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IN THE HIGH COURT OF JUDICATURE AT BOMBAY
ORDINARY ORIGINAL CIVIL JURISDICTION
WRIT PETITION NO. 2296 OF 2007
The BEST Workers Union ]
A union duly registered under ]
the provisions of Indian Trade ]
Union Act, 1926 and a ]
Representative Union approved ]
under the provisions of Bombay ]
Industrial Relations Act, 1946 ]
having its registered office at ]
42, Kennedy Bridge,Mumbai 400004]..Petitioner
versus
1. The State of Maharashtra ]
through its Department of Urban ]
Development, Mantralaya ]
Mumbai 400 032 ]
2. The Municipal Corporation of ]
Greater Mumbai,having its office]
at Mahapalika Marg,Mumbai 400001]
3. The Municipal Commissioner, ]
Municipal Corporation of ]
Greater Mumbai, having his ]
office at Mahapalika Marg, ]
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Mumbai 400 001 ]
4. The Brihan Mumbai Electric ]
Supply and Transport Undertaking]
an Undertaking of Municipal ]
Corporation of Greater Mumbai ]
established under the provisions]
of Mumbai Municipal Corporation ]
Act, 1888 having its head office]
at BEST Bhavan, BEST Marg, ]
Colaba, Mumbai 400 001 ]
5. Shri Uttam Khobragade
ig ]
General Manager,The Brihanmumbai]
Electric Supply and Transport ]
Undertaking, an Undertaking of ]
Municipal Corporation of ]
Greater Mumbai, established ]
under the provisions of Mumbai ]
Municipal Corporation Act, 1888 ]
having its Head Office at BEST ]
Bhavan, BEST Marg, Colaba, ]
Mumbai 400 001 ]
6. The Deputy Director ]
Town Planning for Greater Mumbai]
at Mumbai ]
7. M/s. Vijay Associates (Wadhwa) ]
Constructions Pvt.Ltd. a company]
incorporated under provisions ]
of Companies Act, 1956, having ]
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its registered office at 425-A, ]
Vasukamal, 14th Road, Bandra ]
(West), Mumbai 400 050 ]..Respondents
Mr. V. M. Thorat i/b. Mr. Pramod Patil for the
Petitioner.
Mr. Pradip Jadhav, AGP for the State. - Respondent No.1
and 6.
Mr. C. U. Singh, Sr. Counsel with Ms. S. M. Modle for
MCGM - Respondent Nos. 2 and 3.
Mr. D. G. Dhanure i/b. M/s. M. V. Kini & Co. for the
Respondent No.4.
Mr. V. A. Thorat, Sr. Counsel with Mr. D. G. Dhanure
and Mr. Vaibhav Sugdare i/b. M/s. M. V. Kini & Co. for
the Respondent No.5.
Mr. Janak Dwarkadas, Sr. Counsel with Mr. Parimal
Shroff, Mr. Subodh Joshi, Ms. Radhika Kalpatrai i/b.
M/s. Parimal Shroff & Co. for the Respondent No. 7.
CORAM: S.B. MHASE & A.A. KUMBHAKONI, JJ.
Date of Reserving the Judgment: 4th July,2008.
Date of Pronouncing the Judgment:21st August,2008.
ORAL JUDGMENT : (Per: A. A. Kumbhakoni, J.)
In view the peculiar facts and circumstances of
this case the learned counsels appearing on behalf of
all the parties requested us that instead of hearing
them for admission of this petition, particularly on
the issue of interim relief, we may hear all of them
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for final disposal of this petition at the admission
stage itself, as in their submission they would be
advancing similar arguments for both the purposes. Even
otherwise this petition raises such issues which
require detail scrutiny at our hands. Hence we grant
Rule and make it returnable forthwith. All the learned
counsels appearing on behalf of the Respondents waive
service of the rule on the respective respondents. We
have heard all of them for couple of hours each for
almost seven consecutive working days and reserved the
judgement, which is being delivered today.
1. The petitioner is a Recognised Representative
Union of workers of “Brihan Mumbai Electric Supply and
Transport Undertaking” (hereinafter referred to as
the “BEST” for the sake of brevity), which is an
Undertaking of the Municipal Corporation of Greater
Mumbai (hereinafter referred to as the “said
Corporation” for the sake of brevity). The 2nd
Respondent herein is the said Corporation and 4th
Respondent herein is the BEST. 5th Respondent herein is
the General Manager of BEST who has been made party by
his name. The 1st respondent is the State Government.
2. The dispute between the parties in the present
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petition is in respect of a piece of land. Normally,
we would have referred to it as “a plot”. However, we
are not doing so as there is controversy amongst the
parties as to whether in law, this piece of land in
issue can be referred to as “a plot” or not. This
piece of land which is the subject matter of the
present writ petition admeasures 27,913.93 sq. meters
and is a part of Survey no. 6 (part)i.e. City Survey
no. 1(Part) of Village Goregaon, Oshiwara, Mumbai,
(hereinafter referred to as “the suit property” for
the sake of brevity). For the purpose of identification
of the suit property, at least in the beginning, we
must state that the suit property has been marked as
“Plot No.2A” by the BEST in its records,though it is
the specific contention of the Respondents that the
larger portion of CTS No. 1(part) which admeasures
1,54,082.40 sq. meters ( hereinafter referred to as
‘the said large track of land’ for the sake of brevity)
has not been sub divided into various plots in the eyes
of law. We will refer to this controversy at some
length at an appropriate stage hereunder. Be that as it
may.
3. In the beginning we give hereunder the
admitted, but only relevant, Chronology of Dates and
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Events to understand the facts of the case with some
precision. This Chronology will be also handy at the
later stage of this Judgment when we will be
considering the contention of one of the contesting
Respondents i.e. Respondent No. 7, the Developer, that
this Petition is liable to be dismissed on the ground
of delay and latches, apart from other grounds taken up
in defense.
13th April 1973
ig :By way of Land Acquisition
Award bearing No. LAQ 6748 an area of 95,721 sq. meters
out of Survey No. 6 was acquired for Staff Housing of
BEST workers and was handed over to the BEST.
29th August,1974 : By way of Land Acquisition
Award bearing No. LAQ 280 an area of 5836.14 sq. meters
out of Survey No. 6 was acquired for Staff Housing of
BEST workers and was handed over to the BEST.
23rd October,1989 : A Lay Out Plan for sub-
dividing the said large track of land was prepared.
In this Lay out Plan, the suit property has been marked
as Plot No.2A.
11th May, 1993 : The Revised sanctioned
Development Plan prepared under Maharashtra Regional
and Town Planning Act, 1960 (hereinafter referred to as
“the MRTP Act”) came into force in which the said
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large track of land including the suit property was
reserved for “BEST Bus Depot, Scrap Yard and Housing”.
———- : Various portions of the said
large track of land used by the BEST for following
purposes :-
(a)1,69,30.91 sq.mts. Constructing 10 buildings
for Staff Housing
(b) 5,025.01 sq.mts. Scrap Yard.
(c) 7,557.05 sq.mts. Goregaon Bus Depot.
(d) 6,540.75 sq.mts. Oshiwara Depot.
17th October,1995 : The BEST submitted a
proposal with the State Government seeking permission
to use that portion of the said large track of land
which by this time was still laying vacant for
commercial purpose, in addition to the purposes for
which it was reserved under the aforesaid revised
Development Plan.
19th November,1997 : The State Government
issued an order under Section 154 of the MRTP Act
directing the said Corporation to take steps to carry
out requisite amendments in the Regulation no 9 of the
Development Control Regulations, 1991 (hereinafter
referred to as the “said DCR”) by taking steps under
Section 37(1) of the MRTP Act.
However, the said Corporation failed to
publish the Notice accordingly within a period of 60
days from the aforesaid Directives.
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24th August,2004 : In view of the failure of the
said Corporation to take steps under Section 37 of MRTP
Act 1960 accordingly, the State Government itself
issued a Notice in exercise of its powers under sub
Section 1(A) of Section 37 of the MRTP Act.
6th/8th Sept.2004 : The said Notice was published
in the local newspapers.
9th Sept,2004 : Said Notice was published in a
Government Gazette.
13th May,2005 :ig The Deputy Collector of Town
Planning submitted a report in this regard to the State
Government.
24/27th July 2006 : The Government published
requisite Notification under Section 37 of the MRTP Act
effecting amendment in Regulation No. 9 of said DCR.
Sept. 2006 : BEST issued Tenders inviting bids
for the development to be carried out at the suit
property. In all 66 tenderers purchased tender forms.
The reserved rate of payment of non refundable deposit
was notified as Rs.23,941/- per sq. meters.
8th September, 2006 :Pre-bid meeting was held.
18th September, 2006 : Bids of 9 tenderers were
opened. One tenderer was disqualified due to
submission of invalid Solvency Certificate. The 7th
Respondent offered highest bid and quoted rate of
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Rs.57,000/-(as against the reserved bid of Rs.23,941/-)
per sq. meter for payment of non refundable deposit.
Thus, the 7th Respondent was adjudged as the highest
bidder.
18th May, 2007: The 7th Respondent paid
Rs.2,23,95,87,000/-(Rs. Two Hundred Twenty Three Croers
Ninty Five Lacs and Eighty Even Thousand Only)
@ Rs.57,000/- per sq. meter for 39,291 sq. meters to
the 4th respondent. The 4th Respondent executed Agreement
for Development with the 7th Respondent.
14th June, 2007 : The 7th Respondent received an
IOD for the development of the suit property.
21st June, 2007 : The 7th Respondent received
Commencement Certificate to commence the construction.
--------- : It is the case of the 7th
Respondent that up till now the construction has
proceeded substantially and that the 7th Respondent has
put in or spent about Rs. Thirty Cr. towards the
developmental activities carried out at the suit
property, including Rs. 2.23 Cr. Towards stamp duty and
registration fees etc.
9th October 2007 : Present Writ Petition filed.
4. The Petitioners have filed this Petition in the
light of the aforesaid Chronology of Events, impugning
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or challenging :-
(i) Validity, legality and propriety
of aforesaid Notification dated 27.7.2006issued by the State Government in exercise
of its powers under Section 37(2)of the
MRTP Act whereby Regulation No. 9 of saidDCR has been amended;
(ii) The decision of the 5th Respondent
of allotting the suit property to the 7th
Respondent for commercial development;
(iii) Resolution dated 6.11.2006 of the
BEST approving the Agreement with the 7thRespondent for development of the suit
property.
(iv) Building and other plans
sanctioned by the said Corporation
permitting the 7th Respondent to put up
construction and/or make development on
the suit property.
5. The Petitioners have raised following issues
for consideration of this Court by way of the present
Writ Petition:-
(I) Whether the suit property is
affected by Coastal Regulation Zone
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Notification and Mangroves ?
(II) Whether the Notification dated
27th July,2006 amending Regulation No. 9
of the said DCR is liable to be struck
down on the ground of non-compliance
with the procedure prescribed by
Section 37 of MRTP Act, 1960?
(III) Whether the suit property is a
separate plot prepared on account of an
alleged approved
ig sub division of
original Survey No. 6(Part)i.e. CTS No.
1 (Part)?
(IV) Whether the Resolution dated
6.11.2006 passed by BEST is sustainablein law and in view of the facts of the
case?
(V) Whether the Agreement dated
18.5.2007 entered into between 5th and7th Respondent and all consequential
Agreements/Contracts/Writings/Permissio
ns/Sanctions are sustainable in law andin view of the facts of the case?
6. Instead of reproducing at this stage the
entire submissions of the petitioner followed by entire
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replies thereto given by the Respondents, we propose to
set out submissions of Petitioner and the Respondents
herein along with our conclusions in that regard,
point-wise or issue-wise for the better appreciation of
the rival contentions.
7. POINT NO. 1 : Delay and Latches
The Respondents, particularly, the 7th
Respondent has contested the Petition on the ground
that the present Writ Petition suffers from delay and
latches. It is contended on behalf of the 7th Respondent
that by the time the present petition was filed in this
Court, the 7th Respondent had already been out of pocket
by at least Rs.223,95,87,000/- towards only the
non-refundable deposit made in terms of their
successful bid and consequent aforesaid Agreement of
Development dated 18th May, 2007. In addition thereto,
it is contended by the 7th Respondent that the 7th
Respondent has spent amounts towards stamp duty and
registration fee for getting the aforesaid agreement
duly stamped and registered. It is further contended
that the 7th respondent has also incurred additional
expenses to the tune of about Rs.30,00,00,000/- (Rs. 30
Croers)in pursuance of the Development Agreement for
the purpose of actually conducting developmental
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activities at the suit property after it was granted
IOD on 14.6.2007 and Commencement Certificate on
21.6.2007.
8. It was contended by the learned Senior Counsel
appearing on behalf of the 7th Respondent, in the
aforesaid background that the Notification, issued
under section 37 of the MRTP Act is dated 20.7.2006 and
that the present petition has been filed as late as on
9.10.2007. He drew our attention to the Chronology of
the Events set out at the threshold of this Judgment
and submitted that in the meantime the 7th Respondent
has acted bonafide in taking various steps and in
spending the huge amounts. He relied on the following
two judgments of the Hon’ble Supreme Court to submit
that we should not exercise our discretionary writ
jurisdiction in entertaining this writ petition, in
view of the unexplained delay and latches on the part
of the petitioners.
(1)The Moon Mills Ltd.,vs. M. R. Meher,
President Industrial Court, Bombay &
Ors. Reported in [AIR 1967 Supreme Court
1450] (paragraph 6)
(2)Maharashtra State Road Transport
Corporation vs. Balwant Regular Motor
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Service, Amravati & Ors. Reported in
[AIR 1969 Supreme Court 329](para 6)
9. On the other hand, the learned counsel
appearing on behalf of the petitioner contended that in
the petition itself, the petitioner has set out various
steps which the petitioner took after the petitioner
became aware of the modifications/amendments sought to
be made in the said DCRs by the State Government and
the steps that were taken ig by the BEST towards disposal
of the suit property. The petition has been filed by
the petitioner as expeditiously as possible after
exhausting various remedies available in law and only
after realising that the petitioners were not getting
justice at the hands of other Authorities and by taking
recourse to other remedies available to them in law.
10. The Supreme Court in the case of Trilokchand
Motichand Vs. H.B.Munshi reported in AIR 1970 SC 898
( Paragraph 10 & 11) has held that in India each case
will have to be considered on its own facts and that
such issue of delay and latches is one of discretion of
the court to follow from case to case. Similar
observation also can be found in the case of
R.S.Deodhar Vs. State of Maharshtra reported in AIR
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1974 SC 259 (paragraph 9).
After having considered the rival submissions
in this regard in the proper perspective, we are of the
view that the present petition cannot be thrown out
merely on the ground of delay and latches. This writ
petition raises important issues of law which need to
be dealt with extensively by us. Even otherwise the
Chronology of the Events set out at the threshold of
this Judgment will certainly demonstrate that the
petitioners have filed
ig this petition on 9.10.2007;
whereas the 7th respondent paid the amount of
consideration set out herein above and got the
agreement in issue executed only on 18.5.2007. The IOD
has been issued on 14.6.2007 and the Commencement
Certificate has been issued on 21.6.2007.
11. These dates in particular show that the
petition has been filed within five months from the
execution of the Agreement in issue and within about
three and half months of issuance of IOD and /or
Commencement Certificate. In this regard, we cannot
over look the fact that the petitioner is a recognised
representative of workers of the BEST and is trying to
enforce its alleged rights and/or claims against
organisations like BEST, the said Corporation, the
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State Government and obviously financially sound 7th
respondent who has capacity to invest hundreds of
crores of rupees in a development project.
12. Considering the overall strength and weakness
of the contesting parties and the Chronology of Events
set out at threshold of this Judgment, we are of the
view that the petition does not suffers from such gross
delay and latches that it need not even be entertained
by us on these grounds alone.ig
13. It was also contended on behalf of the
respondents that the conduct of the petitioner is blame
worthy in as much as the impugned modification and/or
amendments in the said DCRs related to three sites of
the BEST and that the petitioner was prosecuting its
claim and making grievance only in respect of the suit
property. In other words, it is contended that the
petitioner was not raising even an eyebrow in regard to
three sites of the BEST situate at Mahim, Kurla and
Dahisar which were also affected by the
amendment/modification of the said DCRs in issue and
that the petitioner was selectively making a grievance
about the suit property alone.
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14. The learned counsel appearing on behalf of the
7th respondent relied on the Judgment of the Supreme
Court delivered in the case of State of Maharashtra vs.
Digambar [(1995)4 Supreme Court Cases 683)] (paragraph
19) to buttress his submission that in view of this
blame worthy conduct of the petitioner, we should not
exercise our extra-ordinary discretionary
constitutional writ jurisdiction under Article 226 of
the Constitution in the present case. The aforesaid
Paragraph 19 reads thus :
19. Power of the High Court to be
exercised under Article 226 of the
Constitution, if is discretionary, its
exercise must be judicious and reasonable,
admits of no controversy. It is for that
reason, a person’s entitlement for relieffrom a High Court under Article 226 of the
Constitution, be it against the State or
anybody else, even if is founded on theallegation of infringement of his legal
right, has to necessarily depend upon
unblameworthy conduct of the person
seeking relief, and the court refuses to
grant the discretionary relief to suchperson in exercise of such power, when he
approaches it with unclean hands or
blameworthy conduct.
15. The learned counsel appearing on behalf of the
petitioner on the other hand contended that in as much
as the modification/amendment effected in the said DCRs
is concerned, the same has impact on the aforesaid
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three sites as against the suit property in a factually
and actually different manner. In as much as the suit
property is concerned, it forms part of the said large
track of land and that excepting housing, the other
purposes for which the said large track of land is
reserved for the development have been already
accomplished on account of the developments that have
already been carried out by the BEST at various
portions of said large track of land other than the
suit property. It is
ig contended on behalf of the
petitioners that no part of the properties of the BEST
situated at Mahim and Dahiser are reserved for housing
of workers of the BEST and that at the property of BEST
situate at Kurla quarters for workers of BEST were
already provided which at present are being
redeveloped. On the basis of these factual contentions
it is submitted on behalf of the petitioners that the
petitioner was justified in filling this petition only
in respect of the suit property and in not raising any
objection in respect of the other three properties of
the BEST situate at Mahm, Kurla and Dahisar.
16. In view of the aforesaid nature of controversy
it is to be noted that the Respondents have not placed
on record the factual details in regard to the sites of
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the BEST situate at Mahim,Kurla and Dahisar enabling us
to assess the impact of the modification/amendment
effected in the said DCRs which are impugned by the
present writ petition, on those properties. In absence
of any factual details in that regard, we are unable to
appreciate the contentions raised on behalf of the
respondents in this regard, especially on account of
the aforesaid factual dispute raised in that by the
Petitioner. Even otherwise only because the petitioners
have not raised any objection in regard to other sites,
and have raised objections in regard to only the suit
property, it cannot be said that the conduct of the
petitioners is blame worthy to such an extend that we
should refuse to exercise our extra-ordinary
constitutional writ jurisdiction in this regard and
even refuse to examine the case even in regard to the
suit property. In as much as the suit property is
concerned, in the context of the said large track of
land and in the background of various factual aspects
of the matter brought on record as to its actual user,
we are of the view that it is necessary for us to
examine the legal issues raised by the petitioner.
17. In our view, mere fact that the petitioners
have not questioned the correctness of the impugned
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notification and/or amendments/modifications effected
in the said DCRs in regard to other aforesaid three
sites of the BEST, cannot detain us in examining the
correctness thereof in regard to the suit property. If
ultimately we find that the impugned notification
and/or amendments/modifications effected in the said
DCRs are illegal,unsustainable in law and in view of
the facts of the case, it may not be just and proper to
let the same go without any scrutiny by us on the
ground that the petitioners have let it go in regard to
other three sites of the BEST.
18. In view of the aforesaid factual background of
the present case, we are of the view that none of the
aforesaid three judgments of the Supreme Court apply to
the facts of this case. In our view, the facts of the
present case are eloquent enough to reject the
contention of the respondents that the present petition
is required to be thrown out and need not be considered
on the ground of delay and/or latches as also on the
ground of alleged blameworthy conduct of the
petitioner. We will therefore proceed to consider the
rival contentions raised by the parties on merits.
19. POINT NO.2: Whether the suit property is
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affected by Coastal Zone CRZ Notification:
It is the contention of the petitioner that
part of the suit property is affected by Coastal Zone
Regulation Notification and that part of the suit
property is also covered by mangroves. It is,
therefore, contended by the Petitioner that the
development on the suit property is not permissible in
law and on this count also the development in issue is
unsustainable in law and in view of the facts and
circumstances of the case.
20. An affidavit-in-reply has been filed by the
7th respondent dated 7.12.2007 making out a case that
the 7th respondent has made necessary applications to
MOEF under Environmental Impart Assessment Notification
seeking necessary clearance and that the application is
pending with MOEF.
However, in the affidavit-in-reply filed on
behalf of the corporation dated 31.1.2008, it has been
clarified that the suit property is only partly
affected by CRZ-II and it is not that the entire suit
property comes under CRZ-II. This affidavit further
explains that the 7th respondent has submitted plans for
putting up construction on such area of the suit
property which is not affected by CRZ-II. In other
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words the contention is that the construction of
buildings proposed by the 7th respondent is not on such
area of the suit property which is covered by CRZ-II,
but is on such area of the suit property which is not
affected by CRZ-II. It is, therefore, contended on
behalf of the respondents that there is no violation of
CRZ Notification.
21. The learned counsel appearing on behalf of the
petitioner in his usual fairness has conceded that the
aforesaid explanation and/or clarification given by the
said Corporation is not disputed by the petitioner.
Thus, the noncontroversial factual position which now
has emerged, is clear as under:-
(i) That the entire suit property (known as
plot no.2-A)is not affected by CRZ-II.
(ii) The 7th respondent has proposed to put
up construction on such portion of thesuit property which is not at all
covered/affected by CRZ-II.
22. In view of the aforesaid facts the objection of
the petitioner to the effect that the impugned
transaction is illegal on account of the violation of
CRZ Notification does not survive.
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23. The respondents have further by the same
affidavit dated 31.1.2008 filed on 4.2.2008
specifically and categorically stated that the suit
property known as plot no.2-A is not at all affected by
mangroves. This categorical contention of the
respondents is not disputed by the learned counsel
appearing on behalf of the petitioner. We, therefore,
need not deal with this factual non-controverted aspect
any further.
24. We therefore conclude that the developmental
activities permitted by the said Agreement and proposed
to be carried out in pursuance thereof by the 7th
respondent, on the suit property known as plot no.2-A,
is neither contrary to CRZ Notification nor is it
covered/affected by mangroves.
25. Point No. 3: Validity of Notification dated
27.7.2007 issued under Section 37 of MRTP
Act, 1960:-
A large track of land was acquired
under the Land Acquisition Act as and by way of
compulsory acquisition from private owners/holders
prior to 1975. The acquisition was for the purpose of
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staff housing of BEST workers. The suit property forms
part thereof. As stated herein above, in the
Development Plan brought into force in accordance with
the MRTP Act 1960, the same property came to be
reserved for BEST Bus Depot, Scrap Yard and Housing.
However it is pertinent to note that in the Development
Plan itself separate portions of the said large track
of land were not shown separately for each of these
purposes for which the use of said large track of land
was so designated. In other words the designation so
made was a consolidated one for the entire large track
of land taken together and not purpose-wise and/or
area-wise separate designation.
26. It has come on record that in the said large
track of land activities have already been carried out
by the BEST to comply with the purposes for which the
aforesaid reservations were provided in the entire
reserved site i.e. said large track of land. There is
no dispute between the parties that on the said large
track of land not only Scrap Yard, Bus Depot have been
constructed but also on a portion thereof a Housing
Society of BEST workers has been put up which is known
as “Ankur Co-operative Housing Society”. Admittedly,
out of the said large track of land, the suit property
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is the only portion which at the relevant time, when
the aforesaid action under Section 154 of the MRTP Act
was taken, was open and available for the development.
27. It is the contention of the BEST that it was
at the relevant time suffering huge financial losses to
the tune of about Rs.450 Crores per annum and that it
had no means of getting over these losses. In the
absence of any financial resources worth the name, it
is contended by the BEST that the only option available
for it was to permit commercial activity at the suit
property along with other properties of the BEST
situate at Mahim, Kurla and Dahisar and thereby
generate funds to wipe out the losses. It is therefore
contended by the BEST that way back in 1995, as
reflected by the aforesaid Chronology of Events, a
proposal was moved by the BEST with the State
Government seeking permission to commercially exploit
the suit property. On account of specific reservation
provided in the Development Plan over the suit
property, which did not include and/or which did not
enable such commercial exploitation of the suit
property, it became necessary to carry out appropriate
amendments and/or modifications in the Development
Plan.
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28. There were two modes available to bring about
such a change. One of them was to modify the
reservation/designation itself to include a commercial
use of the suit property and the other one was to amend
the said DCRs permitting such a commercial use of the
said large track of land, in addition to the use of the
property for the purpose for which it was designated in
the Development Plan.
It appears that the State Government chose
the other option, viz. effecting amendment/modification
in the said DCRs. Consequently, the State Government
issued a direction under Section 154 of the MRTP Act,
1960 to the said Corporation for taking appropriate
steps for effecting requisite amendment/modification in
Regulation No. 9 of the said DCR. The facts will
indicate that inspite of such a direction of the State
Government, the said Corporation did not take any steps
in that direction, within 60 days. Consequently, the
State Government started the process of modification at
its own level as contemplated by sub section (1A) of
Section 37 of the MRTP Act.
29. As reflected by the aforesaid Chronology of
Events, the State Government issued Public Notices, one
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27
in the English newspaper and the other one in Marathi
(i.e. local language) newspaper and called for
objections. It has been brought on record by way of the
Affidavit filed by Dy. Director of Town Planning
Greater Mumbai, dated 7.1.2008 that only one objection
from Prakash Chhabria and 41 others was received in
response to the aforesaid Public Notices.
30. The Notification in issue itself mentions
that, not only after
ig the Deputy Director of Town
Planning, Greater Mumbai submitted its report to the
Government but also after considering the
suggestions/objection received and after consulting the
Director of Town Planning, Maharashtra State, the State
Government has issued the impugned Notification in
exercise of powers conferred on it by sub section (2)
of Section 37 of the MRTP Act, 1960. This Notification
dated 27.7.2006 is impugned by the present Writ
Petition.
31. The only ground on which the legality and/or
validity of the impugned Notification is questioned by
the present Writ Petition is that mandatory prescribed
procedure has not been followed by the State Government
while issuing the impugned Notification.
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32. The First contention of the petitioner is
that under Section 37 it is mandatory to consult the
Director of Town Planning before issuing such a
Notification and that the Director of Town Planning was
not consulted.
33. On the other hand it is the contention of
the respondents that as a matter of fact the Director
of Town Planning has been consulted before issuance of
impugned Notification and that it is accordingly stated
in the impugned Notification itself.
34. The impugned Notification specifically states
thus :
“And whereas, considering the suggestions /
objections and after consulting Director of
Town Planning, Maharashtra State, Governmentis of the opinion that the said modification
shall be sanctioned with some changes;”
(emphasis supplied)
35. We had called for the original file of the
State Government which dealt with the aforesaid
Notification. Perusal of the file shows the Director of::: Downloaded on – 09/06/2013 13:42:40 :::
29Town Planning was in fact consulted and that at page
number 309 of this file the remarks/submissions of the
said Director addressed to the Principle SecretaryUrban Development Department can be found. Thus on
verification of the record it does appear that in fact
the said Director was consulted by the StateGovernment. Therefore we do not find any substance in
the said objection of the petitioner.
36. The second contention of the petitioner is
that it was necessary for the State to serve Notice on
all persons affected by the proposed modification and
that the proposed modification was affecting the
petitioner (in as much as it was affecting the BEST
workers). According to the Petitioners such a Notice
having been admittedly not served on the petitioner,
the impugned Notification has been issued in non
compliance with the aforesaid mandatory provisions of
issuance of Notice to affected persons.
37. The reply of the respondents is that firstly
public notices were admittedly issued and that
therefore it was not necessary to issue separate notice
to either the petitioner or any of the BEST workers.
Secondly according to the Respondents in law such a
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30
notice is required to be served only on the “persons
affected” by the proposed modification. It is further
submitted that neither the petitioner nor the BEST
workers to whom the petitioner represents are “persons
affected” by the proposed modification. It is therefore
submitted that though admittedly no notice has been
specifically served on the petitioner prior to the
issuance of the impugned Notification, it will not
render the impugned Notification invalid for non
compliance with mandatory procedure.
38. In as much as the second contention of the
petitioner as to non service of Notice on the
petitioner is concerned, sub section (1AA) (a) of
Section 37 of the MRTP Act, 1960, reads thus:
“(1AA) (a) Notwithstanding anything
contained in sub-sections (1), (1A) and (2),
where the State Government is satisfied that
in the public interest it is necessary to
carry out urgently a modification of any part
of, or any proposal made in, a finalDevelopment Plan of such a nature that it will
not change the character of such Development
Plan, the State Government may, on its own,
publish a notice in the Official Gazette, and
in such other manner as may be determined by
it, inviting objections and suggestions fromany person with respect to the proposed
modification not later than one month from
the date of such notice and shall also serve
notice on all persons affected by the proposed
modification and the Planning Authority.”
(emphasis supplied)
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31
39. A bare perusal of the aforesaid provision
clearly demonstrates that the State Government is
required to issue a Public Notice in the OfficialGazette and in such other manner as may be determined
by it for inviting objections and suggestions in
respect to the proposed modification. In addition tosuch a Public Notice, the law requires the State
Government to “also serve” Notice on all personsaffected by the proposed modification. The term “also
serve” clearly shows that in addition to Public Notice,independent Notice is also required to be served on all
persons affected by the proposed modification.
We therefore hereby reject the contention of
the respondents to the effect that the Public Notice
was admittedly issued, one in local language and one in
English language in widely circulated newspaper and
that therefore it was not necessary to serve a separate
Notice on the petitioner. If at all the petitioner can
satisfy that the petitioner was “person affected by the
proposed modification” then obviously it was mandatory
for the State Government to serve an independent Notice
on the petitioner even though two Public Notices were
issued in the local newspapers by the State Government.
We therefore hold that mere issuance of Public Notice
under Section 37 of the MRTP Act is not enough
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32
compliance with the provisions of the said Act but in
addition thereto it is necessary for the State
Government to “also serve” notice on ‘all persons
affected’ by the proposed modification.
40. We will however hasten to add that such
additional service of Notice is required to be effected
only on “all persons affected” by the proposed
modification and therefore now it will have to be
determined as to whether the petitioner can be said to
be “person affected” by the proposed modification.
41. In regard to this aspect of the matter a
serious controversy is raised and arguments at length
were advanced before us by the contesting parties. The
gist of the same is as under:-
It is the contention of the petitioner that it
is a Recognised/Approved Representative Union of the
Workers of the BEST and that one of the uses for which
the suit property has been designated in the
Development Plan is housing for BEST workers. Therefore
according to the petitioner if any modification in the
said Regulations were sought to be made whereby the use
of the property in dispute was being permitted for a
purpose other than ‘housing of BEST workers’,
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33
obviously, the BEST workers would be deprived of the
property reserved for the purposes of their housing and
consequently the BEST workers were adversely affected
by such a Notification. As the petitioner was/is the
Representative Approved/Recognised Union of the BEST
workers, the State Government ought to have issued
Notice at least to the petitioner union, if not to
each and every BEST worker, in regard to the proposed
modification.
42.
Admittedly, such Notice not having been served
either on the petitioner Union or on any one of the
BEST workers, in the submission of the petitioner the
impugned Notification was issued in breach of mandatory
provisions of Section 37 of the MRTP Act, 1960.
43. On the other hand, it is the contention of the
respondents that neither the petitioner nor the BEST
workers as such can be said to be “persons affected” by
the proposed modification. It is submitted by the
Respondents that the reservation i.e. designation of
the entire property including the suit property in the
Development Plan was for various purposes, one of which
was housing. It is not that the suit property was
itself separately and specifically reserved for housing
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34
of BEST workers. It was further submitted that
admittedly out of the site so designated, large portion
has already been used for providing housing to the BEST
workers by way of leasing out portion thereof to Ankur
Co-operative Housing Society formed by the BEST
workers. It was submitted by the Respondents that how
much portion of the entire designated site is to be
used for a particular purpose for which it is reserved,
when many such purposes are collectively provided by
such consolidated reservation was and has to be left to
the discretion of the BEST i.e. the management and that
its workers cannot have any say in that regard. It was
also further contended by the Respondents that if at
all any person was affected by such a modification, at
the highest it would be BEST itself and not the workers
of the BEST. It was further contended that providing
housing to the workers was a privilege of the BEST and
the workers had no right as such, to claim housing
accommodation.
44. In this regard reliance was placed by the
Respondents on the Division Bench Judgment of this
Court delivered in the case of PARISAR, an Organisation
and others vs. The State of Maharashtra and others
reported in 1990(1) Bom.C.R. 79 wherein it is observed
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35
as under:
“In our view, both the submissions
made by Shri Shivade deserve to be
rejected. So far as the general public isconcerned publication of notification in the
Official Gazette inviting objections and
suggestions is enough. Individual notices are
required to be served on the persons actually
and factually affected by the proposed
modification. The expression used in thisbehalf in the section is “and shall also serve
notice on all persons affected by the proposed
modification.”As regards the publication of
notification in the two newspapers and the
submission of the proposal by the planningauthority to the State Government within a
week thereof, it is not possible to accept
Shri Shivade’s argument in the absence ofevidence.”
(emphasis supplied)
45. It was therefore contended on behalf of the
Respondents by relying on the aforesaid portion of theobservation on which we have supplied our emphasis that
such individual notices are required to be served only
on the person who are “actually and factually affected”
by the proposed modification and that since neither the
petitioner nor the BEST workers were ‘actually and
factually affected’ by the proposed modification, no
Notice was required to be served on either of them and
consequently for non service of such notice as claimed
by the petitioner issuance of the impugned Notification
cannot be faulted.
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36
46. It is submitted by the Respondents that the
term “person affected” must be given the same meaning
as “person aggrieved” or “aggrieved party” as defined
in the Black’s Law Dictionary 8th Edition Page no. 1154
which reads thus :-
“aggrieved”,adj.(of a person or entity)
having legal rights that are adversely
affected; having been damaged by an
infringement of legal rights.
“aggrieved party” A party entitled to
a remedy; esp., a party whose personal,
pecuniary,or property rights have beenadversely affected by another person’s
actions or by a court’s decree or
judgment-Also termed party aggreived;
person aggreived [Cases: Action -13;
Appeal and Error – 15; Federal Civil
Procedure – 103.2. C.J.S. Actions – 57-
63; Appeal and Error – 168]
47. We find considerable force in the contentions
raised on behalf of the respondents in this regard. A
perusal of the MMC Act, 1888, will demonstrate that
neither any legal right is created in favour of the
workers of the BEST nor any corresponding legal
obligation is cast on the BEST to provide housing to
the workers of the BEST. Upon a specific query in that
regard, the learned counsel appearing on behalf of the
petitioner was also unable to point out any provision
of law creating any such right in favour of workers of
BEST or any corresponding obligation cast on the BEST
to provide housing to the workers of the BEST.
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37
48. A feeble attempt however was made by the
learned counsel appearing on behalf of the petitioner
to spell out such a right and/or obligation by
contending that the BEST has agreed to provide housing
to its workers in terms of an agreement and/or a
settlement between the BEST and its workers. Neither
any such agreement nor any such settlement has been
produced on record. We were not able to find out any
specific contention ig to this effect either in the
petition or in any of the bulky rejoinders filed on
behalf of the petitioner. Consequently, in absence of
any material on record, we are unable to accept the
contention of the petitioner that either such a right
or such an obligation exist in law, on the basis of
which it can be said that workers of the BEST have a
legal right enforceable against the BEST for providing
housing accommodation to them.
49. All workers/employees do not acquire a right,
merely on account of their employment, to claim housing
accommodation from their employer. Such a right has to
be acquired by the employees/workers in law. In other
words, unless by operation of some law, the
employees/workers acquire a right of claiming housing
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38
accommodation from their employer, the
employees/workers do not get a right against their
employer to claim housing accommodation for themselves
only on account of their employment. In law, therefore,
in absence of any condition of service or contract of
service or rule/regulation, it is always a privilege of
an employer to provide housing to its
employees/workers.
50. Having come to a conclusion that there is no
legally enforceable right in favour of the BEST workers
to claim housing accommodation from the BEST, as
discussed herein above, it cannot be said that the
workers of the BEST are deprived of any property meant
for providing housing to the BEST workers by the
impugned Notification/modification. It cannot be said
that BEST workers are “affected” by such an action. In
other words neither the BEST workers nor the petitioner
who represents them are “persons affected” by an
action, which results into user of a property meant for
housing of BEST workers, for a purpose other than
housing of BEST workers. Of course this will also
include any step taken in that direction such as the
change of user.
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39
51. In our view, inasmuch as the applicability of
the said provision of section 37 of the MRTP Act is
concerned, the term “person interested” will not
include each and every person who may be “interested”
in such a land as we say in the common parlance. In
the context of Section 37 of the MRTP Act 1960, when we
refer to the term “person interested”, it always means
a person having some right which is recognisable in
law, over or in respect of such a property in respect
of which such an action under section 37 is taken.
ig A
person who in common parlance is only “interested” in a
land having no such right which is recognisable in law,
therefore, cannot be termed as a “person affected” by
an action under section 37 of the MRTP Act, 1966.
52. In as much as the said DCRs are concerned, the
same are framed under Section 22(m) of the MRTP Act. It
is now settled position of law that making of DCRs or
effecting amendments thereto is a legislative function
and that Section 37 of the MRTP Act is to be used as
repository of the legislative powers for effecting
amendment to the said DCRs. This legislative power of
amending DCRs is delegated to the State Government. In
this regard, reliance can be placed on the following
two Judgments of the Supreme Court :
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40
1.Pune Municipal Corporation & Anr.
vs.Promoters and Builders Association
& Anr. Reported in [(2004) 10 SCC 796]
(paragraph 5).
2.Promoters and Builders Association of
Pune vs. Pune Municipal Corporation &
Ors. [(2007) 6 SCC 143].
53. Consequently, we hold that by the modification
and/or amendment affected by the Notification dated
27.7.2006 in issue neither the BEST workers nor the
petitioner who represents them has been affected and
therefore both of them do not fall within the category
of “persons affected” as contemplated by the aforesaid
provisions of Section 37 of the MRTP Act, 1960.
54. In the result, we hold that though the
respondents were legally bound to serve notice on ‘all
persons affected’ by the proposed modification, in
addition to the Public Notice issued by them, the
respondents were not legally bound to serve such
separate notice of the proposed modification either on
the workers of the BEST or on the petitioner who
represents them, while effecting modification or
amendment vide Notification dated 27.7.2006 in issue.
Obviously therefore for non service of such a notice
it cannot be said that any procedural defect has crept
in, while issuing Notification dated 27.7.2006 in
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41
issue.
55. We are also supported in this regard by the
Judgment delivered by Division Bench of this Court in
the case of PARISAR, an Organisation & Ors. (supra)
whereby it has been specifically observed that under
Section 37 individual notices are required to be
served on the persons “actually and factually
affected” by the proposed modification. As we have come
to a conclusion that neither the BEST worker
ig nor the
petitioner who represents them, can be said to be
“persons actually and factually affected” in the eyes
of law, by the proposed modification effected by the
Notification dated 27.7.2006, the same cannot be said
to be defective on that count.
56. It may not be out of place, in addition to the
aforesaid legal aspect of the matter, to note herein
that in the said large track of land (of which the suit
property forms part), admittedly following portions
have already been utilised for providing housing to the
BEST workers:
10425.00 sq. meters on Ankur Co-operative
Housing Society (of BEST workers)
33344.20 sq. meters BEST Undertaking Staff
Housing.
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42
3717.77 sq. meters BEST Undertaking Staff
Housing.
57. As mentioned herein above, said the large track
of land has been collectively and in a consolidated
manner designated in the Development Plan for BEST Bus
Depot, Scrap Yard and Housing. The Development Plan
does not specify as to how much area out of the said
large track of land is to be used for housing and how
much is to be used for other purposes set out in the
designation.
Considering this aspect of the matter, it will
be for the BEST to decide as to what extent an area out
of the said large track of land is to be used for the
aforesaid three purposes for which the entire said
large track of land has been designated in a
consolidated manner. Having admittedly used the
aforesaid portions of the land out of the very same
said large track of land for housing, it cannot be said
that in law the BEST was duty bound to use the suit
property also only and only for housing the BEST
workers. In other words neither the BEST workers nor
the petitioner in law are entitled to compel the BEST
to use the suit property only and only for the purpose
of providing housing to the BEST workers and not for
any other purpose.
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43
58. It has also been brought on record on behalf of
the BEST that the BEST has constructed 52 buildings for
BEST Staff Quarters which consist of 1,353 tenements,
in the West Zone area. It is stated in this affidavit
dated 29.2.2008 that out of these 1,353 tenements, 165
tenements were lying vacant. In as much as South Zone
is concerned, this affidavit states that there are 28
buildings for BEST Staff Quarters consisting of 1,373
tenements, out of which ig 1 tenement was still vacant.
In regard to the North East Zone, this affidavit states
that there are 42 buildings comprising of 1,424
tenements, out of which 33 tenements were vacant. This
affidavit further states that there are 7 MHADA Staff
Quarters for BEST Staff consisting of 608 tenements,
out of which 8 tenements were still vacant. The affiant
of the aforesaid affidavit therefore has categorically
emphasised that on the date of filing of the Affidavit
total 207 tenements were laying vacant and were
available for BEST Staff/Employees and has given the
detailed Zone wise break up of these vacant tenements
in this affidavit.
59. In the Rejoinder dated 25.3.2008 filed on
behalf of the petitioner in response to the aforesaid
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44
affidavit, it is stated in paragraph 7 that 164
tenements were lying vacant in Santacruz area because
they were not habitable and were not repaired for a
long time. It is contended that the tenements at Kurla
were actually got vacated by BEST itself for
redevelopment. This rejoinder insists that there was
still long waiting list of 208 employees who are
awaiting for the allotment of service quarters. Be that
as it may.
60.
If there are service quarters available which
can not be occupied for want of requisite
repairs/maintenance the remedy for the petitioner is to
get the same repaired and/or properly maintained by the
BEST so that the same become habitable and available
for the BEST workers. The facts will remain that though
there does not appear to be any legal obligation cast
on the BEST to provide housing to its staff/workers it
has in fact made the aforesaid provision to make
housing accommodation available to its workers/staff.
In view of this and such other aspects of the
matter set out herein above, it cannot be said that by
putting the suit property to a use other than providing
housing to its workers, BEST has “factually and
actually” affected its workers. On this additional
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45
ground also, even on facts apart from the aforesaid
legal aspect of the matter, it cannot be said that
either the BEST workers or the petitioner who
represents them are “persons affected” by the
Notification dated 27.7.2006 in issue.
61. It is contended on behalf of the petitioner
that the modification and/or amendment effected by the
aforesaid exercise in issue was of substantial nature
and, therefore, attracted section 22A (b) & (f) of the
MRTP Act, 1966. It is, therefore, submitted that
modification so made being major modification and not
minor modification, the aforesaid action undertaken by
the respondents by virtue of section 37 of the MRTP
Act, 1966 is unsustainable in law.
62. First and foremost, this contention is not
raised specifically by the petitioner in the present
proceedings. There are no pleadings worth the name
made by the petitioner in this regard. That apart, for
the reasons set out hereunder, we do not find any force
in this contention.
63. By the exercise in issue performed by the
respondents under section 37 of the MRTP Act, 1966, all
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46
that is done is that regulation no.9(iv)(c) and (d) of
the said DCRs has been modified by adding explanatory
note at sr. no.(v) below Table 4 contained in
regulation 9 of the said DCRs. This note reads thus:-
“(v) sites reserved for BEST Undertaking
such as BEST Bus Depot, BEST Bus Station,
BEST Terminus, BEST Bus Station and StaffQuarters, BEST Bus Depot and Transport
Carriage may be developed by the BEST
Undertaking for the specified purpose
coupled with commercial user subject to
the following conditions:-
(a) The built up area of such
commercial user shall
ig not exceed 30%
of the total permissible floor area.
(b) Out of such permissible commercial
user 50% built-up area not
exceeding of the total permissible
commercial user may be permitting on the
ground floor. While remaining floor area
for commercial user may be permitted on
the upper floor.
(c) Extent of built-up area proposed
to be used for commercial purpose shallbe such that it does not adversely affect
the principal user.
(d) The proposal for such composite
user shall be cleared by Additional
Commissioner of Police (Transport),
Mumbai.
(e) Considering the strategic location
of reserved sites with reference to the
volume and nature of the traffic in thevicinity of the reserved site,Municipal
Commissioner shall have right to prescribe
additional condition as deemed fit and
also restrict the commercial area to the
justifiable extent.
(f) Provision for separate parking
shall have to be provided as per
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47
prevailing norms in such a way that it
does not affect movement of BEST buses as
well as the traffic of road.
(g) the above commercial user shall be
permitted on plot having area of 2000 sq.
mtr. & above.
(h) If there is any storage of
diesel/petrol or any explosive material on
the plot, then the above commercial useris permissible by maintaining segregating
distance between them as decided by the
Chief Fire Officer.”
64. Thus, by the action taken under section 37
of the MRTP Act, 1966, all that the respondents have
done is that a note is added at sr. no.(v) below Table
4 contained in regulation 9 of the said DCRs. This
explanatory note which is added deals with only and
only ‘the sites reserved for BEST Undertaking’ which
are obviously very few in the entire development plan
of the city of Mumbai. As compared to the entire area
covered by the development plan as also by various
reservations made therein, the area covered by such
reservations meant for BEST Undertaking is very very
small. It is obvious that addition of the aforesaid
explanatory note is going to affect only the sites that
are reserved for BEST undertaking only. Thus the
modification so made by adding explanatory note no.(v)
below Table 4 contained in regulation 9 of the said
DCRs can by no stretch of imagination bring in any
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48
change and/or modification and/or amendment in either
in the entire development plan as such or such change
which is contemplated by the section 22A – (b) & (f) of
the MRTP Act, 1966. Obviously, therefore, for such a
modification and/or amendment, it cannot be said that
the provisions of section 22A – (b) & (f) of the MRTP
Act are attracted, as contended by the petitioner.
These provisions read thus:-
“22A. In section 29 or 31, the expression
“of a substnatial nature” used in relation tothe modifications made by the Planning
Authority or the officer appointed by the
State Government under sub-section (4) of
section 21 (hereinafter referred to as ” thesaid Officer”) or the State Government, as the
case may be, in the Draft Development Plan
means,-
(a) ……
(b)all changes which result in the aggregate
to a reduction of any public amenity by more
than ten per cent of the area provided in the
planning unit or sector in a draft DevelopmentPlan prepared and published under section 26
or published with modification under section
29 or 31, as the case may be;
(c) ..
(d) ..
(e) ..
(f)alternation in the Floor Space Index beyond
ten per cent of the Floor Space Index
prescribed in the development Control
Regulations prepared and published under
section 26 or published with modificationunder section 29 o4 31, as the case may be.
65. The petitioner has not raised any other
contention in regard to the legality and/or validity of
the aforesaid Notification dated 27.7.2006 and
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49
therefore we have no reason to interfere with the same
and grant any relief in favour of the petitioner in
this regard.
66. POINT NO. 4 :- Whether “Plot No.2A” has been
carved out in law as a separate plot or not:-
The answer to the aforesaid question is truly
going to be the most decisive factor in this case,
which will be clear from the contentions of both the
sides that are set out hereunder.
67. The said large track of land bearing CTS No. 1
(part) i.e. Survey No. 6 (Part) admeasures 1,54,082.40
sq. meters. The dispute between the parties is
restricted to only an area admeasuring 27,913.93 sq.
meters out of the said large track of land and is being
referred to in this judgment as the “suit property”.
68. The contentions raised by the petitioner in
regard to this aspect of the matter in short are as
under:-
A Lay Out Plan was prepared by the BEST
dividing the said large track of land into various
plots. This lay out was sanctioned on 23.10.1989. In
this sanctioned lay out plan the suit property has been
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50
marked and/or numbered as “Plot No.2/A”. As the suit
property has been separately carved out in the form of
a “separate plot” it will have to be treated as a
separate plot for all legal purposes, including
calculation of FSI, applicability of DCRs and for all
other aspects of the matter. In that event the entire
development permitted by the transaction in issue
becomes illegal, in as much as such development is
permitted only and only with reference to the total
area of the said large track of land and not with
reference to the separate area of the suit property
alone. In other words, the permitted Development in
issue is impermissible under the DCRs, including
amended and/or modified DCR No.9 if the same is
considered in relation to the area of only and only the
suit property and not the total area of the said large
tack of land (of which the suit property is only a
small part).
In view of the defence of the Respondents to
the contrary, rejoinders have been filed by the
petitioners dated 25.1.2008 and 25.3.2008. In these
rejoinders apart from the original petition a case is
tried to be made out by the petitioner that by and
under the orders of the then Municipal Commissioner
dated 23.10.1989, the aforesaid large track of land has
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been sub divided into plots and a plan also has been
approved of this sub division bearing No. CE/759/LOP
dated 23.10.1989, a copy of which is produced on
record. This approved plan of sub division shows clear
demarcation of various plots prepared out of the said
large track of land, in which the suit property has
been specifically shown/marked as Plot No.2-A and is
marked as reserved for “BEST Undertaking Staff
Housing”.
Even in the Agreement in issue dated 18.5.2007
the suit property has been described specifically as a
separate plot carved out on account of the aforesaid
sub division of the original large track of land,
sanctioned by the Municipal Commissioner on 23.10.1989.
In terms of DCR No. 21 preparation of a lay out for
having sub division of plots is necessary when more
than one building is proposed to be constructed on the
large track of land. Admittedly, in the said large
track of land various buildings have come up like that
of Ankur Co-operative Housing Society, BEST Depot, etc.
In law it would not have been permissible to carry out
such activities on the portions of the aforesaid large
track of land if the was not sub divided into plots.
Therefore, in the submission of the Petitioners the
fact that such activities were permitted shows that the
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said large track of land has already been sub divided
and that the suit property is a separate plot which has
been resultantly carved out on account of such sub
division.
69. It is further pointed out by the Petitioner
that even in the revenue records in regard to said
large tract of land, an entry dated 21.6.1991 has been
effected whereby a separate property register card has
been prepared in the name of Ankur Co-operative Housing
Society Limited to which an area of 10,425.0 sq. mtrs.
Area has been leased out by the BEST. A copy of the
property register card is produced as Exh.3-A along
with the affidavit-in-rejoinder dated 25.1.2008 filed
on behalf of the petitioner. On this basis, it is
contended that the said large tract of land is not
continued as one piece and/or one plot, but has been
sub-divided.
It is further pointed out by the Petitioner
that even a proposal bearing no. CHE/1229/LOP for
amalgamation of all the sub-plots of the said large
tract of land has been submitted and that such a
proposal for amalgamation itself demonstrates that the
said large tract of land has been sub-divided and that,
only therefore, a need was felt to submit a proposal
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for amalgamation.
70. On the basis of these factual aspects of
the matter, the contention of the petitioner is that
the said large tract of land has been sub-divided into
various sub-plots and that the suit property is one of
such plots carved out of the said large tract of land
and is a separate plot bearing “plot no.2-A”, which is
the suit property.
71.
On the other hand, the respondents have
stoutly denied the contentions of the petitioner in
this regard and it is claimed that the said large tract
of land, in law, has not been sub-divided and continues
to be a contiguous single piece of land. In as much as
the allegations of the petitioner that the suit
property is a separate plot is concerned, it is
contended that only for identification purposes, the
area of the suit property is marked as “plot no.2-A”
and not as a result of legal, authentic and authorized
sub-division in terms of the MRTP Act, 1966 creating a
separate plot out of the said large tract of land.
It is the defense that though there was a
proposal by way of lay-out plan for sub-dividing the
said large tract of land, by letter dated 23.10.1989
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bearing no. CE/579/LOP, the said proposal was made only
approvable as per the DCRs., subject to the terms and
conditions indicated therein. It is further submitted
that by such order the lay-out was only made
“approvable” and that by that order the lay out was not
“approved” as such. The final approval to such a lay-
out or the sub-division was to be accorded after the
conditions of construction of internal roads, including
lighting, sewerage, drainage, etc., was completed and
spaces for recreation amenities were developed by BEST
as was provided in the proposal for sub-division. It
is, therefore, contended that since these conditions
set out in the letter dated 23.10.1989 were not and
have not been fulfilled by the BEST, the permission for
lay-out/sub-division never fructified into effecting
legal sub-division of the said large tract of land and
the same remained pending at the stage of only an
“approvable lay-out”, which has not resulted into
creation of a separate sub-plot i.e. the suit property.
72. It is further the case of the respondents
that in law, sub-division of land requires not only
sub-division in the Municipal records, but also
corresponding sub-division of records maintained by the
Collector under the Maharashtra Land Revenue Code
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resulting into preparation of separate property
register cards with new city survey numbers assigned to
each sub-division so made. In the present case,
admittedly, no such separate record has been prepared
and/or maintained by the Collector in regard to the
suit property. On this ground also the respondents
contend that the suit property is not and can not be
treated as a separate plot as claimed by the
petitioner.
73.
Section 2(21) of the MRTP Act, 1966 defines
the term “plot” thus:-
“(21) “plot” means a portion of land held in
one ownership and numbered and shown as one
plot in a town planning scheme;”
Admittedly, the suit property does not
fall within this definition even if the case of the
petitioner is accepted at its face value. Admittedly,the suit property is not numbered and shown as one plot
in the town planning scheme. In terms of the town
planning scheme the suit property is still a part ofCity Survey No. 1 equivalent to part of Survey No. 6.
Consequently, the suit property cannot be termed as “a
plot” as defined by the MRPT Act, 1966.
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74. The contention of the petitioner is factually
correct that not only in the tender notice (exh.`C’ to
the petition), but also in the agreement in issue dated
18.5.2007, the suit property is referred to
specifically as ‘plot no.2-A’ and it is also stated
therein that the same is ‘a sub-divided plot of land’
out of a large tract of land bearing C.T.S. no.1(Pt.),
survey no.6(Pt.) of village Goregaon and that it
admeasures 27,913.92 sq. mtrs.
However, only because the documents issued by
BEST and/or executed by BEST refer to the suit property
as a “sub-divided plot” it does not necessarily mean
that in law also the suit property is a “sub-divided
plot”. The suit property will be considered in law as
a separate plot resulted on account of sanctioned
and/or approved sub-division of the said large tract of
land in issue only and only if the alleged sub-division
of the said large tract of land is approved and/or
sanctioned in accordance with law. Otherwise, the suit
property will continue to be only and only a part of
the said large tract of land as one piece and will not
have an separate identity as “a plot”.
75. Though the petitioner has heavily relied on
the order dated 23.10.1989 as an order resulting into
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approval/sanction of the lay-out/sub-division of the
said large tract of land, unfortunately, even a copy
thereof was not produced on record for our
consideration by the petitioner. What the petitioner
has produced on record is only the lay-out plan which
no doubt marks the suit property as ‘plot no.2-A’.
However, mere marking on the lay-out plan of the suit
property as ‘plot no.2-A’ will not make it a separate
and independent plot,especially in terms of the
applicability of the said DCRs.
ig This is more so in
view of the specific defense of the respondents that
the said order dated 23.10.1989 on which reliance is
placed by the petitioner is only a conditional order
whereunder the sub-division of the said large tract of
land in issue became only “approvable”, that too
conditionally. The copy of this order is produced by
the 4th Respondent, the BEST, along with an affidavit
dated 1st March 2008. The opening sentence thereof reads
thus :
” Your plans submitted of the
layouts/subdivision of above plot along with
your letter dtd. 4.7.89 are approvable as they
are as per Development Control Rules, subject
to the terms and conditions already intimated
to you as per previous approval.”
The petitioner has not satisfied us as to what
were these terms and conditions and as to whether such
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conditions were/are in fact satisfied or not so that it
could be said that the layout in issue has been finally
approved. The petitioner ought to have produced enough
material on record to show that either by order dated
23.10.1989 sanctioning/approving the lay-out of the
said large tract of land was approved unconditionally
or that the conditions,if any, subject to which such
lay out (resulting into sub-division of said large
tract of land) was made approvable, are/were in fact
fulfilled, enabling igus in fact and law to draw an
inference that the large tract of land has been sub-
divided creating the suit property as a separate plot.
On the basis of whatever material available on
record, it does appear that the proposal for sub-
division of the said large tract of land in terms of
the proposed lay-out was made only approvable, that too
conditionally, by the said letter dated 23.10.1989. In
absence of final approval it will not be possible for
us to conclude and consequently hold that the aforesaid
layout has been approved and that such approval has
resulted into effecting sub-devisions of the said large
track of land creating the suit property as a “separate
plot” in law and in fact.
76. Moreover, the revenue record of the said
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large tract of land in issue also does not reflect any
such sub-division of the same. Admittedly, the suit
property does not have a separate property register
card drawn up by the Collector enabling us to hold that
the suit property is a separate plot created on account
of approved legal sub-division of the said large tract
of land. Mere marking of the suit property as “plot
no.2-A” on the plans of the BEST or mere references to
the suit property made in various documents of BEST as
“a sub-divided plotig no.2-A” will not make the suit
property ‘a plot’. In our view, such marking and/or
references are found in the record only for the purpose
of identification of the exact location and/or
situation of the suit property forming part of the said
large tract of land in issue admeasuring 1,54,082.42
sq. mtrs. It appears to us that for the purpose of
convenience of identification of the area alone, the
suit property is addressed and referred throughout by
the BEST as “plot no.2-A”.
77. It is also pertinent to note that though a
separate property register card was prepared in the
revenue records in regard to the property leased out to
Ankur Co-operative Housing Society Ltd., that has not
resulted into actual sub-division of the said large
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tract of land. This is principally because though a
lease was created in favour of Ankur Co-operative
Housing Society Ltd., the lessor of the land continued
to be the BEST. As there was no severance of ownership
of the said large tract of land the same has continued
to remain undivided. Mere creation of a separate
property register card in the name of Ankur Co-
operative Housing Society Ltd., in law has not resulted
into effecting of sub-division of the said large tract
of land.
78. We, therefore, conclude that the suit property
is not a separate plot as defined by section 2(21) of
the MRTP Act, 1966 and cannot be considered for the
purpose of this petition as an independent and separate
piece of land inasmuch as the applicability of DCRs is
concerned. In other words, the suit property will have
to be considered in law, for all the purposes,
especially for the applicability of DCRs, as a portion
of one single piece of large tract of land admeasuring
1,54,082.42 sq. mtrs.
79. POINT NO.6 : Legality of the permissions
granted for the development that is being
carried out at the suit plot by the 7th
Respondent :-
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This issue is truly a fall out of the earlier
issue framed and answered hereinabove which deals with
the question as to whether the suit property is in law
a “separate plot” or not.
80. It is the contention of the petitioner that the
suit property is a separate plot which admeasures
27,913.93 sq. mtrs. and is carved out of the said large
tract of land admeasuring 1,54,082.40 sq. mtrs. On the
basis of this contention,
ig the petitioner further
submits that for the purpose of determining the extent
to which development and/or construction is permissible
( which can be carried out) on the suit plot, the area
of the plot should be considered only and only as
27,913.93 sq. mtrs. i.e., the suit property and not
1,54,082.40 sq. mtrs. i.e., the said large tract of
land.
81. Admittedly, the requisite permissions and/or
sanctions and/or approvals have been granted in favour
of the 7th respondent developer by the said corporation
and/or other competent authorities in terms of the said
DCRs by considering the said large tract of land as one
single plot/unit admeasuring 1,54,082.40 sq. mtrs and
not by considering the suit property as a separate
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plot/unit admeasuring 27,913.93 sq. mtrs. Therefore,
if we come to the conclusion that the suit property is
a separate plot, obviously, all the
permissions/sanctions/approvals granted for carrying
out developmental activities on the suit property will
be contrary to the said DCRs and thus impermissible in
law.
82. However, in terms of the aforesaid detailed
discussions made and conclusions drawn by us, we will
have to proceed on the basis that the suit property is
not a separate plot as contemplated in law (and as
contended by the petitioner) and that it is only a
portion of the said large tract of land (as is the case
of the respondents). Obviously, appropriate
calculations for applicability of the said DCRs will
have to be made on the basis that the suit property is
a undivided part of the said large track of land
admeasuring 1,54,082.40 sq. mtrs.
83. In as much as the issue of permissibility of
extent of construction at the hands of the 7th
Respondent is concerned, firstly, it is the case of
the petitioner that the permissible FSI and other
calculations in that regard are required to be made on
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the basis that the suit property is a separate plot. We
have however herein above by a detailed reasoning
rejected this contention of the petitioner that the
suit property is a separate plot. We have held
hereinabove that the same is a part and parcel of an
undivided said large track of land admeasuring
1,54,082.40 sq. meters.
84. It was in the alternative submitted on behalf
of the petitioner that in case if we hold that the suit
property is not a separate plot but is an undivided
portion of said large track of land, even then the
permission granted to the 7th Respondent to put up
construction to the extent of 38,653.51 sq. meters is
far in excess of the legally permissible limits even
under the amended DCRs. In this regard, our attention
was drawn by the learned counsel appearing on behalf of
the petitioner to the contentions raised by the
petitioner on pages 25 and 29 of the writ petition and
calculations given in the affidavit in reply filed on
behalf of the 2nd Respondent, said Corporation dated
16.6.2008. Relying on the very same calculations given
by the said Corporation, it is contended by the
petitioner that the balance permissible FSI works out
to 83,920.07 sq. meters and that 30% of the same works
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out to only 24,900 sq. meters and therefore the
permission granted to the 7th respondent to put up
construction to the extent of 38,653.51 sq. meters is
far in excess of permissible limits.
85. It was further submitted on behalf of the
petitioner that even under the amended DCRs i.e. DCR
No. 9 the sites which were open and vacant alone are
to be considered and therefore the areas which are
already used by putting
ig up scrap yard, bus depot,
service quarters and/or Ankur Co-operative Housing
Society from and out of the said large track of land
will have to be executed. In the submission of the
petitioner therefore even if for the sake of argument
the suit property is not considered as a separate plot
and it is considered as an undivided portion of the
said large track of land, the FSI permitted to be
utilised by the 7th respondent at the suit property of
30,653.51 sq. meters is far in excess of the
permissible limits in law and that on this ground also
the agreement in issue, the resolution in issue
passed by the BEST and the consequent
permissions/approvals granted to the 7th respondent are
liable to be quashed and set aside.
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86. On the contrary on behalf of the respondents it
is contended that the true and correct interpretation
of Explanation No.(v)introduced by way of
amendment/modification in issue effected in DCR No. 9,
will show that the area to be considered is not just
open/vacant area out of the said large track of land,
but total permissible area out of the entire site
reserved for BEST Undertaking. Our attention has been
drawn to the calculations set out in the affidavit of
the BEST dated 30.11.2007, particularly, in paragraphs
9 and 11 thereof. On that basis, it is contended that
30% of the total permissible built up area (1,28,845.04
sq meters) works out to 38,653.51 sq. meters and that
accordingly permissions/approvals have been granted to
the 7th respondent and that therefore this court may not
interfere with the same.
87. Admittedly in terms of DCR 32(3), the FSI
permissible at the suit property is one. In as much as
the interpretation of Amended DCR No. 9 is concerned,
the amended portion, viz. Explanation (v) is already
set out by us herein above. A perusal of the same
demonstrates that it deals with “sites reserved for
BEST Undertaking” and development of such sites by the
BEST Undertaking for the specified purpose coupled with
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commercial user thereof. Obviously, therefore the
contention of the petitioner that the calculations of
FSI will have to be made by taking into consideration
only open/vacant area out of the said large track of
land is not correct. There is nothing in this
explanation which can possibly warrant such a
restrictive interpretation of the said provision. For
the purposes of calculating FSI and for other purposes
of calculations set out in the aforesaid Explanation
No. (v) the entire area of “sites reserved for BEST
Undertaking” will have to be considered. If so
considered, the area of the entire said large track of
land i.e. 1,54,082.40 sq. meters will have to be
considered as the basis for the requisite calculations,
as this entire area (and not just the suit property) is
‘a site reserved for the Best Undertaking’. We
therefore reject the contention of the petitioner to
the contrary and hold that for the purpose of all the
calculations to be made for determining permissible
development at the suit property, area to be considered
as basis will be the total area of the said large track
of land i.e. 1,54,082.40 sq. meters and not just the
area of the suit property i.e.27,913.93 sq. mtrs.
88. Now, in as much as splitting of the aforesaid
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area is concerned, fortunately, there is no dispute as
to the area which are actually used for putting up bus
depot, scrap yard, staff housing and Ankur Co-operative
Housing Society. There is also no dispute about
balance area which is lying vacant. On the basis of
these admitted facts and figures, calculations works
out as under:-
Area to be excluded :
2,500.00 sq. mts. Area handed over to the said Corporation
22,737.36 sq. mts. ig 15% Recreation Ground
Net area of the plot after aforesaid exclusion
works out to 1,28,845.04 sq. mts. And 30% of the
aforesaid 1,28,845.04 sq. mts. works out to 38,653.51
sq. mts., which is permitted to be developed by the 7th
Respondent.
Area so far consumed by the BEST
37,061.77 sq. mts. Staff Housing
5,025.01 sq. mts. Scrap Yard
7,557.05 sq. mts Goregaon Bus Depot
6,540.75 sq. mts. Oshiwara Bus Depot
The total area thus consumed is 1,26,168.47
sq.mts., which leaves the BEST with 27,913.93 sq.mts
i.e. suit property.
89. In regard to the aforesaid calculations, it is
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worthwhile to note that sub clause (a) of the aforesaid
Explanation No. (v) introduced by way of
modification/amendment of the DCR No. 9 shows that the
built up area for commercial user is not to exceed 30%
of the “total permissible floor area”. The total
permissible floor area of the said large track of land
in terms of the aforesaid calculations works out to
1,28,845.04 sq.mts. Obviously, therefore the
respondents were fully justified in law in permitting
the 7th respondent to carry out development at the suit
site to the extent of 30% of the aforesaid total
permissible floor area i.e. 1,28,845.04 sq. mts. which
works out to 38,653.51 sq. mts.
The contention of the Petitioner that in
accordance with the amended/modified DCR no 9, 30% has
to be of the 83,920.07 sq.mts i.e. only balance
permissible FSI available for the BEST as on the date
of impugned transaction, can not be accepted. In our
view the ‘total permissible floor area’ {as set out by
clause (a) of the explanation (v) of the DCR no.9} has
to be considered of the ‘site reserved for BEST
undertaking’ and not just of the ‘available/balance
FSI’ as contended by the Petitioner. Acceptance of such
contention of the petitioner will amount to reading
something into the said DCR that is not there, which of
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course is impermissible in law.
Considering the case, from this aspect of the
matter, it is clear that the development permitted to
be carried out by the 7th respondent is strictly within
the four corners of the amended provisions of the said
DCR No.9.
90. The aforesaid calculations will also further
demonstrate that even
ig after permitting the 7th
respondent to carry out development to the extent of
38,653.51. sq. mts. FSI, the BEST still will be left
with the balance FSI to the extent of 45,266.56 sq.
mts. which can be utilised by the BEST in carrying out
development at the said large track of land. This part
of the calculations also further shows that the
contention of the petitioner that the 7th respondent is
permitted to carry out developments in excess of
permissible FSI is far from the truth.
91. It also further needs to be stated that in
paragraph 7 of the affidavit dated 31.1.2008 filed on
behalf of the said Corporation, it is stated that the
proposal for development submitted with it comprises of
only residential buildings and that no commercial
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development is proposed on the suit property. It is
further stated in this paragraph that the said
Corporation has approved plans of residential buildings
only.
92. In view of our aforesaid calculations, we also
do not find any substance in the contention of the
petitioners to the effect that permitting the 7th
respondent to carry out development at the suit
property to the extent of 38,653.51 sq. mts. amounts to
permitting the 7th respondent to use the FSI of such
other portion of the said large track of land which
falls beyond the suit property and that therefore it
amounts to using TDR (Transferable Development Rights)
which is not permitted in law.
93. POINT NO.7 : What is the nature of “Agreement
for Development” dated 18.5.2007 entered into
by and between BEST and 7th respondent ?:
As set out hereinabove, after following the
procedure of inviting bids by way of public
advertisement, the BEST selected 7th respondent as the
successful bidder in as much as the 7th respondent
offered maximum premium as and by way of non-refundable
deposit at the rate of Rs.57,000/- per sq. mtr., for an
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area of 39,291 sq. mtrs. of the suit property. It has
come on record that the 7th respondent accordingly
deposited the entire amount which worked out to
Rs.2,20,32,21,000/- (Two hundred twenty crores thirty
two lakhs twenty-one thousand only) with the BEST and
that on deposit of such amount, the BEST has entered
into “Agreement for Development” with the 7th respondent
on 18.5.2007 (hereinafter referred to as the “said
Agreement” for brevity sake). A copy of the Agreement
has been produced as Exh.`2′ by the petitioner along
with its affidavit-in-rejoinder dated 25.1.2008. The
annexures thereof have been separately tendered by the
petitioner after conclusion of arguments, for the
purpose of completion of record. However we do not
think that these annexture produced subsequently, make
any difference to the case of either the Petitioner or
that of any of the Respondents.
94. According to the petitioner, the said Agreement
is an agreement which creates a lease and, therefore,
the provisions of section 460K and 460Q of the said
Act, 1888 are attracted. It is the contention of the
petitioner that as a result of the execution of the
said Agreement, a lease in respect of the suit property
stands created and, therefore, taking into
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consideration the aforesaid amount of huge premium, the
provisions of section 460K(b) and 460Q(d) are attracted
to such a transaction. It is, therefore, submitted
that the General Manager of the BEST who has executed
the said Agreement was required to comply with the
aforesaid provisions of law by obtaining prior approval
of the said Corporation before execution of the said
Agreement and that approval/permission of the said BEST
committee was not sufficient compliance with the
aforesaid provisions of law.
95. On the contrary, it is the contention of the
respondents that the said Agreement by itself does not
create any lease in favour of anyone and, therefore,
the aforesaid provisions of law relied on behalf of the
petitioner are not at all attracted to the facts and
circumstances of the case. It is the case of the
respondents that the said Agreement is only a
development agreement and by itself the same does not
create any leasehold rights as such either in favour of
the 7th respondent or the nominees of the 7th respondent
in the suit property. In the submission of the
respondents, since the General Manager has obtained
appropriate approval and/or sanction for execution of
the said agreement from the BEST Committee, the said
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Agreement is legal, valid and enforceable in law. In
support of this contention, the respondents relied on
the Resolution dated 20.10.2006 passed by the BEST
Committee, copies of which are also produced by the
petitioner as Exh.`E’ to the petition.
96. The crucial issue, therefore, to be determined
is as to whether the said Agreement is “an Agreement of
lease” or an “Agreement to lease”. In other words, it
is to be determined as to whether the said Agreement is
only an agreement whereby the BEST has agreed to create
a lease in future or is it an agreement which by itself
creates a lease in praesenti. In legal terms, it will
have to be determined whether the said Agreement
creates “a present demise” or not.
97. Before dealing with the aforesaid issue, we
must take care of one interesting legal controversy
raised as an offshoot of the aforesaid legal issue. It
is thus :
whether an assignment of “right to lease” an
immovable property amounts to creating an
interest in such an immovable property ?
98. Ownership of immovable property is a bundle of
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various rights. Obviously, one of such right is a
“right to lease” such an immovable property. A right
to sell is another such right from the aforesaid bundle
of rights. Only to the aforesaid limited context a
“right to sell” is something which is similar, if not
higher, to a “right to lease” an immovable property.
It is well-settled position of law that an “agreement
to sell” does not create any legal interest in the
immovable property. Though an agreement to sell is
enforceable in law, igsuch an agreement does not by
itself create any right, title or interest in the
immovable property. Certainly, an “agreement to sell”
creates rights which are similar (if not higher) in
nature as are created by an “agreement to lease”. We
are, therefore, of the view that if an agreement to
sell does not create any right in an immovable
property, obviously, an agreement to lease also does
not create any right in an immovable property.
99. We are, therefore, of the view that an
“agreement to lease” does not create any right, title
or interest in the immovable property. It creates only
a right to obtain a deed of Lease in future. However an
“agreement of lease” certainly creates rights in the
immovable property as contemplated by the Transfer of
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75
Property Act. Thus, we will have to now examine the
said Agreement to find out as to whether it is an
“agreement to lease” or an “agreement of lease” to
answer the issue as to whether the said agreement
attracts the aforesaid provisions of Section 460 K
and/or 460 Q of the said Act 1888.
100. The aforesaid question raised by the parties to
the present proceedings as to the applicability of
section 460K and/or section 460Q of the said Act 1888
will have to be answered only after finding out the
true and correct purport and nature of the said
Agreement. It will, therefore, be necessary to dwell
into some of the important terms of the said Agreement
to appreciate the exact nature of the transaction
entered into by and between the parties to the said
Agreement.
101. As the Agreement is very bulky and gives
numerous details, it will not be convenient to
reproduce herein the terms thereof. We will, however,
prefer to mention hereunder generally as to the nature
of the transaction the parties have entered into by
virtue of the said Agreement.
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102. The 7th respondent has agreed to pay the “non-
refundable premium” to the BEST. In fact, as set out
hereinabove, the same is already paid by the 7th
respondent to the BEST. In consideration thereof, the
7th respondent is permitted to enter upon the suit
property and construct commercial/residential premises
therein in terms of the aforesaid explanatory note no.
(v) added below Table 4 contained in regulation 9 of
the said DCRs. The 7th respondent is further granted a
one time right to nominate the lessee(s) with respect
to the premises that the 7th Respondent is permitted to
construct at the suit property. The 7th respondent is
entitled to receive consideration for such a nomination
to be made by the 7th respondent. The 7th respondent is
not liable to the BEST to account for such a
consideration that the 7th Respondent will be receiving
from its nominees. The 7th respondent is to intimate
the names of such lessees and the name of the trade
which will be conducted by such lessees in the allotted
premises. BEST has agreed to lease out the constructed
commercial/residential premises on carpet area basis to
the lessee(s) so recommended by the 7th respondent, for
which the BEST has agreed to execute the lease deed(s)
with each of such lessee(s). BEST has also agreed and
confirmed that it will execute any other related
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documents as may be required to be executed to prefect
the title of the developer’s nominees to the said
constructed and allotted premises as lessees of the
such premises without any delay or demur, provided that
the 7th respondent does not commit breach of any of its
obligation under the said Agreement. It is further
clarified by the said Agreement that once the 7th
respondent nominates the names of the proposed lessees
and the BEST enters into lease deed with such lessees
in respect of the premises constructed and allotted by
the 7th respondent at the suit property, the right of
the 7th respondent to nominate such names of lessees
will extinguish. In other words, it is clarified that
in case of early termination of such proposed lease(s)
for any reason whatsoever, the 7th respondent shall have
no further right to nominate any name with respect to
the premises under such lease(s). It is also agreed
that the 7th respondent will be entitled to form or
cause to be formed a society of such proposed
lessees/nominees of the 7th respondent and that the BEST
has agreed to execute an Indenture of Lease in respect
of such property in favour of such proposed society, if
any.
103. Inasmuch as the lease period is concerned, it
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is agreed to be initially of 60 years for which the
monthly lease rent is agreed to be Rs.1/- per sq. foot
of built-up area for the first 30 years and Rs.2/- per
sq. foot of built-up area for the subsequent 30 years.
Thereafter, the lease period is agreed to be renewable
at monthly lease rent to be determined by the BEST. It
is clarified that the lease rent shall be exclusive of
all taxes. However, clause 12 of the agreement states
that the lease rent will commence from the date of
receipt of Occupation
ig Certificate from the said
Corporation in respect of residential/commercial
construction or 48 months from the date of the said
Agreement, whichever is earlier. It further states
that the 7th respondent shall be responsible for payment
of the lease rent with respect to the entire
constructed premises from the date of commencement of
the lease rent. This clause further states that the
lessee will be required to pay a deposit equivalent to
12 months’ monthly lease rent in advance to the BEST.
104. The said Agreement sets out various terms and
conditions subject to which the 7th respondent is to
carry out the development in issue. Nothing turns on
these terms and conditions and, therefore, we need not
set out the same herein. Suffice it to say that the
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right to carry out development conferred by the said
agreement on the 7th respondent is not unconditional,
but the same is very much subject to compliance with
certain terms and conditions.
105. A perusal of the said Agreement and the nature
of transaction effected thereby, in short, as set out
hereinabove will demonstrate that the said Agreement by
itself does not create a lease in anybody’s favour,
much less either in favour of the 7th respondent or in
favour of the nominees of the 7th respondent. There can
be no manner of doubt that the said Agreement with
certainty assures the 7th respondent that without any
delay or demur the BEST will execute the lease deed and
all other documents in favour of the nominees of the 7th
respondent for creating a lease in favour of the
nominees of the 7th respondent in respect of the portion
of the premises/building that will be constructed and
allotted by the 7th respondent to such nominees. This
commitment made by the BEST to the 7th respondent by
virtue of the said Agreement, howsoever strong and/or
unequivocal may be, still the same falls short of
actual creation of a lease in favour of the nominees of
the 7th respondent, there being no question of creation
of any lease in favour of the 7th Respondent. The terms
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of the said Agreement clearly demonstrate that such
leases assured by the BEST are to be created in future.
Obviously, therefore, there is nothing in the said
Agreement which can be read to mean that a `present
demise has taken place’ by virtue of the said Agreement
either in regard to the suit property or in respect of
the building to be constructed thereon by the 7th
Respondent.
106. The specific ig clause which requires the 7th
respondent to pay the amount of lease rent to the BEST
with the expiry of the period of 48 months from the
date of the said Agreement does not by itself create a
lease of the suit property in favour of the 7th
respondent. This term appears to have been included in
the said Agreement only as and by way of quantum of
amount that will become payable by the 7th respondent to
the BEST. By paying such an amount as agreed, the 7th
respondent cannot acquire any lease-hold rights in the
suit property nor can the 7th respondent thereby acquire
any status of a lessee in law of the construction that
may be put up by the 7th respondent on the suit
property.
107. In as much as the issue as to whether a
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particular document creates a “present demise” or not,
no doubt is always a question which is to be answered
by considering the document in issue, terms thereof and
the nature of transactions that the parties may have
contemplated under the same. However, so far as legal
aspect of creating “present demise” is concerned, the
Supreme Court had occasion to deal with the same,
basically in the light of provisions of Indian
Registration Act, 1908. Observations made by the
Supreme Court, though are in the context of provisions
of Registration Act, 1908 and in the background of
factual controversy involved in such matters, the same
may be useful for considering the aforesaid question
involved in this case. These observations can be found
in the following few Judgments :
(a)Trivenibai * Anr. Vs.Smt. Leelabai
reported in AIR 1959 S. C. 620 (paras 11,15).
(b)State of Maharashtra & Ors. Vs.
Atur India Pvt. Ltd.,(1994)2 SCC 497(para 24).
108. In the aforesaid Judgments, the Supreme Court
has considered the distinction between “agreement to
lease” and “agreement of lease”. This distinction is
considered by the Supreme Court by referring not only
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English law but also Indian Law.
109. The Supreme Court again placed reliance on the
ratio of the Judgment delivered by it in Trivenibai’s
case (supra) while dealing with the case of Food
Corporation of India & Ors. vs. Babulal Agarwal
reported in [(2004) 2 SCC 712]. The paragraph 10
thereof reads thus:
“………….There must be demise of the
property in praesenti. But an agreement for
securing another agreement or deed in future
would not be such an agreement or document
which may require registration. Clause 8 ofthe agreement did not create any right in
praesenti nor was there any immediate demise
of the property. It was only an executory
agreement. The construction of the plinths, it
seems, had yet to start with other facilitiesand amenities. On completion, such a
certificate was to be obtained from the
defendant. It was thereafter that thepossession was to be handed over under the
lease agreement which was to be executed
between the parties. The construction was to
be strictly in accordance with the directions
and specifications of the defendant. Condition9 also contemplated that if the structure was
found defective or workmanship was faulty, the
defendant could refuse to take possession of
the premises and the earnest money was liable
to be forfeited. Hence it is evident that no
possession, right or title had passed on inpraesenti at the time of execution of the
agreement, and there were many prior
conditions attached thereto. Such an
agreement, in our view, has been rightly held
to be only an executory agreement and not an
agreement creating rights in the immovable
property, hence not compulsorily required to
be registered. It was a mere agreement between::: Downloaded on – 09/06/2013 13:42:43 :::
83the parties which was not registered but was
admissible in evidence.”
110. These Judgments and such other judgments
delivered by the Supreme Court in this regard have
crystalised the law on the point as to distinction
between the nature of document, which is a “Agreement
of Lease” and “Agreement to lease”. The crux of this
distinctions is to find out as to whether the document
in issue creates or does not create “a present demise”.
If the document and/or transaction creates a lease in
praesenti then the same is an “Agreement of Lease”. On
the other hand, if the document is only executory in
nature and instead of creating a lease in praesenti
only assures and/or promises to create such a lease in
future, the same is “Agreement to Lease”.
111. In view of the aforesaid legal background as to
the distinction between the aforesaid two different
types of documents relating to lease and in view of the
facts and circumstances of this case discussed in
detailed herein above, we hold that the Agreement in
issue dated 18.5.2007 is only executory agreement i.e.
an “Agreement to Lease” and that the same is not an
“Agreement of lease”. Consequently, we conclude that
the aforesaid Agreement in issue dated 18.5.2007 does
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not create any right, title or interest in favour of
the 7th Respondent in praesenti and particularly such a
right, title or interest as is contemplated by the
provisions of Section 260Q of the said MMC Act, 1888.
112. One more important aspect of the matter is that
in India, dual ownership is recognized in law.
Therefore, leasing out the building i.e. the super-
structure or a part thereof that will be constructed on
the suit plot and leasing out the suit plot and/or area
thereof will be two different aspects in law. In other
words, creating a lease in respect of the super-
structure is entirely different than creating a lease
of the land on which the super-structure stands. If the
said Agreement is considered from this legal aspect of
the matter, it will become clear that the said
Agreement contemplates only creation of lease of the
tenement and/or residential/commercial construction to
be put up on the suit property and does not contemplate
creation of a lease in anybody’s favour in regard to
the land underneath the construction i.e. the suit
property or part thereof. Thus the said Agreement for
this additional reason also does not in law, create any
lease in favour of anybody inasmuch as the suit
property or part thereof is concerned. The said
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85
Agreement only contemplates creation of a lease of the
portion of the building that will be constructed on the
suit property or part thereof by the 7th Respondent.
113. In view of the aforesaid discussion, we hold
that the said Agreement is only an executory agreement
which contemplates and, at the highest, assures
execution of lease in future and does not create a
lease in praesenti. We, therefore, conclude that the
said Agreement does not create a `present demise’ in
law and, therefore, is not a lease deed and further
that the said Agreement does not create any right in
the suit property in favour of the 7th respondent being
only “Agreement for Development”.
114. With the aforesaid conclusions we proceed to
deal with the issue of applicability of the aforesaid
provisions of Section 460 K and 460 Q of the said Act
1888. As this issue overlaps the next point framed for
consideration we will deal with the same collectively
as under.
115. POINT NO.8: Legality and validity of the
Resolutions dated 6th November 2006 of the BEST
and the Agreement for Development dated 18th May
2007 :-
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As set out herein above, this issue needs to be
answered, taking into consideration the nature of the
said Agreement. The entire edifice of the case of the
petitioner that the said Agreement is illegal is built
on the foundation that the said Agreement creates a
lease and/or in any case an interest in law, in the
suit property, either in favour of the 7th respondent or
in favour of the nominees of the 7th respondent. On the
basis of such a foundation, the aforesaid argument is
made by the learned counsel appearing on behalf of the
petitioner that the General Manager of the BEST has not
obtained the requisite approval and/or permission
and/or sanction from the said Corporation before
executing the said Agreement and that therefore there
is non-compliance with the provisions of Section 460 K
(b) r/w 460 Q (d) of the said Act 1888.
116. However, as we have concluded hereinabove that
the said Agreement does not create either lease in
praesenti or any interest in law in favour of anybody
in the suit property, in our view, the aforesaid
provisions relied on behalf of the petitioner will not
be attracted. The relevant portion of section 460K and
section 460Q of the said Act, 1888 read thus:-
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87
“460K. Making of contracts:- With respect
to the making of contracts for the
purposes of the Brihan Mumbai Electric
Supply and Transport Undertaking)
(including contracts relating to the
acquisition and disposal of immovable
property or any interest therein, or any
right thereto) the following provisions
shall have effect, namely:-
(a) …………………………….
……………………….
(b) no such contract for any purpose
which, in accordance with any provision of
the Chapter, the General Manager may not
carry out without the approval or sanction
of some other municipal authority, shall
be made by him until or unless such
approval or sanction has first been duly
given ;
(c) no contract which will involve an
expenditure exceeding ten lakhs rupees
shall be made by the General Manager
unless the same is previously approved
by the Brihan Mumbai Electric Supply and
Transport Committee:
Provided that, where the previous approval
of the Committee is sought for any such
contract by the General Manager, the
Committee shall consider and dispose of
such proposal within thirty days from the
date of on which the item is first
included in the agenda of any meeting of
the Committee, failing which, the previous
approval shall be deemed to have been
given by the Committee for such Contract
on the last day of the period of thirty
days aforesaid. A report to that effect
shall be made by the General Manager to
the Committee;
(d) ………………………………..
………………………..
(e) ………………………………
………………………..”
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88
“460Q. Provisions governing disposal of
municipal property:- With respect to the
disposal of property vesting in the
corporation for the purposes of the Brihan
Mumbai Electric Supply and Transport
Undertaking the following provision shall
have effect, namely:-
(a) the General Manager may, dispose
of by sale, hire, hire-purchase or
otherwise, any movable property belonging
to the corporation not exceeding
in value in each instance, two thousand
rupees;
(b) the General Manager may grant a
lease of any immovable property
belonging to the corporation
ig for any
period not exceeding twelve months at a
time:
[Provided that, every lease granted by
the General Manager (other than a contract
for monthly tenancy) the annual rent of
which exceeds fifteen thousand rupees
shall be reported by him, within fifteen
days after the same has been granted, to
the Brihan Mumbai electric Supply and
Transport Committee];
(c) with the sanction of the [Brihan
Mumibai Electric Supply and Transport
Committee], the General Manager may
dispose of, by sale or otherwise, any
movable property belonging to the
corporation of which the value does not
exceed [one lakh rupees], and may grant a
lease of any immovable property belonging
to the corporation for any period
exceeding one year, or sell or grant a
lease in perpetuity of any immovable
property belonging to the corporation for
any period exceeding one year, or sell or
grant a lease in perpetuity of any
immovalbe property belonging to the
corporation the value whereof does not
exceed [one lakh rupees] or the annual
rental whereof does not exceed [ten
thousand rupees];
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89
(d) with the sanction of the corporation,
the General Manager may lease, sell or
otherwise convey any property, moveable or
immovable, belonging to the corporation.”
117. Considering the nature of the said Agreement,
we are of the view that the provisions of section 460K
(c) alone are attracted. In our view, the provisions
of section 460-Q are not at all attracted, in the facts
and circumstances of the case and that Section 460-Q
will not govern and/or apply to the said Agreement.
Section 460-Q will apply only when the property of the
BEST is to be disposed of. In our view, the said
Agreement does not dispose of the suit property. At
the highest, the said Agreement may be read to mean
that thereby a strong unequivocal commitment is made on
behalf of the BEST by the General Manager with the
previous approval and/or sanction of the BEST to
dispose of the property of the BEST. However, the said
Agreement certainly falls short of such actual disposal
of the suit property. It has been brought on record
that the BEST Committee has passed a resolution on 6th
Nov. 2006 not only approving and/or sanctioning the
tender in favour of the 7th respondent, but also
approving and/or sanctioning the said Agreement
executed in favour of the 7th respondent on behalf of
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the BEST. In view of the provisions of section 460K
(c), the General Manager was, therefore, legally
competent to make the contract i.e., the said Agreement
and, therefore, the said Agreement does not suffer from
any legal infirmity.
118. It needs to be mentioned herein that on behalf
of the BEST it is made clear that at an appropriate
stage when an occasion will arise for the execution of
the actual leases as contemplated/assured by the said
Agreement, the BEST will take appropriate steps as
required by the aforesaid provisions of the said Act
1888.
119. It was contended on behalf of the BEST that
there are two classes of properties possessed by the
BEST. The first one are those which belong to the said
Corporation and are only given to the BEST for its
user. The second one are those properties which are
acquired directly by the BEST and therefore are held
and possessed by the BEST. It was contended that the
suit property falls in the second category and that it
is acquired by the BEST and therefore that it is owned
and held by the BEST. It was therefore contended on the
basis of such a submission that the provisions of
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91
Section 260K and 260Q of the said Act 1888 will have to
be considered accordingly.
120. We are unable to express our opinion and take a
definite view in this regard, one way or the other, as
no material adequate enough to perform such an exercise
has been produced on record by either sides to show the
source of acquisition of the suit property and its
vesting in the BEST. In this case therefore we do not
propose to venture into an exercise to determine the
correctness or otherwise of this contention raised on
behalf of the Respondents. For want of adequate
material to trace out the title of the BEST and decide
as to whether or not the said Corporation has
title/ownership of the suit property, we keep this
issue specifically open.
121. Having considered all the contentions raised on
behalf of all the parties and having found no substance
in the case of the Petitioner we hereby dismiss this
petition and discharge the Rule with no order as to
costs.
(A.A.KUMBHAKONI, J.) (S.B.MHASE, J.)
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IN THE HIGH COURT OF JUDICATURE AT BOMBAY
ORDINARY ORIGINAL CIVIL JURISDICTION
WRIT PETITION NO. 2296 OF 2007
DATE OF PRONOUNCEMENT OF JUDGEMENT :- 21st August 2008
FOR APPROVAL AND SIGNATURE :-
HON'BLE SHRI JUSTICE S.B.MHASE )
)
HON’BLE SHRI JUSTICE A.A.KUMBHAKONI )
1. Whether Reporters of Local Newspapers may be )
allowed to see the judgement ?
2. Whether to be referred to the Reporters or not? )
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