M/S Mahendra Logistics India Pvt.Ltd. Through Its Director Lalit Mohan Goyal vs Nagar Palika Parishad Shivpuri

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IN THE HIGH COURT OF MADHYA PRADESH
AT GWALIOR

BEFORE
HON'BLE SHRI JUSTICE MILIND RAMESH PHADKE
WRIT PETITION No. 37075 of 2024
M/S MAHENDRA LOGISTICS INDIA PVT.LTD. THROUGH ITS
DIRECTOR LALIT MOHAN GOYAL
Versus
NAGAR PALIKA PARISHAD SHIVPURI AND OTHERS
Appearance:
Shri Prashant Sharma - Advocate for the petitioner.
Shri Soumya Pawaiya -Advocate for respondents No.1 and 2.
Shri Rinkesh Goyal - Govt. Advocate for respondents No.3 to 5/State.
RESERVED ON :- 24/06/2026
DELIVERED ON :- 1/07/2026
ORDER
The present petition, under Article 226/227 of the Constitution of
India, has been filed by the petitioner seeking following reliefs:-
"A. The impugned order dated 08.11.2024 Annexure P/1 be
set aside and respondent be directed not to restrain the petitioner
from continuing its construction project in the interest of justice.
B. The any other relief which this Hon'ble Court deem fit in
the facts and circumstances of the instant case."
FACTS
Short facts of the case are that the petitioner is a private limited
company duly incorporated under the provisions of the Companies Act,
2013, and is engaged in the business of real estate development. Shri Lalit

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Mohan Goyal, Director of the petitioner company, has been duly authorized

to institute and prosecute the present writ petition on behalf of the company.
The petitioner undertook the development of a commercial-cum-residential
project known as "Sandhya Luxuriya" over land bearing Survey No. 248/1,
ad-measuring approximately 5,220 square metres, situated at Village
Bachora, Tehsil and District Shivpuri (M.P.). The petitioner acquired the said
property by way of a registered sale deed dated 25.07.2022, whereupon its
name was duly mutated in the revenue records and the requisite diversion of
land was also obtained. Thereafter, the petitioner obtained all statutory
permissions and approvals required for the development of the project. A
Nazul No Objection Certificate was issued by the State Government on
11.11.2022. The Town and Country Planning Department approved the
development plan vide Permission No.SVPLP221122825, dated 27.12.2022,
together with the approved layout and site plan. Subsequently, the petitioner
was granted a Colonizer Licence dated 07.09.2023 under the provisions of
the Madhya Pradesh Municipalities Act, 1961, followed by permission under
the Madhya Pradesh Municipality (Colony Development) Rules, 2021 by the
Collector, Shivpuri, on 29.12.2023. The petitioner also obtained building
permission from the respondent/Municipal Council vide order dated
04.03.2024 and the sanctioned building plan specifically permitted
construction of Basement-I ad-measuring 2,764 square metres and
Basement-II ad-measuring 2,815 square metres. The petitioner thereafter
commenced construction strictly in accordance with the sanctioned plans and
permissions granted by the competent authorities. The project was duly

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registered with the Real Estate Regulatory Authority (RERA) on 19.06.2024,

with the prescribed period for completion extending from 14.06.2024 to
03.03.2027. Since commencement of the project, the petitioner has been
regularly complying with the requirements of the RERA Act and the Rules
framed thereunder, including submission of quarterly progress reports duly
certified by the approved engineer. The petitioner had invested
approximately Rs.4.68 crores in the project by utilizing substantial borrowed
funds, thereby incured considerable financial obligations.
To the surprise of the petitioner, Respondent Nos.1 and 2 issued the
impugned notice dated 08.11.2024 directing him to immediately stop all
construction activities on the allegation that the petitioner had exceeded the
permissible basement construction area beyond 1,566 square metres. The
impugned notice further alleged violation of the provisions of the Madhya
Pradesh Nagar Tatha Gram Nivesh Adhiniyam, 1973 and the Madhya
Pradesh Land Development Rules, 2012, and called upon the petitioner to
produce various project-related approvals and documents. Immediately upon
receipt of the impugned notice, the petitioner suspended the ongoing
construction work and thereafter, it submitted a detailed reply pointing out
that the construction being undertaken was strictly within the limits
sanctioned under the building permission dated 04.03.2024. The petitioner
specifically brought to the notice of the respondents that the permissible
basement area under the sanctioned building plan extended up to 2,815
square metres and, therefore, the allegation of unauthorized construction
beyond 1,566 square metres was wholly unfounded. Despite submission of

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the aforesaid reply and production of all relevant approvals, the respondents

have neither withdrawn the impugned notice nor passed any reasoned order
thereon. Being aggrieved by the arbitrary, illegal and unreasonable action of
the respondents in issuing the impugned notice and preventing continuation
of sanctioned construction project, the petitioner is constrained to file the
present petition.
ARGUMENTS
Learned counsel for the petitioner submitted that the impugned notice
dated 08.11.2024 is wholly arbitrary, illegal and liable to be quashed, as it
has been passed on an erroneous factual premise and in complete disregard
of the statutory provisions governing building construction under the
Madhya Pradesh Nagar Tatha Gram Nivesh Adhiniyam, 1973 and the
Madhya Pradesh Bhumi Vikas Rules, 2012. The respondents have alleged
that the petitioner was permitted to construct a basement over an area of only
1,566 square metres, whereas the sanctioned building permission issued by
Respondent No.1 on 04.03.2024 expressly permits construction of
Basement-I ad-measuring 2,764.31 square metres and Basement-II ad-
measuring 2,815.58 square metres. The respondents, therefore, have
proceeded contrary to their own sanctioned building permission, rendered the
impugned notice ex facie arbitrary and unsustainable.
Learned counsel further submitted that before commencement of
construction, the petitioner obtained every statutory approval contemplated
under law and the petitioner obtained the Nazul No Objection Certificate,
approval of the development plan from the Town and Country Planning

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Department, Colonizer Licence, permission under the Madhya Pradesh

Municipality (Colony Development) Rules, 2021, building permission from
the Municipal Council and registration under the Real Estate (Regulation and
Development) Act, 2016. After scrutiny of the sanctioned plans and the
applicable development control regulations, the competent authority granted
building permission specifically approving construction of two basement
floors of the aforesaid dimensions. Consequently, the respondents cannot
subsequently disregard their own statutory approval without first modifying
or cancelling the same in accordance with law.
Learned counsel further submitted that the impugned notice proceeds
on a complete misinterpretation of the provisions of the Madhya Pradesh
Bhumi Vikas Rules, 2012, as the Rules provide a comprehensive code
regulating development permissions, floor area ratio, open spaces and
basement construction. However, none of the provisions relied upon by the
respondents prescribe any ceiling restricting the basement area to 1,566
square metres.
Inviting the attention of this Court to Rule 2(7) of the Madhya Pradesh
Bhumi Vikas Rules, 2012, learned counsel submitted that the Rule merely
defines the expression "basement" to mean that part of a building which is
constructed below the plinth level and further recognizes that, depending
upon the topography of the site, the portion of a building below the ground
or reference level may also be treated as a basement. The definition is purely
descriptive and explains the nature and location of a basement. It does not
prescribe any quantitative restriction on the area of a basement. The

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respondents have, therefore, erroneously construed the statutory definition as

imposing a limitation which the Rule itself does not contain.
While referring to Rule 2(20) defining "covered area" or "ground
coverage", learned counsel further submitted that the Rule provides that
'covered area' means the area of land occupied by the plinth of the building at
the ground floor level and expressly excludes several components such as
cantilevered projections, podiums, stilts, staircases, fire escapes, ramps,
mechanized parking areas, lift wells, service ducts, watchmen huts and pump
rooms while calculating the covered area. Thus, the Rule deals exclusively
with computation of ground coverage and has no bearing upon the
permissible extent of basement construction. The respondents have failed to
appreciate the distinction maintained by the Rules between "covered area"
and "basement area", thereby arrived at a wholly erroneous conclusion.
Learned counsel further submitted that the development norms
governing the petitioner's project are prescribed under Rule 42(1) read with
Table No.4 of the Madhya Pradesh Bhumi Vikas Rules, 2012. Table No. 4
applies to plots on which buildings having a height above 12.5 metres and up
to 30 metres are proposed. The Table prescribes the minimum road width,
minimum plot area, frontage, permissible Floor Area Ratio (FAR), building
height and mandatory minimum open spaces (MOS). The petitioner's plot
measures 5,219.81 square metres, has a frontage of 45.740 metres, is situated
in a commercial zone and falls within Entry No.3 of Table No. 4. The
sanctioned building permission records that the petitioner has maintained a
Front MOS of 12.34 metres, Rear MOS of 7.50 metres, Side MOS-I of 7.50

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metres, Side MOS-II of 7.54 metres, Permissible FAR of 2.00, Total

Permissible Built-up Area of 10,439.62 square metres, Proposed Built-up
Area of 10,368.03 square metres, and Ground Coverage well within the
permissible limit of 60%. Thus, every development parameter prescribed
under Rule 42 and Table No. 4 stands fully satisfied.
Learned counsel submitted that neither Rule 42 nor Table No. 4
prescribes any maximum permissible basement area. The statutory scheme
regulates the building through FAR, ground coverage, setbacks, building
height and other planning norms. Once these parameters are complied with
and the competent authority grants building permission after scrutiny of the
plans, the respondents cannot subsequently invent an altogether different
restriction not found in the Rules.
While emphasising Rule 76 of the Madhya Pradesh Bhumi Vikas
Rules, 2012, which specifically governs basement construction, learned
counsel submitted that Rule 76 is a complete code dealing with the
construction, dimensions, use and safety requirements relating to basements
and Sub-rule (2) expressly permits construction of basements in all land use
categories, subject only to the conditions enumerated therein. The first
condition is that the basement shall not extend into the prescribed Minimum
Open Space (MOS), except to the extent permitted by the proviso. As
demonstrated by the sanctioned building plan, the petitioner has maintained
every prescribed setback in accordance with Rule 42 and Table No. 4, and
there is no allegation whatsoever in the impugned notice regarding
encroachment upon the mandatory open spaces.

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Learned counsel further submitted that Rule 76(2)(b) merely requires

that the plinth level of the building shall not exceed 0.45 metres above the
surrounding ground level, while Rule 76(2)(c) recognizes that, depending
upon the topography of the site, the portion of a building situated below the
ground or reference level shall also be treated as a basement and, if habitable,
shall be included while computing the Floor Area Ratio. Therefore, the Rule
itself contemplates extensive basement construction and merely regulates its
treatment for planning purposes. It nowhere prescribes any statutory ceiling
limiting the physical area of a basement.
It was further submitted that Rule 76(3) specifically authorizes use of
basements for storage, strong rooms, machinery, parking and, in specified
cases, commercial activities in the first basement of commercial plots
satisfying the prescribed conditions. The petitioner's project is admittedly
situated in a commercial zone and has been sanctioned as a mercantile
building. The competent authority, after considering the statutory
requirements, approved construction of two basement levels. Thus, the
respondents cannot subsequently contend that the very basement approved by
them has become unauthorized.
Learned counsel also referred to Rule 76(4), which prescribes the
technical requirements relating to minimum clear height, ventilation,
drainage, waterproofing, access, ramps, fire safety and structural
arrangements. Significantly, the impugned notice does not allege violation of
any of these mandatory statutory requirements. The sole allegation relates to
the extent of basement area, which finds no support anywhere in Rule 76.

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Attention was also invited to Rule 76(5), which expressly permits

construction of multi-level basements up to three levels, subject to fulfilment
of the prescribed conditions relating to frontage, plot dimensions, road width
and detached building configuration. The petitioner's project satisfies these
statutory requirements. In fact, the competent authority itself sanctioned
construction of two basement levels after examining these very conditions.
This clearly demonstrates that the respondents had consciously exercised
their statutory powers while granting permission and cannot now take a
contradictory stand.
Learned counsel submitted that Rule 76(6) further clarifies that where
any built form below the ground or reference level is used as habitable
accommodation because of the existing topography, such area shall merely
be included in the computation of the Floor Area Ratio. Once again, the Rule
regulates the treatment of basement area for FAR purposes and does not
impose any restriction upon its physical extent.
Learned counsel further submitted that a harmonious reading of Rules
2(7), 2(20), 42 and 76 unmistakably demonstrates that the statutory
framework regulates development by prescribing definitions, planning
parameters, FAR, ground coverage, open margins and conditions for
basement construction. None of these provisions prescribe any prohibition
against constructing a basement exceeding 1,566 square metres. On the
contrary, the respondents themselves scrutinized the petitioner's proposal
under the said Rules and thereafter, granted permission for Basement-I
measuring 2,764.31 square metres and Basement-II measuring 2,815.58

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square metres. The impugned notice is therefore founded upon a factual

assumption wholly inconsistent with the statutory approvals granted by the
respondents themselves.
Learned counsel further submitted that immediately upon receipt of
the impugned notice, the petitioner submitted a detailed reply enclosing the
sanctioned building permission and pointing out that the basement
construction was strictly within the sanctioned limits. Despite the same, the
respondents failed to consider the petitioner's explanation and did not pass
any reasoned order. Instead, they continued to restrain the petitioner from
carrying on construction, thereby acting in complete violation of the
principles of natural justice and fair administrative action.
Learned counsel was lastly submitted that the petitioner has already
invested more than Rs.4.68 crores in the project after obtaining all statutory
approvals and has undertaken substantial financial commitments. The
arbitrary stoppage of construction has resulted in enormous financial loss,
escalation of project cost, mounting interest liability, delay in completion of
the project and serious prejudice to the petitioner's commercial reputation.
The respondents' action, being contrary to the sanctioned building
permission as well as the statutory provisions governing basement
construction, is arbitrary, unreasonable and violative of Article 14 of the
Constitution of India. The impugned order is, therefore, liable to be set aside,
and the respondents deserve to be directed not to interfere with the
petitioner's construction activities being carried out strictly in accordance
with the sanctioned plans and permissions.

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Per contra, learned counsel appearing for respondents submitted that

the writ petition is devoid of merit and deserves to be dismissed, as the
impugned notice dated 08.11.2024 was issued after a site inspection revealed
that the petitioner had undertaken basement construction over an area of
approximately 2,876 square metres, whereas the maximum permissible
ground coverage, as approved by the Town and Country Planning
Department under the sanctioned layout plan, was restricted to 1,566 square
metres.
Learned counsel further submitted that the development permission
granted by the Town and Country Planning Department constituted the
governing planning approval, and the building permission issued by the
Municipal Council was required to conform to the said approval as well as
the provisions of the Madhya Pradesh Nagar Tatha Gram Nivesh Adhiniyam,
1973 and the Madhya Pradesh Bhumi Vikas Rules, 2012. Rule 42 read with
the applicable development norms prescribed the permissible ground
coverage at 30% of the total plot area. Since the petitioner's plot measured
5,220 square metres, the permissible ground coverage was 1,566 square
metres.
It was further submitted that the restriction relating to ground coverage
equally applied to the basement, and therefore the petitioner was not entitled
to construct a basement exceeding the sanctioned ground coverage area.
Although the building permission dated 04.03.2024 reflected basement areas
of 2,764.31 square metres and 2,815.58 square metres, the respondents
contended that such permission had been issued inadvertently and could not

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override or dilute the statutory development norms or the planning approval

granted by the Town and Country Planning Department.
Learned counsel further submitted that the impugned notice was issued
only after the competent authority verified the construction at the site and
found the petitioner to be in violation of the sanctioned planning parameters.
It was argued that the petitioner had obtained interim protection without fully
disclosing the restriction contained in the approved layout plan relating to
maximum ground coverage and had, therefore, not approached this Court
with complete candour.
It was further submitted that the respondents have acted strictly in
discharge of their statutory duties to ensure compliance with the provisions
of the Madhya Pradesh Nagar Tatha Gram Nivesh Adhiniyam, 1973 and the
Madhya Pradesh Bhumi Vikas Rules, 2012, and the impugned notice was
issued to prevent unauthorized construction in excess of the permissible
limits. It is, thus, prayed that the writ petition be dismissed and the interim
protection granted to the petitioner be vacated.
Heard counsel for the parties and perused the record.
DISCUSSION AND CONCLUSION
The controversy involved in the present case lies in a narrow compass.
The sole basis of the impugned notice dated 08.11.2024 is that the petitioner
was allegedly permitted to construct a basement only over an area of 1,566
square metres, whereas the construction carried out by the petitioner
extended to approximately 2,876 square metres. The respondents have
proceeded on the assumption that the permissible ground coverage under the

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sanctioned development plan also constitutes the maximum permissible

basement area. Such an assumption, in the considered opinion of this Court,
is not borne out either from the sanctioned building permission or from the
statutory provisions governing the subject. The statutory framework
contained in the Madhya Pradesh Bhumi Vikas Rules, 2012 draws a clear
distinction between the concepts of "basement", "covered area", "ground
coverage", "Floor Area Ratio (FAR)" and the conditions regulating basement
construction. These expressions operate in different fields and cannot be
treated as interchangeable.
Rule 2(7) of the Madhya Pradesh Bhumi Vikas Rules, 2012 merely
defines the expression "basement" as that part of a building constructed
below the plinth level and further recognizes that, depending upon the
topography of the site, a portion of the building below the ground or
reference level may also be regarded as a basement.
Likewise, Rule 2(20) defines "covered area" or "ground coverage" to
mean the area of land covered by the plinth of the building at the ground
floor level and specifically excludes several components such as cantilevered
projections, podiums, stilts, staircases, fire escapes, ramps, mechanized
parking areas, lift wells and other specified structures from its computation.
The Rule regulates only the method of calculating the footprint of the
building at the ground level and neither defines nor regulates the permissible
extent of basement construction. Further, Rule 2(52) defines the expression
"plinth" to mean the portion of a structure between the surface of the
surrounding ground and the surface of the floor immediately above it. The

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definition of "plinth" is intended only to identify the reference level of a

building for planning and construction purposes and does not prescribe any
limitation on the area or extent of a basement. A conjoint reading of Rules
2(20) and 2(52) makes it abundantly clear that the Rules maintain a
distinction between the concepts of "ground coverage" and "plinth", and
neither provision stipulates that the basement area must be restricted to the
permissible ground coverage. The respondents have, therefore, committed a
manifest error in equating the concept of ground coverage with basement
area, a restriction which finds no support in the statutory scheme of the
Madhya Pradesh Bhumi Vikas Rules, 2012.
The respondents have placed considerable reliance upon Rule 42 read
with Table No. 4 of the Madhya Pradesh Bhumi Vikas Rules, 2012. A
careful reading of the said provisions shows that they prescribe the planning
and development control norms applicable to plots depending upon their
dimensions, frontage, road width and proposed building height. The said
provisions regulate parameters such as the minimum plot area, frontage,
Floor Area Ratio (FAR), permissible ground coverage, building height and
mandatory Minimum Open Spaces (MOS). The stipulation regarding
permissible ground coverage of 30% merely regulates the maximum extent
of the building footprint at the ground floor level and the floors constructed
above the ground level. It is intended to ensure adequate open spaces,
ventilation, access and orderly urban development. The concept of ground
coverage is, therefore, intrinsically linked to the portion of the building
occupying the surface of the plot at the ground level. It neither governs nor

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restricts the extent of basement construction, which is a distinct component

of a building situated below the ground level and is separately regulated
under Rule 76 of the Rules. Had the rule-making authority intended that the
permissible percentage of ground coverage should also operate as a ceiling
upon basement construction, such a restriction would have been expressly
incorporated either in Rule 42 or in Rule 76. The conspicuous absence of
any such provision clearly indicates that the percentage of permissible
ground coverage cannot be imported to restrict the basement area by
implication. The respondents have, therefore, erroneously treated the
permissible ground coverage of 30% as the maximum permissible basement
area, although the statutory scheme draws no such equation.
The petitioner's project admittedly satisfies every requirement
prescribed under Rule 42 read with Table No. 4. The sanctioned building
permission itself records that the petitioner's plot measures 5,219.81 square
metres, the permissible FAR is 2.00, the total permissible built-up area is
10,439.62 square metres, the proposed built-up area is 10,368.03 square
metres, the front Minimum Open Space measures 12.34 metres and the rear
and side Minimum Open Spaces exceed the prescribed minimum of 7.50
metres. The permissible ground coverage has also been duly considered by
the competent authority while sanctioning the building plans. Having
scrutinized the proposal with reference to all the development control
parameters prescribed under Rule 42 and Table No. 4, the competent
authority consciously granted permission for construction of Basement-I
measuring 2,764.31 square metres and Basement-II measuring 2,815.58

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square metres. Once the planning authority itself found the proposal to be in

conformity with the applicable development control norms and granted
statutory approval, the respondents cannot subsequently reinterpret the
concept of ground coverage so as to invalidate the very basement
construction which they had earlier sanctioned.
This Court is unable to accept the submission of the respondents that
the permissible ground coverage prescribed under Rule 42 automatically
limits the basement area. Rule 42 nowhere contains any provision prescribing
that the basement area shall always remain confined to the extent of ground
coverage. Had the rule-making authority intended to impose such a
restriction, it would have expressly incorporated the same. The Court cannot
introduce, by interpretation, a limitation which the statute itself does not
prescribe.
The matter is put beyond any pale of controversy by Rule 76 of the
Madhya Pradesh Bhumi Vikas Rules, 2012, which exclusively governs
basement construction. Rule 76(2) expressly permits construction of
basements in all categories of land use subject to the conditions stipulated
therein. The Rule requires that the basement shall not extend into the
prescribed Minimum Open Space (MOS), the plinth level shall not exceed
the prescribed limit and in appropriate cases, portions below the ground level
shall be treated as basements.
A cumulative reading of Rule 76 unmistakably demonstrates that the
Rules regulate the manner, conditions and permissible use of basement
construction; however, they do not prescribe any independent statutory

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prohibition restricting the basement area to the extent of the permissible

ground coverage. Significantly, the respondents have not alleged violation of
any of the conditions stipulated under Rule 76 relating to minimum open
spaces, plinth level, ventilation, structural safety, drainage, waterproofing,
access or fire safety. The sole allegation pertains to the extent of the
basement area, which, as discussed hereinabove, finds no support in the
statutory framework.
Equally significant is the fact that the competent Municipal Authority
itself issued the building permission dated 04.03.2024 specifically
sanctioning Basement-I measuring 2,764.31 square metres and Basement-II
measuring 2,815.58 square metres. The respondents do not dispute the
issuance of the said permission. Their subsequent stand that the permission
was granted inadvertently cannot furnish a valid basis to penalize the
petitioner. An administrative authority cannot, without first reviewing,
modifying or cancelling its own permission in accordance with law, proceed
against a citizen by alleging violation of a permission which the authority
itself granted. Administrative certainty and fairness require that public
authorities remain bound by their own sanctioned approvals unless such
approvals are lawfully withdrawn.
The impugned notice proceeds on a factual premise directly
inconsistent with the sanctioned building permission and on a legal
interpretation unsupported by the Madhya Pradesh Bhumi Vikas Rules,
2012. The action of the respondents is thus vitiated by non-application of
mind, misconstruction of the statutory provisions and arbitrariness. Such

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administrative action cannot withstand judicial scrutiny under Article 226 of

the Constitution of India.
Accordingly, the impugned notice/order dated 08.11.2024 (Annexure
P/1) is hereby quashed. The respondents are directed not to interfere with the
construction activities of the petitioner so long as the construction is carried
out strictly in accordance with the sanctioned building permission dated
04.03.2024 and the other statutory permissions granted by the competent
authorities. It is, however, made clear that this order shall not preclude the
respondents from taking action in accordance with law in the event of any
future violation of the applicable statutory provisions or the sanctioned
building plans, after following the procedure prescribed by law.
The writ petition is accordingly allowed. There shall be no order as to
costs.
(MILIND RAMESH PHADKE)
JUDGE
Digitally signed by PAWAN KUMAR
DN: c=IN, o=HIGH COURT OF MADHYA PRADESH BENCH AT
GWALIOR,
2.5.4.20=b864d1ab4ace2215bfcf3ab301c34d631287f1b1cdd9 0b4a49f265f02d9d593f, ou=HIGH COURT OF MADHYA
PRADESH BENCH AT GWALIOR,CID - 7064434,
postalCode=474001, st=Madhya Pradesh,
serialNumber=61b9d129971d2ea4fd4455ed49ea436ea65e26
164beeed89153191c56e98ce21, cn=PAWAN KUMAR
Date: 2026.07.01 16:30:21 +05'30'
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