Bombay High Court
Sapphire Enterprises And 2 Ors vs State Of Maharashtra Through Housing ... on 17 April, 2023
Author: Neela Gokhale
Bench: G.S. Patel, Neela Gokhale
5-6-OSWP-1654-2021+.DOC
Arun
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
ORDINARY ORIGINAL CIVIL JURISDICTION
WRIT PETITION NO. 1654 OF 2021
Sapphire Enterprises & Ors ...Petitioners
Versus
State of Maharashtra through Housing ...Respondents
Department & Ors
WITH
WRIT PETITION NO. 1607 OF 2022
Udaynagar Rahvashi SRA Cooperative Society ...Petitioner
through its Chief Promoter
Versus
The State of Maharashtra & Ors ...Respondents
Mr Mukesh Vashi, Senior Advocate, with Manisha Desai, i/b MP
Vashi Associates, for the Petitioner in WP/1654/2021 and for
Respondent No. 4 in WP/1607/2022.
Mr SB Gore, AGP, for the Respondent-State in WP/1654/2021.
Mrs AA Purav, AGP, for the Respondent -State in WP/1607/2022.
Mr Jagdish G Aradwad (Reddy), for Respondent No.3 in
WP/1654/2021 and for Respondents Nos. 2 & 3 in
ARUN
WP/1607/2022.
RAMCHNDRA
SANKPAL Mr Mayur Khandeparkar, i/b SP Bakore, for Respondent No. 4 in
Digitally signed by
ARUN
RAMCHNDRA
WP/1654/2021 & for the Petitioner in WP/1607/2022.
SANKPAL
Date: 2023.04.18
11:02:12 +0530
CORAM G.S. Patel &
Neela Gokhale, JJ.
DATED: 17th April 2023
PC:-
1. The present order is an interim order. We do not dispose of the Petitions because we believe that by following the directions that Page 1 of 9 17th April 2023 ::: Uploaded on - 18/04/2023 ::: Downloaded on - 18/04/2023 21:38:29 ::: 5-6-OSWP-1654-2021+.DOC we propose below, and supervising the process, the entire controversy may indeed be brought to an end.
2. The Petitioner in Writ Petition No. 1654 of 2021 is the original owner of a large piece of land at village Marol, Taluka Andheri. This was subjected to an acquisition under the Maharashtra Slum Areas (Improvement, Clearance and Redevelopment) Act 1971 ("the Slum Act"). The details are not important at this stage.
3. An award of compensation has been made. The Petitioner, Sapphire Enterprises, claimed that it was entitled to a priority right to develop the project as a slum scheme. It claims it has the consent of the requisite majority.
4. The 4th Respondent to this Petition is the Udaynagar Rahvashi SRA CHSL (proposed) ("Udaynagar Society"). This is the Petitioner in Writ Petition No. 1607 of 2022 and is represented by Mr Khandeparkar. The Society says that Sapphire Enterprises did not exercise its rights in accordance with law, and that there is a divesting of ownership. Therefore, according to Mr Khandeparkar, Sapphire Enterprises is not entitled to bring a second proposal now, outside the time frame stipulated for owner developer. He also says that Sapphire Enterprises does not have the necessary consents from the required majority.
5. Mr Reddy for the Slum Rehabilitation Authority ("SRA") says that the consents that Sapphire Enterprises claims to have Page 2 of 9 17th April 2023 ::: Uploaded on - 18/04/2023 ::: Downloaded on - 18/04/2023 21:38:29 ::: 5-6-OSWP-1654-2021+.DOC obtained have not been verified. He is, therefore, not able to say whether Sapphire Enterprises's claim as projected by Mr Vashi is indeed correct or not correct. He also says that a draft Annexure II has been prepared and what is required is the necessary 51% majority of eligible slum dwellers and not of the entire body of slum dwellers.
6. Mr Reddy finally adds that a survey has been carried out.
7. There is obviously very bad blood between the Society and Sapphire Enterprises. Our task is to balance the competing claims. It is important to understand how these claims are placed, and the rival legal backgrounds. Sapphire Enterprises was once the owner of the land in question. There may have been an acquisition under the Slum Act, but Sapphire Enterprises is differently positioned from an outside developer with no history of land ownership. The Society claims 'rights' over this very land and its development. But we cannot lose sight of the fact that every single one of the Society's members is an encroacher, one whose initial entry on the land is not juridical, i.e., not one that the law recognizes. It is under the Slum Act that encroachers are, as a matter of welfare, given benefits of rehabilitation; and, specifically, what is held out to them is the promise of 'free housing'. There is clearly an inherent disjunct or connect -- trespass yielding a free-of-cost high-value real estate asset -- and Division Benches of this Court have often been moved to remark that this assurance of free housing is nothing but a premium on illegality: see: High Court on its own motion (in the matter Page 3 of 9 17th April 2023 ::: Uploaded on - 18/04/2023 ::: Downloaded on - 18/04/2023 21:38:29 ::: 5-6-OSWP-1654-2021+.DOC of Jilani Building at Bhiwandi) v Bhiwandi Nizampur Municipal Corporation & Ors:1
7. ... [A]lso there is a need to do away with such policies which confer a premium illegality in favour of the encroachers, by granting them a windfall of State largesse, namely, a gift of valuable government land in the form of tenements on Government lands wherever situated. This is nothing but legalizing encroachments on prime public lands, in a manner nullifying the "public trust doctrine" and catering to private gains in the teeth of the well established Constitutional requirements while dealing with State largesse. By such mechanism, valuable public lands are gone forever. Given the financial burden on the public exchequer it is impossible for the government to acquire such prime land for any public requirement except at an unimaginable burden on the public exchequer. If such land acquisition cannot be achieved, in that case, is it not the duty of the State to save these lands from being thrown to the encroachers and private gains? Is it necessary that the encroachers are rehabilitated on the same land, when others who want to purchase a small dwelling unit are required to go miles away from such prime places, where encroachments on public land happen with impunity? There cannot be such an imbalance in the societal position in which the citizens are placed when Article 14 of the Constitution stares at the State. Merely because the slums turn into potential 'vote banks' such policy of rehabilitation on hypothetical cut off dates is being implemented under the garb of slum rehabilitation. This, in our opinion, is a mockery of the public trust doctrine. We were constrained to make these observations, as not only these larger issues stare at us in plethora of litigations reaching 1 2022 SCC OnLine Bom 386 : 2022:BHC-AS:4075-DB.
Page 4 of 917th April 2023 ::: Uploaded on - 18/04/2023 ::: Downloaded on - 18/04/2023 21:38:29 ::: 5-6-OSWP-1654-2021+.DOC the Courts, but also for the reason that the building collapse with which we are concerned has taken place in a purported rehabilitation and/or a slum area.
(Emphasis added)
8. The decision is precedent binding on us, and it fortifies our own view. It guides us on the approach to be taken in assessing and balancing the rival claims in this very matter.
9. For, between Sapphire Enterprises and the Society, there are several layers of disputes. First, the Society maintains that Sapphire Enterprises is stripped of all rights altogether. It cannot even come in as a developer. Its right of first refusal to develop the land it owned as a slum project is now lost to it, and it is no longer the owner of the land. Mr Vashi for Sapphire Enterprises seriously disputes this formulation. Second, the Society says that Sapphire Enterprises does not have consent from the requisite number of eligible slum dwellers. This is a progression on the first argument, for it means that the original landowners' rights are completely denuded and there is now the primacy of 'rights' by the Society -- one comprised entirely of encroachers, whose initial entry in the land was illegal. It is they, we are told, who have the determinative right in deciding re-development. And it is only they who can decide what is or is not a valid 'consent'. Third, the Society claims that the 'survey' of which Mr Reddy speaks is a doctored one, put up by Sapphire Enterprises to suit its purposes. Mr Khandeparkar claims that many Society members were 'non-cooperating' slum dwellers:
they did not participate in the survey. According to him, Sapphire Enterprises gave the SRA its own 'survey', that this impermissibly Page 5 of 9 17th April 2023 ::: Uploaded on - 18/04/2023 ::: Downloaded on - 18/04/2023 21:38:29 ::: 5-6-OSWP-1654-2021+.DOC included structures of only those who were 'cooperative', that single structures were shown as more than one -- essentially, that the SRA survey is a fraud.
10. Neither side seems to be at all mindful of what they are canvassing in writ petitions. We are being asked to get into disputed questions of fact. Indeed, as we put to Mr Khandeparkar, it is difficult to believe that a single one of the Society members could withstand the most basic cross-examination on facts. Mr Vashi too would have the greatest difficulty in establishing his case on evidence.
11. We refuse to allow us to be driven down a path that is jurisprudentially closed to us. We turn, instead, and for this reason, to, and only to, the SRA, the statutory authority charged with the implementation of the statute. Again, there are observations in Jilani that guide us, for that very decision demands the closest and most complete fidelity to law and the Constitution -- and not to the demands or cares of this or that lobby.
12. Given this background, we see no reason why Sapphire Enterprises should be wholly excluded from an open and transparent bidding process supervised by the SRA. It is not as if it is a rank outsider. We do not accept that it must be entirely ejected from the proposed project and even its right to bid should be denied to it. Even if we take the Slum Act as it stands, there is no question that an open and transparent competitive bidding process far better Page 6 of 9 17th April 2023 ::: Uploaded on - 18/04/2023 ::: Downloaded on - 18/04/2023 21:38:29 ::: 5-6-OSWP-1654-2021+.DOC serves the statutory intent than selectively choosing one particular builder.
13. The following directions are to this end and purpose.
(a) SRA will complete the process of finalising its draft Annexure II within a period of four to six weeks from today. It will not be possible to do it any sooner than that. The Annexure II that is to be prepared will be on the basis of the survey conducted by the SRA, i.e., that finalization must be on the basis of a neutral and independent survey. The SRA cannot wash its hands of this obligation. If the present survey is, according to SRA, sufficiently accurate and neutral, it is entitled to proceed on that basis. We reject Mr Khandeparkar's submission that a fresh survey must be carried out, because that argument is based entirely on disputed question of fact -- that the survey already done is fraudulent, one-sided, etc. -- and which the Society probably cannot prove even in a civil suit.
(b) The Chief Executive Officer ("CEO"), SRA will then depute or nominate an Authorised Representative for the purposes below.
(c) The society will call a Special General Meeting specifically for the purposes of selecting a developer.
Sapphire Enterprises is entitled to submit to the SRA its bid complete in all respects and its proposal but this will not be disclosed either to the Society or to anyone else and even the CEO, SRA or the Authorised Page 7 of 9 17th April 2023 ::: Uploaded on - 18/04/2023 ::: Downloaded on - 18/04/2023 21:38:29 ::: 5-6-OSWP-1654-2021+.DOC Representative will not open the sealed bid when submitted.
(d) Other developers will have to be invited by SRA to submit their bids by the same date. The SRA will do so by public notice.
(e) On the date fixed by the Authorised Representative for the Society's General Meeting (and which should be preceded by sufficient notice), and which should not be later than mid-July 2023 at the latest, all bids will be placed before the General Body of the Society. Representatives of the various bidders will be permitted to attend the meeting. The meeting will be supervised by the Authorised Representative. Bidders will be entitled to improve their bids at the meeting itself.
(f ) Further, at the General Meeting, the bidders will have to establish that they have the requisite majority of eligible slum dwellers following the Annexure II list finalized by the SRA.
(g) The consent will be a determinative factor and it is the CEO or his Authorised Representative who will decide whether the requisite numbers of majority have been met or not.
(h) Before the CEO issues an Letter of Intent ("LOI") to any successful bidder, including Sapphire Enterprises, the CEO, SRA will make a report to the Court. This will be on Affidavit and the matter will then be listed Page 8 of 9 17th April 2023 ::: Uploaded on - 18/04/2023 ::: Downloaded on - 18/04/2023 21:38:29 ::: 5-6-OSWP-1654-2021+.DOC for directions so that all sides can be heard pursuant to these steps being taken.
14. The reason we have prescribed this procedure is to avoid further delay, accelerate the commencement of the project, to ensure the Society has the best possible terms and also to allow Sapphire Enterprises to participate meaningfully and on fair terms.
15. We can conceive of no other method to balance these competing equities.
16. For the present list these Petitions for directions on the supplementary board on 28th July 2023.
17. Lastly, any application regarding Annexure II, eligibility, etc., by any person must be made by way of an Interim Application in either of these two Petitions and not a separate Petition. Further, no civil court is to entertain any application for stay of any part of this process whether on grounds of eligibility or otherwise.
(Neela Gokhale, J) (G. S. Patel, J) Page 9 of 9 17th April 2023 ::: Uploaded on - 18/04/2023 ::: Downloaded on - 18/04/2023 21:38:29 :::