1 wp221.10.sxw IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION WRIT PETITION NO. 221 OF 2010 Pramod Vithal Salgaonkar, Chief Promoter of Shree Dattaguru CHS (Prop) & Anr. ....Petitioners. Vs. The State of Maharashtra & Ors. ....Respondents. Mr. Ashutosh A. Kumbhakoni with Ms. Shirin Shaikh i/by M/s. Deepak Chitnis-Chiparikar and Co. for the Petitioners. Mr. Milind V. More, AGP for Respondent No.1. Mr. A.Y Sakhare, Sr. Advocate with Ms. V.S. Gharpure for Respondent Nos. 2 to 9. Mr. P.K. Dhakephalkar, Sr. Advocate with Mr. J.G. Aradwad for Respondent No. 10. Mr. R.A. Dada, Sr. Advocate with Mr. V. Merchant i/by M/s. Kishore Thakordas & Co. for Respondent No.11. Mr. Pravin Samdani, Sr. Advocate with Mr. Chetan Kapadia i/by Mr. Deepak J. Bhatia for Respondent No. 12. Mr. A.Y. Bookwala, Sr. Advocate with Mr. Sanjay Udeshi i/by M/s. Sanjay Udeshi & Co. for Shree Dattaguru Co-op. Housing Society (Proposed). CORAM : DR. D.Y. CHANDRACHUD AND ANOOP V. MOHTA, JJ. DATE : NOVEMBER 25, 2010. ORAL JUDGMENT (PER DR. D.Y. CHANDRACHUD, J.):- The First Petitioner is a proposed society of unauthorized 2 wp221.10.sxw occupants residing on immovable property known as “Sethana Compound” bearing C.S. 1/367 of Mazgaon Division. The Petitioner seeks to impugn- (i) Resolutions of the Improvement Committee dated 10 August, 2009 and the Municipal Corporation of 12 August 2009; (ii) A letter of intent of 2 September 2009 issued to the Twelfth Respondent which is a proposed Co-operative Society; (iii) Revised Annexure-II certifying the list of eligible occupants; and (iv) A report of the Deputy Chief Engineer dated 1 April 2009. 2 The substance of the challenge is to an approval which has been granted for a proposed redevelopment to the Mazgaon Dholkawala Co-operative Housing Society (Proposed), the Twelfth Respondent, under Development Control Regulation 33(7). The land in question was leased to the Municipal Corporation by the State Government. There are 54 municipal tenants on structures situated on the land. Besides this, there are 29 encroachers, who are unauthorized occupants. 3 wp221.10.sxw 3 On 8 May 2000, the unauthorized occupants of the land submitted a proposal for redevelopment under DCR 33(7) in the name of Chamunda Co-operative Housing Society (proposed) through a developer, Shankala Associates. The name of the First Petitioner has since been changed to Shri Dattaguru Co-operative Housing Society. 4 Guidelines have been framed by the Government in regard to the development of Municipal properties under DCR 33(7) Paragraph 3 of the Guidelines clarifies who can initiate a scheme. The Guidelines stipulate that it is necessary that more than 70% of the eligible existing municipal tenants in the building should have furnished their written consent to redevelop the property under DCR 33 (7) and to form an association/ Co-operative Housing Society and initiate a proposal of redevelopment/reconstruction. The application which was filed by the First Petitioner on 8 May 2000, could not have been entertained under Section 33(7) of the DCR in view of the requirement that any such proposal must be mooted by a Co-operative Housing Society of municipal tenants. Unauthorized occupants cannot do so. 4 wp221.10.sxw 5 A proposal was, as a matter of fact, propounded by municipal tenants. On 9 October, 2002, the municipal tenants of C.S. 1/367 formed the Twelfth Respondent as a proposed Co-operative Housing Society and submitted a proposal for redevelopment under DCR 33(7). For this purpose the Eleventh Respondent was appointed as a developer. Together with the proposal, the consents obtained from the tenants were forwarded. According to the Petitioners, 46 out of 54 tenants consented to the proposal. Besides, of the 29 unauthorized occupants, who are eligible having been in occupation on the cut-off date of 1 January 2005, 22 had consented to the proposal. The computation of 70% eligible occupants in support of the scheme was required to be determined with reference to municipal tenants. 6 Subsequently, on 20 March 2006, the unauthorized occupants of C.S. 1/367 floated a proposed Co-operative Housing Society and submitted a proposal for redevelopment through another developer, this time under DCR 33(10). On this proposal, the Collector forwarded an intimation dated 30 November, 2006, to the First Petitioner that on a perusal of the property card it appeared that the land belongs to the Municipal Corporation and that photo passes had been issued by that authority. Hence, the Collector stated that 5 wp221.10.sxw Annexure-II certifying the eligible occupants could not be issued by his office and that the proposal of the First Petitioner which was submitted to the Additional Collector through the Slum Rehabilitation Authority on 4 May, 2006 was being “filed on record”. In the meantime, the proposals of the Eleventh and the Twelfth Respondents were processed on 3 May, 2006 and Annexure-II came to be issued. 7 On 31 January, 2007, the First Petitioner appointed the Second Petitioner as a developer and submitted a proposal for redevelopment under DCR 33(7). On 20 February, 2008, a letter was addressed on behalf of the Petitioners to the Municipal Corporation stating that Annexure-II in respect of the property which was owned by the Corporation, was issued on 3 May 2006. The Co-operative Society stated that all its members may be included in Annexure-II after the names of its members were included in the proposal which was being implemented by the Twelfth Respondent. There is some dispute before the Court on whether the letter is, as a matter of fact, a genuine document. In this connection, the attention of the Court has been drawn to an affidavit dated 6 October 2010, of the President- Pratibha Shirke and of the Secretary-Sanjay Ahir, of Shri Dattaguru Co-operative Housing Society. Exhibit 1 to the Affidavit is a copy of a 6 wp221.10.sxw letter dated 20 February 2008. The Affidavit records that with a view to ensure housing and rehabilitation for the occupants of the property, the deponents have agreed to the redevelopment of the property by the Twelfth Respondent and had addressed a letter dated 20 February, 2008 to the Municipal Corporation consenting to development under DCR 33(7) and for incorporating the names of the occupants in the proposal for development by the Twelfth Respondent. Though the Secretary of the Co-operative Society, (Sanjay Ahir) has in a subsequent affidavit dated 18 November, 2010 changed his position by contending that it is not beneficial to the First Petitioner to join together with the Eleventh Respondent, the deponent has not specifically denied the authenticity of the letter dated 20 February, 2008. 8 On 2 March 2009, the provisions of DCR 33(9) as modified came into force. DCR 33(9) provides for reconstruction or redevelopment of cessed buildings / Urban Renewal Schemes in the Island City, undertaken by- (a) The Maharashtra Housing and Area Development Authority or by the Municipal Corporation of Greater Mumbai either departmentally or through any suitable agency or; 7 wp221.10.sxw (b) MHADA/ MCGM jointly with land owners and/or Co-operative Housing Societies of tenants/occupiers of buildings or a developer or a Co-operative Housing Society of hutment dwellers therein; or (c) Independently by land owners and/or Co-operative Housing Societies of tenants /occupiers of buildings or developers. DCR 33(9) provides an FSI of 4.00 or the FSI required for rehabilitation of existing tenants/occupiers plus incentive FSI as provided under Appendix-III-A, whichever is more. 9 The Petitioners submitted a proposal for redevelopment of C.S. 1/367 under DCR 33(9) on 17 March 2009. On 20 March 2009, a note was put up by the Deputy Chief Engineer and the Additional Municipal Commissioner to issue a revised Annexure-II to the Twelfth Respondent, being a Society of Municipal Tenants. On 23 March 2009 a meeting was held between the Additional Municipal Commissioner, Deputy Chief Engineer and the other officials of the Municipal Corporation. The minutes record that the proposal under DCR 33(7) was more beneficial to the Corporation than DCR 33(9). The minutes record that the First Petitioner is a society of Slum Dwellers while the Twelfth Respondent has the consent of more than 70% of the tenants. The proposal of the Petitioners was, therefore, rejected. On 1 April 8 wp221.10.sxw 2009, minutes were recorded for rejecting the proposal of the Petitioners under DCR 33(9). The reasons recorded state that (i) The municipal tenants have given their consent to the Eleventh and the Twelfth Respondents; (ii) On 30 November, 2006, the proposal has been recorded by the SRA as the plot belongs to the Municipal Corporation; (iii) 70% of the tenants had consented in favour of the Twelfth Respondent; (iv) A comparative statement under DCR 33(7) and DCR 33(9) was discussed at the meeting held on 19 March 2009; (v) The eligible hutment dwellers would be accommodated in that scheme; and (vi) Shri Dattaguru Co-operative Society did not meet the eligibility criteria. 10 On 10 July 2009, the Municipal Corporation issued a revised Annexure-II, to the Twelfth Respondent including in addition, the names of 29 unauthorized occupants, to whom alternate accommodation would be provided. The Improvement Committee sanctioned redevelopment by the Eleventh and Twelfth Respondents on 10 August 2009. The general body of the Municipal Corporation sanctioned the redevelopment on 12 August 2009. The Municipal Corporation issued a letter of Intent on 2 September 2009. Following this, the Twelfth Respondent made a payment of Rs. 10.26 crores to 9 wp221.10.sxw the Municipal Corporation. 11 The Petition under Article 226 was instituted in this Court on 12 January 2010. On 20 July 2010, the plot was handed over by the Municipal Corporation to the Eleventh Respondent. 12 Before we deal with the merits of the rival contentions, we must note that the locus of the Petitioners to pursue the Petition is seriously questioned by the Respondent. It has been stated before the Court that on 25 September, 2010, a Resolution has been passed by the Co- operative Housing Society recording that the First Petitioner is not authorized to represent the Society and calling upon the Advocate appearing for the Petitioner to withdraw the Petition. That apart, it has been stated before the Court, that save and except for six occupants, who have not consented to the scheme, no other occupants have supported the Petitioners. Annexure-II, as noted earlier, has already been issued, under which 54 municipal tenants and 29 unauthorized occupants are eligible to participate in the proposed scheme. 46 out of the 54 municipal tenants and 22 out of 29 unauthorized occupants have consented to the Scheme which is to be implemented by the Eleventh and Twelfth Respondents. 10 wp221.10.sxw 13 The submission which has been urged on behalf of the Petitioners is that the proposal which has been submitted by the Petitioners under DCR 33(9) would have been substantially more beneficial to the Municipal Corporation. It has been urged that, as a result of the acceptance of the proposal submitted by the Eleventh and the Twelfth Respondents under DCR 33(7), the Municipal Corporation has lost the benefit of substantially better terms to which it would have been entitled if the proposal had been proceeded with under DCR 33(9). The submission of the counsel is that during the course of the decision making of process the comparative merits of the proposal of the Petitioners under DCR 33(9) has not been evaluated in relation to the merits of the proposal submitted by the Eleventh and the Twelfth Respondents under DCR 33(7). In order to buttress the submission, the Petitioners have relied upon two charts annexed to an affidavit-in-rejoinder filed on 13 April 2010. The charts seek to set out the salient features of a project under DCR 33(7) on the one hand and DCR 33(9) on the other and an attempt is made to establish before the Court that the proposal of the Petitioners would be more beneficial to the Municipal Corporation and ought to have been accepted in the public interest. 11 wp221.10.sxw 14 Now, while we evaluate the submission made before the Court, it must be noted that the Petitioners had initially mooted a proposal under DCR 33(7) on 8 May 2000. That proposal of the Petitioners was not maintainable in view of the administrative guidelines issued by the Municipal Corporation under which, in respect of Municipal properties any proposal under DCR 33 (7) has to be initiated by municipal tenants acting with the consent of 70% of them. Such a proposal was, as a matter of fact, initiated by the Municipal tenants on 9 October, 2002. Subsequently, the unauthorized occupants who are represented by the Petitioner mooted a proposal under DCR 33(10) on 20 March, 2006. The proposal under DCR 33(10) was subsequent to the proposal initiated by the Municipal tenants under DCR 33(7). The proposal under DCR 33(7) was duly processed, Annexure-II certifying the list of eligible tenants was issued on 3 May 2006. The Petitioners came out with a proposal under DCR 33(9) much later, on 17 March 2009. Now, in this background, it falls for the determination as to whether the Petitioners have made out a prima facie case that, the Municipal Corporation has acted contrary to the public interest or sustained a serious prejudice, as asserted by the Petitioners. Clause 5(a) of Appendix III-A of DCR 33(9) stipulates the 12 wp221.10.sxw manner in which the FSI for rehabilitation of existing tenants/ occupiers has to be calculated. The material part of the provisions recites follows. “The total permissible FSI shall be on gross plot area excluding reservations/ designations but including the built-up area under reservation/ designation”. 15 The aforesaid provision therefore, requires that while calculating the permissible FSI, the extent of the reservations/ designations on the gross plot area have to be excluded. However, the built-up area under reservation/ designation has to be included. An FSI of 4.00 is thereupon available. In the present case, it is an admitted position that the entire land is reserved for the public purpose of Municipal Staff Quarters and a Municipal Primary School. The area of the land is 13,018.96 square meters. The fallacy in the chart submitted by the Petitioners is that the Petitioners proceed on the assumption that an FSI of 4.00 would be available to the entire extent of the land (save and except for 510.77 square meters, representing structures after 1940). Counsel appearing on behalf of the Municipal Corporation has relied on the charts which were considered during the decision making process by the Municipal Authorities. These charts show that 13 wp221.10.sxw since the entire area of the plot is under reservation, the FSI of 4.00 would have to be applied only in respect of the built-up areas under reservation/ designation as provided in Clause 5(a) of Appendix III-A of DCR 33(9), which has been noted above. The comparative charts which have been relied upon by the Municipal Corporation show that if the scheme for redevelopment was to be approved under DCR 33(9), the total share which would accrue to the Municipal Corporation is 17,868.71 square meters (comprising of 7081.34 square meters, being the share in surplus area and 10,787.37 square meters in the reservation area). As opposed to this, under DCR 33(7) the share of the Municipal Corporation would work out to 28,530.64 square meters. The scheme under DCR 33(9) is hence not demonstrated by the Petitioners to be more beneficial in the facts of the present case. 16 While dealing with the analysis which has been accepted by the Municipal Corporation, this Court has to be mindful of the fact that the jurisdiction of the Court has been invoked under Article 226 of the Constitution. Unless the Court finds patent illegality, arbitrariness or perversity, the Court would to be loath to re-appreciate such issues which also involve determinations of fact. The Municipal Authorities considered the entire issue of the applicability of DCR 33(7) vis-a-vis 14 wp221.10.sxw DCR 33(9) at several stages. The record before the Court would indicate that on 12 March, 2009, 19 March, 2009 and 1 April, 2009 the comparative merits of a proposal under DCR 33(7) and DCR 33(9) were evaluated at meetings inter-alia attended by the Additional Municipal Commissioner, the Deputy Chief Engineer and other Officials. Their evaluation is not established to be unlawful. 17 Counsel appearing on behalf of the Municipal Corporation has stated before the Court that the entire record was placed before the Technical Scrutiny Committee when it evaluated the proposal of the Twelfth Respondent on 29 July 2009. The proposal was eventually approved by the Improvement Committee and by the general body of the Municipal Corporation. 18 Cases such as the present involve ostensible conflicts between occupants. In reality, rival builders step into the fray ostensibly to support the cause of a particular group of unauthorized occupants. Builders’ avarice exploits the needs of a hapless segment of society for whom even bare essential housing is a luxury. Occupants switch loyalties, swayed by the lure of an offer by a competing builder. While dealing with such cases, the jurisdiction under Article 226 must be exercised by applying norms of administrative law which elucidate whether the decision making process adopted by regulatory authorities is flawed. 15 wp221.10.sxw The application of established norms of administrative law provides an objective foundation to adjudicate upon rival claims in such cases. Many of them involve disputed questions of fact which are not conventionally amenable to the writ jurisdiction under Article 226. The application of the principles of administrative law will ensure objectivity, certainty and consistency in the judicial process. 19 Having considered the challenge in all its perspectives we are of the view that no case of arbitrariness, perversity or illegality has been demonstrated to the Court. The Petitioners represent some of the unauthorized encroachers to whom also alternate accommodation would be provided under the Scheme as approved. All the eligible occupants whose names have been certified in Annexure-II are entitled to the benefit of alternate accommodation. The scheme has the approval and the consent of 70% of the municipal tenants. In that view of the matter, no case for interference under Article 226 of the Constitution is made out. The Petition is accordingly dismissed. No order as to costs. (ANOOP V. MOHTA, J.) (DR. D.Y. CHANDRACHUD, J.)