84, 87, 88]

Maharashtra Slum Areas (Improvement, Clearance and Redevelopment) Act, 1971 – Chapter I-A – Validity of the acquisition of land – Indian Cork Mills Private Limited (ICM) was the owner of the subject land, over time, it was encroached upon by hutment dwellers, and a portion of it was declared as a ‘Slum Area’ u/s.4 – The slum expanded and its dwellers formed the co-operative housing societyappellant – Thereafter, entire subject land was declared as SR area through a s.3C(1) Declaration – Appellant requested Additional Collector for acquiring the Subject Land coupled with a proposal to redevelop the same– Originally, proceedings were initiated before the Additional Collector in the absence of ICM – Fresh notice was issued to the ICM and it responded that as owner, it would like to develop the property itself, under an SR Scheme – Eventually, the CEO submitted report proposing to acquire the subject land recommending that the acquisition be undertaken u/s.14 and that though, while ICM had relayed its willingness to redevelop the Subject Land, it had not filed any SR Scheme – Notification issued by State u/s.14(1) for the acquisition of the Subject Land – ICM filed writ petition, High Court set aside the acquisition inter alia holding that a landowner has a preferential right to develop the Subject Land u/ss. 3B(4) and 13(1); SRA was directed to consider ICM’s proposal expeditiously – Whether, in the facts of the case, the acquisition of the Subject Land by the State Government was rightly set aside by the High Court: Held: Impugned judgement upheld – The SRA never issued a notice to Indian Cork Mills Private Limited-ICM (owner of the subject land), thereby inviting it to submit an SR Scheme, and does not appear to have explored the opportunity for the owner to develop the Subject Land – As such, ICM’s preferential right to develop the land was not extinguished – On facts, it cannot be concluded that ICM failed to submit its scheme within the stipulated time –ICM was, at all times, willing to prepare and submit an SR Scheme, but neither the appellant-housing society nor the SRA extended the necessary cooperation – Where the circumstances and the conduct of the SRA and the Society themselves impeded the owner from submitting the SR Scheme, it cannot be said that the owner failed to do so within a reasonable period – The SRA and the State exceeded their power, apparently to pre-empt the owner from undertaking redevelopment – The acquisition of land, in such circumstances, being a colourable exercise of power is unsustainable – The conduct and bona fides of both the SRA and the appellant are seriously doubtful – The SRA’s entire initiative to undertake Slum Rehabilitation on the Subject Land was driven at the behest of the appellant – To permit the acquisition to stand, despite the dubious motives of the appellant and its developer and the deeply suspect conduct of the SRA, would catalyse a travesty of justice – Directions issued. [Paras 92-95, 106, 107] Maharashtra Slum Areas (Improvement, Clearance and Redevelopment) Act, 1971 – Scheme of the Act – Chapters I-A; IV, V – Original Framework for Slum Redevelopment (1971) vis-à-vis New Framework for Slum Rehabilitation (Between 1995 and 2018) – 2018 Amendment – Subordinate Legislation/Circulars – Development Control Regulations for Greater Mumbai, 1991 – Guidelines for the Implementation of Slum Rehabilitation Policy in Greater Mumbai, 1997 – General Slum Rehabilitation Scheme for Greater Mumbai, 1998 – SRA Circular Nos. 144 and 144-A – Enumerated. [Paras 3-38] Maharashtra Slum Areas (Improvement, Clearance and Redevelopment) Act, 1971 – Chapter I-A – Scope – Discussed.