Land Allotment Process Stalled Due To Political Interference: Bombay HC Directs Execution Of Lease & Delivery Of Possession
|The Bombay High Court, granting relief in two cases where land was allotted in an industrial area but lease agreements were never executed and possession not delivered, has directed an industrial development agency of the Maharashtra government to execute the same and grant possession, stating that the process had been arbitrary stalled because of political interference.
The Court was hearing two Writ Petitions by Petitioners who were allotted land at an industrial area by the Maharashtra Industrial Development Corporation (MIDC) and had paid the required amounts, but lease agreement were not executed in their favour and possession was not handed over. During the course of the proceedings, the Court was informed of a letter by the state government directing the MIDC to keep the lease agreements on hold, which it found was not a valid policy direction and had interfered with pre-existing rights of the Petitioners.
A Division-Bench comprising Justice B. P. Colabawalla and Justice Somasekhar Sundaresan said, "In the instant case, MIDC has made allotments, its allotment letters contain stipulations and deadlines for activity to be undertaken by the allottee, and yet, despite pocketing the money payable by the allottees, the MIDC has refrained from moving the process forward, evidently on the basis of political interference through a process unknown to law. Consequently, it would be necessary to direct the MIDC to execute the requisite agreements to lease with the Petitioners and hand over their respective land parcels for development in terms of the allotments made."
Advocates Tushar Sonawane and Siddhi Sawant appeared for the Petitioners; Senior Advocate Prashant Chawan appeared for the MIDC.
In the first petition, the Petitioner was allotted land by the MIDC for developing a hotel at the Trans Thane Creek Industrial Area, Mahape. Despite the allotment having been made and full payment having been received, the MIDC refrained from executing the requisite agreements and granting possession of the land to the Petitioner. This inaction was assailed by the Petitioner as an arbitrary failure on the part of MIDC to perform a statutory obligation, and to issue a direction to the MIDC to execute the agreements to lease.
The second Petitioner, who is also desirous of setting up a hotel in the TTC Industrial Area and was allotted land by the MIDC, but was not delivered possession. The land allotted to both lie on the same service road.
In the second petition, the Navi Mumbai Municipal Corporation entered appearance and pleaded that there are serious problems related to parking on the service road on which the plots of land involved are located. According to its counsel, the land must not be developed and instead a parking lot must be created in that space.
During the course of the proceedings, the counsel for the MIDC produced a letter by the state government to keep further processing of the two leases on hold, and submitted that the MIDC was helpless since the direction of the state government is binding on the MIDC.
The instructions were based on a letter by the Chief Minister stating that there should be no alienation of any land along the service and even those to whom land has already been allotted and projects have developed, must be relocated elsewhere. The purported reason for issuance of such instructions is said to be potential vehicular accidents in the area.
Upon hearing the parties, the Court said "it became clear that there has been an abject failure on the part of MIDC, at the intervention by office- bearers of the State Government. The sheer refusal to proceed further with the two hotel projects, stalling them without any reason or basis in any manner known to law, calls for our intervention."
Perusing the provisions of the Maharashtra Industrial Development Act, 1961, the Court noted that there was only one provision that allowed the issuance of directions by the State Government to the MIDC. This provision states that the state government may issue to the MIDC such general or special directions as to policy as it may think necessary or expedient for the purpose of carrying out the purposes of this Act
Upon asking the state's counsel whether the instruction to keep leases on hold was made under the said provision, the Court was informed it was not issued under the said provision. On this, the Court said, it was clear that the instruction was "not at all a policy direction under Section 18 of the MIDC Act, and that cannot be the basis of MIDC refusing to discharge its statutory duty owed pursuant to its functioning."
The Court said further, "Instead, what becomes clear is that the MIDC had, in compliance with all due process, allotted the lands involved in these Petitions. Such due process was suddenly interfered with, and stalled, at the instance of the local political representative. The contents of the January 4 Instruction are not only ambiguous in terms of dealing with pre-existing and accrued rights, but also do not even contain a semblance of a reasoned articulation of why such pre-existing rights and pre-approved projects are to be interfered with."
The Court concluded that that the MIDC had allotted the lands in compliance with all due process, but "such due process was suddenly interfered with, and stalled at the instance of the local political representative." It called the the contents of the instruction, "not only ambiguous in terms of dealing with pre-existing and accrued rights, but also do not even contain a semblance of a reasoned articulation of why such pre-existing rights and pre-approved projects are to be interfered with."
"Besides, the written contents of the January 4 Instruction, ex facie do not carry the character of a policy direction, and they are evidently directions on the manner of handling projects." the Court said, allowing the Writ Petitions.
"Evidently, validly processed projects have simply been stalled and interfered with, without any basis in law – firmly placing the inaction by MIDC and the core reason or justification behind the stalling, in the realm of manifest arbitrariness, necessitating our intervention in exercise of our jurisdiction under Article 226 of the Constitution of India." the Court remarked.
Cause Title: Bikaner Sweets & Namkin v. Area Manager, MIDC, Mahape And Ors. [WRIT PETITION NO. 15309 OF 2023] WITH Siddhilaxmi Enclave Pvt. Ltd. v. State of Maharashtra And Ors. [WRIT PETITION NO. 10246 OF 2024]
Appearance:
Petitioners: Advocates Tushar Sonawane, Siddhi Sawant and Nikhil Waje
Respondents: Senior Advocate Prashant Chawan, Additional Government Pleaders A.I. Patel and S.L. Babar, Advocates S.R. Nargolkar and Neeta Patil
Click here to read/download the Judgment