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Wednesday, January 7, 2015

CIVIL APPEAL No.5989 OF 2007 Nargis Jal Haradhvala ...Appellant (s) versus State of Maharashtra and others ...Respondent(s)


                        IN THE SUPREME COURT OF INDIA
                        CIVIL APPELLATE JURISDICTION

                        CIVIL APPEAL No.5989  OF 2007

Nargis Jal Haradhvala                              ...Appellant (s)


State of Maharashtra and others              ...Respondent(s)

                               J U D G M E N T

M.Y. Eqbal, J.:

      This appeal by special leave is directed against  judgment  and  order
dated 16.8.2007 of the High Court of Judicature at Bombay  whereby  Division
Bench of the High  Court  dismissed  the  writ  petition  preferred  by  the
appellant challenging orders issued by the respondents.

2.    The factual matrix of the case is that the appellant  applied  for  an
exemption under Section 20 of the Urban Land (Ceiling and  Regulation)  Act,
1976 (in short, 'the Act')  in  respect  of  land  bearing  CTS  No.1310  of
village Versova in Andheri Taluka of  Mumbai  Suburban  District,  measuring
5892.5 (in  short,  "suit  property"),  out  of  which  exemption  in
respect of 3491.5 was granted by Respondent  No.1  in  August,  1987.
The balance 2401 did not need exemption being reserved for  road  and
garden and was  duly  handed  over  to  the  Municipal  Corporation  by  the
appellant.  500 was "retainable land" that the landowner is  entitled
to retain.  Exemption order tentatively specified  30%  of  the  permissible
floor space of the exempted land to be sold to Government Nominees.  It  was
clarified that the percentage will be prescribed by the  Government  as  per
the extent of the land to be exempted.

3.    On 31.1.1990, this Court in the case of Shantistar Builders  vs.  N.K.
Toitame, (1990) 1 SCC 520, dealing with  the  issue  of  constructions  over
exempted lands covered under Section 20  of  the  Act  laid  down  that  the
number of the  government  nominees  should  not  exceed  5%  of  the  total
accommodation available in any scheme. The case of  the  appellant  is  that
after the aforesaid decision, on 23.11.1990, by  a  subsequent  corrigendum,
Respondent No.1 amended  the  area  to  be  surrendered  to  the  Government
nominees and finally prescribed it as 20% of the floor space  of  the  first
2000 of the net permissible F.S.I. of the land exempted  and  30%  of
the balance permissible.

4.    The appellant's further  case  is  that  being  unaware  of  aforesaid
decision of this  Court,  appellant  initially  offered  26  flats  (1036.39 by her letters and subsequent  reminders   in  the  years  1990  and
1991, but the respondents neither took up the flats  offered  nor  did  they
respond in any way to appellant's letters.  However,  respondents  moved  an
application for modification of the  judgment  in  the  case  of  Shantistar
Builders (supra) and maintained the quota of flats for  Government  nominees
at  10%  by  its  Resolution  dated  22.10.1992.    Accordingly,   appellant
requested the respondents to take over 10% of the net  permissible  area  of
the exempted land viz. 296.73 and offered  7  flats  (having  area  of
303.73, in reply to which, respondents acknowledged  that  only  10%
of the area needed  to  be  surrendered  for  the  Government  nominees  but
claimed that this 10% worked out to be 414.92 and not  296.73
However, in May, 1993, respondents took up only 4 of the 7 flats offered  by
the appellant, whose area was 5.86%  of  the  net  permissible  FSI  of  the
exempted land.  Upon being asked by the appellant for the  issuance  of  the
certificate  to  the  effect  that  required  number  of  flats  have   been
surrendered to the Government, Respondent no.3 asked the appellant  to  hand
over 21 flats  in  addition  to  the  7  flats  already  offered.  On  this,
appellant pointed out that only 5% flats could be claimed in  view  of  Apex
Court's judgment in Shantistar Builders (supra) and  the  same  had  already
been handed  over.   On  17.11.1995,  this  Court  rejected  the  Government
request to allow 10% quota for Government nominees and restricted the  quota
to 5% only.

5.    The appellant, therefore, reiterated in her subsequent letters to  the
respondent that only  5%  flats  could  be  claimed  in  view  of  aforesaid
judgment of the Apex Court, and on 30.9.1998, three more flats  were  handed
over to secure the Occupation Certificates that were being withheld  by  the
respondents.  It is the case of the appellant that  several  representations
were made to the Government to limit the  area  to  be  surrendered  to  the
Government as per aforesaid judgment of the Apex  Court,  but  her  requests
were rejected  and  Respondent  No.3,  vide  letters  dated  18.6.2002   and
23.7.2004, asked the  appellant  to  surrender  805.58  of  area  in
addition to 303.73 already surrendered by  her.   The  appellant  was
also served with notices dated 16.10.2004 and 3.1.2005, in reply  to  which,
appellant pointed out jurisdiction of Respondent No.3  and  the  fact  about
the wrong calculation of area to be handed over to Government nominees.

6.    By letter dated 18.10.2005, Respondent no.3  informed  appellant  that
since the appellant has failed to surrender in all 1109.31  built  up
area to the Government in the form of 28 flats from the  subject  scheme,  a
criminal case is being filed against the appellant with the  Versova  Police
Station.   An appeal preferred by the appellant against this  was  dismissed
by Respondent No.2 by its order dated 25.7.2006,  stating  inter  alia  that
the Competent Authority is very much in  his  powers  to  hear  and  act  on
matters regarding Section 20 and is  in  no  way  exercising  any  authority
outside his jurisdiction or outside the letter and spirit of the Act.

7.     Thereafter,  the  appellant,  challenged  the  order  passed  by  the
respondents by way of writ petition in the Bombay High Court.  The  Division
Bench of the High Court rejected the appellant's writ petition holding  that
the present case is not covered  by  the  decision  in  Shantistar  Builders
(supra) as the  same  does  not  have  retrospective  effect  and  that  the
document dated 18.10.2005 was not an order but a  letter/intimation  by  the
competent authority to the appellant that the conditions  of  the  exemption
order were not complied with.  Hence, this appeal  by  special  leave  under
Article 136 of the Constitution of  India  is  preferred  by  the  appellant
raising issue what percentage (5%, 10% or higher) of area in any  scheme  is
to be surrendered under the Urban Land (Ceiling and Regulation) Act, 1976.

8.    Mr. C.A. Sundaram, learned senior counsel appearing for the  appellant
in course of argument fairly submitted that since the decision  rendered  by
this Court in Shantistar Builders's  case was prospective in its  operation,
the same will not  apply  in  the  facts  of  the  present  case.   However,
admittedly, the respondents issued a corrigendum dated  23.11.1990  amending
the area to be surrendered to the Government nominee and finally  prescribed
it as 20%  of  the  floor  space  of  the  first  2000  of  the  net
permissible FSI of the land exempted.  Learned  counsel  submitted  that  by
another circular dated  22.10.1992  issued  under  the  signature  of  Joint
Secretary to the Government,  the  quota  for  the  Government  nominee  was
reduced from 20% to 10%.  According to the  learned  counsel  the  appellant
already handed over 10% of  the  total  accommodation.   Mr.  Sundaram  then
submitted that at the initial stage after completion of construction 30%  of
the permissible floor space was offered for sale to the Government  nominee,
but it was neither acknowledged nor accepted by the  Government,  hence  the
respondent is stopped from claiming the same on  the  principle  of  waiver.
Learned counsel drawn our attention to the relevant document  and  submitted
that the flats which were surrendered by the appellant  have  been  sold  by
the respondent to VIPs and  not  to  the  weaker  section  of  the  society.
Learned  counsel  lastly  contended  that  on  the   basis   of   subsequent
corrigendum dated 23.11.1990 read with the  circular  dated  22.10.1992  the
appellant is not liable to surrender more than 10% of the quota as fixed  in
the circular.

9.    Per contra, Mr. Rahul  Chitnis,  learned  counsel  appearing  for  the
State, submitted that in support of the above referred corrigendum  and  the
circular, the appellant executed indemnity bond on 12.10.1998 and agreed  to
give 30% of the permissible floor space  to  the  Government  nominee.   The
appellant further agreed to surrender the remaining  tenements  within  five
years from  the  date  of  execution  of  indemnity  bond.  Learned  counsel
submitted that as against 30% (28 flats) and 20% (18 flats),  the  appellant
has given only seven flats to the respondent till date.

10.   We have considered the entire facts  of  the  case  and  the  argument
advanced by the learned counsel appearing for the parties.

11.   Indisputably exemption under Section 20 of  the  Act  was  granted  on
17.8.1987 with the condition to  surrender  30%  of  the  permissible  floor
space to the allottees nominated by the Government.  It was  clarified  that
the percentage will be prescribed by the Government as  per  the  extent  of
the land to be  exempted.   It  is  also  not  in  dispute  that  subsequent
corrigendum was issued by the Government on 23.11.1990  wherein  the  extent
of 30% was agreed as 20% of the floor space of the  first  2,000  of
the net permissible FSI of the land exempted under the order and 30% of  the
2364.37 sq. mt. balance permissible area.   However,  we  do  not  find  any
authenticity in the circular  dated  22.10.1992,  copy  of  which  has  been
produced before us in support of the contentions made by the appellant  that
the 20% quota fixed by the corrigendum was further reduced  to  10%  of  the
floor space.  Further, admittedly, the appellant executed an indemnity  bond
on 12.10.1998 wherein it was agreed that the balance built up area would  be
surrendered to the Government within a period  of  five  years  i.e.  up  to

12.   In the background of all these facts,  in our considered opinion,  the
appellant is bound to surrender  to  the  Government  a  total  20%  of  the
permissible floor space in the light of  the  corrigendum  dated  23.11.1990
issued by the Government.  As noticed above, till date,  the  appellant  has
given only seven  flats  to  the  allottees  nominated  by  the  Government.
Calculating 20% of the floor space, the appellant is bound to sell  11  more
flats to the persons that may be nominated by the Government.

13.   We, therefore, allow this appeal and set aside  the  order  passed  by
the High Court.  Consequently, we modify the order dated  25th  July,  2006,
passed by the Additional Commissioner, Konkan Division,  Mumbai  and  direct
the appellant to sell eleven more flats  to  the  allottees,  who  shall  be
nominated by the Government.  Taking note of the fact that  seven  flats  so
surrendered by the appellant have been sold to  the  Government  nominee  in
gross violation of the Act and the Scheme framed by the  Government,  we  do
not wish to issue any direction in this matter. However, we  make  it  clear
that the remaining eleven flats that shall be handed over by  the  appellant
to the Government shall be sold to the Government nominees, who must  belong
to the weaker section of the society.  We also direct the appellant to  hand
over and sell remaining eleven flats to the Government  within  four  months
from today.

                                                                (M.Y. Eqbal)

                                                       (Abhay Manohar Sapre)
New Delhi
January 06, 2015

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