The Bombay High Court on Wednesday directed the Economic Offences Wing, Mumbai to register an FIR within 5 days after concluding that prima facie officials of Maharashtra Housing and Area Development Authority (MHADA) colluded with defaulting developers and builders who failed to surrender surplus area which belongs to the State under Development Control Regulation.
Division bench of Justice SC Dharmadhikari and Justice SK Shinde held that two high ranking officials namely Keshav Patil, Additional Commissioner of Anti-Corruption Bureau and Parag Shyam Manere, DCP, EOW opined that there was prima facie violation of the Prevention of Corruption Act, yet State and its agencies "consciously avoided" filing an FIR in the case.
Court pronounced the judgement in a Public interest Litigation filed by Kamlakar Shenoy, who alleged an unholy nexus, between the defaulting Developers and the Officials of MHADA which caused unlawful losses to the States' exchequer to the tune of Rs.40,000 crores by virtue of defaulting builders not surrendering surplus area of approximately 1.37 lakh sq.mtrs which otherwise is exclusive property of the State in terms of the Scheme, floated by the State Government under the Development Control Regulation 33(7).
Under the said scheme private developers are roped in to re-develop old cess buildings and as per DCR 33(7), a developer to whom No-Objection Certificate (NOC) has been issued for redevelopment of the dilapidated building is required to surrender surplus built-up area, as per prescribed percentage provided in third schedule of the MHADA Act, 1976.
Petitioner sought information from the Mumbai Housing Area Developement Board under the RTI about the number of NOCs granted to developers and the number of cases wherein the Developers were obliged to surrender the surplus built-up area to the Board and have done so. On August 26, 2000 the Board replied to the petitioner and stated that it issued NOC/permissions to 241 developers out of which 121 developers did not surrender the surplus area.
After much persuasion from the petitioner, MHADA filed a complaint with EOW against only 33 of the 121 defaulting developers.
Another RTI query revealed on March 17, 2016 that, the surplus area of 1,37,332.52 sq.mtrs is yet to be received from 379 project-holders/developers. Thus, in July 2016, petitioner filed a complaint with EOW seeking registration of FIR against MHADA officials and the Board.
The bench highlighted what Parag Manere stated about the said complaint-
"I say that a general scrutiny of the said complaint primarily suggested violation of provisions of Prevention of Corruption Act hence on 03.06.2016, Economic Offences Wing, Mumbai forwarded said complaint to the Director General of police, Anti-Corruption Bureau, Mumbai for further necessary action."
Moreover, in a communication dated April 18, 2018 Keshav Patil of ACB expressed his grave concern about the alleged complicity of the officials of the MHADA and their possible collusion with the developers. He preferred to take recourse to the provisions of Section 17A of the Prevention of Corruption Act and sought permission of the State to hold open enquiry against the Officers of the MHADA.
Court also noted that on January 11, 2018, Mr. Ramchandra Kondiba Dhanawade, Deputy Secretary to the State, Housing Department, filed a reply-affidavit and attempted to shield MHADA officials, contending that surplus area required to be surrendered to the MHADA by developers is always at the completion of the project and not at any stage, during or before the construction.
"These statements of facts are not supported by any document or material particulars. Be that as it may, reply of the State, however, does not answer, as to why for years together officials of the MHADA did not take any efforts or steps to recover the constructed area. Neither of the respondents have informed the Court about the effective steps taken by the officials of the MHADA to recover the surplus constructed area from the developers, which is about 30,00,000 sq.fts" the bench observed.
Court pointed out from the said affidavit that although a total penalty of Rs.32 crores (approx.) was imposed on 33 defaulting developers but no effort whatsoever was made to recover the penalty.
"We therefore hold that the State and its agencies have consciously avoided to Register the FIR, against the concerned official of the MHADA, under the garb of enquiry, though information clearly disclosed commission of a cognizable offence", Court said.
Referring to Lalita Kumari V/s. Government of Uttar Pradesh and Others, Court emphasised on the need for registration of FIR in such a case where "there is not only credible information disclosing the commission of offence is on record but also the opinion of two high rank officers of the State that information suggests prima-facie commission of offence atleast under the Prevention of Corruption Act, 1988."
Thus, Court allowed the petition and directed EOW to register an FIR within 5 days.
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