The Supreme Court of India, in an order passed on Friday, rejected an application for the de-sealing of a property in New Rajinder Nagar Market, New Delhi. A bench comprising CJI B. R. Gavai and Justice K. Vinod Chandran held that the lease and subsequent freehold rights for the premises in question permitted only the ground floor for commercial use, while the upper floors were explicitly sanctioned for residential purposes.
The Court ruled that commercial use of the upper floors, while “eligible for conversion,” could only be permitted after the payment of requisite conversion charges, regularization of excess Floor Area Ratio (FAR) by paying penalties, and removal of all “non-compoundable constructions.”
The order was passed in I.A. No. 203615 of 2024, filed within the long-pending Writ Petition (C) No. 4677 of 1985 (M.C. Mehta v. Union of India).
Background of the Case
The primary writ petition, a Public Interest Litigation (PIL) filed in 1985, addressed issues of misuse of premises and unauthorized constructions in Delhi. By an order dated March 24, 2006, the Supreme Court appointed a three-member Monitoring Committee to oversee the implementation of the law and proceed against unauthorizedly built or converted premises.
Subsequently, by an order dated September 13, 2022, the Court appointed a Judicial Committee to consider matters related to the sealing, de-sealing, regularization, and demolition of properties.
The present applicant, the owner of Plot No. 106 in New Rajinder Nagar Market, sought the de-sealing of his ‘commercial premises’ by relying on a common order passed by this Judicial Committee on December 18, 2023. The Municipal Corporation of Delhi (MCD) had filed a separate challenge against the same Judicial Committee order.
Arguments of the Parties
The applicant contended that the subject premises were always intended to be used commercially. Reliance was placed on the Judicial Committee’s order, a 1957 letter from the Land and Development Office (L&DO) concerning a different plot in the same market, and lease deeds from 1974-75 that used the term “business flat.” The applicant also claimed his predecessor-in-interest had constructed the first floor for commercial use in 1961 and that various documents, including the certificate of possession, lease deed, and freehold conversion papers, referred to the property as a “shop” or “commercial.”
The Municipal Corporation of Delhi (MCD), represented by Senior Counsel Mr. Sanjib Sen, countered these claims. The MCD argued that only the ground floor was sanctioned for commercial use. It was asserted that the applicant himself had applied for and received sanction for the construction of residential accommodation on the upper floors. The MCD classified New Rajinder Nagar Market as a “shop-cum-residence” Local Shopping Centre (LSC) under the Master Plan for Delhi (MPD)-2021, where conversion of upper residential floors to commercial is permissible, but only “subject to payment of conversion charges.” The MCD also alleged the existence of unauthorized constructions and significant FAR violations.
The Court’s Analysis and Findings
The Supreme Court bench, opting to examine the specific facts of the case, noted that the Judicial Committee’s order was “more on a general manner and not on an individual basis.” The Court also referred to its own prima facie observation from an order dated August 22, 2024, that the Committee “has not looked into individual cases of buildings/units.”
Upon reviewing the documents submitted by the applicant, the Court found the applicant’s contentions were not supported by the evidence.
- On Third-Party Documents: The Court stated it was “not persuaded to place any reliance on the letter issued to a third-party or to the supplementary lease deeds which are not specified as the one in the name of the two plots referred therein.”
- On the 1961 Construction Claim: The Court found the applicant’s claim that a commercial first floor was built in 1961 to be directly contradicted by the 1987 lease deed (Annexure A-37) and deed of conveyance (Annexure A-38) in favor of his predecessor. The bench noted these documents “specifically speaks of a single storied building which again puts to peril the contention of the applicant that there was a first floor constructed in the year 1961.”
- On the Sanctioned Plan: The Court identified the plan appended to the applicant’s own 2005 Deed of Conveyance (Annexure A-49) as a critical piece of evidence. This document was titled “proposed shop-cum-residential building plan of plot No. 106… for Sh. Vinod Kumar Arora (the applicant).” The Court observed, “The said plan indicates sanction of residential apartments over the shop building… Hence the plan approved for construction of the upper floors was clearly intended for residential purposes, as applied for by the applicant…”
- On Property Classification: The Court accepted the MCD’s classification, finding, “We find the New Rajinder Nagar Market to be a shop-cum-residence LSC as designated in the MPD-2021.” It also noted that the building’s FAR “further fortify the contention of the MCD that over the shop residential spaces were constructed.”
Summarizing its analysis, the Court concluded: “On a broad overview of the documents produced by the applicant… we find that the lease and the subsequent freehold rights granted permits only the ground floor to be used as commercial area.”
The Decision
Based on these findings, the Supreme Court rejected the applicant’s Interlocutory Application to de-seal the premises and the prayer for permitting the use of the upper floors as commercial.
“The upper floors though eligible for conversion, it can happen only with payment of the conversion charges,” the bench affirmed. It further stated that “The additional FAR as built and existing in excess of that sanction will also have to be regularised by paying penalty charges and any non-compoundable constructions will have to be removed.”
The Court directed the MCD to issue a further notice for a joint inspection of the premises. This inspection is to result in a written order specifying:
- Any non-compoundable constructions.
- The conversion charges payable for the upper floors.
- The penalty charges for regularization of excess FAR.
The Court clarified that the applicant “would be entitled to comply with the order passed removing the non-compoundable constructions/ projections and depositing the conversion charges as also the penalty charges for regularisation of the excess FAR so as to carry out commercial activities in the upper floors.”
With these directions, the I.A. was rejected.
