“Generations Pass Without A Home": Bombay HC Initiates Suo Motu Case Over Developers Abandoning Cessed Building Redevelopment Projects In Mumbai

The Bombay High Court has initiated a suo-motu writ petition to develop a mechanism for situations where the developer stops re-development midway, leaving tenants without a home or transit rent for decades. The division bench of Justices Gautam Patel and SG Dige observed this was an “increasingly common problem of the human condition” in Mumbai, where projects were left abandoned. A consequent dereliction in payment of property tax etc, would result in the civic body and Maharashtra Housing Area Development Authority having a claim against the property itself. “With the members out of their homes, deprived of transit rent, the building incomplete (or, in some cases, not constructed at all), and years and even decades pass without a resolution in sight? Entire generations pass in the meantime. We have to ask ourselves if this is really what society re-development means or was ever intended to mean, and whether encouraging or incentivizing private participation in such projects is meant to only to benefit profit-driven developers but is meant primarily to assist the residents of this city?” Nearly, 50,000 families are stranded due to stalled re-development in over 2,152 cess buildings in Mumbai according to a report in the TOI from November 2019. After being informed about an amendment to the MHADA Act is yet to be enforced, the court said its orders in the present petition can be used as a model till then. “How is it even possible, we ask, that the law allows a developer to undertake a re-development, promises it profit through the free-sale component, but makes no provision at all for ensuring and safeguarding the interests of society members if the development stalls or fails, or if, as in this case, the developer goes bankrupt?” The court passed the order in a petition filed by one Upkar Kochhar seeking arrears of transit rent and allotment in a re-development premises. Kochhar and 44 other tenants had vacated their cess premises known as Ratilal Mansion at Parekh Street, Girgaon Mumbai in 2009. The private developer, Orbit Corporation Ltd, was in liquidation. As for now, there are arrears of property tax, an attachment is levied by the MCGM. And in the meantime, the society members are in a difficult situation without rent. “They have no homes. To put it even more bluntly, they have absolutely no prospects.” The court said the writ petition will be called In Re: Ratilal Mansion CHSL, where in questions about how a developer would be appointed, what is to be done with the existing structure that has been lying incomplete and exposed to monsoon after monsoon for the last ten years, changes in development law that have taken place in the meantime, the concerns of the MCGM and of MHADA etc would be addressed. In a vivid and eloquent description of these buildings and the problems, the court said “societies like Ratilal Mansion.” These are usually landlord- tenant properties, some are very old. “Many are occupied by middle-income or lower-income groups. Yet, these are quite unlike the more modern developments with separate homes, greater distancing and more privacy. These old societies are really communities. Everyone knows everyone, and everyone knows everything about everyone. There are shared joys and sorrows. Enduring bonds are forged and maintained. The elders get together early morning or late evening for a stroll or a chat. The younger generation will organize some sport or game. People are in and out of each other’s houses all the time. They look after each other. This is not a romanticized vision. It is, we believe, a fairly accurate description of life in large swathes of the city. But the buildings themselves degrade over time. Maintenance and repairs are expensive. Modern amenities are impossible. Hence, re-development. Hence, the appointment of an experienced developer. The promise is not just money in compensation under one head or the other. It is, above all, about improvement and restoration: to improve the buildings and tenements and to restore to the society members their community….The benefit to the developer, the real ‘consideration’, is the free-sale component of additional units, which the developer can then put to sale in the open market.” The petition will now be listed for orders on February 3, 2023.Click Here To Read/Download Order

“Generations Pass Without A Home": Bombay HC Initiates Suo Motu Case Over Developers Abandoning Cessed Building Redevelopment Projects In Mumbai

Sharmeen Hakim

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