Case: Bombay Dyeing and Manufacturing Company Limited Vs. Monitoring Committee Through The Member Secretary, Office of Chief Engineer (Dp), Municipal Corporation For Greater Mumbai &amp; Others

The petitioner in the first Writ Petition No.977 of 2010, Bombay Dyeing and Manufacturing Company Limited (theor the Company) has two properties in the City of Mumbai viz.(i)Textile Mill at Prabhadevi in Lower, and(ii) Spring Mills at Dadar Naigaon in Wadala.The land upon which the Mills are situate island belonging to the Company. Spring Mills at Dadar was closed after obtaining necessary permission of the Commissioner of Labour, Maharashtra State vide order dated 25 November 2004 under sectionof the Industrial Disputes Act, 1947 ("I.D. Act").2. Since the lands of the Company were permitted to be used for running cotton textile mills, i.e. industrial user, ordinarily the lands could not have been used for development or redevelopment for commercial or residential purpose. However, several cotton textile mills in Mumbai were sick and/or closed and they were desirous of going for development or redevelopment of lands for commercial and/or residential user for generating funds. Similarly, the cotton textile mills which claimed that they wanted to go for moderisation on the same lands also required funds for such modernisation and, therefore, they were desirous of using a substantial part of their lands for putting up constructions for commercial/residential user.3. Development of land and use of land included in the development plans for the city of Greater Bombay are regulated by provisions of Chapter IV of Maharashtra Regional and Town Planning Act, 1966 with the title "Control of Development for Use of Land included in Development Plans". There is no dispute about the fact that the lands of the two textile mills of the company in Mumbai are covered by the development plan made as per the provisions of the Maharashtra Regional and Town Planning Act, 1966 (the MRTP Act). In exercise of the powers conferred by the MRTP Act, the State Government has made the `Development Control Regulations for Greater Bombay, 1991 (DCR). These regulations apply to the construction activity and development work in the areas of the entire jurisdiction of Municipal Corporation of Greater Mumbai.4. The State of Maharashtra added Regulation 58 in the Development Control Regulations for Greater Mumbai, 1991 with a view to deal with the situation arising out of closure and/or unviability of various cotton textile mills. The deteriorating condition of the textile units and need to have open green spaces for public purpose and public housing/ housing for mill workers prompted the Government to have policy to free open mill lands for development and/or redevelopment. Under this policy, the cotton textile mills which were sick and/or closed or wanted to go for modernization were to be granted permission for development and/or redevelopment of its lands for commercial and/or residential user, subject to the condition that after excluding the lands occupied by the existing built up area (and also after excluding the lands becoming open upon demolition of the built up area which was in existence on the date of coming into force of Regulation 58), the remaining open lands would be shared with Maharashtra Housing and Area Development Authority (MHADA) for public housing/mill workers housing and with the Municipal Corporation for Greater Mumbai for open green spaces like recreation grounds/ gardens/ play grounds.5.As far as the lands of the petitionerare concerned, there is no dispute that after excluding the lands which had existing built up areas on the date of coming into force of Regulation 58, the Company has to share the remaining open lands of the textile mills at Prabhadevi (Lower) and Spring Mill at Dadar, Wadala in the following proportion with MHADA and the Municipalin sq.meters rounded off.)Sr. No. Textile Mill at Prabhadevi/LowerClosed Mill Spring Mills at Dadar,5 Ha.)(Between 5 and 10 Ha.)1Total Land in sq.mts.1,00,4981,38,2552Land with existing built up area (Company can demolish the existing structures and can develop the land below the same for constructing buildings for commercial/ residential user.)79,12660,1493Land to be shared /as per layout submitted by Company and approvedby Mu.Corp.21,37278,106(a)Earmarked for development by Company8,549 (40%)25,755 (33%)(b)Earmarked for public housing/mill workers housing to be developed byMHADA.5,771 (27%)26,556 (34%)(c)Earmarked for open green spaces to be maintained by Municipal Corporation (Recreation Ground/Garden/ Play Ground etc.)7,053 (33%)25,775 (33%)4Total land to be retained by Textile Company Col.2+3(a)79,126 87,675+ 8,54960,149 1,03,881+25,7755Total land to be handed over to MHADA and Mu.Corpn. Col. 3(b)+3(c)5,771 12,824+ 7,05326,556 52,331+ 25,7756. Theaccordingly submitted the lay out plans to the Planning Authority i.e. Municipal Corporation for Greater Mumbai (Municipal Corporation) in respect of the lands of both the textile mills. The lay out plans were approved by the Municipal Corporation on 25.8.2005. As far as the lay out in respect of lands of Spring Mills at Dadar is concerned, it was subsequently amended and the amendment was approved on 16.12.2010. The company also applied to the Municipal Corporation for approval of the plans for constructing buildings with built up area 76,878 sq.mtrs. for commercial/residential user on the land of the textile mill at Prabhadevi (Lower) and buildings with built up area of 1,29,199 sq.mtrs. for residential user on the land of Spring Mill at Dadar (Wadala). The Municipal Corporation also granted approvals as per the details given in the chart reproduced hereinafter.7.(9) of Regulation 58 of DCR provides for constitution of Monitoring Committee to oversee the due implementation of schemes for development or redevelopment of the lands of cotton textile mills sanctioned under Regulation 58. A retired High Court Judge is to be the Chairman of the Committee, with one representative each of the cotton textile mill owners, recognised trade union of cotton textile mill workers, the Commissioner and the Government as members. Accordingly, the Monitoring Committee headed by a retired High Court Judge is constituted.8. At its 99th meeting held on 29 January 2010, when the Monitoring Committee called upon the representative of the company to state about the managements commitment to surrender the land earmarked for the workers housing as well as recreation ground, the committee was informed that the management was ready to hand over necessary land, but they had submitted necessary plans which were yet to be approved. When inquired from the concerned officer of the Municipal Corporation, the Committee was informed that so far (29 January 2010) no such amended plans were received. The Monitoring committee then gave certain directions. The reasons for giving the directions and the directions are asof Maharashtra, Urban Development Department has already issued directives under Section 37(1) ofT.P.Act, 1966 to the Corporation to initiate modification of Regulation 58(1)(b) so that the lands earmarked for MHADA and R.G. could be handed over to the concerned Authority immediately after approval of layout. The formal procedure for the modification is going to take considerable time. However, the intention of the Govt. is clear from the directions that the concerned mills should hand over the lands earmarked for MHADAR.G. after approval of their layouts. In the present case before starting the construction on both the properties already layouts have been submitted and both the layouts have been approved, in pursuance of which construction has also started. Therefore, in pursuance of the spirit of the directions given by the State Govt. there should be no difficulty for the Bombay Dyeing Units to hand over the respective portions earmarked to workers housing to MHADA and R.G. to MCGM shown in the 2 approved layouts. The Monitoring Committee, therefore, gives the direction that Bombay Dyeing Management should immediately hand over the earmarked lands in the respective layouts of the two units immediately without any further delay. Both MCGM as well as MHADA will start immediate action for taking advance possession after getting an undertaking from the Management to complete other formalities." (emphasis supplied)9. At the next meeting of the Managing Committee i.e. 100th Meeting held on 16 February 2010, the company submitted that it was not bound to hand over possession of the lands earmarked for the MHADA and the Municipal Corporation until the company crosses the limit of existing built up area + 30% of the balance FSI as stipulated under DCR 58(2). The Monitoring Committee did not accept the companys contention and observed that on the one hand there is no progress so far as the workers housing is concerned, whereas the permitted construction on the companys share of the land is going on which appears to be incongruous. The Monitoring Committee decided to issue stop work notice at both the places of the company for stopping the development work. The Monitoring Committee also notedmeeting Mr.Gunaji submitted that after amended plans are approved, land will be handed over to MCGM and MHADA. However, no such amended plans are submitted. Today, totally different plea is taken. Govt. has also issued order for changing the rule. It may take time. But, some urgency is necessary for solving the problem in totality and hence the stop work notice should be issued at both the places stopping the development of the work."10. Accordingly, the Municipal Corporation issued stop work notice dated 26 March 2010 (Exhibit "V") calling upon the company to stop all the construction activities on the sites at Dadar Naigaon Division, Wadala as well as at Prabhadevi, Lower. The said decision of the Monitoring Committee and the stop work notice issued by the Municipal Corporation are challenged by thein Writ Petition No.977 of 2010 under Article 226 of the Constitution filed on 6 April 2010.11. Writ Petition (Lodging) No.1134 of 2010 is filed by one of the Unions of Workmen of the two Mills of the textile company with a prayer that the company be directed to surrender the lands as per the ratio laid down in Regulation 58(1)(b) for public housing/mill workers housing to MHADA and to the Municipal Corporation for Greater Mumbai for open green spaces.12. Before proceeding further, we may refer to the Government Notification dated 24 August 2010. We may note that the modification of Regulation referred to in the minutes of the Monitoring Committee held on 29 January 2010 and 16 February 2010 was to the proposal contemplated for modification of DCR 58. After consulting the Director of Town Planning Maharashtra State and the suggestions and objections received on the said modification proposal by the Municipal Corporation, the State Government issued Notification dated 24 August 2010 under Section 37(1) of the Maharashtra Regional and Town Planning Act,1966. The preamble to the Notification, inter alia, stated aswhereas, it has been brought to the notice of the Government that the cotton textile mills are closed but the lands which are required to be handed over to MHADA and MCGM under Regulation 58(1)(b) of the said modified Regulations are not made available for the required purposes."The Notification then added the following Note VII to RegulationNotwithstanding any thing above, the layout of mill land shall be submitted by the mill owner within six months of closure of the mill or within six months of this notification whichever is later and the lands earmarked for MHADA and Recreation Ground shall be handed over to the concerned Authority immediately after the approval of layout."

Court's reasoning:
19. Having gone through the MRTP Act particularly section 2 and Chapter IV thereof and the Development Control Regulations for Greater Mumbai, 1991 including DC Regulation 58 therein, we find that a company running a cotton textile mill in the city of Greater Mumbai which is using the land for industrial purposes, is not entitled to use the land for development or redevelopment for commercial or residential purpose, unless the Municipal Commissioner grants such permission either under Clause (1) or Clause(2) of Regulation58. Having carefully gone through the otherof Regulation 58, we find that Clause (3) empowers the Municipal Commissioner to grant such permission if the cotton textile mill is to be shifted outside Greater Mumbai but within the State (shifting outside the State to be regarded as closure and to be dealt with as such) provided due permission is granted by concerned competent authorities in accordance with a scheme approved by the Government.) of Regulation 58empowers the Municipal Commissioner to allow reconstruction after demolition of existing structures by aggregating in one or more structures the built up areas in demolished structures and also to allow multi mills aggregation of the built up areas of existing structures where an integrated scheme for demolition and reconstruction of the existing structures of more than one mill, whether under common ownership or otherwise, ON THE SAME LAND is duly submitted.20. In the background of these Regulations and having carefully examined the permissions granted to the company, we find that by letter dated 10 November 2003 the Government of Maharashtra sanctioned the scheme of modernization of textile activity by the company in respect of the properties at Dadar Naigaon Division at Wadala and of Lower Division purportedly under Regulation 58(2) read with Regulation 58(6)(a) and (b) of DC Regulations. It is necessary to note that when the above permission was granted on 10 November 2003, neither of the two mills of the company was closed. At least no permission for closure was granted under Sectionof the Industrial Disputessanction granted by the State Government to the petitioner company for development/ redevelopment on the lands at Dadar Naigaon (Wadala) division for residential user is traceable only to(1)(a) and (b)4. It is, therefore, difficult to see as to how the petitioner company can dispute the applicability of Regulation 58(1)(b) to the lands of Spring Mills at Dadar Naigaon (Wadala). The very fact that the petitioner company submitted its layout plan for the said mill in the year 2005 and the notification dated 24 August 2010 came into force on 24 August 2010, Note VII to Regulation 58(1) became operational and since in the meantime, the layout plan was approved in 2007, with effect from that date, the lands earmarked for MHADA for public housing/ mill workers housing were required to be handed over to MHADA and the lands earmarked for open green spaces were required to be handed over to the Municipal Corporation.Having heard the learned counsel for the parties, we do not propose to dilate on this issue any further as, in our view, in absence of any permission for closure under Sectionof ID Act, 1947 the permission granted to develop/redevelop the companys lands at Lower (Prabhadevi) may, for the purposes of this petition, be treated as permission under Regulation 58(2), but even then Note VII to Regulation 58(1) applies to the permission granted under Regulation 58(2) also, as discussed hereinafter. As far as sanction granted for development or redevelopment on the land at Prabhadevi in Lower division is concerned, according to the company, the company is going for modernization and as per the approved layout has retained 21,699 sq. mtrs out of 1,05,238 sq. mtrs of existing built up area which the petitioner company had on the date of coming into force of Regulation 58. The remaining built up area i.e. 83,539 sq. mtrs of built up area of the textile mill at Prabhadevi (Lower) has already been demolished and the company has obtained approval for constructing buildings for commercial/residential user with built up area of 76,878 sq.mtrs., out of which the petitioner has already constructed and obtained Occupancy Certificate for commercial buildings with built up area of 31,131 sq.mtrs. and has also obtained Commencement Certificate for other commercial buildings with built up area of 23,828any view of the matter the Monitoring Committee (respondent No.1 in Writ Petition No.977 of 2010) appointed under Regulation 58(9) for overseeing due implementation of schemes sanctioned under Regulation 58, Maharashtra Housing and Area Development Authority (MHADA) and the workers unions which have been permitted to intervene have never accepted the interpretation as canvassed by theHence we have independently examined the statutory regulations and proceeded to interpret the same without being fettered by the interpretation placed by some officers of the Municipal Corporation who have not cared to read Note 7 inserted by Government Notification dated 24th August,actual construction cannot start without the mill owner first submitting a lay out plan, approval of the lay out plan by the Municipal Corporation, notice being given by the mill owner to erect the building, the Municipal Corporation issuing the IOD and thereafter the commencement certificate. As to how much open land and balance FSI will be available to the MHADA for public housing / mill workers housing and to the Municipal Corporation for the open green spaces has, therefore, necessarily to be decided at the time of submitting the layout plan.38. That is precisely what the petitioner company did while submitting the layout plan to the planning authority (i.e. Municipal Corporation for Greater Mumbai) in the year 2005. The Municipal Corporation then granted approval to the said layout plan in April 2007 and thereafter, the petitioner company submitted notice for permission to erect the building and thereafter, the Municipal Corporation granted permission in the negative terms i.e. intimation of disapproval.Applying the aforesaid principles to the provisions of Regulation 58, we must first note that(2) of Regulation58 are provisions of the same Regulation made by the same authority and are supplemental to each other. In(2) "if the development exceeded 30% of open land the provisions of Clause (b) ofsubregulation (1) of this Regulationshall apply." Thus,(2) merely contains a reference to Clause (b) ofsubregulation (1) ofRegulation 58 andsince there is no different intention appearing, the reference has to be construed as reference to the provisions of Clause (b) in(1), as may be in force from time to time. It is clear thation (2) are parts of the same scheme of development or redevelopment of lands of cotton textile mills, whether they are sick and/or closed textile mills or whether they are textile mills requiring modernisation, the legislative intention is clear that in stead of being tied down to industrial use of the land, the textile mills are permitted to put up construction in excess of the existing structures, (even by demolition of existing structures and constructing new building on that land) by putting up additional construction to assist the textile mills to generate additional funds, to tide over the financial crisis, to pay the creditors and workers their dues and also to make lands available to a public authority like MHADA to meet the crying need for public housing/mill workers housing and also to make open green spaces available to the residents of Mumbai by handing over some lands to the Municipal Corporation of Greater Mumbai to provide recreation ground, play ground etc. The above legislative intent would, therefore, be applicable to all cotton textile mills, seeking and obtaining permission to develop/redevelop their lands under Regulation 58.48. There is no indication, and there is no reason to hold, that Regulation making Authority did not intend to apply Note VII to) of Regulation58. In fact, Note III to Regulation 58(1)(b) provides that owner of the land will be entitled to development rights in accordance with the Regulation for grant of development rights in respect of land earmarked and handed over to MHADA for public housing/mill workers housing. The same Note further provides that the development rights in respect of land earmarked and handed over to the Municipal Corporation shall be available to the owner of the land for utilisation in the land to be developed by the mill owner as under Regulation 58(1)(b) or as transferable development rights. It is not the case of thecompany that it is not going to take advantage of these transferable development rights available under Note III in respect of the lands which are earmarked for MHADA and Municipal Corporation in the layout plans submitted by thecompany itself to the Planning Authority (Municipal Corporation), which plans have also been approved long back. Thecannot, therefore, be permitted to blow hot and cold by claiming the transferable development rights available under Note III and trying to wriggle out of the liability under Note VII to share the lands on 24 August, 2010 or atleast within six months thereof.49. The legislative intent is, therefore, clear that the submission of the layout plan by the textile company indicating the lands available for sharing under Regulation 58(1)(b) and lands on which theproposes to put up construction and indicatingproposed to be constructed would be sufficient to trigger the operation of Regulation 58(1) (b), whether the textile mill in question is sick and/or closed or whether the cotton textile mill is going for modernization, irrespective of the question of actual construction.50. In view of the above discussion, we are of the view that for applicability of Note VII to Regulation 58(1), it makes no difference whether the permission is granted under Regulation 58(1) or 58(2) or 58(6) of the Development Control Regulations because when permission for development or redevelopment is granted, even for modernization of a Cotton Textile Mill which is not sick or closed, the provisions of Regulation 58(1)(b) for sharing of open lands and balance FSI would apply as soon as the land owner submits layout plan wherein the mill owner proposes development of open lands and balance FSI exceeding 30% of the open land and balance FSI.51. In the facts of the present case, the petitioner company did submit separately the layout plans in the year 2005 for its mills at Prabhadevi, Lower (Spring Mills) and its textile mill at Wadala, Dadar for development of 40% and 33% of the open lands to be shared at the above two mills respectively, and the plans have been approved by the Planning Authority i.e. Municipal Corporation for Greater Mumbai.52. The Municipal Corporation granted IOD for construction of seven residential buildings on the land of Spring Mills at Dadar by 4 June 2007. Thus, the Municipal Corporation had granted IOD for total built up area of 1,29,199.14 sq.mtrs. on the land of the companys Spring Mills at Dadar Naigaon (Wadala) even before 24 August, 2010.53. Similarly, after approving the layout in April 2007, by 21 April 2007, the Municipal Corporation granted IOD for construction of two commercial buildings and one residential building on petitioner companys land at Lower for construction of total area aggregating to about 78,879 sq.mtrs. of land. The existing buildings retained by the petitioner company for commercial and textile user aggregate only to 21,669 sq.mtrs at Prabhadevi, Lower Parel.In the present proceedings, no party has disputed the aforesaid figures and the figures given in the chart in para 4 are also the same but fractions have been rounded off. When no party has disputed the areas of lands required to be handed over by thecompany to Municipal Corporation and to MHADA as per the above details, and the only controversy is at what point of time such lands are required to be handed over by the petitionerto the above two public bodies, and the said controversy was never before the Supreme Court while rendering the judgment dated 7 March 2006, the petitioneris not justified in contending that the said decision of the Supreme Court is a complete answer to the contentions of the respondents.The contention raised by Mr. Seervai cannot be accepted for several reasons.70. In the first place, as held by the Supreme Court, it is not a profitable task to extract a sentence here and there from a judgment and to build upon it.71. The Supreme Court was really concerned with the question as to the whether the open lands in Regulation 58(1)(b) as amended would include lands which became available as open lands after demolition of the old structures. The contention of the PIL petitioners and workmen in that case was that the lands which became open upon demolition of the old structures would also have to be shared by the mill owner for the purpose of earmarking and handing over to Municipal Corporation for recreation ground/garden/play ground (open green spaces) and for earmarking and for the purpose of earmarking and handing over for development by MHADA for public housing / mill workers housing alongwith user of the remaining land for development by the mill owner for residential or commercial user. In other words, "what are the open lands available for sharing under Regulation 58(1)(b)" was the only question which fell for consideration of the Supreme Court.72. Secondly, the sentence in para 152 of the Supreme Court judgment upon which Mr.Seervai has heavily relied, has to be read in the context of the discussion as set out in all the paras quoted in para 67 of this judgment. The sentence in question only indicates that if the textile mill owner did not propose to put up any additional built up area (BUA), over and above the existing BUA (which existing BUA could be demolished and new buildings would be constructed only to the extent of the demolished BUA), then there was no question of sharing the other open lands with Municipal Corporation and MHADA.73. That is, however, not the situation in the presentThe very fact that thecompany has submitted layout plans to the Planning Authority (i.e. Municipal Corporation of Greater Mumbai) indicating the areas on which the company proposed in 2005 to put up construction of commercial and residential towers in excess of the existing built up area the petitioner textile company even obtained approval from the Planning Authority (the Municipal Corporation) to construct residential buildings with built up area of 1,29,199 sq.mtrs. as against the existing BUA of only 79998. 95 sq.mtrs. rounded off to 80,000 sq.mtrs. Hence, after demolition of the existing BUA of 80,000 sq. mtrs., thecan construct new buildings of built up area of 80,000 sq. mtrs. under Regulation 58(1)(a) and further 61,962 sq,ntrs, of built up area under Regulation 58(1)(b). The petitioner company gets not only existing BUA of 79998 sq.mtrs. i.e. 80,000 sq. mtrs., but has obtained approval from the Planning Authority (Municipal Corporation for Greater Mumbai) to construct of residential buildings with total built up area of 1,29,199 sq. mtrs.. That means, the approval obtained by theis for additional built up area of 49,120 sq.mtrs. also. This 49,199 sq.mtrs. as well as open land of 25,775 sq.mtrs on which theis going to construct these buildings is certainly in excess of 30% of the open land and balance FSI referred to in Regulation 58(1)(b). The petitioners contention is that it is only after the petitioner will actually complete construction of 79,998 sq.mtrs. plus construction on 30% of land to be shared that the question of sharing land under Regulation 58(1)(b) will arise.75. The contention cannot be accepted. Not only it runs counter to the scheme of Regulation 58 which was specifically amended on 24 August 2010, but it also makes nonsense of the entire object of Regulation 58 made in public interest to balance the claims of cotton textile mill companies as well as mill workers and residents of Mumbai who need public housing as well as open green spaces. The entire 79,999 sq.mtrs. of construction which was existing on the date of coming into force of DCR 58 and which was relatable to 60,149 sq.mtrs. of land has been completely demolished by theHence, the approval obtained by the petitionercompany is not only for redevelopment after demolition of existing 79,999 sq.mtrs. of BUA but also of additional 49,120 sq.mtrs. of BUA. The petitioner has already got approval to develop 25,775 sq.mtrs. of open land over and above 60,149 sq.mtrs. of land which was covered by the existing built up area. This 25,775 sq.mtrs. is definitely in excess of 30% of the open lands to be shared i.e. more than 30% of 78,106 sq.mtrs. of land to be shared from out of the land of Spring Mills at Dadar, Naigaon (Wadala). Similarly, this additional 49,199 sq.mtrs of BUA (over and above the existing 80,000 sq. mtrs.) is also more than 30% of the 61,962 sq.mtrs. of built up area which is permissible for theto put up on the land to be retained by it [(i.e. land on which there was existing construction which has been demolished plus the land which is available to thefor sharing under Regulation 58(1)(b)].76. Similarly, the petitionerhas already obtained approval for construction of 76,878 sq.mtrs. of buildings for commercial/residential user which are in the process of being constructed on the lands at Prabhadevi (Lower). The petitioner has already earmarked 40% of the open lands to be shared under Regulation 58(1)(b) which is also in excess of 30% limit stipulated in Regulation 58(1)(b).