In a landmark judgment, the Supreme Court of India has ruled that the Bombay High Court erred in dismissing several writ petitions on the grounds of delay and laches. The Court emphasized that compensation for land acquired for public purposes must be paid without requiring a request from the landowners, stating that any failure to do so would constitute a breach of Article 300-A of the Constitution, which protects the right to property.
The judgment was delivered in a series of appeals led by Kukreja Construction Company & Others v. State of Maharashtra & Others, Civil Appeal No. 9702 of 2024, by a bench comprising Justice B.V. Nagarathna and Justice N. Kotiswar Singh. The case revolved around the compensation entitlements for landowners who had surrendered plots and developed public amenities such as roads in Mumbai, under the provisions of the Maharashtra Regional and Town Planning Act, 1966 (MRTP Act) and the Development Control Regulations for Greater Bombay, 1991 (DCR).
Background of the Case:
The appellants, including Kukreja Construction Company, had surrendered lands for public amenities such as Development Plan (DP) Roads, which were part of the sanctioned development plan for Greater Mumbai. These lands were reserved under the provisions of the MRTP Act and were handed over to the Municipal Corporation of Greater Mumbai. In return, the landowners were entitled to compensation in the form of Floor Space Index (FSI) or Transferable Development Rights (TDR).
However, disputes arose when the Municipal Corporation failed to grant 100% TDR for the construction of these amenities, relying instead on amended regulations and circulars that limited the compensation to 15% or 25% of the area of the constructed amenity. This led to multiple writ petitions before the Bombay High Court, which were dismissed on grounds of delay and laches, prompting the appellants to approach the Supreme Court.
Key Legal Issues:
1. Validity of the High Court’s Dismissal on Delay Grounds: The Supreme Court scrutinized whether the Bombay High Court was justified in dismissing the writ petitions based on delay and laches, particularly given that the compensation owed to landowners is considered a constitutional right under Article 300-A.
2. Entitlement to 100% Additional TDR: The Court examined the entitlement of landowners to 100% additional TDR for the construction of amenities on surrendered plots, as provided by the original provisions of Regulation 34 and Appendix-VII of the DCR, which were amended later in 2016.
3. Retrospective Application of Amended Regulations: The Court also addressed whether the amendments to Regulation 34 and Appendix-VII, made via a notification on November 16, 2016, should apply retrospectively, affecting rights that had already vested under the earlier regulations.
Key Observations by the Court:
– Compensation as a Constitutional Right: The Court underscored that “the right to receive fair compensation is a constitutional right guaranteed under Article 300-A of the Constitution, which can also be traced to Article 21.” It held that denying compensation on the grounds of delay, especially when the land has already been surrendered for public use, would amount to an unconstitutional deprivation of property.
– Non-Retrospective Application of 2016 Amendment: The Court ruled that the 2016 amendment to Regulation 34 of the DCR, which restricted the grant of additional TDR, could not be applied retrospectively. The Court clarified that any vested right to compensation could not be taken away by subsequent amendments unless explicitly stated.
– Duty to Pay Compensation Without Request: The Court stressed that it is the obligation of the acquiring authority, in this case, the Municipal Corporation of Greater Mumbai, to compensate landowners without waiting for a request. “The failure of the Municipal Corporation to grant compensation in the form of TDR or FSI without a formal request would constitute a breach of Article 300-A,” the judgment stated.
Senior Counsel Pravin Samdani, representing the appellants, welcomed the decision, stating that “the Supreme Court has rightly recognized the constitutional obligation to compensate landowners fairly and without delay.” He argued that this judgment would safeguard property rights and prevent arbitrary actions by municipal bodies.
On the other hand, Senior Counsel Sri Nadkarni, appearing for the Municipal Corporation, argued that the High Court’s decision was justified based on the significant delay by the landowners in making their claims. However, the Supreme Court’s decision effectively overrules this position, affirming the paramountcy of constitutional protections over procedural grounds like delay.
Supreme Court’s Decision:
The Supreme Court, in a detailed judgment authored by Justice B.V. Nagarathna, with the concurrence of Justice N. Kotiswar Singh, held that the High Court had erred in dismissing the writ petitions on the grounds of delay and laches. The Court emphasized that the right to compensation for land acquired for public purposes is protected under Article 300-A of the Constitution, and such compensation must be paid promptly and without requiring a formal request from the landowner.
Case Title: Kukreja Construction Company & Others v. State of Maharashtra & Others
Case Number: Civil Appeal No. 9702 of 2024, along with related appeals.
