Jyoti Builders vs. Chief Executive Officer

REPORTABLE
2025 INSC 1372
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NO. 14512 OF 2025
(arising out of S.L.P. (Civil) No. 3405 of 2025)

JYOTI BUILDERS …APPELLANT(S)
VERSUS
CHIEF EXECUTIVE OFFICER & ORS. …RESPONDENT(S)
J U D G M E N T
J.B. PARDIWALA, J. :
1. Leave granted.
2. This appeal arises from the judgment and order passed by the
High Court of Judicature at Bombay (Original Ordinary Civil
Jurisdiction) dated 18.12.2024 by which the writ petition filed by the
appellant herein seeking to challenge the orders passed by the
respondent No. 1 herein dated 03.10.2022 and respondent No. 3 herein
dated 07.10.2024 respectively came to be dismissed.
3. Over and above the challenge to the two orders referred to above,
the appellant also prayed before the High Court for a writ of mandamus
directing the respondent Nos. 1 and 3 herein respectively to implement
the order dated 26.02.2015 passed by the respondent No. 1 herein i.e.
the Chief Executive Officer, Slum Rehabilitation Authority (CEO-SRA).
4. This litigation has a chequered history. The facts are quite
Signature Not Verified
complicated. In such circumstances, we need to give a fair idea about
Digitally signed by
VISHAL ANAND
Date: 2025.12.02
15:29:56 IST
Reason:
this litigation which, according to the High Court, was a third round of
litigation between the parties.
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FACTUAL MATRIX
5. The dispute in the present case relates to a parcel of land
admeasuring 2,005 sq. mts. bearing CTS No.620/A/1A/1(Part) (now
renumbered as CTS No. 620/A/1A/1B/1 and 620/A/1A/1B/2) of
Village Malad in Taluka Borivali, Mumbai Suburban District (“
Subject
Property ”).
6. The Subject Property was originally owned by F.E. Dinshaw
Trust. Since there were hutments on the Subject Property and the same
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had no proper hygiene and sanitation, it was declared as a slum on 26
November, 1987 under Section 4 of the Maharashtra Slum Areas
(Improvement, Clearance and Redevelopment) Act, 1971 (for short “ Slum
Act ”).
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7. On 25 March, 1991, the Development Plan of 1991 for Mumbai
was published, wherein the Subject Property was reserved for
Recreational Ground (“ RG ”). The Subject Property even today is reserved
for RG.
8. The respondent No. 5, i.e., Phuldai R. Yadav claims to have
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purchased the Subject Property from the Trust on 18 September, 1991
under a distressed sale for an amount of Rs. 1,06,000/-. Within a period
of 6 months from the date of purchase, the respondent No. 5 is said to
have entered into a Memorandum of Understanding (MOU) dated
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9 February, 1992 (“19 92 MOU” ) for sale of the Subject Property with the
appellant’s predecessor in interest viz . Harishree Enterprises
( “ Harishree Enterprises ” ). The respondent No. 5 is said to have granted
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her consent to Harishree Enterprises for redevelopment. It is the case of
the appellant that such act on the part the respondent No. 5 is a pointer
that she was not interested in developing the property herself or in any
case, had waived her preferential right, if any, to redevelop the slum land
i.e. the Subject Property way back in the year 1992.
9. Initially, Harishree Enterprises propounded the slum scheme on
a larger property consisting of seven plots of land, admeasuring 19456.7
sq. mts. (“ Larger Property ”). The Subject Property is one of the said seven
plots. The 1992 MOU was considered as grant of consent by the owner
for the proposed redevelopment as per the prevailing law. The other six
plots of land are either owned by the appellant’s predecessor (and
thereafter the appellant) or the development rights/consent for the slum
scheme had been given for the same.
10. Accordingly, a survey was undertaken to identify the number of
slum dwellers. As per the survey, 34 slum dwellers were found to be
residing on the Subject Property.
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11. On 30 January 1997, Certified Annexure-II (“ Annexure II ”) was
issued by the SRA in respect of the slum dwellers of the Larger Property
including the Subject Property. Annexure II contains a plan on which
slum scheme is to be implemented. The plan annexed to Annexure II
includes the Subject Property and contain names/details of 34 slum
dwellers who had their hutments on the Subject Property.
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12. On 3 September, 1997, a Letter of Intent (“ 1997 LOI ”) was
issued in favour of Harishree Enterprises for implementation of the Slum
Scheme on Larger Property, which includes the Subject Property.
13. In the meantime, there was an agreement between Harishree
Enterprises and one M/s. Vikas Housing Ltd. (“ Vikas Housing ”) for joint
development. This led to a dispute, which, in turn, was ultimately
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resolved through Consent Terms dated 3 August, 2000. In accordance
with the consent terms, Vikas Housing became entitled to develop
12606.7 sq. mts. (“ Project Property ”), which includes the Subject
Property. The said Consent Terms came to be subsequently registered.
In the present appeal we are not concerned with the balance portion of
the Larger Property which came to Harishree Enterprises’s share as per
the Consent Terms.
14. The appellant claims to have acquired its rights from Vikas
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Housing for Project Property. On 9 August, 2005, a revised LOI came to
be issued in favour of the appellant thereby sanctioning slum scheme on
Project Property and Annexure II was certified. The plan includes the
Subject Property. The 34 slum dwellers whose hutments were on the
Subject Property were included in the Annexure II issued to the
appellant.
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15. A Public Notice dated 8 June, 2004 was issued by the SRA
intimating the public at large that a Letter of Intent with respect to the
Project Property including the Subject Property had been issued to
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Harishree Enterprises for rehabilitation and redevelopment of slum
dwellers.
16. Thereafter four Rehabilitation Buildings were constructed
between the year 2005 and 2011 and the Occupation Certificate (OC) for
the fifth Rehabilitation building was issued by the SRA in the year 2022.
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17. On 26 February, 2015 (“ 2015 Order ”), a detailed order came to
be passed by the CEO-SRA after giving notice to and hearing to all the
concerned including the respondent No. 5 (Phuldai, the then owner) inter
alia holding that the Slum Scheme of the appellant had substantially
been implemented on the entire area covering the Project Property
admeasuring 12,606 sq. mts. (including the Subject Property) and that a
substantial number of slum dwellers had already been accommodated
and in furtherance of the slum scheme, the Subject Property was liable
to be acquired in the interest of the slum scheme and the slum dwellers
on the Subject Property had to be rehabilitated by the appellant. It
further states that the respondent No. 5 (Phuldai) would be entitled to
monetary compensation amount after acquisition. The 2015 Order never
came to be challenged by the respondent No.5 (Phuldai) and thus, has
attained finality.
18. Accordingly, on the application filed by the society of the slum
dwellers, a survey for demarcation of the Subject Property was carried
out by the Officers of SRA and requests were made by the Slum Societies
for acquisition of the Subject Property from time to time as per the 2015
Order. It is the case of the appellant that the Full Occupation Certificate
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for the sale building in favour of the appellant was not granted on the
ground that the Subject Property of the respondent No. 5 (Phuldai) was
yet to be acquired under Section 14 of the Slum Act and handed over to
MCGM.
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19. On 26 March, 2022, the respondent No. 5 (Phuldai) sold the
Subject Property to the respondent No. 4 (“ Alchemi Developers ”).
According to the appellant, it was sold on the pretext that there are slum
dwellers on the Subject Property who are required to be rehabilitated. It
is alleged by the appellant that the subject property was sold with the
knowledge that the slum scheme had already been implemented.
However, the respondent No. 4 (Alchemi Developers) has now floated its
own scheme giving a list of 34 persons, most of whom, according to the
appellant, have already been rehabilitated.
20. The subject matter of the present dispute is only to the extent of
2005 sq. mts. i.e. the Subject Property which was owned by the
respondent No. 5 (Phuldai) and which has belatedly been acquired by
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another builder, i.e. respondent No. 4 (Alchemi Developers) on 26
March, 2022 with knowledge that the Slum Scheme on the area of
12606.7 sq. mts., i.e. the Project Property, including Subject Property,
had fully been implemented by rehabilitating 498 slum dwellers. It is the
case of the appellant that the SRA has changed its earlier consistent
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stand till the issuance of letter dated 14 March, 2022 only after the
respondent No. 4 (Alchemi Developers) acquired rights from the
respondent No. 5 (Phuldai), i.e. after March 2022.
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21. In such circumstances referred to above, the appellant invoked
the writ jurisdiction of the High Court and questioned the legality and
validity of the orders passed by the respondent No. 1 (CEO-SRA) granting
sanction to the respondent No. 4 (Alchemi Developers) and refusal to
implement the 2015 Order referred to above.
JUDGMENT OF THE HIGH COURT
22. The High Court first looked into Section 14(1) of the Slum Act.
Section 14 relates to the power of State Government to acquire land.
Section 14 of the Slum Act reads thus:-
“14. Power of State Government to acquire land
(1) Where on any representation from the Competent Authority
it appears to the State Government that, in order to enable the
Authority to execute any work of improvement or to redevelop
any slum area or any structure in such area, it is necessary
that such area, or any land within adjoining or surrounded by
any such area should be acquired the State Government may
acquire the land by publishing in the Official Gazette, a notice
to the effect that the State Government had decided to acquire
the land in pursuance of this section:
Provided that, before publishing such notice, the State
Government, or as the case may be, the Competent Authority
may call upon by notice the owner of, or any other person who,
in its or his opinion may be interested in, such land to show
cause in writing why the land should not be acquired with
reasons therefor, to the Competent Authority shall, with all
reasonable despatch, forward any objections so submitted
together with his report in respect thereof to the State
Government and on considering the report and the objections,
if any, the State Government may pass such order as it deems
fit.
1(A) The acquisition of land for any purpose mentioned in sub-
section (1) shall be deemed to be a public purpose.
(2) When a notice as aforesaid is published in the Official
Gazette, the land shall, on and from the date on which the
notice is so published, vest absolutely in the State Government
free from all encumbrances.”
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23. The High Court took notice of the proviso to Section 14 of the
Slum Act which imposes an obligation on the State Government to
consider the SRA’s report as well as the objections that might have been
raised by the owner as regards the acquisition. Based on such material,
the State Government would thereafter proceed to pass an appropriate
order as it may deem fit. The High Court observed that the State could
have proceeded with the acquisition subject to the conditions prescribed
in the proviso contained under Section 14 of the Slum Act referred to
above. The High Court recorded that indisputably the State Government
had failed to take steps contemplated under Section 14(1) referred to
above despite the order dated 26.02.2015. However, according to the
High Court, it was too late in the day now for Jyoti Builders (appellant
herein) to assert that the State Government should be directed to acquire
the subject property. In other words, the finding returned by the High
Court is that the respondent No. 5 (Phuldai) was never called upon to
develop the subject property in accordance with Section 14 of the Slum
Act. The High Court noted that Jyoti Builders (appellant herein) had
failed to take necessary steps for a period of seven years i.e. between
2015 and 2022. The High Court had also returned the finding that the
attempt now being made by Jyoti Builders is to acquire the subject
property by back door entry. If Jyoti Builders at all intended to acquire
the subject property, it could have purchased it. It is when Jyoti Builders
failed to purchase the subject property, then respondent No. 4 (Alchemi
Developers purchased it.
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24. The High Court thereafter considered the question whether the
respondent No. 4 herein (Alchemi Developers) had submitted a scheme
for the subject property. According to the appellant herein, the
respondent No. 4 (Alchemi Developers) is responsible for dragging one
and all to this litigation. The appellant has levelled serious allegations
against the respondent No. 4 alleging that it managed with the authority
concerned. However, the High Court returned the finding that since the
rights of respondent No. 5 (Phuldai), the owner of the subject property,
were yet to be adjudicated upon, the respondent No. 4 (Alchemi
Developers) would be entitled to submit its scheme for redevelopment.
25. The third issue that the High Court addressed itself was whether
the subject property was included in the slum scheme. In this regard,
the High Court returned the finding that subject property is not included
in the slum redevelopment scheme.
26. In such circumstances referred to above, the final conclusion
arrived at by the High Court reads thus:-
“14) Additionally, even as per Jyoti the benefits of subject
property were excluded. Furthermore, in light of Citispace vs.
State of Maharashtra (“Citispace”) Order dated 31" July 2002
in Writ Petition No 1152 of 2002 read together with the Order
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dated 25 July 2014, no new scheme could be implemented
on the land reserved for garden. This was the view of the CEO
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SRA in Order dated 26 February 2015 where he noted the
following:
“Further with regard to the land owned by
Respondent No. 2 viz. Shrimati Phuldai R Yadav, the
record shows that the said land is reserved for
recreation ground and therefore the same cannot be
developed in view of the order dated 31-7-2002
passed by the Honourable High Court at Bombay in
Writ Petition No. 1152 of 2002 [Citispace v State of
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Maharashtra]. However since the land is occupied
and encroached by the Slum Dwellers, they are
required to be rehabilitated as Project Affected
Persons and it is the responsibility of the developer
to handover the RG plot of land to MCGM.”
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It was only after 1 March 2022 that an owner could
propose a scheme for such property. Therefore, the question of
Phuldai attempting to propound a scheme post SRA's order of
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26 February 2015 does not arise.
15) Regarding the contention of Mr. Kadam that, the CEO SRA
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whilst passing the Order dated 3 October 2022 had reviewed
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the Order dated 26 February 2015, - we reject it outrightly.
We clarify that the CEO SRA acted solely in compliance with
the Court's directive to examine the contentions raised by Jyoti
and Alchemi in Jyoti's Petition itself, which opposed the
implementation of S R Scheme on the subject property by
Alchemi. The CEO SRA’s role was limited to addressing the
rival contentions and did not involve reopening or
reconsidering the earlier decision. Therefore Mr Kadam's claim
that the CEO SRA “reviewed” the matter is unfounded and is
hereby rejected. Consequently, the judgements of Kapra
Mazdoor Ekta Union (supra), Deoki Nandan Parashar (supra)
and Chiranjilal Shrilal Goenka (supra) cited by Mr. Kadam will
render no assistance to the Petitioner.
16) We agree with Mr. Chinoy’s argument that Jyoti has
already benefitted from accommodating the slum dwellers
under the scheme by receiving necessary FSI under the Rules.
Therefore, the cost of relocation has effectively been
compensated to Jyoti.
17) The AGRC has rightly asked the SRA to ‘look into’ the
matter. We now expect that the SRA will not adopt a contrary
stance, especially after recording that the slum dwellers on
Phuldai’s plot have been already allocated apartments.
18) Considering the case from another perspective, in our view,
first Harishree and now Jyoti's intent appears on usurping
Phuldai’s land in some form or manner and to deprive her of
her legitimate benefit under the law.
18.1) It is undisputed that prior to the slum scheme proposed
by Harishree, a MoU was entered into between Phuldai and
Harishree with the intent to purchase Phuldai’s land for
consideration. For reasons unknown, that MOU failed.
However, Harishree proceeded with the slum scheme,
assuming they would acquire Phuldai’s land at a later stage.
A significant portion of the plot (approximately 1905 sq. mtrs.)
remained vacant, as evidenced by the MOU. The LoI’s issued
from time-to-time further confirm this fact.
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19) A comparison of LoI dated 4 June 2004 and 9 August
2005 reveals that not only was the area of the plot reduced,
but the number of slum dwellers slated for rehabilitation was
also reduced from 574 to 472. It is undisputed that the
conditions outlined in the LoIs required Harishree - and later
Vikas - to produce title documents and clear the land
concerning Phuldai Yadav’s plot. Since this was not
accomplished, the utilization of the FSI was kept in abeyance.
20) Pausing here for a moment, we ask ourselves: what
remained on the plot apart from FSI? There were only 34 slum
dwellers on a specific portion of the subject property that
needed rehabilitation. It is undisputed that this plot was
reserved for garden and HD purposes, meaning that the land
had to remain open and vacant. The FSI was, therefore, the
only component to be utilised - either on the same plot or
elsewhere.
21) As the FSI of the said plot was kept in abeyance, it raised
a significant question about the land’s inclusion in the scheme.
The LoIs clearly demonstrate that the SRA was not convinced
about Harishree’s or Jyoti’s title to the subject property. Even
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the CEO SRA’s order dated 26 February 2015 noted that
Jyoti will have to give clear title to MCGM. In our view it meant
that Jyoti was required to acquire it and that which its
predecessors had intended and based on which proposed the
scheme.
22) We believe that Harishree and now Jyoti, assumed they
would purchase the land from Phuldai and, in anticipation
relocated the slum dwellers. However, the critical question is,
if someone decides to relocate and clear the slum dwellers
from someone else's plot, can they subsequently claim
beneficial rights of the plot? In our view, the answer is in the
negative. Notably, Phuldai was never called upon to develop
the subject property as per Section 14(1) of the Slums Act.
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There is an inexplicable delay in enforcing the 26 February
2015 Order.
23) What Jyoti did during seven years between 2015 to 2022?
In our opinion, seeking acquisition now appears to be an
attempt at a backdoor entry. If Jyoti intended to acquire the
property, they could have purchased it. They did not and
Alchemi did. Therefore, any benefit or loss concerning the
property rightfully belongs to Alchemi alone.
24) Jyoti cannot claim a right over the property simply because
they rehabilitated the slum dwellers. At best, they are entitled
to compensation, which, in our view, has already been
provided by granting them an equivalent and/or adequate
area for sale.
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25) We reiterate that we find no error or illegality in the AGRC’s
findings that would warrant setting them aside. We thus
concur with the findings of the AGRC. In view of the above
deliberation, we find no merits in the Petition and therefore
dismiss it.”
27. In such circumstances referred to above, the appellant is here
before this Court.
SUBMISSIONS ON BEHALF OF THE APPELLANT
28. Mr. Shyam Divan, the learned senior counsel appearing for the
appellant, broadly submitted the following:-
(a) Subject Property is not excluded from the appellant’s
predecessor’s slum scheme of 1997 and the same continues to be an
integral part of the appellant’s slum scheme till date.
(b) No new slum scheme could have been propounded and/or
sanctioned in favour of the respondent No. 4 (Alchemi Developers) as
there are no slum dwellers to be rehabilitated.
(c) The SRA does not have jurisdiction to entertain or approve the
respondent No. 4’s scheme.
(d) As per the appellant’s scheme, the entire subject property is
required to be handed over to the MCGM as a Recreational Ground
(i.e. open green land), whereas the respondent No. 4 (Alchemi
Developers) has applied for slum rehabilitation scheme under DCPR
2034 and, if the same is approved, then the respondent No. 4 would
construct upon 65% of the RG area and would keep only 35% vacant
as RG. As per the learned senior counsel, this would lead to reduction
of RG in the city of Mumbai which already has been very low per
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capita green spaces. In such circumstances, the respondent No. 4’s
scheme ought not to have been accepted.
(e) A slum scheme in Mumbai was implemented as per Regulation
33(10) of DCR 1991 till 2018 and thereafter as per Regulation 33(10)
of DCPR 2034 (both provisions are in pari materia ). Appendix (IV) of
DCR 1991 and DCPR 2034 allows redevelopment of slum properties
by slum dwellers (self-redevelopment), through a developer, owner,
public authorities or NGOs. Thus, consent of owner is not mandatory
for implementation of slum scheme. In the event the owner does not
consent or redevelop the property, it can be acquired by the State
Government on the recommendation of the SRA. The owner gets
compensation as per Section 17 of the Slum Act.
(f) By 2015 Order, the CEO-SRA could be said to have adjudicated
the lis between the respondent No. 5 (Phuldai) and the appellant.
After hearing the respondent No. 5 (who belatedly objected to the
continuation of implementation of slum scheme), and considering the
rival contentions between the parties, by the 2015 Order, the CEO-
SRA held that the slum scheme of appellant has progressed
substantially and therefore the Subject Property cannot be excluded
from the scheme. The CEO-SRA saying so issued directions to the
Dy. Collector SRA to take steps for acquiring the Subject Property
under Section 14 of the Slum Act for the effective implementation of
the appellant’s slum scheme. There was no challenge to the 2015
Order; the same attained finality; and as such, could not have been
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revisited either by the parties or slum authorities respectively. The
respondent Nos. 4 (Alchemi Developers) and 5 (Phuldai) respectively
were aware that the 2015 Order is binding on them. To overcome
this, they have gone to the extent of misinterpreting the 2015 Order
by misconstruing the words ‘carve out’. The words ‘carve out’ have to
be read in the context of the finding and conclusion of the 2015
Order, which is to include the same and not exclude from the slum
scheme. As such, the purport of 2015 Order is that the property
should be “demarcated” i.e. carved out for the purpose of acquisition
and handing over the same to BMC. The demarcation was already
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undertaken on 6 October, 2016. The 2015 Order does not in any
manner suggest “taking out” the Subject Property out of the
appellant’s scheme.
(g) In such circumstances referred to above, the power of the SRA
under Section 14 of the acquisition is also coupled with duty to
acquire the Subject Property. Such a duty has been recognized by
this Court in the case of (i) State of Uttar Pradesh v. Jogendra
Singh , 1963 SCC OnLine SC 96, and (ii) State of Tamil Nadu v.
Governor of Tamil Nadu & Anr ., 2025 SCC OnLine SC 770.
29. Mr. Divan, the learned senior counsel further highlighted the
SRA’s diametrically opposite stance before and after the respondent No.
4 proposed its alleged illegal scheme which, according to him, is evident
from the following:-

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(a) From the year 1997 to 2022:
The SRA’s stand prior to Alchemi Developers coming in
picture is as follows:
(i) All the LOIs issued by the SRA clearly show that the
Subject Property is part of the appellant’s slum scheme.
(ii) The SRA included 34 slum dwellers on the Subject
Property in the Annexure II of the appellant’s slum scheme.
(iii) The SRA directed rehabilitation of the said 34 slum
dwellers in the rehab component of the appellant’s slum
scheme.
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(iv) By an Order dated 26 February, 2015, the SRA directed
acquisition of the Subject Property and stated that the
respondent No. 5 (Phuldai) would be entitled to monetary
compensation after the acquisition.
(v) In pursuance of 2015 Order, the Subject Property was
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demarcated by CTS Officer on 6 June, 2015.
(vi) When the appellant requested for grant of Occupation
Certificate in respect of the Sale Building No. 4, the SRA
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(respondent No.1) vide its letter dated 14 March ,2022
stated that the request for Occupation Certificate cannot be
granted as RG is not handed over and that the Subject
Property is yet to be acquired under Section 14(1) of the Slum
Act.
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(vii) On 20 April, 2022 the Tehsildar from the office of SRA
gave an opinion stating that necessary steps towards
acquisition should be taken with respect to the Subject
Property as per 2015 Order and in fact enclosed a draft Notice
to be issued under Section 14 (1) of the Slum Act and sent
the same to the CEO-SRA for further process.
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(viii) On 27 May, 2022 the Chief Legal Consultant of SRA
gave his opinion and stated that the Subject Property be
acquired as per 2015 Order.
(ix) From 2015 till 2022, it was a consistent stand of the SRA
that the Subject Property forms part of the appellant’s
scheme and thus was required to be acquired under Section
14(1) of the Slum Act for the benefit of the Slum Scheme of
the appellant.
(b) Events post Alchemi Developers – respondent No. 4 coming
into picture :-
30. According to Mr. Divan, the moment another builder i.e.
respondent No. 4 came into picture and started pursing its slum
scheme on the Subject Property, the office of SRA made a complete
volte face which can be seen from the following:
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(i) On 26 March, 2022 the respondent No. 5 (Phuldai) sold the
Subject Property to the respondent No. 4 (Alchemi Developers).
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(ii) Thereafter, in March-April 2022, the respondent No. 5 applied
for implementation of the Slum Scheme on the Subject Property
based on fraudulent list of slum dwellers (persons who were already
rehabilitated by the appellant). The true and correct status of list of
the slum dwellers submitted by the respondent No. 5 in its scheme
is set out by the appellant. This list, relied upon by the appellant at
every stage, from CEO-SRA to this Court, has not been denied by
the respondent No. 4.
(iii) After respondent No. 4 started pursuing its slum scheme, the
SRA made a complete volte face and started contending that the
Subject Property is excluded from the slum scheme and 2015 Order
need not be implemented, and the Subject Property should form
part of the respondent No. 5’s scheme, despite holding that all the
slum dwellers had already been rehabilitated.
(iv) After the new developer came into picture, the respondent No. 1
(SRA) has taken a stance which is contradictory to the order dated
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26 February, 2015 and the same amounts to review of its own
order i.e. order of his predecessor.
31. According to Mr. Divan, the CEO-SRA (respondent No. 1) could
not have taken the orders passed by his predecessor in review as no such
power is provided under the statute. He would submit that the order
dated 03.10.2022 passed by the CEO-SRA holding that acquisition of the
Subject Property as per the 2015 Order need not be undertaken amounts
to review of the 2015 Order directing acquisition of the Subject Property.
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32. He would thereafter contend that the findings returned by the
High Court to the effect that the appellant had already availed the FSI
benefit insofar as rehabilitation of 34 slum dwellers is concerned could
be said to be perverse. In this regard, he submitted that a perusal of the
LOI would indicate that the entire FSI benefit arising out of the Subject
Property is kept in abeyance. He would submit that the slum scheme is
implemented by the developer under the Slum Act. The developer gets
dual benefit - first rehabilitating the slum dwellers and secondly
entitlement to FSI for implementation of slum scheme. He strongly
contended that the entire FSI for the Subject Property has been kept in
abeyance. He asserted that, on the other hand, the respondent No. 4
(Alchemi Developers) seeks benefit of the entire FSI without
implementing the slum scheme or the clearing slum. According to Mr.
Divan, this is something absolutely illegal.
33. In the last, Mr. Divan contended that the respondent Nos. 4
and 5 respectively have misled this Court by submitting that 34 slum
dwellers on the subject property have been rehabilitated as Project
Affected Persons i.e. PAPs. According to him, the slum dwellers of the
subject property are part of Annexure II issued to the appellant and
therefore they have been rehabilitated in rehab component under the
slum scheme and cannot be rehabilitated as PAPs as per the orders and
directions of the respondent No. 1.
34. In such circumstances referred to above, Mr. Divan, the learned
senior counsel appearing on behalf of the appellant herein submitted
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that there being merit in his appeal, the same may be allowed and
appropriate relief may be granted.
SUBMISSIONS ON BEHALF OF THE RESPONDENT NOS. 1 and 2
35. Mr. Siddharth Dharmadhikari, the learned counsel appearing for
the respondent Nos. 1 and 2 respectively vehemently submitted that no
error, not to speak of any error of law, could be said to have been
committed by the High Court in passing the impugned judgment and
order.
36. It was submitted that the subject property does not form part of
the appellant’s slum scheme. As per Regulation 33(10) of DCR 1991 and
Guidelines issued in the year 1997, a slum scheme could have been
submitted only with the consent of the “owner” or after acquiring the
same in accordance with Section 14(1) of the Slum Act.
37. It was argued that indisputably the true and correct position in
tabular format is as under:-

19

38. It was argued that indisputably the respondent No. 5 namely
Phuldai was the owner of the subject property. According to the learned
counsel, the predecessor in title of the appellant had misrepresented to
have obtained the consent from the owner i.e. Phuldai on the basis of an
unregistered MOU between the appellant’s predecessor (Harishree
Enterprises) and the respondent No. 5 (Phuldai). It was pointed out that
the records reveal that the respondent No. 5 (Phuldai) had terminated
the unregistered MOU in 1995 itself. Such termination was challenged
by Harishree Enterprises before the Civil Court by filing Civil Suit No.
1514 of 1995 which later came to be dismissed.
39. In so far as obtaining occupation certificate for the Final Sale
Building in Slum Scheme is concerned, the learned counsel submitted
that the appellant is not required to hand over the subject property. It
was submitted that it is absolutely incorrect on the part of the appellant
to say that the appellant has been put to a specific condition to acquire
or hand over the Light Green portion i.e. subject property (2005 sq. m.)
for further compliance of Full Occupation Certificate.
40. It was vehemently submitted by the learned counsel appearing
for the respondent Nos. 1 and 2 respectively that since the subject
property stood excluded from its Slum Scheme, the respondent No. 1
could not have insisted on any such condition for the purpose of issuing
20


the occupation certificate. However, it was clarified that the appellant
was liable to hand over the Dark Green Portion admeasuring 2700 sq.
mts. as Recreational Ground (RG).
41. It was argued that in accordance with the direction issued by the
respondent No. 1 vide order dated 26.02.2015 the appellant had declared
the 34 slum dwellers residing on the subject property as Project Affected
Persons (PAPs). In lieu of the appellant handing over PAP’s to SRA, the
appellant has been compensated in accordance with the policy with
equivalent FSI for Sale Component. The appellant had already utilised
such FSI generated against PAP and had constructed its Final Sale
Building.
42. It was next submitted that the appellant had at no point of time
ever challenged the directions issued by the CEO-SRA to rehabilitate the
34 slum dwellers as PAPs. It was argued that the subject property has
now been purchased by the respondent No. 4 (Alchemi Developers) from
the respondent No. 5 (Phuldai) i.e. the original owner of the subject
property and thus, the respondent No. 4 has a vested right to have the
first choice to undertake a slum rehabilitation scheme and only upon
failure to do so, the State Government may acquire the land. The learned
counsel submitted that the respondent No. 4 (Alchemi Developers) as the
lawful owner had already exercised its preferential right and was
implementing the scheme by including the subject property as part of its
scheme. In such circumstances referred to above, there is no question
at this point of to acquire the subject land.
21


43. In such circumstances referred to above, the learned counsel
appearing for the respondent Nos. 1 and 2 prayed that there being no
merit in the present appeal, the same may be dismissed.
SUBMISSIONS ON BEHALF OF THE RESPONDENT NO. 4
44. Mr. Vikas Singh, the learned senior counsel appearing for the
respondent No. 4 (Alchemi Developers) vehemently submitted that the
subject property has been lawfully purchased by Alchemi Developers for
a valuable consideration. It is alleged that the appellant is trying to usurp
the subject property without paying any consideration. It was argued
that the 34 slum dwellers were part of the scheme in 1996-97. However,
they came to be excluded in 2000. The mere existence of the 34 slum
dwellers in the Annexure II would not establish anything. Further, the
SRA had expressly directed the appellant to rehabilitate them as PAPs.
45. It was further argued that if there are no slums on the subject
property, the SRA would not have any jurisdiction to acquire the subject
property with a view to hand over the same to MCGM. In the last, it was
submitted that the subject property was never a part of the scheme of
the appellant. The appellant on its own and without any permission from
the planning authority rehabilitated the slum dwellers. The appellant
should not be permitted to take advantage of its own wrong.
46. In such circumstances referred to above, the learned senior
counsel prayed that there being no merit in the present appeal, the same
may be dismissed.
22


SUBMISSIONS ON BEHALF OF THE RESPONDENT NOS. 6 AND 8
RESPECTIVELY
47. Ms. Pallavi Sharma, the learned counsel appearing for the
respondent No. 6 - Gokuldham Ekta SRA Co-operative Housing Society
Limited and the respondent No. 8 - Shree Gokuldham Durgadevi Vikas
SRA Co-op Housing Society Ltd. respectively (“Slum Societies”) submitted
that the 34 slum dwellers who were in the subject property owned by the
respondent No. 5 (Phuldai) and also other slum dwellers on the larger
property which was being developed by Harishree Enterprises had given
their consent for slum rehabilitation scheme by the Harishree
Enterprises. The slum dwellers had also executed agreements for
permanent alternate accommodation with Harishree Enterprises. The
respondent No. 5 (Phuldai) had never approached the slum dwellers to
redevelop the subject property.
48. It was pointed out that the appellant herein acquired the rights
to redevelop the property admeasuring 12,606 sq. mts. including the
subject property. All the slum dwellers on the property admeasuring
12,606 sq. mts. have been rehabilitated in the rehab building
constructed by the appellant herein. The main concern expressed by the
Slum Societies is with respect to the loss of the open recreational ground.
According to the Slum Societies, the subject property is reserved for
recreational ground. The slum scheme of the appellant under the 1991
DCR envisages the subject property which is in front of the slum
rehabilitation building entirely as open space for recreation as RG.
23


49. However, according to the learned counsel, as per the scheme of
the respondent No. 4 (Alchemi Developers) which is under DCPR 2034,
the respondent No. 4 proposes to construct on 65% of the subject
property. If the respondent No. 4’s scheme is allowed, the 498 slum
dwellers and even general public would loose 65% of recreational ground
i.e. about 1,303 sq. mts. out of the subject property. This would cause
grave prejudice to the slum dwellers. According to the learned counsel,
this aspect is not considered by the respondent Nos. 1 and 2 respectively
including the High Court.
SUBMISSIONS ON BEHALF OF THE RESPONDENT NO. 5 (ORIGINAL
OWNER OF SUBJECT PROPERTY)
50. Mr. K. Parameshwar, the learned senior counsel appearing for the
respondent No. 5 (Phuldai) fully supported the respondent No. 4 (Alchemi
Developers). It was argued that the respondent No. 4 as a purchaser of
the subject property from the respondent No. 5 has a preferential right
to redevelop the subject property and the SRA is obliged under law to
invite the respondent No. 4 (Alchemi Developers) to come forward with a
redevelopment proposal. It was argued that the State should not have
ordered to acquire the subject property before extinguishment of the
preferential right. It was argued that each of the LOIs specifically
excluded the subject property or, in other words, the subject property is
not reflected in any manner as a part of the scheme. It has been
admittedly confirmed by the SRA. The learned counsel provided us with
the details of the LOIs as under:-
24


“a) LOI dt. 03.09.1997 which was revised (pursuant to
complaints by R5) and a fresh LOI dt. 02.08.1999 was issued
in favour of Harishree Enterprises for slum development of the
larger property.
b) Revised LOI dt. 04.06.2004 was issued in favour of
Harishree Enterprises, superseding earlier LOI dt. 02.08.1999
(cl. 39) - see cl. 23, 25, and 35. Cl. 35 is extracted:
“35. That you shall not claimed FSI of plot
adm. 2005.00 sq. mts. Kept in abeyance till
the dispute between Harishree & Smt.
Phulday Yadav is decided by Court.”
c) LOI dt. 09.08.2005 - see cl. 33:
“33. You shall not claim FSI of plot
admeasuring 2005.00 sq. mt. kept in
abeyance till the dispute between M/s Vikas
Housing Ltd. & M.s Harishree Enterprises &
Smt. Phuldai Yadav is decided by Court.”
d) LOI dt. 28.09.2017 in favour of the appellant (i.e., present
developer) makes no mention of the subject property, as a part
of the scheme. A copy of this LOI, however, is conspicuously
absent and suppressed by the appellant in the present
pleadings.”
51. It was submitted that the fact that the subject property does not
figure in the last LOI dated 28.09.2017 has been taken note of by the
High Court in its impugned judgment. The appellant having acted on this
very LOI that excluded the subject property to implement its slum
redevelopment scheme cannot now seek to contest the right qua the same
subject property as it was owned by the respondent No. 5 and later
purchased by the respondent No. 4.
52. In the last, it was submitted that the SRA vide letter dated
04.01.2008 had directed the appellant to submit a revised scheme after
excluding the subject property. It was pointed out that the appellant vide
its letter dated 15.01.2008 had stated in so many words that it was not
25


utilising or taking benefit of the subject property and therefore there was
no need to submit a revised scheme.
53. In such circumstances referred to above, the learned senior
counsel submitted that there being no merit in the present appeal, the
same may be dismissed.
ANALYSIS
54. Having heard the learned counsel appearing for the parties and
having gone through the materials on record, we would like to address
ourselves on three pivotal issues namely:-
(i) Whether we should issue a mandamus to the State
Government to acquire the subject property in accordance with
Section 14(1) of the Slum Act keeping in mind the order dated
26.02.2015 passed by the Chief Executive Officer-Slum
Rehabilitation Authority?
(ii) Whether the appellant is entitled to full Occupation
Certificate for the final sale building in the slum scheme upon
handing over the portion of land admeasuring 2700 sq. mts.
meant for Recreational Ground (RG) identified as the dark green
portion?
(iii) Whether the appellant has been fully compensated by
granting an equivalent and/or adequate area (FSI) for sale by
the State Government?
26


55. Before adverting to the rival submissions canvassed on either
side, we must look into few relevant provisions of the Maharashtra
Regional Town Planning Act, 1966 (for short, “MRTP Act”) and the Slum
Act respectively.
56. Section 2(19) of the MRTP Act reads thus:-
“ 2(19) “ Planning Authority ” means a local authority; and
shall include:-

(a) a Special Planning Authority constituted or appointed or
deemed to have been appointed under section 40; and

(b) in respect of slum rehabilitation area declared under
section 3C of the Maharashtra Slum Areas (Improvement,
Clearance and Redevelopment) Act, 1971, the Slum
Rehabilitation Authority appointed under section 3A of the
said Act.”

57. Proviso to Section 152 of the MRTP Act provides as under:-
“ 152. Powers of Planning Authority or Development
Authority to be exercised by certain officers.-
x x x x
..... Provided further that, the State Government may by a
notification in the Official Gazette, delegate any of the powers
exercisable under sections 44, 45, 46, 51, 53, 54, 55, 56, 135
and 136 of this Act by the Slum Rehabilitation Authority
appointed under the Maharashtra Slum Act (Improvement,
Clearance and redevelopment) Act, 1971 acting as Planning
Authority, to the Chief Executive Officer of the Slum
Rehabilitation Authority.”

58. Section 3B of the Slum Act reads thus:-

“ 3B. Slum Rehabilitation Schemes .- (1) The Slum
Rehabilitation Authority concerned, with the previous sanction
of the State Government, shall prepare or amend the general
Slum Rehabilitation Scheme for the areas specified under sub-
section (1) of section 3A, for rehabilitation or relocation of
protected occupiers and other occupiers of the building in such
areas.

27


(2) The general Slum Rehabilitation Scheme prepared or any
amendment to it under sub-section (1), shall be published in
the Official Gazette, by the concerned Slum Rehabilitation
Authority, as draft general Slum Rehabilitation Scheme or
draft amendment to general Slum Rehabilitation Scheme, for
the area specified under sub-section (1) of section 3A, for the
information of general public, inviting objections and
suggestions, giving reasonable period of not less than thirty-
days but not more than forth-five days, for submission of
objections and suggestions, if any, in respect of the Scheme.

(3) The Chief Executive Officer of the concerned Slum
Rehabilitation Authority shall, within sixty days consider the
objections and suggestions, if any, received within the
specified period in respect of the said draft general Slum
Rehabilitation Scheme or any draft amendment to the general
Slum Rehabilitation Scheme and after considering the same
and after carrying out such modification as deemed fit or
necessary, finally publish said general Slum Rehabilitation
Scheme or such amendment to it, with the approval of the
State Government, in the Official Gazette.

(4) The general Slum Rehabilitation Scheme published under
sub-section (3) shall be deemed Development Control
Regulations under the provisions of Chapter III of the
Maharashtra Regional and Town Planning Act, 1966 (Mah.
XXXVII of 1966), for the said area and the provisions of the
general Slum Rehabilitation Scheme shall prevail over the
Development Control Regulations, published under the
Maharashtra Regional and Town Planning Act, 1966 (Mah.
XXXVII of 1966).

(5) The Slum Rehabilitation Scheme so notified under sub-
section (3) shall, generally lay down the parameters for
declaration of any land as the Slum Rehabilitation Area and
indicate the manner in which rehabilitation of the occupants of
the area declared as Slum Rehabilitation Area shall be carried
out. In particular, it shall provide for all or any of the following
matters, that is to say,-

(a) the parameters or guidelines for declaration of land as
the Slum Rehabilitation Area;

(b) basic and essential parameters of development of
Slum Rehabilitation Area under the Slum Rehabilitation
Scheme;

(c) provision for obligatory participation of the owners,
landholders and occupants of the land declared as the
28


Slum Rehabilitation Area under the approved Slum
Rehabilitation Scheme in the implementation of such
Scheme;

(d) provision relating to transit accommodation or
entitlement of compensation in lieu of transit
accommodation to the slum dwellers pending
development of the Slum Rehabilitation Area;

(e) provision relating to allotment of tenements either in-
situ or otherwise, on development free of cost to the
protected occupiers of the building in such Slum
Rehabilitation Area;

(f) provision relating to allotment of tenements either in-
situ or otherwise, on ownership or on rent, to the other
st
non-protected occupiers up to the 1 January 2011,
subject to the availability of tenements as per the terms
and conditions and guidelines so notified in the Official
Gazette, by the Chief Executive Officer with the prior
approval of the State Government;

(g) scheme for development of the Slum Rehabilitation
Areas under the Slum Rehabilitation Scheme by the
landholders and occupants by themselves or through a
developer and the terms and conditions of such
development; and the option available to the Slum
Rehabilitation Authority for taking up such development
in the event of non-participation of the landholders or
occupants;

(h) provision regarding sanction of Floor Space Index and
transfer of development rights, if any, to be made
available to the developer for development of the Slum
Rehabilitation Area under the Slum Rehabilitation
Scheme;

(i) provision regarding non-transferable nature of
tenements for a certain period, etc.

(6) The Chief Executive Officer of the Slum Rehabilitation
Authority, with prior approval of the State Government shall,
regulate procedure for appointment and registration of
developers for implementation of the Slum Rehabilitation
Scheme as per the rules prescribed by the State Government,
from time to time. The Chief Executive Officer or the Slum
Rehabilitation Authority, as the case may be, may register any
person or an association of persons registered under the
Partnership Act, 1932 (9 of 1932) or a company registered
29


under the Companies Act, 2013 (18 of 2013), as a developer
in the prescribed manner for the implementation of Slum
Rehabilitation Scheme.”

59. Section 4 of the Slum Act reads thus:-

“ 4 . Declaration of slum areas :-(1) Where the Competent
Authority is satisfied that-
(a) any area is or may be a source of danger to the health,
safety or convenience of the public of that area or of its
neighbourhood, by reason of the area having inadequate or
no basic amenities, or being insanitary, squalid, overcrowded
or otherwise; or
(b) the buildings in any area, used or intended to be used for
human habitation are-
(i) in any respect, unfit for human habitation; or
(ii) by reasons of dilapidation, overcrowding, faulty
arrangement and design of such building, narrowness or
faulty arrangement of streets, lack of ventilation, light or
sanitation facilities or any combination of these factors,
detrimental to the health, safety or convenience of the
public of that area,
the Competent Authority may, by notification in the Official
Gazette, declare such area to be a slum area. Such
declaration shall also be published in such other manner (as
will give due publicity to the declaration in the area) as may
be prescribed.
Explanation.- For the purposes of clause (b), the expression
“buildings” shall not include,-
(a) cessed buildings in the island City of Mumbai as defined
in clause (7) of section 2 of the Maharashtra Housing and
Area Development Act, 1976 (Mah. XXVIII of 1977), or old
buildings belonging to the Corporation;
(b) buildings constructed with permission of the relevant
authority at any point of time;
(c) any building in an area taken up under the Urban
Renewal Scheme.
(2) In determining whether buildings are unfit for human
habitation for the purposes of this Act, regard shall be had to
the condition thereof in respect of the following matters, that
is to say,-
(a) repairs;
30


(b) stability;
(c) freedom from damp;
(d) natural light and air;
(e) provision for water-supply;
(f) provision for drainage and sanitary conveniences;
(g) facilities for the disposal of waste water;
and the building shall be deemed to be unfit as aforesaid, if,
and only if, it is so far defective in one or more of the said
matters that it is not reasonably suitable for occupation in
that condition.
(3) Any person aggrieved by a declaration made under sub-
section (1) may, within thirty days after the date of such
declaration in the Official Gazette, appeal to the Tribunal. No
such appeal filed after the expiry of thirty days as aforesaid
shall be entertained.
(4) When an appeal is presented under sub-section (3), the
Tribunal shall, by a public notice published in a newspaper
in the Marathi language circulating in the local area in which
the slum area situated and also displayed at some
conspicuous place in the slum area, call upon the residents
of the slum area to file their objections, if any, to the appeal
within a period of fifteen days from the date of publication of
such public notice in the newspaper as aforesaid, either by
themselves or through any association of residents in the
slum area of which they are members.
(5) On expiry of the period of fifteen days as aforesaid the
Tribunal shall fix a day for hearing the appeal and inform the
appellant about the same by letter under certificate of posting
and the residents of the slum area by displaying the notice
of hearing at some conspicuous place in the slum area and
upon hearing the appellant and the residents or
representative of their association in the slum area, if
present, or on considering the written objections, if any, made
by such residents or association, if absent, the Tribunal may,
subject to the provisions of sub-section (6), make an order
either confirming, modifying or rescinding the declaration;
and the decision of the Tribunal shall be final.
Explanation.- For the purposes of sub-section (4) and this
sub-section, the expression “any association of residents in
the slum area” means a society, if any, of such residents
registered under the Societies Registration Act, 1860 (XXI of
1860) or under the Maharashtra Co-operative Societies Act,
1960 (Mah. XXI of 1961).
31


(6) While deciding the appeal the Tribunal shall ignore the
works of improvement executed in such slum area by any
agency of the Government or any local authority after the
declaration thereof as such slum area by the Competent
Authority under sub-section (1).”
60. The scheme of the Slum Act indicates that it is a beneficial
legislation and emphasizes on the protection of the occupiers (slum
dwellers) by making a provision for redevelopment and rehabilitation.
Accordingly, Section 4 of the Slum Act contemplates for an area to be
declared as a ‘slum area’. Section 3B contemplates a Slum
Rehabilitation Authority (“SRA”) to prepare a Slum Rehabilitation
Scheme, which shall be deemed to be the Development Control
Regulations made under the MRTP Act.
61. The MRTP Act has been amended to provide that the SRA shall
be treated as a Planning Authority for areas declared as slums
Accordingly, Regulation 33(10) of DCR 1991 has been framed to deal
with SRA Schemes.
62. The DCR 1991, i.e. Regulation 33(10) read with Appendix IV
thereto provides for the redevelopment of the slum dwellers through the
owners/developers/cooperative societies of slum dwellers, whereby
70% consent of the slum dwellers is to be obtained ‘in a viable stretch
at one place to join a rehabilitation scheme’ (Clause 1.15. of Appendix
IV). In lieu of the developer clearing slums, constructing and handing
over flats to the slum dwellers, it is entitled to an incentive FSI which
can be commercially utilized by the developer undertaking
32


redevelopment by constructing buildings/buildings for sale in open
market known as ‘free sale component’.
63. This Court in Tarabai Nagar Co-Op. Hog. Society (Proposed) v.
State of Maharashtra & Ors. reported in 2025 SCC OnLine SC 1795
considered the entire scheme of the Slum Act and held that the owner
possesses a preferential right to redevelop the SR Area; that the SRA is
duty-bound to invite the owner to submit a SR Scheme, and that any
acquisition is not warranted until such right stands extinguished. The
relevant extracts are as follows:
“82. [...] the owner has a preferential right over other
stakeholders to develop an SR Area. If the owner then
chooses to exercise this right by submitting and
implementing a valid SR Scheme, issues involving rights
over the property would not arise. It is, thus, not fathomable
that when the landowner is implementing an SR Scheme on
its own, a necessity to acquire the land could arise.
83. Rather, any process to acquire the land shall have to be
kept in abeyance till such time as the owner's preferential
right to develop it stands extinguished. Since it is open to
the owner to file its own SR Scheme within a reasonable
time and the proposal of the owner, if valid and complete,
would take primacy, it cannot be said that there is any legal
necessity to acquire the land. If acquisition is allowed to
take place at this stage, it will jeopardise the preferential
right of the landowner. It is only when the owner declines
to undertake development or to support any third-party
development, thereby foregoing its preferential right, that
such a necessity would actually arise. There can thus be no
doubt that, as long as the owner is willing to undertake
development in exercise of its preferential right, the
acquisition cannot proceed.
84. This can also be harmoniously read in conjunction with
the requirement for a notice-cum-invitation to the owner, as
set out in Section 13.46 Until the SRA has invited the owner
to submit an SR Scheme, the owner's right to develop the
land cannot be said to have closed. In such a case, the
subsisting preferential right cannot be frustrated or
undermined by initiating the acquisition process.
33


x x x x
87. When an SR Area has been notified under Section 3C(1)
of Chapter I-A51 and its development through an SR
Scheme is conceptualised, whereunder there is an inbuilt
preferential right of an owner to carry out redevelopment,
the power of acquisition under Section 1452 would not
operate in an independent silo; rather, it must derive
meaning and effect from the principles prevailing
throughout the legislative scheme of Chapter I-A”.
64. Following the decision in Tarabai (supra), this Court in
Saldanha Real Estate Pvt. Ltd. v. Bishop John Rodrigues & Ors. ,
reported in 2025 SCC OnLine SC 1794 reiterated these principles. The
relevant paragraphs are extracted for convenience:
“26. This Court in Tarabai (supra) has unequivocally
established that: (i) the private owner of an SR Area has a
preferential right to develop it; (ii) the SRA must invite the
landowner to come forward with a redevelopment proposal
and give them reasonable time to do so before the said
preferential right extinguishes; and (iii) the State or the SRA
cannot move to acquire the land before the preferential right
of the owner is extinguished. These principles will also apply
mutatis mutandis to the case in hand.
27. Consequently, there vests a preferential right in favour of
the Church Trust, over and above the SRA, occupants, or
other stakeholders, to develop the Subject Land. The Trust
ought to have been invited by the SRA to submit a proposal
and undertake such redevelopment after the declaration
dated 29.12.2020 was issued. Thus, the SRA cannot proceed
for acquisition of the Subject Land unless (i) such a notice-
cum-invitation is extended, and (ii) thereafter, the right of the
Church Trust is extinguished if it fails to submit a
redevelopment scheme within the prescribed period of 120
days.
28. The High Court has held that there was no compliance of
these preconditions by the SRA before initiating the
acquisition, and the entire process was liable to be
invalidated. The High Court has further found from the
conduct of the Appellants that the acquisition proceedings
arose from an exercise of power in bad faith. We, therefore,
now proceed to examine whether the High Court was right in
drawing such a conclusion.
x x x x
34


32. The inevitable consequence of the SRA's omission to issue
a separate notice under Section 1329 is that the Church
Trust's preferential right to redevelop the Subject Land
remains intact. In the absence of a valid notice or opportunity,
there existed no legal basis to extinguish this right. The
acquisition was, therefore, vitiated in law, falling afoul of the
prescribed procedure.”
65. It is not in dispute that in the development plan issued by the
Town Planning Authority, the subject property was reserved for the
purpose of Recreational Ground. One order passed by the Bombay High
Court dated 31.07.2002 in Writ Petition No. 1152 of 2002 titled
Citispace & Ors. v. State of Maharashtra was brought to our notice.
The order reads thus:-
“Heard parties.
2. Respondent No. 2 is directed to file an affidavit
disclosing necessary information as claimed in prayer
clauses (c)(i) to (xiii) of the writ petition.
3. Adjourned for four weeks. In the meantime, until
further orders, no new rehabilitation scheme be sanctioned
without the permission of this Court in respect of open
spaces which are reserved for gardens, parks,
playgrounds, recreational spaces, maidans,
no-development zones, pavements, roads and
carriageways.”
66. Thus, it appears that the High Court had passed an order of
injunction referred to above on use of lands reserved for
inter alia
Recreation Ground meant for the implementation of Slum
Rehabilitation Scheme. This very fact is also recorded in the order dated
26.02.2015 passed by the CEO-SRA. Such injunction continued till
01.03.2022. In such circumstances, there was no occasion for the
respondent No. 1 SRA to acquire the subject property. This fact has
been acknowledged by the appellant and the same is evident from the
35


letter dated 07.03.2022 addressed by the appellant i.e. within 7 days
from the date the injunction referred to above came to be vacated. In
such circumstances, it is clear that till 01.03.2022 nothing could have
been done.
67. In the meantime, the respondent No. 5 namely Phuldai
transferred her title rights in the subject property in favour of the
respondent No. 4 (Alchemi Developers). The respondent No. 4 (Alchemi
Developers) submitted its proposal for implementation of the slum
rehabilitation scheme. It is also not in dispute that the respondent No.
4 (Alchemi Developers) submitted its proposal for development of the
subject property on 05.04.2022 and the same was accepted in
accordance with law as there was no slum scheme proposal on the
subject property.
68. In such circumstances referred to above, the appellant for the
first time on 25.07.2022 filed a Writ Petition (L) No. 23703 of 2022
seeking a mandamus for the purpose of acquisition of the subject
property relying on the CEO-SRA’s order dated 26.02.2015.
69. We should also take notice of the fact that the respondent No. 5
(Phuldai) had executed a Memorandum of Understanding dated
09.02.1992 with Harishree Enterprises (predecessor developer) to sell
the subject property and granting consent to redevelop the same. This
MoU came to be terminated in 1995. The termination of the MoU led to
filing of a suit being Suit No. 1514/1995 by Harishree Enterprises on
the original side of the Bombay High Court for specific performance of
36


the MoU. This suit came to be dismissed for default on 06.04.2000 by
the Bombay High Court and thus attained finality. On 26.03.2022, the
respondent No. 5 (Phuldai) executed a registered conveyance deed in
favour of the respondent No. 4 (Alchemi Developers) for the subject
property.
70. We are of the view that it is too late in the day, or to put it in other
words, it will be too much if we at this point of time direct the authority
concerned to acquire the land under Section 14 of the Slum Act on the
basis of the CEO-SRA’s order dated 26.02.2015.
71. In such circumstances referred to above, we decline to grant any
relief to the appellant insofar as the prayer for acquisition of the subject
property is concerned.
72. It is well settled that the power of the State Government to
acquire land under Section 14 read with Section 3D(c)(i) of the Slum Act
is subject to preferential right, if any, of the owner. This issue has been
set at rest by this Court in Tarabai Nagar Co-Op. Hog. Society
(supra). In the said case, exactly the very same argument was canvassed
by Mr. Shyam Divan, the learned senior counsel appearing for the
appellant therein that even if there is a preferential right in favour of
the owner, the same would not militate against the power of the State
to acquire the land under Section 14 of the Slum Act. This Court while
negativing such contention observed as under:-
“77. In this context, we deem it appropriate to clarify at this
stage that Section 1445 empowers the State Government to
acquire land if necessary to enable the SRA to carry out
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development under the SR Scheme. It is writ large on the
text of Section 14 that the State can invoke its power to
acquire the land, if it is necessitated, as per the SRA, for the
implementation of a Scheme.
78. To explicate, the SRA, in line with the scheme envisaged
by the Slums Act, is not only authorised but also responsible
for ensuring that development is undertaken in SR Areas. In
furtherance of this objective, it invites developers to submit
SR Schemes. In the event no developer comes forward, the
SRA can take over the development itself. To achieve this, it
would undoubtedly need to utilise the land in the SR Area
for various purposes, such as preparing temporary or
permanent transit residences, construction work, setback
area, and access roads.
79. However, when tasked with such an endeavour, the
SRA may face instances where the owner is unwilling to
accede to the redevelopment of the land. In such situations,
as per the 1997 Guidelines and Regulation 33(10), a
consent or no-objection certificate from the owner is
mandatory for any proposal to be considered. By
withholding such consent, the landowner has the ability to
perpetually stall the entire redevelopment.
80. This instance illustrates how it may become necessary
for the State to acquire land using its eminent domain for
the purpose of facilitating slum rehabilitation. E.3.2
Interplay with the Owner’s Rights
81. Given the above backdrop, what becomes important for
us to ascertain is whether such necessity can arise before
the landowner’s preferential right to redevelop is
extinguished.
82. As already held, the owner has a preferential right over
other stakeholders to develop an SR Area. If the owner then
chooses to exercise this right by submitting and
implementing a valid SR Scheme, issues involving rights
over the property would not arise. It is, thus, not fathomable
that when the landowner is implementing an SR Scheme on
its own, a necessity to acquire the land could arise.
83. Rather, any process to acquire the land shall have to be
kept in abeyance till such time as the owner’s preferential
right to develop it stands extinguished. Since it is open to
the owner to file its own SR Scheme within a reasonable
time and the proposal of the owner, if valid and complete,
would take primacy, it cannot be said that there is any legal
necessity to acquire the land. If acquisition is allowed to
take place at this stage, it will jeopardise the preferential
right of the landowner. It is only when the owner declines
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to undertake development or to support any third-party
development, thereby foregoing its preferential right, that
such a necessity would actually arise. There can thus be no
doubt that, as long as the owner is willing to undertake
development in exercise of its preferential right, the
acquisition cannot proceed.
84. This can also be harmoniously read in conjunction with
the requirement for a notice-cum-invitation to the owner, as
set out in Section 13. Until the SRA has invited the owner to
submit an SR Scheme, the owner’s right to develop the land
cannot be said to have closed. In such a case, the subsisting
preferential right cannot be frustrated or undermined by
initiating the acquisition process.
85. This Court in Murlidhar Teckchand Gandhi (supra) held
that Sections 13 and 14, as they were couched in the
original framework, are independent provisions, which can
be invoked separately. Mr. Divan, on this premise, urged
that a similar independent power to acquire the land was
traceable under Chapter I-A also. However, such a
contention would merit acceptance only if the object and
scope of acquisition under Section 14, as contained in
Chapter V of the original framework, are similar, if not
identical, to the scope and power of acquisition conferred
under the same provision when proceeding under the
Chapter I-A framework. In this context, it becomes crucial to
analyse the differences herein.
86. Firstly, the original framework and the cited judgement
do not confer or provide any preferential right in favour of
the owner to develop the land, whereas there exists a
definite primacy of the owner’s right to develop the SR Area
under Chapter I-A. Secondly and more importantly, the
scope of acquisition under Section 14 (within Chapter V) in
the original framework48 is much broader than that in
Chapter I-A.49 In the former, the power of acquisition is
wide enough to include improvement works and specific
structures, whereas in the latter, it is restricted only to the
implementation of an SR Scheme. Thirdly, in Murlidhar
Tekchand Gandhi (supra), this Court had no occasion to
evaluate the scope of Chapter I-A, to which we are
concerned in the present matter. The perceived power to
proceed under Section 14 without responding to the rights
and powers created under Section 13,50 cannot, thus, be
applied mutatis mutandis in a case of an SR Scheme to be
given effect under Chapter I-A. Given these stark
differences, comparing the interpretation of the original
framework and the Chapter I-A framework is akin to
matching apples with oranges. The High Court has thus
39


rightly distinguished this decision in the Impugned
Judgement.
87. When an SR Area has been notified under Section 3C(1)
of Chapter I-A51 and its development through an SR
Scheme is conceptualised, whereunder there is an inbuilt
preferential right of an owner to carry out redevelopment,
the power of acquisition under Section 1452 would not
operate in an independent silo; rather, it must derive
meaning and effect from the principles prevailing
throughout the legislative scheme of Chapter I-A.”
(Emphasis supplied)
73. Insofar as the issue of Occupation Certificate is concerned, the
respondent Nos. 1 and 2 respectively have made their stance very clear
that the appellant is entitled to the Occupation Certificate for the final
Sale Building in the slum scheme. Of course, such issuance of
Occupation Certificate for the final sale building in the slum scheme is
subject to the appellant handing over the Dark Green Portion
admeasuring 2700 sq. mts. reserved for Recreational Ground (RG).
74. In the aforesaid context, we direct that the respondent Nos. 1
and 2 respectively to issue the Occupation Certificate for the final Sale
Building in the slum scheme within a period of four weeks from today
subject to the appellant handing over the Dark Green Portion
admeasuring 2700 sq. mts. reserved for Recreational Ground (RG). For
the sake of clarity and for easy identification, we set out herein below a
coloured map which carries the “dark green portion CTS No.
620/A/1A/1A/3”, which the appellant shall handover to the MCGM:-
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41



75. As regards the third issue, it appears from the materials on
record that the respondent No. 1 vide its order dated 26.02.2015 had
directed the developer to include 34 slum dwellers who were residing
on the subject property as Project Affected Persons (PAPs). In lieu of the
developer handing over the PAP’s to SRA in accordance with the policy,
the developer was compensated with equivalent FSI for sale component.
The materials on record indicate that the FSI generated in the sale
component is equivalent to the Rehab Component which include the
Project Affected Persons (PAPs). The appellant has already utilised such
FSI generated against the PAP and has completed the construction on
the final sale building. Even otherwise, the LOI dated 28.09.2017
makes it clear that the subject land is not a part of the scheme.
76. We make it abundantly clear that no construction shall be made
on the subject property of any nature and the same shall be utilized
only as a Recreational Ground (RG). In this regard, a clear statement
was made by the learned counsel appearing for the respondent Nos. 1
and 2 respectively that no construction of any nature would be
permitted on the subject property. We direct the Respondent No. 4
(Alchemi Developers) their successors and assigns that they shall not
put up any type of construction on the subject property and the same
shall be utilized only as a recreational Ground (RG).


42


77. Our final conclusion is as under:-
(1) The power of the State Government under Section
14 read with Section 3D(c)(i) of the Slum Act is subject to
preferential right, if any, of the owner. This being the
position of law, no case is made out by the appellant for a
writ of mandamus to be issued to the State Government to
acquire the subject property under Section 14 of the Slum
Act.
(2) The appellant is entitled to the Occupation
Certificate for the Final Sale Building in the slum scheme
on the appellant handing over the Dark Green Portion
admeasuring 2700 sq. mts. reserved for Recreational
Ground (RG).
(3) The appellant has been fully compensated by
granting adequate area/FSI for sale.
(4) We direct the Respondent No. 4 (Alchemi Developers) their
successors and assigns that they shall not put up any type of
construction on the subject property and the same shall be
utilized only as a recreational Ground (RG).

78. In view of the aforesaid discussion, nothing further is required to
be looked into in the matter.
79. The appeal is disposed of accordingly.
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80. The parties are left to bear their own costs.
81. Pending application, if any, also stands disposed of.


…………………………………………J
(J.B. PARDIWALA)




…………………………………………J
(K.V. VISWANATHAN)


NEW DELHI;
DECEMBER 2, 2025
44