Powai Plant Co-Operative Housing ... vs Pooja Estate Consultant & Construction ...

Present appeals have been filed against the judgment and order dated February 25, 2005 passed by a Division Bench of the High Court of Judicature at Bombay in Writ Petition No. 10243 of 2004 and an order dated April 25, 2005 in Review Petition No. 56 of 2005. To appreciate the controversy raised in the present appeals, few relevant facts may be noted. The Maharashtra Housing and Area Development Authority ('MHADA' for short) is a statutory authority constituted under the Maharashtra Housing and Area Development Act, 1976 (hereinafter referred to as "the Act"). One of the functions of MHADA is to construct residential tenements/flats for Low Income Groups, Middle Income Groups and Other Poorer Sections of the society and to provide them residential accommodation at lower costs. As per the said mandate, MHADA took up Mass Housing Project and constructed several flats in Building Nos. 23A and 23B at Veer Savarkar Nagar, Powai, Mumbai in 1995. The Act enables the State Government to frame rules (Section 184) for the purpose of carrying into effect the provisions of the Act. Likewise, it authorises MHADA to make regulations with the previous sanction of the State Government for all or any of the matters which have to be or may be prescribed or provided by the regulations under the Act (Section 185). In exercise of the power under Section 184 of the Act, the State Government has framed rules knows as the Maharashtra Housing and Area Development (Disposal of Land) Rules, 1985. Similarly, in exercise of power under Section 185 of the Act, MHADA framed regulations knows as the Maharashtra Housing and Area Development (Estate, Management, Sale, Transfer and Exchange of Tenements) Regulations, 1981. Rules framed by the State Government as also Regulations made by MHADA provide for allotment of residential tenements by inviting applications from members of public who are eligible for such allotment.

MHADA, in accordance with the provisions of law released public advertisements for sale of 165 Non- Deluxe Flats. Between 1995 and 2002, eight such advertisements were released in several leading newspapers for allotment of flats, but there was practically no response from public. In 2003, as also in 2004, two more advertisements were issued but again there was negligible response from public. MHADA also considered appointment of Estate/Property Agents to boost up sale and disposal of flats since huge amount of crores of rupees had been blocked up. Pooja Estate Consultant & Construction (original petitioner-first respondent-herein) was appointed as an authorised property agent of MHADA. But it also could sell only 12 flats. The agency of Pooja came to an end on October 7, 2003 which was not renewed thereafter. A policy decision was then taken to make allotment of flats through Co-operative Housing Societies (Proposed) under the "Bulk Purchase Scheme'. As per the said decision, an offer was made by the Powai Planet Co-operative Housing Society (Proposed) (appellant) and since it was the only society, which had applied, a decision was taken to sell flats to the appellant subject to the terms and conditions mentioned in the Resolution passed by MHADA. The terms and conditions were accepted by the appellant-society and a Letter of Intent was issued to the Chief Promoter of appellant-society on October 25, 2004 stating therein that its request was accepted by MHADA. It was also communicated by MHADA to the appellant vide its letter dated November 17, 2004 that the offer made by the appellant-society was accepted and that the society had paid an amount of Rs.27,50,000/- (Rupees twenty seven lakhs, fifty thousand only) towards EMD. When Pooja came to know about the resolution passed by MHADA to sell flats to the appellant-society, it approached the High Court complaining against the said action. It was inter alia contended by the petitioner that it had come to know pursuant to an advertisement issued by MHADA on May 27, 2004, that certain vacant tenements of MHADA were to be sold to members of public on "first come first served" basis. Since buyers did not come forward to purchase the flats, MHADA entertained applications under the 'Bulk Purchase Scheme'. On August 23, 2004, appellant-society made such application for purchase of flats. According to the first respondent, it was well-known consultation and construction concern and was having vast experience as an estate agency of MHADA. It was also interested in purchase of flats and, accordingly, applied on September 9, 2004 for purchase of 100 flats. According to the first respondent, Letter of Intent was issued to the appellant on October 25, 2004. Since the first respondent applied on September 9, 2004 and the decision was taken by MHADA and Letter of Intent was issued thereafter on October 25, 2005, it was clear that when the decision was taken by MHADA, application of the appellant- society as also of the first respondent (Pooja) were before MHADA. It was, therefore, incumbent on MHADA to consider both the applications and to take appropriate decision on merits. The grievance of the first respondent, however, was that its application was never considered by MHADA and a decision was taken to sell all flats to appellant-society. The action was, therefore, illegal, unlawful and was liable to be set aside.

If after following the procedure prescribed in the foregoing rules or the Regulations made thereunder, it is found that there is no adequate response and demand for tenements in any particular scheme, such of the tenements as cannot be so disposed of may be disposed of in any other manner deemed fit by the Authority.

For the foregoing reasons, the appeals deserve to be allowed and are accordingly allowed. The order passed by the High Court in Writ Petition as also in Review Petition is set aside and the matter is remanded to the Court for fresh decision in accordance with law. Before parting with the matter, we may clarify that we have not entered into correctness or otherwise of the decision taken by MHADA and we may not be understood to have expressed any opinion thereon. We are also not deciding one way or the other the contention of the appellants as to locus standi of Pooja that since its agency came to an end in 2003, it could not have filed a writ petition to challenge the decision of MHADA. The parties are at liberty to take up all pleas before the High Court and the Court will decide them in accordance with law without being influenced by observations made by us in this judgment. The High Court is requested to decide the matter expeditiously preferably within three months from the receipt of the order from this Court. The appeals are disposed of accordingly with no order as to costs.